375 
HR 1 PP 
(1) by striking ‘‘March 31, 2009’’ each place it 
appears and inserting ‘‘December 31, 2009’’; 
(2) in the heading for subsection (b)(2), by 
striking ‘‘MARCH 31, 2009’’ and inserting ‘‘DECEM-
BER 31, 2009’’; and 
(3) in subsection (b)(3), by striking ‘‘August 
27, 2009’’ and inserting ‘‘May 31, 2010’’. 
(b) FINANCING PROVISIONS.—Section 4004 of such 
Act is amended by adding at the end the following: 
‘‘(e) TRANSFER OF FUNDS.—Notwithstanding any 
other provision of law, the Secretary of the Treasury shall 
transfer from the general fund of the Treasury (from 
funds not otherwise appropriated)— 
‘‘(1) to the extended unemployment compensa-
tion account (as established by section 905 of the 
Social Security Act) such sums as the Secretary of 
Labor estimates to be necessary to make payments 
to States under this title by reason of the amend-
ments made by section 2001(a) of the Assistance for 
Unemployed Workers and Struggling Families Act; 
and 
‘‘(2) to the employment security administration 
account (as established by section 901 of the Social 
Security Act) such sums as the Secretary of Labor 
estimates to be necessary for purposes of assisting 
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States in meeting administrative costs by reason of 
the amendments referred to in paragraph (1). 
There are appropriated from the general fund of the 
Treasury, without fiscal year limitation, the sums referred 
to in the preceding sentence and such sums shall not be 
required to be repaid.’’. 
SEC. 2002. INCREASE IN UNEMPLOYMENT COMPENSATION 
BENEFITS. 
(a)
FEDERAL-STATE
AGREEMENTS.—Any
State 
which desires to do so may enter into and participate in 
an agreement under this section with the Secretary of 
Labor (hereinafter in this section referred to as the ‘‘Sec-
retary’’). Any State which is a party to an agreement 
under this section may, upon providing 30 days’ written 
notice to the Secretary, terminate such agreement. 
(b) PROVISIONS OF AGREEMENT.— 
(1) ADDITIONAL COMPENSATION.—Any agree-
ment under this section shall provide that the State 
agency of the State will make payments of regular 
compensation to individuals in amounts and to the 
extent that they would be determined if the State 
law of the State were applied, with respect to any 
week for which the individual is (disregarding this 
section) otherwise entitled under the State law to re-
ceive regular compensation, as if such State law had 
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been modified in a manner such that the amount of 
regular compensation (including dependents’ allow-
ances) payable for any week shall be equal to the 
amount determined under the State law (before the 
application of this paragraph) plus an additional 
$25. 
(2) ALLOWABLE METHODS OF PAYMENT.—Any 
additional compensation provided for in accordance 
with paragraph (1) shall be payable either— 
(A) as an amount which is paid at the 
same time and in the same manner as any reg-
ular compensation otherwise payable for the 
week involved; or 
(B) at the option of the State, by pay-
ments which are made separately from, but on 
the same weekly basis as, any regular com-
pensation otherwise payable. 
(c) NONREDUCTION RULE.—An agreement under 
this section shall not apply (or shall cease to apply) with 
respect to a State upon a determination by the Secretary 
that the method governing the computation of regular 
compensation under the State law of that State has been 
modified in a manner such that— 
(1) the average weekly benefit amount of reg-
ular compensation which will be payable during the 
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period of the agreement (determined disregarding 
any additional amounts attributable to the modifica-
tion described in subsection (b)(1)) will be less than 
(2) the average weekly benefit amount of reg-
ular compensation which would otherwise have been 
payable during such period under the State law, as 
in effect on December 31, 2008. 
(d) PAYMENTS TO STATES.— 
(1) IN GENERAL.— 
(A) FULL REIMBURSEMENT.—There shall 
be paid to each State which has entered into an 
agreement under this section an amount equal 
to 100 percent of— 
(i) the total amount of additional 
compensation (as described in subsection 
(b)(1)) paid to individuals by the State 
pursuant to such agreement; and 
(ii) any additional administrative ex-
penses incurred by the State by reason of 
such agreement (as determined by the Sec-
retary). 
(B) TERMS OF PAYMENTS.—Sums payable 
to any State by reason of such State’s having 
an agreement under this section shall be pay-
able, either in advance or by way of reimburse-
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ment (as determined by the Secretary), in such 
amounts as the Secretary estimates the State 
will be entitled to receive under this section for 
each calendar month, reduced or increased, as 
the case may be, by any amount by which the 
Secretary finds that his estimates for any prior 
calendar month were greater or less than the 
amounts which should have been paid to the 
State. Such estimates may be made on the 
basis of such statistical, sampling, or other 
method as may be agreed upon by the Secretary 
and the State agency of the State involved. 
(2)
CERTIFICATIONS.—The
Secretary
shall 
from time to time certify to the Secretary of the 
Treasury for payment to each State the sums pay-
able to such State under this section. 
(3) APPROPRIATION.—There are appropriated 
from the general fund of the Treasury, without fiscal 
year limitation, such sums as may be necessary for 
purposes of this subsection. 
(e) APPLICABILITY.— 
(1) IN GENERAL.—An agreement entered into 
under this section shall apply to weeks of unemploy-
ment— 
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(A) beginning after the date on which such 
agreement is entered into; and 
(B) ending before January 1, 2010. 
(2) TRANSITION RULE FOR INDIVIDUALS RE-
MAINING ENTITLED TO REGULAR COMPENSATION AS 
OF JANUARY 1, 2010.—In the case of any individual 
who, as of the date specified in paragraph (1)(B), 
has not yet exhausted all rights to regular com-
pensation under the State law of a State with re-
spect to a benefit year that began before such date, 
additional compensation (as described in subsection 
(b)(1)) shall continue to be payable to such indi-
vidual for any week beginning on or after such date 
for which the individual is otherwise eligible for reg-
ular compensation with respect to such benefit year. 
(3) TERMINATION.—Notwithstanding any other 
provision of this subsection, no additional compensa-
tion (as described in subsection (b)(1)) shall be pay-
able for any week beginning after June 30, 2010. 
(f) FRAUD AND OVERPAYMENTS.—The provisions of 
section 4005 of the Supplemental Appropriations Act, 
2008 (Public Law 110–252; 122 Stat. 2356) shall apply 
with respect to additional compensation (as described in 
subsection (b)(1)) to the same extent and in the same 
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(B) shall in no event be payable for any 
week beginning after the date specified in sub-
section (e)(3). 
(h) DISREGARD OF ADDITIONAL COMPENSATION FOR 
PURPOSES
OF MEDICAID
AND SCHIP.—The monthly 
equivalent of any additional compensation paid under this 
section shall be disregarded in considering the amount of 
income of an individual for any purposes under title XIX 
and title XXI of the Social Security Act. 
(i) DEFINITIONS.—For purposes of this section— 
(1) the terms ‘‘compensation’’, ‘‘regular com-
pensation’’, ‘‘benefit year’’, ‘‘State’’, ‘‘State agency’’, 
‘‘State law’’, and ‘‘week’’ have the respective mean-
ings given such terms under section 205 of the Fed-
eral-State Extended Unemployment Compensation 
Act of 1970 (26 U.S.C. 3304 note); 
(2) the term ‘‘emergency unemployment com-
pensation’’ means emergency unemployment com-
pensation under title IV of the Supplemental Appro-
priations Act, 2008 (Public Law 110–252; 122 Stat. 
2353); and 
(3) any reference to unemployment benefits de-
scribed in this paragraph shall be considered to refer 
to— 
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383 
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(A) extended compensation (as defined by 
section 205 of the Federal-State Extended Un-
employment Compensation Act of 1970); and 
(B) unemployment compensation (as de-
fined by section 85(b) of the Internal Revenue 
Code of 1986) provided under any program ad-
ministered by a State under an agreement with 
the Secretary. 
SEC.
2003.
SPECIAL
TRANSFERS
FOR
UNEMPLOYMENT 
COMPENSATION MODERNIZATION. 
(a) IN GENERAL.—Section 903 of the Social Security 
Act (42 U.S.C. 1103) is amended by adding at the end 
the following: 
‘‘Special Transfers in Fiscal Years 2009, 2010, and 2011 
for Modernization 
‘‘(f)(1)(A) In addition to any other amounts, the Sec-
retary of Labor shall provide for the making of unemploy-
ment compensation modernization incentive payments 
(hereinafter ‘incentive payments’) to the accounts of the 
States in the Unemployment Trust Fund, by transfer from 
amounts reserved for that purpose in the Federal unem-
ployment account, in accordance with succeeding provi-
sions of this subsection. 
‘‘(B) The maximum incentive payment allowable 
under this subsection with respect to any State shall, as 
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determined by the Secretary of Labor, be equal to the 
amount obtained by multiplying $7,000,000,000 by the 
same ratio as would apply under subsection (a)(2)(B) for 
purposes of determining such State’s share of any excess 
amount (as described in subsection (a)(1)) that would 
have been subject to transfer to State accounts, as of Oc-
tober 1, 2008, under the provisions of subsection (a). 
‘‘(C) Of the maximum incentive payment determined 
under subparagraph (B) with respect to a State— 
‘‘(i) one-third shall be transferred to the ac-
count of such State upon a certification under para-
graph (4)(B) that the State law of such State meets 
the requirements of paragraph (2); and 
‘‘(ii) the remainder shall be transferred to the 
account of such State upon a certification under 
paragraph (4)(B) that the State law of such State 
meets the requirements of paragraph (3). 
‘‘(2) The State law of a State meets the requirements 
of this paragraph if such State law— 
‘‘(A) uses a base period that includes the most 
recently completed calendar quarter before the start 
of the benefit year for purposes of determining eligi-
bility for unemployment compensation; or 
‘‘(B) provides that, in the case of an individual 
who would not otherwise be eligible for unemploy-
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ment compensation under the State law because of 
the use of a base period that does not include the 
most recently completed calendar quarter before the 
start of the benefit year, eligibility shall be deter-
mined using a base period that includes such cal-
endar quarter. 
‘‘(3) The State law of a State meets the requirements 
of this paragraph if such State law includes provisions to 
carry out at least 2 of the following subparagraphs: 
‘‘(A) An individual shall not be denied regular 
unemployment compensation under any State law 
provisions relating to availability for work, active 
search for work, or refusal to accept work, solely be-
cause such individual is seeking only part-time work 
(as defined by the Secretary of Labor), except that 
the State law provisions carrying out this subpara-
graph may exclude an individual if a majority of the 
weeks of work in such individual’s base period do 
not include part-time work (as so defined). 
‘‘(B) An individual shall not be disqualified 
from regular unemployment compensation for sepa-
rating from employment if that separation is for any 
compelling family reason. For purposes of this sub-
paragraph,
the
term
‘compelling
family
reason’ 
means the following: 
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‘‘(i) Domestic violence, verified by such 
reasonable and confidential documentation as 
the State law may require, which causes the in-
dividual reasonably to believe that such individ-
ual’s continued employment would jeopardize 
the safety of the individual or of any member 
of the individual’s immediate family (as defined 
by the Secretary of Labor). 
‘‘(ii) The illness or disability of a member 
of the individual’s immediate family (as those 
terms are defined by the Secretary of Labor). 
‘‘(iii) The need for the individual to accom-
pany such individual’s spouse— 
‘‘(I) to a place from which it is im-
practical for such individual to commute; 
and 
‘‘(II) due to a change in location of 
the spouse’s employment. 
‘‘(C) Weekly unemployment compensation is 
payable under this subparagraph to any individual 
who is unemployed (as determined under the State 
unemployment compensation law), has exhausted all 
rights to regular unemployment compensation under 
the State law, and is enrolled and making satisfac-
tory progress in a State-approved training program 
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or in a job training program authorized under the 
Workforce Investment Act of 1998. Such programs 
shall prepare individuals who have been separated 
from a declining occupation, or who have been invol-
untarily and indefinitely separated from employment 
as a result of a permanent reduction of operations 
at the individual’s place of employment, for entry 
into a high-demand occupation. The amount of un-
employment compensation payable under this sub-
paragraph to an individual for a week of unemploy-
ment shall be equal to the individual’s average week-
ly benefit amount (including dependents’ allowances) 
for the most recent benefit year, and the total 
amount
of
unemployment
compensation
payable 
under this subparagraph to any individual shall be 
equal to at least 26 times the individual’s average 
weekly benefit amount (including dependents’ allow-
ances) for the most recent benefit year. 
‘‘(D) Dependents’ allowances are provided, in 
the case of any individual who is entitled to receive 
regular unemployment compensation and who has 
any dependents (as defined by State law), in an 
amount equal to at least $15 per dependent per 
week, subject to any aggregate limitation on such al-
lowances which the State law may establish (but 
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which aggregate limitation on the total allowance for 
dependents paid to an individual may not be less 
than $50 for each week of unemployment or 50 per-
cent of the individual’s weekly benefit amount for 
the benefit year, whichever is less). 
‘‘(4)(A) Any State seeking an incentive payment 
under this subsection shall submit an application therefor 
at such time, in such manner, and complete with such in-
formation as the Secretary of Labor may within 60 days 
after the date of the enactment of this subsection prescribe 
(whether by regulation or otherwise), including informa-
tion relating to compliance with the requirements of para-
graph (2) or (3), as well as how the State intends to use 
the incentive payment to improve or strengthen the State’s 
unemployment compensation program. The Secretary of 
Labor shall, within 30 days after receiving a complete ap-
plication, notify the State agency of the State of the Sec-
retary’s findings with respect to the requirements of para-
graph (2) or (3) (or both). 
‘‘(B)(i) If the Secretary of Labor finds that the State 
law provisions (disregarding any State law provisions 
which are not then currently in effect as permanent law 
or which are subject to discontinuation) meet the require-
ments of paragraph (2) or (3), as the case may be, the 
Secretary of Labor shall thereupon make a certification 
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to that effect to the Secretary of the Treasury, together 
with a certification as to the amount of the incentive pay-
ment to be transferred to the State account pursuant to 
that finding. The Secretary of the Treasury shall make 
the appropriate transfer within 7 days after receiving such 
certification. 
‘‘(ii) For purposes of clause (i), State law provisions 
which are to take effect within 12 months after the date 
of their certification under this subparagraph shall be con-
sidered to be in effect as of the date of such certification. 
‘‘(C)(i) No certification of compliance with the re-
quirements of paragraph (2) or (3) may be made with re-
spect to any State whose State law is not otherwise eligible 
for certification under section 303 or approvable under 
section 3304 of the Federal Unemployment Tax Act. 
‘‘(ii) No certification of compliance with the require-
ments of paragraph (3) may be made with respect to any 
State whose State law is not in compliance with the re-
quirements of paragraph (2). 
‘‘(iii) No application under subparagraph (A) may be 
considered if submitted before the date of the enactment 
of this subsection or after the latest date necessary (as 
specified by the Secretary of Labor) to ensure that all in-
centive payments under this subsection are made before 
October 1, 2011. 
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‘‘(5)(A) Except as provided in subparagraph (B), any 
amount transferred to the account of a State under this 
subsection may be used by such State only in the payment 
of cash benefits to individuals with respect to their unem-
ployment (including for dependents’ allowances and for 
unemployment compensation under paragraph (3)(C)), ex-
clusive of expenses of administration. 
‘‘(B) A State may, subject to the same conditions as 
set forth in subsection (c)(2) (excluding subparagraph (B) 
thereof, and deeming the reference to ‘subsections (a) and 
(b)’ in subparagraph (D) thereof to include this sub-
section), use any amount transferred to the account of 
such State under this subsection for the administration 
of its unemployment compensation law and public employ-
ment offices. 
‘‘(6) Out of any money in the Federal unemployment 
account not otherwise appropriated, the Secretary of the 
Treasury shall reserve $7,000,000,000 for incentive pay-
ments under this subsection. Any amount so reserved shall 
not be taken into account for purposes of any determina-
tion under section 902, 910, or 1203 of the amount in 
the Federal unemployment account as of any given time. 
Any amount so reserved for which the Secretary of the 
Treasury has not received a certification under paragraph 
(4)(B) by the deadline described in paragraph (4)(C)(iii) 
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shall, upon the close of fiscal year 2011, become unre-
stricted as to use as part of the Federal unemployment 
account. 
‘‘(7) For purposes of this subsection, the terms ‘ben-
efit year’, ‘base period’, and ‘week’ have the respective 
meanings given such terms under section 205 of the Fed-
eral-State Extended Unemployment Compensation Act of 
1970 (26 U.S.C. 3304 note). 
‘‘Special Transfer in Fiscal Year 2009 for Administration 
‘‘(g)(1) In addition to any other amounts, the Sec-
retary of the Treasury shall transfer from the employment 
security administration account to the account of each 
State in the Unemployment Trust Fund, within 30 days 
after the date of the enactment of this subsection, the 
amount determined with respect to such State under para-
graph (2). 
‘‘(2) The amount to be transferred under this sub-
section to a State account shall (as determined by the Sec-
retary of Labor and certified by such Secretary to the Sec-
retary of the Treasury) be equal to the amount obtained 
by multiplying $500,000,000 by the same ratio as deter-
mined under subsection (f)(1)(B) with respect to such 
State. 
‘‘(3) Any amount transferred to the account of a 
State as a result of the enactment of this subsection may 
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be used by the State agency of such State only in the pay-
ment of expenses incurred by it for— 
‘‘(A) the administration of the provisions of its 
State law carrying out the purposes of subsection 
(f)(2) or any subparagraph of subsection (f)(3); 
‘‘(B) improved outreach to individuals who 
might be eligible for regular unemployment com-
pensation by virtue of any provisions of the State 
law which are described in subparagraph (A); 
‘‘(C) the improvement of unemployment benefit 
and unemployment tax operations, including re-
sponding to increased demand for unemployment 
compensation; and 
‘‘(D) staff-assisted reemployment services for 
unemployment compensation claimants.’’. 
(b) REGULATIONS.—The Secretary of Labor may 
prescribe any regulations, operating instructions, or other 
guidance necessary to carry out the amendment made by 
subsection (a). 
Subtitle B—Assistance for 
Vulnerable Individuals 
SEC. 2101. EMERGENCY FUND FOR TANF PROGRAM. 
(a) IN GENERAL.—Section 403 of the Social Security 
Act (42 U.S.C. 603) is amended by adding at the end the 
following: 
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‘‘(c) EMERGENCY FUND.— 
‘‘(1) ESTABLISHMENT.—There is established in 
the Treasury of the United States a fund which 
shall be known as the ‘Emergency Contingency 
Fund for State Temporary Assistance for Needy 
Families Programs’ (in this subsection referred to as 
the ‘Emergency Fund’). 
‘‘(2) DEPOSITS INTO FUND.—Out of any money 
in the Treasury of the United States not otherwise 
appropriated, there are appropriated such sums as 
are necessary for payment to the Emergency Fund. 
‘‘(3) GRANTS.— 
‘‘(A) GRANT RELATED TO CASELOAD IN-
CREASES.— 
‘‘(i) IN GENERAL.—For each calendar 
quarter in fiscal year 2009 or 2010, the 
Secretary shall make a grant from the 
Emergency Fund to each State that— 
‘‘(I) requests a grant under this 
subparagraph for the quarter; and 
‘‘(II) meets the requirement of 
clause (ii) for the quarter. 
‘‘(ii) CASELOAD INCREASE REQUIRE-
MENT.—A State meets the requirement of 
this clause for a quarter if the average 
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‘‘(i) IN GENERAL.—For each calendar 
quarter in fiscal year 2009 or 2010, the 
Secretary shall make a grant from the 
Emergency Fund to each State that— 
‘‘(I) requests a grant under this 
subparagraph for the quarter; and 
‘‘(II) meets the requirement of 
clause (ii) for the quarter. 
‘‘(ii) SUBSIDIZED
EMPLOYMENT
EX-
PENDITURE
REQUIREMENT.—A
State 
meets the requirement of this clause for a 
quarter if the total expenditures of the 
State for subsidized employment in the 
quarter, whether under the State program 
funded under this part or as qualified 
State expenditures, exceeds the total of 
such expenditures of the State in the cor-
responding quarter in the emergency fund 
base year of the State. 
‘‘(iii) AMOUNT OF GRANT.—Subject to 
paragraph (5), the amount of the grant to 
be made to a State under this subpara-
graph for a quarter shall be an amount 
equal to 80 percent of the excess described 
in clause (ii). 
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‘‘(4) AUTHORITY TO MAKE NECESSARY ADJUST-
MENTS TO DATA AND COLLECT NEEDED DATA.—In 
determining the size of the caseload of a State and 
the expenditures of a State for basic assistance, non- 
recurrent short-term benefits, and subsidized em-
ployment, during any period for which the State re-
quests funds under this subsection, and during the 
emergency fund base year of the State, the Sec-
retary may make appropriate adjustments to the 
data to ensure that the data reflect expenditures 
under the State program funded under this part and 
qualified State expenditures. The Secretary may de-
velop a mechanism for collecting expenditure data, 
including procedures which allow States to make 
reasonable estimates, and may set deadlines for 
making revisions to the data. 
‘‘(5) LIMITATION.—The total amount payable 
to a single State under subsection (b) and this sub-
section for a fiscal year shall not exceed 25 percent 
of the State family assistance grant. 
‘‘(6) LIMITATIONS ON USE OF FUNDS.—A State 
to which an amount is paid under this subsection 
may use the amount only as authorized by section 
404. 
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‘‘(7) TIMING OF IMPLEMENTATION.—The Sec-
retary shall implement this subsection as quickly as 
reasonably possible, pursuant to appropriate guid-
ance to States. 
‘‘(8) DEFINITIONS.—In this subsection: 
‘‘(A)
AVERAGE
MONTHLY
ASSISTANCE 
CASELOAD.—The term ‘average monthly assist-
ance caseload’ means, with respect to a State 
and a quarter, the number of families receiving 
assistance during the quarter under the State 
program funded under this part or as qualified 
State expenditures, subject to adjustment under 
paragraph (4). 
‘‘(B) EMERGENCY FUND BASE YEAR.— 
‘‘(i) IN GENERAL.—The term ‘emer-
gency fund base year’ means, with respect 
to a State and a category described in 
clause (ii), whichever of fiscal year 2007 or 
2008
is
the
fiscal
year
in
which
the 
amount described by the category with re-
spect to the State is the lesser. 
‘‘(ii) CATEGORIES
DESCRIBED.—The 
categories described in this clause are the 
following: 
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‘‘(I) The average monthly assist-
ance caseload of the State. 
‘‘(II) The total expenditures of 
the State for non-recurrent short term 
benefits, whether under the State pro-
gram funded under this part or as 
qualified State expenditures. 
‘‘(III) The total expenditures of 
the State for subsidized employment, 
whether
under
the
State
program 
funded under this part or as qualified 
State expenditures. 
‘‘(C) QUALIFIED STATE EXPENDITURES.— 
The term ‘qualified State expenditures’ has the 
meaning given the term in section 409(a)(7).’’. 
(b) TEMPORARY MODIFICATION OF CASELOAD RE-
DUCTION CREDIT.—Section 407(b)(3)(A)(i) of such Act 
(42 U.S.C. 607(b)(3)(A)(i)) is amended by inserting ‘‘(or 
if the immediately preceding fiscal year is fiscal year 2009 
or 2010, then, at State option, during the emergency fund 
base year of the State with respect to the average monthly 
assistance caseload of the State (within the meaning of 
section 403(c)(8)(B)))’’ before ‘‘under the State’’. 
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(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on the date of the enactment 
of this Act. 
SEC. 2102. ONE-TIME EMERGENCY PAYMENT TO SSI RECIPI-
ENTS. 
(a) PAYMENT AUTHORITY.— 
(1) IN GENERAL.—At the earliest practicable 
date in calendar year 2009 but not later than 120 
days after the date of the enactment of this section, 
the Commissioner of Social Security shall make a 
one-time payment to each individual who is deter-
mined by the Commissioner in calendar year 2009 to 
be an individual who— 
(A) is entitled to a cash benefit under the 
supplemental security income program under 
title XVI of the Social Security Act (other than 
pursuant to section 1611(e)(1)(B) of such Act) 
for at least 1 day in the calendar month in 
which the first payment under this section is to 
be made; or 
(B)(i) was entitled to such a cash benefit 
(other than pursuant to section 1611(e)(1)(B) 
of such Act) for at least 1 day in the 2-month 
period preceding that calendar month; and 
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(ii)
whose
entitlement
to
that
benefit 
ceased in that 2-month period solely because 
the income of the individual (and the income of 
the spouse, if any, of the individual) exceeded 
the applicable income limit described in para-
graph (1)(A) or (2)(A) of section 1611(a) of 
such Act. 
(2) AMOUNT
OF
PAYMENT.—Subject to sub-
section (b)(1) of this section, the amount of the pay-
ment shall be— 
(A) in the case of an individual eligible for 
a payment under this section who does not have 
a
spouse
eligible
for
such
a
payment,
an 
amount equal to the average of the cash bene-
fits payable in the aggregate under section 
1611 or 1619(a) of the Social Security Act to 
eligible individuals who do not have an eligible 
spouse, for the most recent month for which 
data on payment of the benefits are available, 
as determined by the Commissioner of Social 
Security; or 
(B) in the case of an individual eligible for 
a payment under this section who has a spouse 
eligible for such a payment, an amount equal to 
the average of the cash benefits payable in the 
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aggregate under section 1611 or 1619(a) of the 
Social Security Act to eligible individuals who 
have an eligible spouse, for the most recent 
month for which data on payment of the bene-
fits are available, as so determined. 
(b) ADMINISTRATIVE PROVISIONS.— 
(1) AUTHORITY
TO
WITHHOLD
PAYMENT
TO 
RECOVER PRIOR OVERPAYMENT OF SSI BENEFITS.— 
The Commissioner of Social Security may withhold 
part or all of a payment otherwise required to be 
made under subsection (a) of this section to an indi-
vidual, in order to recover a prior overpayment of 
benefits to the individual under the supplemental se-
curity income program under title XVI of the Social 
Security Act, subject to the limitations of section 
1631(b) of such Act. 
(2) PAYMENT TO BE DISREGARDED IN DETER-
MINING
UNDERPAYMENTS
UNDER
THE
SSI
PRO-
GRAM.—A payment under subsection (a) shall be 
disregarded in determining whether there has been 
an underpayment of benefits under the supplemental 
security income program under title XVI of the So-
cial Security Act. 
(3) NONASSIGNMENT.—The provisions of sec-
tion 1631(d) of the Social Security Act shall apply 
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with respect to payments under this section to the 
same extent as they apply in the case of title XVI 
of such Act. 
(c) PAYMENTS TO BE DISREGARDED FOR PURPOSES 
OF ALL FEDERAL
AND FEDERALLY ASSISTED PRO-
GRAMS.—A payment under subsection (a) shall not be re-
garded as income to the recipient, and shall not be re-
garded as a resource of the recipient for the month of re-
ceipt and the following 6 months, for purposes of deter-
mining the eligibility of any individual for benefits or as-
sistance, or the amount or extent of benefits or assistance, 
under any Federal program or under any State or local 
program financed in whole or in part with Federal funds. 
(d) APPROPRIATION.—Out of any sums in the Treas-
ury of the United States not otherwise appropriated, there 
are appropriated such sums as may be necessary to carry 
out this section. 
SEC.
2103.
TEMPORARY
RESUMPTION
OF
PRIOR
CHILD 
SUPPORT LAW. 
During the period that begins with October 1, 2008, 
and ends with September 30, 2010, section 455(a)(1) of 
the Social Security Act shall be applied and administered 
as if the phrase ‘‘from amounts paid to the State under 
section 458 or’’ did not appear in such section. 
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TITLE III—HEALTH INSURANCE 
ASSISTANCE FOR THE UNEM-
PLOYED 
SEC. 3001. SHORT TITLE AND TABLE OF CONTENTS OF 
TITLE. 
(a) SHORT TITLE OF TITLE.—This title may be cited 
as the ‘‘Health Insurance Assistance for the Unemployed 
Act of 2009’’. 
(b) TABLE OF CONTENTS OF TITLE.—The table of 
contents of this title is as follows: 
Sec. 3001. Short title and table of contents of title. 
Sec. 3002. Premium assistance for COBRA benefits and extension of COBRA 
benefits for older or long-term employees. 
Sec. 3003. Temporary optional Medicaid coverage for the unemployed. 
SEC. 3002. PREMIUM ASSISTANCE FOR COBRA BENEFITS 
AND EXTENSION OF COBRA BENEFITS FOR 
OLDER OR LONG-TERM EMPLOYEES. 
(a) PREMIUM ASSISTANCE FOR COBRA CONTINU-
ATION COVERAGE FOR INDIVIDUALS AND THEIR FAMI-
LIES.— 
(1) PROVISION OF PREMIUM ASSISTANCE.— 
(A)
REDUCTION
OF
PREMIUMS
PAY-
ABLE.—In the case of any premium for a pe-
riod of coverage beginning on or after the date 
of the enactment of this Act for COBRA con-
tinuation coverage with respect to any assist-
ance eligible individual, such individual shall be 
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treated for purposes of any COBRA continu-
ation provision as having paid the amount of 
such premium if such individual pays 35 per-
cent of the amount of such premium (as deter-
mined without regard to this subsection). 
(B) PREMIUM REIMBURSEMENT.—For pro-
visions providing the balance of such premium, 
see section 6431 of the Internal Revenue Code 
of 1986, as added by paragraph (12). 
(2) LIMITATION OF PERIOD OF PREMIUM AS-
SISTANCE.— 
(A) IN GENERAL.—Paragraph (1)(A) shall 
not apply with respect to any assistance eligible 
individual for months of coverage beginning on 
or after the earlier of— 
(i) the first date that such individual 
is eligible for coverage under any other 
group health plan (other than coverage 
consisting of only dental, vision, coun-
seling, or referral services (or a combina-
tion thereof), coverage under a health re-
imbursement
arrangement
or
a
health 
flexible spending arrangement, or coverage 
of treatment that is furnished in an on-site 
medical facility maintained by the em-
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ployer and that consists primarily of first- 
aid services, prevention and wellness care, 
or similar care (or a combination thereof)) 
or is eligible for benefits under title XVIII 
of the Social Security Act, or 
(ii) the earliest of— 
(I) the date which is 12 months 
after the first day of the first month 
that paragraph (1)(A) applies with re-
spect to such individual, 
(II) the date following the expira-
tion of the maximum period of con-
tinuation coverage required under the 
applicable COBRA continuation cov-
erage provision, or 
(III) the date following the expi-
ration of the period of continuation 
coverage
allowed
under
paragraph 
(4)(B)(ii). 
(B) TIMING
OF
ELIGIBILITY
FOR
ADDI-
TIONAL COVERAGE.—For purposes of subpara-
graph (A)(i), an individual shall not be treated 
as eligible for coverage under a group health 
plan before the first date on which such indi-
vidual could be covered under such plan. 
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(C)
NOTIFICATION
REQUIREMENT.—An 
assistance eligible individual shall notify in writ-
ing the group health plan with respect to which 
paragraph (1)(A) applies if such paragraph 
ceases to apply by reason of subparagraph 
(A)(i). Such notice shall be provided to the 
group health plan in such time and manner as 
may be specified by the Secretary of Labor. 
(3) ASSISTANCE
ELIGIBLE
INDIVIDUAL.—For 
purposes of this section, the term ‘‘assistance eligible 
individual’’ means any qualified beneficiary if— 
(A) at any time during the period that be-
gins with September 1, 2008, and ends with 
December 31, 2009, such qualified beneficiary 
is eligible for COBRA continuation coverage, 
(B) such qualified beneficiary elects such 
coverage, and 
(C) the qualifying event with respect to the 
COBRA continuation coverage consists of the 
involuntary termination of the covered employ-
ee’s employment and occurred during such pe-
riod. 
(4) EXTENSION OF ELECTION PERIOD AND EF-
FECT ON COVERAGE.— 
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(A) IN
GENERAL.—Notwithstanding sec-
tion 605(a) of the Employee Retirement Income 
Security Act of 1974, section 4980B(f)(5)(A) of 
the Internal Revenue Code of 1986, section 
2205(a) of the Public Health Service Act, and 
section 8905a(c)(2) of title 5, United States 
Code, in the case of an individual who is a 
qualified
beneficiary
described
in
paragraph 
(3)(A) as of the date of the enactment of this 
Act and has not made the election referred to 
in paragraph (3)(B) as of such date, such indi-
vidual may elect the COBRA continuation cov-
erage under the COBRA continuation coverage 
provisions containing such sections during the 
60-day period commencing with the date on 
which the notification required under paragraph 
(7)(C) is provided to such individual. 
(B) COMMENCEMENT
OF
COVERAGE;
NO 
REACH-BACK.—Any COBRA continuation cov-
erage elected by a qualified beneficiary during 
an extended election period under subparagraph 
(A)— 
(i) shall commence on the date of the 
enactment of this Act, and 
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(ii) shall not extend beyond the period 
of
COBRA
continuation
coverage
that 
would have been required under the appli-
cable COBRA continuation coverage provi-
sion if the coverage had been elected as re-
quired under such provision. 
(C) PREEXISTING CONDITIONS.—With re-
spect
to
a
qualified
beneficiary
who
elects 
COBRA continuation coverage pursuant to sub-
paragraph (A), the period— 
(i) beginning on the date of the quali-
fying event, and 
(ii) ending with the day before the 
date of the enactment of this Act, 
shall be disregarded for purposes of deter-
mining the 63-day periods referred to in section 
701)(2) of the Employee Retirement Income 
Security Act of 1974, section 9801(c)(2) of the 
Internal Revenue Code of 1986, and section 
2701(c)(2) of the Public Health Service Act. 
(5) EXPEDITED REVIEW OF DENIALS OF PRE-
MIUM ASSISTANCE.—In any case in which an indi-
vidual requests treatment as an assistance eligible 
individual and is denied such treatment by the group 
health plan by reason of such individual’s ineligi-
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bility for COBRA continuation coverage, the Sec-
retary of Labor (or the Secretary of Health and 
Human services in connection with COBRA continu-
ation coverage which is provided other than pursu-
ant to part 6 of subtitle B of title I of the Employee 
Retirement Income Security Act of 1974), in con-
sultation with the Secretary of the Treasury, shall 
provide for expedited review of such denial. An indi-
vidual shall be entitled to such review upon applica-
tion to such Secretary in such form and manner as 
shall be provided by such Secretary. Such Secretary 
shall make a determination regarding such individ-
ual’s eligibility within 10 business days after receipt 
of such individual’s application for review under this 
paragraph. 
(6) DISREGARD OF SUBSIDIES FOR PURPOSES 
OF
FEDERAL
AND
STATE
PROGRAMS.—Notwith-
standing any other provision of law, any premium 
reduction with respect to an assistance eligible indi-
vidual under this subsection shall not be considered 
income or resources in determining eligibility for, or 
the amount of assistance or benefits provided under, 
any other public benefit provided under Federal law 
or the law of any State or political subdivision there-
of. 
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(7) NOTICES TO INDIVIDUALS.— 
(A) GENERAL NOTICE.— 
(i) IN GENERAL.—In the case of no-
tices provided under section 606(4) of the 
Employee Retirement Income Security Act 
of
1974
(29
U.S.C.
1166(4)),
section 
4980B(f)(6)(D) of the Internal Revenue 
Code of 1986, section 2206(4) of the Pub-
lic Health Service Act (42 U.S.C. 300bb- 
6(4)), or section 8905a(f)(2)(A) of title 5, 
United States Code, with respect to indi-
viduals who, during the period described in 
paragraph (3)(A), become entitled to elect 
COBRA continuation coverage, such no-
tices shall include an additional notifica-
tion to the recipient of the availability of 
premium reduction with respect to such 
coverage under this subsection. 
(ii) ALTERNATIVE
NOTICE.—In the 
case of COBRA continuation coverage to 
which the notice provision under such sec-
tions does not apply, the Secretary of 
Labor, in consultation with the Secretary 
of the Treasury and the Secretary of 
Health and Human Services, shall, in co-
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ordination
with
administrators
of
the 
group health plans (or other entities) that 
provide or administer the COBRA continu-
ation coverage involved, provide rules re-
quiring the provision of such notice. 
(iii) FORM.—The requirement of the 
additional notification under this subpara-
graph may be met by amendment of exist-
ing notice forms or by inclusion of a sepa-
rate document with the notice otherwise 
required. 
(B) SPECIFIC REQUIREMENTS.—Each ad-
ditional notification under subparagraph (A) 
shall include— 
(i) the forms necessary for estab-
lishing eligibility for premium reduction 
under this subsection, 
(ii) the name, address, and telephone 
number necessary to contact the plan ad-
ministrator and any other person main-
taining relevant information in connection 
with such premium reduction, 
(iii) a description of the extended elec-
tion
period
provided
for
in
paragraph 
(4)(A), 
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(iv) a description of the obligation of 
the qualified beneficiary under paragraph 
(2)(C) to notify the plan providing continu-
ation coverage of eligibility for subsequent 
coverage under another group health plan 
or eligibility for benefits under title XVIII 
of the Social Security Act and the penalty 
provided for failure to so notify the plan, 
and 
(v)
a
description,
displayed
in
a 
prominent manner, of the qualified bene-
ficiary’s right to a reduced premium and 
any conditions on entitlement to the re-
duced premium. 
(C) NOTICE
RELATING
TO
RETROACTIVE 
COVERAGE.—In the case of an individual de-
scribed in paragraph (3)(A) who has elected 
COBRA continuation coverage as of the date of 
enactment of this Act or an individual described 
in paragraph (4)(A), the administrator of the 
group health plan (or other entity) involved 
shall provide (within 60 days after the date of 
enactment of this Act) for the additional notifi-
cation required to be provided under subpara-
graph (A). 
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(D) MODEL NOTICES.—Not later than 30 
days after the date of enactment of this Act, 
the Secretary of the Labor, in consultation with 
the Secretary of the Treasury and the Secretary 
of Health and Human Services, shall prescribe 
models for the additional notification required 
under this paragraph. 
(8) SAFEGUARDS.—The Secretary of the Treas-
ury shall provide such rules, procedures, regulations, 
and other guidance as may be necessary and appro-
priate to prevent fraud and abuse under this sub-
section. 
(9) OUTREACH.—The Secretary of Labor, in 
consultation with the Secretary of the Treasury and 
the Secretary of Health and Human Services, shall 
provide outreach consisting of public education and 
enrollment assistance relating to premium reduction 
provided under this subsection. Such outreach shall 
target employers, group health plan administrators, 
public assistance programs, States, insurers, and 
other entities as determined appropriate by such 
Secretaries. Such outreach shall include an initial 
focus on those individuals electing continuation cov-
erage who are referred to in paragraph (7)(C). In-
formation on such premium reduction, including en-
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rollment, shall also be made available on website of 
the Departments of Labor, Treasury, and Health 
and Human Services. 
(10) DEFINITIONS.—For purposes of this sub-
section— 
(A) ADMINISTRATOR.—The term ‘‘admin-
istrator’’ has the meaning given such term in 
section 3(16) of the Employee Retirement In-
come Security Act of 1974. 
(B) COBRA CONTINUATION COVERAGE.— 
The
term
‘‘COBRA
continuation
coverage’’ 
means continuation coverage provided pursuant 
to part 6 of subtitle B of title I of the Em-
ployee Retirement Income Security Act of 1974 
(other than under section 609), title XXII of 
the Public Health Service Act, section 4980B of 
the Internal Revenue Code of 1986 (other than 
subsection (f)(1) of such section insofar as it 
relates to pediatric vaccines), or section 8905a 
of title 5, United States Code, or under a State 
program that provides continuation coverage 
comparable to such continuation coverage. Such 
term does not include coverage under a health 
flexible spending arrangement. 
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(C) COBRA CONTINUATION PROVISION.— 
The
term
‘‘COBRA
continuation
provision’’ 
means the provisions of law described in sub-
paragraph (B). 
(D)
COVERED
EMPLOYEE.—The
term 
‘‘covered employee’’ has the meaning given such 
term in section 607(2) of the Employee Retire-
ment Income Security Act of 1974. 
(E) QUALIFIED BENEFICIARY.—The term 
‘‘qualified beneficiary’’ has the meaning given 
such term in section 607(3) of the Employee 
Retirement Income Security Act of 1974. 
(F)
GROUP
HEALTH
PLAN.—The
term 
‘‘group health plan’’ has the meaning given 
such term in section 607(1) of the Employee 
Retirement Income Security Act of 1974. 
(G) STATE.—The term ‘‘State’’ includes 
the District of Columbia, the Commonwealth of 
Puerto Rico, the Virgin Islands, Guam, Amer-
ican Samoa, and the Commonwealth of the 
Northern Mariana Islands. 
(11) REPORTS.— 
(A) INTERIM REPORT.—The Secretary of 
the Treasury shall submit an interim report to 
the Committee on Education and Labor, the 
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Committee on Ways and Means, and the Com-
mittee on Energy and Commerce of the House 
of
Representatives
and
the
Committee
on 
Health, Education, Labor, and Pensions and 
the Committee on Finance of the Senate re-
garding the premium reduction provided under 
this subsection that includes— 
(i) the number of individuals provided 
such assistance as of the date of the re-
port; and 
(ii) the total amount of expenditures 
incurred (with administrative expenditures 
noted separately) in connection with such 
assistance as of the date of the report. 
(B) FINAL
REPORT.—As soon as prac-
ticable after the last period of COBRA continu-
ation coverage for which premium reduction is 
provided under this section, the Secretary of the 
Treasury shall submit a final report to each 
Committee referred to in subparagraph (A) that 
includes— 
(i) the number of individuals provided 
premium reduction under this section; 
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(ii)
the
average
dollar
amount 
(monthly and annually) of premium reduc-
tions provided to such individuals; and 
(iii) the total amount of expenditures 
incurred (with administrative expenditures 
noted separately) in connection with pre-
mium reduction under this section. 
(12) COBRA PREMIUM ASSISTANCE.— 
(A) IN GENERAL.—Subchapter B of chap-
ter 65 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following 
new section: 
‘‘SEC. 6431. COBRA PREMIUM ASSISTANCE. 
‘‘(a) IN GENERAL.—The entity to whom premiums 
are payable under COBRA continuation coverage shall be 
reimbursed for the amount of premiums not paid by plan 
beneficiaries by reason of section 3002(a) of the Health 
Insurance Assistance for the Unemployed Act of 2009. 
Such amount shall be treated as a credit against the re-
quirement of such entity to make deposits of payroll taxes 
and the liability of such entity for payroll taxes. To the 
extent that such amount exceeds the amount of such 
taxes, the Secretary shall pay to such entity the amount 
of such excess. No payment may be made under this sub-
section to an entity with respect to any assistance eligible 
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individual until after such entity has received the reduced 
premium from such individual required under section 
3002(a)(1)(A) of such Act. 
‘‘(b) PAYROLL TAXES.—For purposes of this section, 
the term ‘payroll taxes’ means— 
‘‘(1) amounts required to be deducted and with-
held for the payroll period under section 3401 (relat-
ing to wage withholding), 
‘‘(2) amounts required to be deducted for the 
payroll period under section 3102 (relating to FICA 
employee taxes), and 
‘‘(3) amounts of the taxes imposed for the pay-
roll period under section 3111 (relating to FICA em-
ployer taxes). 
‘‘(c) TREATMENT OF CREDIT.—Except as otherwise 
provided by the Secretary, the credit described in sub-
section (a) shall be applied as though the employer had 
paid to the Secretary, on the day that the qualified bene-
ficiary’s premium payment is received, an amount equal 
to such credit. 
‘‘(d) TREATMENT OF PAYMENT.—For purposes of 
section 1324(b)(2) of title 31, United States Code, any 
payment under this section shall be treated in the same 
manner as a refund of the credit under section 35. 
‘‘(e) REPORTING.— 
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‘‘(1) IN GENERAL.—Each entity entitled to re-
imbursement under subsection (a) for any period 
shall submit such reports as the Secretary may re-
quire, including— 
‘‘(A) an attestation of involuntary termi-
nation of employment for each covered em-
ployee on the basis of whose termination entitle-
ment to reimbursement is claimed under sub-
section (a), and 
‘‘(B) a report of the amount of payroll 
taxes offset under subsection (a) for the report-
ing period and the estimated offsets of such 
taxes for the subsequent reporting period in 
connection
with
reimbursements
under
sub-
section (a). 
‘‘(2)
TIMING
OF
REPORTS
RELATING
TO 
AMOUNT
OF
PAYROLL
TAXES.—Reports
required 
under paragraph (1)(B) shall be submitted at the 
same time as deposits of taxes imposed by chapters 
21, 22, and 24 or at such time as is specified by the 
Secretary. 
‘‘(f) REGULATIONS.—The Secretary may issue such 
regulations or other guidance as may be necessary or ap-
propriate to carry out this section, including the require-
ment to report information or the establishment of other 
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methods for verifying the correct amounts of payments 
and credits under this section. The Secretary shall issue 
such regulations or guidance with respect to the applica-
tion of this section to group health plans that are multiem-
ployer plans (as defined in section 3(37) of the Employee 
Retirement Income Security Act of 1974).’’. 
(B) SOCIAL SECURITY TRUST FUNDS HELD 
HARMLESS.—In determining any amount trans-
ferred or appropriated to any fund under the 
Social Security Act, section 6431 of the Inter-
nal Revenue Code of 1986 shall not be taken 
into account. 
(C) CLERICAL AMENDMENT.—The table of 
sections for subchapter B of chapter 65 of the 
Internal Revenue Code of 1986 is amended by 
adding at the end the following new item: 
‘‘Sec. 6431. COBRA premium assistance.’’. 
(D) EFFECTIVE DATE.—The amendments 
made by this paragraph shall apply to pre-
miums to which subsection (a)(1)(A) applies. 
(13)
PENALTY
FOR
FAILURE
TO
NOTIFY 
HEALTH PLAN OF CESSATION OF ELIGIBILITY FOR 
PREMIUM ASSISTANCE.— 
(A) IN GENERAL.—Part I of subchapter B 
of chapter 68 of the Internal Revenue Code of 
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1986 is amended by adding at the end the fol-
lowing new section: 
‘‘SEC. 6720C. PENALTY FOR FAILURE TO NOTIFY HEALTH 
PLAN OF CESSATION OF ELIGIBILITY FOR 
COBRA PREMIUM ASSISTANCE. 
‘‘(a) IN GENERAL.—Any person required to notify a 
group health plan under section 3002(a)(2)(C)) of the 
Health Insurance Assistance for the Unemployed Act of 
2009 who fails to make such a notification at such time 
and in such manner as the Secretary of Labor may require 
shall pay a penalty of 110 percent of the premium reduc-
tion provided under such section after termination of eligi-
bility under such subsection. 
‘‘(b) REASONABLE CAUSE EXCEPTION.—No penalty 
shall be imposed under subsection (a) with respect to any 
failure if it is shown that such failure is due to reasonable 
cause and not to willful neglect.’’. 
(B) CLERICAL AMENDMENT.—The table of 
sections of part I of subchapter B of chapter 68 
of such Code is amended by adding at the end 
the following new item: 
‘‘Sec. 6720C. Penalty for failure to notify health plan of cessation of eligibility 
for COBRA premium assistance.’’. 
(C) EFFECTIVE DATE.—The amendments 
made by this paragraph shall apply to failures 
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occurring after the date of the enactment of 
this Act. 
(14) COORDINATION WITH HCTC.— 
(A) IN GENERAL.—Subsection (g) of sec-
tion 35 of the Internal Revenue Code of 1986 
is amended by redesignating paragraph (9) as 
paragraph (10) and inserting after paragraph 
(8) the following new paragraph: 
‘‘(9) COBRA
PREMIUM
ASSISTANCE.—In the 
case of an assistance eligible individual who receives 
premium reduction for COBRA continuation cov-
erage under section 3002(a) of the Health Insurance 
Assistance for the Unemployed Act of 2009 for any 
month during the taxable year, such individual shall 
not be treated as an eligible individual, a certified 
individual, or a qualifying family member for pur-
poses of this section or section 7527 with respect to 
such month.’’. 
(B) EFFECTIVE
DATE.—The amendment 
made by subparagraph (A) shall apply to tax-
able years ending after the date of the enact-
ment of this Act. 
(15) EXCLUSION OF COBRA PREMIUM ASSIST-
ANCE FROM GROSS INCOME.— 
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(A) IN GENERAL.—Part III of subchapter 
B of chapter 1 of the Internal Revenue Code of 
1986 is amended by inserting after section 
139B the following new section: 
‘‘SEC. 139C. COBRA PREMIUM ASSISTANCE. 
‘‘In the case of an assistance eligible individual (as 
defined in section 3002 of the Health Insurance Assist-
ance for the Unemployed Act of 2009), gross income does 
not include any premium reduction provided under sub-
section (a) of such section.’’. 
(B) CLERICAL AMENDMENT.—The table of 
sections for part III of subchapter B of chapter 
1 of such Code is amended by inserting after 
the item relating to section 139B the following 
new item: 
‘‘Sec. 139C. COBRA premium assistance.’’. 
(C) EFFECTIVE DATE.—The amendments 
made by this paragraph shall apply to taxable 
years ending after the date of the enactment of 
this Act. 
(b) EXTENSION OF COBRA BENEFITS FOR OLDER 
OR LONG-TERM EMPLOYEES.— 
(1) ERISA
AMENDMENT.—Section 602(2)(A) 
of the Employee Retirement Income Security Act of 
1974 is amended by adding at the end the following 
new clauses: 
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‘‘(x) SPECIAL RULE FOR OLDER OR 
LONG-TERM EMPLOYEES GENERALLY.—In 
the case of a qualifying event described in 
section 603(2) with respect to a covered 
employee who (as of such qualifying event) 
has attained age 55 or has completed 10 
or more years of service with the entity 
that is the employer at the time of the 
qualifying event, clauses (i) and (ii) shall 
not apply. For purposes of this clause, in 
the case of a group health plan that is a 
multiemployer plan, service by the covered 
employee performed for 2 or more employ-
ers during periods for which such employ-
ers contributed to such plan shall be treat-
ed as service performed for the entity re-
ferred to in the preceding sentence. 
‘‘(xi) YEAR OF SERVICE.— For pur-
poses of this subparagraph, the term ‘year 
of service’ shall have the meaning provided 
in section 202(a)(3).’’. 
(2) IRC
AMENDMENT.—Clause (i) of section 
4980B(f)(2)(B) of the Internal Revenue Code of 
1986 is amended by adding at the end the following 
new subclauses: 
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‘‘(X) SPECIAL RULE FOR OLDER 
OR
LONG-TERM
EMPLOYEES
GEN-
ERALLY.—In the case of a qualifying 
event described in paragraph (3)(B) 
with respect to a covered employee 
who (as of such qualifying event) has 
attained age 55 or has completed 10 
or more years of service with the enti-
ty that is the employer at the time of 
the qualifying event, subclauses (I) 
and (II) shall not apply. For purposes 
of this subclause, in the case of a 
group health plan that is a multiem-
ployer plan (as defined in section 
3(37) of the Employee Retirement In-
come Security Act of 1974), service by 
the covered employee performed for 2 
or more employers during periods for 
which such employers contributed to 
such plan shall be treated as service 
performed for the entity referred to in 
the preceding sentence. 
‘‘(XI) YEAR OF SERVICE.— For 
purposes of this clause, the term ‘year 
of service’ shall have the meaning pro-
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vided in section 202(a)(3) of the Em-
ployee
Retirement
Income
Security 
Act of 1974.’’. 
(3) PHSA AMENDMENT.—Section 2202(2)(A) 
of the Public Health Service Act is amended by add-
ing at the end the following new clauses: 
‘‘(viii) SPECIAL RULE FOR OLDER OR 
LONG-TERM EMPLOYEES GENERALLY.—In 
the case of a qualifying event described in 
section 2203(2) with respect to a covered 
employee who (as of such qualifying event) 
has attained age 55 or has completed 10 
or more years of service with the entity 
that is the employer at the time of the 
qualifying event, clauses (i) and (ii) shall 
not apply. For purposes of this clause, in 
the case of a group health plan that is a 
multiemployer plan (as defined in section 
3(37) of the Employee Retirement Income 
Security Act of 1974), service by the cov-
ered employee performed for 2 or more 
employers during periods for which such 
employers contributed to such plan shall be 
treated as service performed for the entity 
referred to in the preceding sentence. 
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‘‘(ix) YEAR OF SERVICE.— For pur-
poses of this subparagraph, the term ‘year 
of service’ shall have the meaning provided 
in section 202(a)(3) of the Employee Re-
tirement Income Security Act of 1974.’’. 
(4) EFFECTIVE DATE OF AMENDMENTS.—The 
amendments made by this subsection shall apply to 
periods of coverage which would (without regard to 
the amendments made by this section) end on or 
after the date of the enactment of this Act. 
SEC. 3003. TEMPORARY OPTIONAL MEDICAID COVERAGE 
FOR THE UNEMPLOYED. 
(a) IN GENERAL.—Section 1902 of the Social Secu-
rity Act (42 U.S.C. 1396b) is amended— 
(1) in subsection (a)(10)(A)(ii)— 
(A) by striking ‘‘or’’ at the end of sub-
clause (XVIII); 
(B) by adding ‘‘or’’ at the end of subclause 
(XIX); and 
(C) by adding at the end the following new 
subclause: 
‘‘(XX) who are described in sub-
section (dd)(1) (relating to certain un-
employed individuals and their fami-
lies);’’; and 
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(2) by adding at the end the following new sub-
section: 
‘‘(dd)(1) Individuals described in this paragraph 
are— 
‘‘(A) individuals who— 
‘‘(i) are within one or more of the categories de-
scribed in paragraph (2), as elected under the State 
plan; and 
‘‘(ii) meet the applicable requirements of para-
graph (3); and 
‘‘(B) individuals who— 
‘‘(i) are the spouse, or dependent child under 
19 years of age, of an individual described in sub-
paragraph (A); and 
‘‘(ii) meet the requirement of paragraph (3)(B). 
‘‘(2) The categories of individuals described in this 
paragraph are each of the following: 
‘‘(A)(i) Individuals who are receiving unemploy-
ment compensation benefits; and 
‘‘(ii) individuals who were receiving, but have 
exhausted, unemployment compensation benefits on 
or after July 1, 2008. 
‘‘(B) Individuals who are involuntarily unem-
ployed and were involuntarily separated from em-
ployment on or after September 1, 2008, and before 
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January 1, 2011, whose family gross income does 
not exceed a percentage specified by the State (not 
to exceed 200 percent) of the income official poverty 
line (as defined by the Office of Management and 
Budget, and revised annually in accordance with sec-
tion 673(2) of the Omnibus Budget Reconciliation 
Act of 1981) applicable to a family of the size in-
volved,
and
who,
but
for
subsection 
(a)(10)(A)(ii)(XX), are not eligible for medical as-
sistance under this title or health assistance under 
title XXI. 
‘‘(C) Individuals who are involuntarily unem-
ployed and were involuntarily separated from em-
ployment on or after September 1, 2008, and before 
January 1, 2011, who are members of households 
participating in the supplemental nutrition assist-
ance program established under the Food and Nutri-
tion Act of 2008 (7 U.S.C. 2011 et seq.), and who, 
but for subsection (a)(10)(A)(ii)(XX), are not eligi-
ble for medical assistance under this title or health 
assistance under title XXI. 
‘‘(3) The requirements of this paragraph with respect 
to an individual are the following: 
‘‘(A) In the case of individuals within a cat-
egory described in subparagraph (A)(i) of paragraph 
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(2), the individual was involuntarily separated from 
employment on or after September 1, 2008, and be-
fore January 1, 2011, or meets such comparable re-
quirement as the Secretary specifies through rule, 
guidance, or otherwise in the case of an individual 
who was an independent contractor. 
‘‘(B) The individual is not otherwise covered 
under creditable coverage, as defined in section 
2701(c) of the Public Health Service Act (42 U.S.C. 
300gg(c)), but applied without regard to paragraph 
(1)(F) of such section and without regard to cov-
erage provided by reason of the application of sub-
section (a)(10)(A)(ii)(XX). 
‘‘(4)(A) No income or resources test shall be applied 
with respect to any category of individuals described in 
subparagraph (A) or (C) of paragraph (2) who are eligible 
for medical assistance only by reason of the application 
of subsection (a)(10)(A)(ii)(XX). 
‘‘(B) Nothing in this subsection shall be construed 
to prevent a State from imposing a resource test for the 
category of individuals described in paragraph (2)(B)). 
‘‘(C) In the case of individuals described in paragraph 
(2)(A) or (2)(C), the requirements of subsections (i)(22) 
and (x) in section 1903 shall not apply.’’. 
(b) 100 PERCENT FEDERAL MATCHING RATE.— 
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(1) FMAP
FOR
TIME-LIMITED
PERIOD.—The 
third sentence of section 1905(b) of such Act (42 
U.S.C. 1396d(b)) is amended by inserting before the 
period at the end the following: ‘‘and for items and 
services furnished on or after the date of enactment 
of this Act and before January 1, 2011, to individ-
uals who are eligible for medical assistance only by 
reason
of
the
application
of
section 
1902(a)(10)(A)(ii)(XX)’’. 
(2) CERTAIN ENROLLMENT-RELATED ADMINIS-
TRATIVE COSTS.—Notwithstanding any other provi-
sion of law, for purposes of applying section 1903(a) 
of the Social Security Act (42 U.S.C. 1396b(a)), 
with respect to expenditures incurred on or after the 
date of the enactment of this Act and before Janu-
ary 1, 2011, for costs of administration (including 
outreach and the modification and operation of eligi-
bility information systems) attributable to eligibility 
determination and enrollment of individuals who are 
eligible for medical assistance only by reason of the 
application
of
section
1902(a)(10)(A)(ii)(XX)
of 
such Act, as added by subsection (a)(1), the Federal 
matching percentage shall be 100 percent instead of 
the matching percentage otherwise applicable. 
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(c)
CONFORMING
AMENDMENTS.—(1)
Section 
1903(f)(4) of such Act (42 U.S.C. 1396c(f)(4)) is amend-
ed
by
inserting
‘‘1902(a)(10)(A)(ii)(XX),
or’’
after 
‘‘1902(a)(10)(A)(ii)(XIX),’’. 
(2)
Section
1905(a)
of
such
Act
(42
U.S.C. 
1396d(a)) is amended, in the matter preceding paragraph 
(1)— 
(A) by striking ‘‘or’’ at the end of clause (xii); 
(B) by adding ‘‘or’’ at the end of clause (xiii); 
and 
(C) by inserting after clause (xiii) the following 
new clause: 
‘‘(xiv) individuals described in section 
1902(dd)(1),’’. 
TITLE IV—HEALTH 
INFORMATION TECHNOLOGY 
SEC. 4001. SHORT TITLE; TABLE OF CONTENTS OF TITLE. 
(a) SHORT TITLE.—This title may be cited as the 
‘‘Health Information Technology for Economic and Clin-
ical Health Act’’ or the ‘‘HITECH Act’’. 
(b) TABLE OF CONTENTS OF TITLE.—The table of 
contents of this title is as follows: 
Sec. 4001. Short title; table of contents of title. 
Subtitle A—Promotion of Health Information Technology 
PART I—IMPROVING HEALTH CARE QUALITY, SAFETY, AND EFFICIENCY 
Sec. 4101. ONCHIT; standards development and adoption. 
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‘‘TITLE XXX—HEALTH INFORMATION TECHNOLOGY AND 
QUALITY 
‘‘Sec. 3000. Definitions. 
‘‘Subtitle A—Promotion of Health Information Technology 
‘‘Sec. 3001. Office of the National Coordinator for Health Information 
Technology. 
‘‘Sec. 3002. HIT Policy Committee. 
‘‘Sec. 3003. HIT Standards Committee. 
‘‘Sec. 3004. Process for adoption of endorsed recommendations; adoption 
of initial set of standards, implementation specifications, 
and certification criteria. 
‘‘Sec. 3005. Application and use of adopted standards and implementation 
specifications by Federal agencies. 
‘‘Sec. 3006. Voluntary application and use of adopted standards and im-
plementation specifications by private entities. 
‘‘Sec. 3007. Federal health information technology. 
‘‘Sec. 3008. Transitions. 
‘‘Sec. 3009. Relation to HIPAA privacy and security law. 
‘‘Sec. 3010. Authorization for appropriations. 
Sec. 4102. Technical amendment. 
PART II—APPLICATION AND USE OF ADOPTED HEALTH INFORMATION 
TECHNOLOGY STANDARDS; REPORTS 
Sec. 4111. Coordination of Federal activities with adopted standards and imple-
mentation specifications. 
Sec. 4112. Application to private entities. 
Sec. 4113. Study and reports. 
Subtitle B—Testing of Health Information Technology 
Sec. 4201. National Institute for Standards and Technology testing. 
Sec. 4202. Research and development programs. 
Subtitle C—Incentives for the Use of Health Information Technology 
PART I—GRANTS AND LOANS FUNDING 
Sec. 4301. Grant, loan, and demonstration programs. 
‘‘Subtitle B—Incentives for the Use of Health Information Technology 
‘‘Sec. 3011. Immediate funding to strengthen the health information tech-
nology infrastructure. 
‘‘Sec. 3012. Health information technology implementation assistance. 
‘‘Sec. 3013. State grants to promote health information technology. 
‘‘Sec. 3014. Competitive grants to States and Indian tribes for the devel-
opment of loan programs to facilitate the widespread 
adoption of certified EHR technology. 
‘‘Sec. 3015. Demonstration program to integrate information technology 
into clinical education. 
‘‘Sec. 3016. Information technology professionals on health care. 
‘‘Sec. 3017. General grant and loan provisions. 
‘‘Sec. 3018. Authorization for appropriations. 
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PART II—MEDICARE PROGRAM 
Sec. 4311. Incentives for eligible professionals. 
Sec. 4312. Incentives for hospitals. 
Sec. 4313. Treatment of payments and savings; implementation funding. 
Sec. 4314. Study on application of EHR payment incentives for providers not 
receiving other incentive payments. 
PART III—MEDICAID FUNDING 
Sec. 4321. Medicaid provider HIT adoption and operation payments; implemen-
tation funding. 
Sec. 4322. Medicaid nursing home grant program. 
Subtitle D—Privacy 
Sec. 4400. Definitions. 
PART I—IMPROVED PRIVACY PROVISIONS AND SECURITY PROVISIONS 
Sec. 4401. Application of security provisions and penalties to business associ-
ates of covered entities; annual guidance on security provisions. 
Sec. 4402. Notification in the case of breach. 
Sec. 4403. Education on Health Information Privacy. 
Sec. 4404. Application of privacy provisions and penalties to business associates 
of covered entities. 
Sec. 4405. Restrictions on certain disclosures and sales of health information; 
accounting of certain protected health information disclosures; 
access to certain information in electronic format. 
Sec. 4406. Conditions on certain contacts as part of health care operations. 
Sec. 4407. Temporary breach notification requirement for vendors of personal 
health records and other non-HIPAA covered entities. 
Sec. 4408. Business associate contracts required for certain entities. 
Sec. 4409. Clarification of application of wrongful disclosures criminal pen-
alties. 
Sec. 4410. Improved enforcement. 
Sec. 4411. Audits. 
Sec. 4412. Special rule for information to reduce medication errors and improve 
patient safety. 
PART II—RELATIONSHIP TO OTHER LAWS; REGULATORY REFERENCES; 
EFFECTIVE DATE; REPORTS 
Sec. 4421. Relationship to other laws. 
Sec. 4422. Regulatory references. 
Sec. 4423. Effective date. 
Sec. 4424. Studies, reports, guidance. 
Subtitle E—Miscellaneous Medicare Provisions 
Sec. 4501. Moratoria on certain Medicare regulations. 
Sec. 4502. Long-term care hospital technical corrections. 
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Subtitle A—Promotion of Health 
Information Technology 
PART I—IMPROVING HEALTH CARE QUALITY, 
SAFETY, AND EFFICIENCY 
SEC. 4101. ONCHIT; STANDARDS DEVELOPMENT AND ADOP-
TION. 
The Public Health Service Act (42 U.S.C. 201 et 
seq.) is amended by adding at the end the following: 
‘‘TITLE XXX—HEALTH INFORMA-
TION
TECHNOLOGY
AND 
QUALITY 
‘‘SEC. 3000. DEFINITIONS. 
‘‘In this title: 
‘‘(1) CERTIFIED EHR TECHNOLOGY.—The term 
‘certified EHR technology’ means a qualified elec-
tronic health record that is certified pursuant to sec-
tion 3001(c)(5) as meeting standards adopted under 
section 3004 that are applicable to the type of 
record involved (as determined by the Secretary, 
such as an ambulatory electronic health record for 
office-based physicians or an inpatient hospital elec-
tronic health record for hospitals). 
‘‘(2)
ENTERPRISE
INTEGRATION.—The
term 
‘enterprise integration’ means the electronic linkage 
of health care providers, health plans, the govern-
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ment, and other interested parties, to enable the 
electronic exchange and use of health information 
among all the components in the health care infra-
structure in accordance with applicable law, and 
such term includes related application protocols and 
other related standards. 
‘‘(3)
HEALTH
CARE
PROVIDER.—The
term 
‘health care provider’ means a hospital, skilled nurs-
ing facility, nursing facility, home health entity or 
other long term care facility, health care clinic, Fed-
erally qualified health center, group practice (as de-
fined in section 1877(h)(4) of the Social Security 
Act), a pharmacist, a pharmacy, a laboratory, a phy-
sician (as defined in section 1861(r) of the Social 
Security Act), a practitioner (as described in section 
1842(b)(18)(C) of the Social Security Act), a pro-
vider operated by, or under contract with, the Indian 
Health Service or by an Indian tribe (as defined in 
the Indian Self-Determination and Education Assist-
ance Act), tribal organization, or urban Indian orga-
nization (as defined in section 4 of the Indian 
Health Care Improvement Act), a rural health clinic, 
a covered entity under section 340B, an ambulatory 
surgical center described in section 1833(i) of the 
Social Security Act, and any other category of facil-
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ity or clinician determined appropriate by the Sec-
retary. 
‘‘(4) HEALTH INFORMATION.—The term ‘health 
information’ has the meaning given such term in 
section 1171(4) of the Social Security Act. 
‘‘(5) HEALTH
INFORMATION
TECHNOLOGY.— 
The term ‘health information technology’ means 
hardware, software, integrated technologies and re-
lated licenses, intellectual property, upgrades, and 
packaged solutions sold as services that are specifi-
cally designed for use by health care entities for the 
electronic creation, maintenance, or exchange of 
health information. 
‘‘(6) HEALTH PLAN.—The term ‘health plan’ 
has the meaning given such term in section 1171(5) 
of the Social Security Act. 
‘‘(7) HIT POLICY COMMITTEE.—The term ‘HIT 
Policy Committee’ means such Committee estab-
lished under section 3002(a). 
‘‘(8) HIT STANDARDS COMMITTEE.—The term 
‘HIT Standards Committee’ means such Committee 
established under section 3003(a). 
‘‘(9) INDIVIDUALLY IDENTIFIABLE HEALTH IN-
FORMATION.—The
term
‘individually
identifiable 
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health information’ has the meaning given such term 
in section 1171(6) of the Social Security Act. 
‘‘(10)
LABORATORY.—The
term
‘laboratory’ 
has the meaning given such term in section 353(a). 
‘‘(11)
NATIONAL
COORDINATOR.—The
term 
‘National Coordinator’ means the head of the Office 
of the National Coordinator for Health Information 
Technology established under section 3001(a). 
‘‘(12)
PHARMACIST.—The
term
‘pharmacist’ 
has the meaning given such term in section 804(2) 
of the Federal Food, Drug, and Cosmetic Act. 
‘‘(13)
QUALIFIED
ELECTRONIC
HEALTH 
RECORD.—The
term
‘qualified
electronic
health 
record’ means an electronic record of health-related 
information on an individual that— 
‘‘(A)
includes
patient
demographic
and 
clinical health information, such as medical his-
tory and problem lists; and 
‘‘(B) has the capacity— 
‘‘(i) to provide clinical decision sup-
port; 
‘‘(ii) to support physician order entry; 
‘‘(iii) to capture and query informa-
tion relevant to health care quality; and 
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‘‘(iv) to exchange electronic health in-
formation with, and integrate such infor-
mation from other sources. 
‘‘(14) 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. 
‘‘Subtitle A—Promotion of Health 
Information Technology 
‘‘SEC. 3001. OFFICE OF THE NATIONAL COORDINATOR FOR 
HEALTH INFORMATION TECHNOLOGY. 
‘‘(a) ESTABLISHMENT.—There is established within 
the Department of Health and Human Services an Office 
of the National Coordinator for Health Information Tech-
nology (referred to in this section as the ‘Office’). The Of-
fice shall be headed by a National Coordinator who shall 
be appointed by the Secretary and shall report directly to 
the Secretary. 
‘‘(b) PURPOSE.—The National Coordinator shall per-
form the duties under subsection (c) in a manner con-
sistent with the development of a nationwide health infor-
mation technology infrastructure that allows for the elec-
tronic use and exchange of information and that— 
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‘‘(1) ensures that each patient’s health informa-
tion is secure and protected, in accordance with ap-
plicable law; 
‘‘(2) improves health care quality, reduces med-
ical errors, reduces health disparities, and advances 
the delivery of patient-centered medical care; 
‘‘(3) reduces health care costs resulting from 
inefficiency, medical errors, inappropriate care, du-
plicative care, and incomplete information; 
‘‘(4) provides appropriate information to help 
guide medical decisions at the time and place of 
care; 
‘‘(5) ensures the inclusion of meaningful public 
input in such development of such infrastructure; 
‘‘(6) improves the coordination of care and in-
formation among hospitals, laboratories, physician 
offices, and other entities through an effective infra-
structure for the secure and authorized exchange of 
health care information; 
‘‘(7) improves public health activities and facili-
tates the early identification and rapid response to 
public health threats and emergencies, including bio-
terror events and infectious disease outbreaks; 
‘‘(8) facilitates health and clinical research and 
health care quality; 
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‘‘(9) promotes prevention of chronic diseases; 
‘‘(10) promotes a more effective marketplace, 
greater competition, greater systems analysis, in-
creased consumer choice, and improved outcomes in 
health care services; and 
‘‘(11) improves efforts to reduce health dispari-
ties. 
‘‘(c) DUTIES OF THE NATIONAL COORDINATOR.— 
‘‘(1) STANDARDS.—The National Coordinator 
shall review and determine whether to endorse each 
standard, implementation specification, and certifi-
cation criterion for the electronic exchange and use 
of health information that is recommended by the 
HIT Standards Committee under section 3003 for 
purposes of adoption under section 3004. The Coor-
dinator shall make such determination, and report to 
the Secretary such determination, not later than 45 
days after the date the recommendation is received 
by the Coordinator. 
‘‘(2) HIT POLICY COORDINATION.— 
‘‘(A) IN GENERAL.—The National Coordi-
nator shall coordinate health information tech-
nology policy and programs of the Department 
with those of other relevant executive branch 
agencies with a goal of avoiding duplication of 
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efforts and of helping to ensure that each agen-
cy undertakes health information technology ac-
tivities primarily within the areas of its greatest 
expertise and technical capability and in a man-
ner towards a coordinated national goal. 
‘‘(B) HIT POLICY AND STANDARDS COM-
MITTEES.—The National Coordinator shall be a 
leading member in the establishment and oper-
ations of the HIT Policy Committee and the 
HIT Standards Committee and shall serve as a 
liaison among those two Committees and the 
Federal Government. 
‘‘(3) STRATEGIC PLAN.— 
‘‘(A) IN GENERAL.—The National Coordi-
nator shall, in consultation with other appro-
priate Federal agencies (including the National 
Institute of Standards and Technology), update 
the Federal Health IT Strategic Plan (devel-
oped as of June 3, 2008) to include specific ob-
jectives, milestones, and metrics with respect to 
the following: 
‘‘(i) The electronic exchange and use 
of health information and the enterprise 
integration of such information. 
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‘‘(ii) The utilization of an electronic 
health record for each person in the United 
States by 2014. 
‘‘(iii) The incorporation of privacy and 
security protections for the electronic ex-
change of an individual’s individually iden-
tifiable health information. 
‘‘(iv) Ensuring security methods to 
ensure appropriate authorization and elec-
tronic authentication of health information 
and specifying technologies or methodolo-
gies for rendering health information unus-
able, unreadable, or indecipherable. 
‘‘(v) Specifying a framework for co-
ordination and flow of recommendations 
and policies under this subtitle among the 
Secretary, the National Coordinator, the 
HIT Policy Committee, the HIT Standards 
Committee, and other health information 
exchanges and other relevant entities. 
‘‘(vi) Methods to foster the public un-
derstanding of health information tech-
nology. 
‘‘(vii) Strategies to enhance the use of 
health information technology in improving 
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the quality of health care, reducing medical 
errors, reducing health disparities, improv-
ing public health, and improving the con-
tinuity of care among health care settings. 
‘‘(B)
COLLABORATION.—The
strategic 
plan shall be updated through collaboration of 
public and private entities. 
‘‘(C)
MEASURABLE
OUTCOME
GOALS.— 
The strategic plan update shall include measur-
able outcome goals. 
‘‘(D) PUBLICATION.—The National Coor-
dinator shall republish the strategic plan, in-
cluding all updates. 
‘‘(4)
WEBSITE.—The
National
Coordinator 
shall maintain and frequently update an Internet 
website on which there is posted information on the 
work,
schedules,
reports,
recommendations,
and 
other information to ensure transparency in pro-
motion of a nationwide health information tech-
nology infrastructure. 
‘‘(5) CERTIFICATION.— 
‘‘(A) IN GENERAL.—The National Coordi-
nator, in consultation with the Director of the 
National
Institute
of
Standards
and
Tech-
nology, shall develop a program (either directly 
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or by contract) for the voluntary certification of 
health information technology as being in com-
pliance
with
applicable
certification
criteria 
adopted under this subtitle. Such program shall 
include testing of the technology in accordance 
with section 4201(b) of the HITECH Act. 
‘‘(B)
CERTIFICATION
CRITERIA
DE-
SCRIBED.—In this title, the term ‘certification 
criteria’ means, with respect to standards and 
implementation specifications for health infor-
mation technology, criteria to establish that the 
technology meets such standards and implemen-
tation specifications. 
‘‘(6) REPORTS AND PUBLICATIONS.— 
‘‘(A) REPORT
ON
ADDITIONAL
FUNDING 
OR AUTHORITY NEEDED.—Not later than 12 
months after the date of the enactment of this 
title, the National Coordinator shall submit to 
the appropriate committees of jurisdiction of 
the House of Representatives and the Senate a 
report on any additional funding or authority 
the Coordinator or the HIT Policy Committee 
or HIT Standards Committee requires to evalu-
ate
and
develop
standards,
implementation 
specifications, and certification criteria, or to 
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achieve full participation of stakeholders in the 
adoption of a nationwide health information 
technology infrastructure that allows for the 
electronic use and exchange of health informa-
tion. 
‘‘(B)
IMPLEMENTATION
REPORT.—The 
National Coordinator shall prepare a report 
that identifies lessons learned from major pub-
lic and private health care systems in their im-
plementation of health information technology, 
including information on whether the tech-
nologies and practices developed by such sys-
tems may be applicable to and usable in whole 
or in part by other health care providers. 
‘‘(C) ASSESSMENT OF IMPACT OF HIT ON 
COMMUNITIES WITH HEALTH DISPARITIES AND 
UNINSURED, UNDERINSURED, AND MEDICALLY 
UNDERSERVED AREAS.—The National Coordi-
nator shall assess and publish the impact of 
health information technology in communities 
with health disparities and in areas with a high 
proportion of individuals who are uninsured, 
underinsured, and medically underserved indi-
viduals (including urban and rural areas) and 
identify practices to increase the adoption of 
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such technology by health care providers in 
such communities. 
‘‘(D)
EVALUATION
OF
BENEFITS
AND 
COSTS
OF
THE
ELECTRONIC
USE
AND
EX-
CHANGE OF HEALTH INFORMATION.—The Na-
tional Coordinator shall evaluate and publish 
evidence on the benefits and costs of the elec-
tronic use and exchange of health information 
and assess to whom these benefits and costs ac-
crue. 
‘‘(E)
RESOURCE
REQUIREMENTS.—The 
National Coordinator shall estimate and publish 
resources required annually to reach the goal of 
utilization of an electronic health record for 
each person in the United States by 2014, in-
cluding the required level of Federal funding, 
expectations for regional, State, and private in-
vestment, and the expected contributions by vol-
unteers to activities for the utilization of such 
records. 
‘‘(7) ASSISTANCE.—The National Coordinator 
may provide financial assistance to consumer advo-
cacy groups and not-for-profit entities that work in 
the public interest for purposes of defraying the cost 
to such groups and entities to participate under, 
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whether in whole or in part, the National Tech-
nology Transfer Act of 1995 (15 U.S.C. 272 note). 
‘‘(8) GOVERNANCE FOR NATIONWIDE HEALTH 
INFORMATION
NETWORK.—The
National
Coordi-
nator shall establish a governance mechanism for the 
nationwide health information network. 
‘‘(d) DETAIL OF FEDERAL EMPLOYEES.— 
‘‘(1) IN GENERAL.—Upon the request of the 
National Coordinator, the head of any Federal agen-
cy is authorized to detail, with or without reimburse-
ment from the Office, any of the personnel of such 
agency to the Office to assist it in carrying out its 
duties under this section. 
‘‘(2) EFFECT OF DETAIL.—Any detail of per-
sonnel under paragraph (1) shall— 
‘‘(A) not interrupt or otherwise affect the 
civil service status or privileges of the Federal 
employee; and 
‘‘(B) be in addition to any other staff of 
the Department employed by the National Co-
ordinator. 
‘‘(3) ACCEPTANCE
OF
DETAILEES.—Notwith-
standing any other provision of law, the Office may 
accept detailed personnel from other Federal agen-
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cies without regard to whether the agency described 
under paragraph (1) is reimbursed. 
‘‘(e) CHIEF PRIVACY OFFICER OF THE OFFICE OF 
THE
NATIONAL
COORDINATOR.—Not
later
than
months after the date of the enactment of this title, the 
Secretary shall appoint a Chief Privacy Officer of the Of-
fice of the National Coordinator, whose duty it shall be 
to advise the National Coordinator on privacy, security, 
and data stewardship of electronic health information and 
to coordinate with other Federal agencies (and similar pri-
vacy officers in such agencies), with State and regional 
efforts, and with foreign countries with regard to the pri-
vacy, security, and data stewardship of electronic individ-
ually identifiable health information. 
‘‘SEC. 3002. HIT POLICY COMMITTEE. 
‘‘(a) ESTABLISHMENT.—There is established a HIT 
Policy Committee to make policy recommendations to the 
National Coordinator relating to the implementation of a 
nationwide health information technology infrastructure, 
including implementation of the strategic plan described 
in section 3001(c)(3). 
‘‘(b) DUTIES.— 
‘‘(1) RECOMMENDATIONS ON HEALTH INFOR-
MATION TECHNOLOGY INFRASTRUCTURE.—The HIT 
Policy Committee shall recommend a policy frame-
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work for the development and adoption of a nation-
wide health information technology infrastructure 
that permits the electronic exchange and use of 
health information as is consistent with the strategic 
plan under section 3001(c)(3) and that includes the 
recommendations under paragraph (2). The Com-
mittee shall update such recommendations and make 
new recommendations as appropriate. 
‘‘(2) SPECIFIC AREAS OF STANDARD DEVELOP-
MENT.— 
‘‘(A) IN GENERAL.—The HIT Policy Com-
mittee shall recommend the areas in which 
standards, implementation specifications, and 
certification criteria are needed for the elec-
tronic exchange and use of health information 
for purposes of adoption under section 3004 
and shall recommend an order of priority for 
the development, harmonization, and recogni-
tion of such standards, specifications, and cer-
tification
criteria
among
the
areas
so
rec-
ommended. Such standards and implementation 
specifications shall include named standards, 
architectures, and software schemes for the au-
thentication and security of individually identifi-
able health information and other information 
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as needed to ensure the reproducible develop-
ment of common solutions across disparate en-
tities. 
‘‘(B) AREAS
REQUIRED
FOR
CONSIDER-
ATION.—For purposes of subparagraph (A), the 
HIT Policy Committee shall make recommenda-
tions for at least the following areas: 
‘‘(i) Technologies that protect the pri-
vacy of health information and promote se-
curity
in
a
qualified
electronic
health 
record, including for the segmentation and 
protection from disclosure of specific and 
sensitive individually identifiable health in-
formation with the goal of minimizing the 
reluctance of patients to seek care (or dis-
close information about a condition) be-
cause of privacy concerns, in accordance 
with applicable law, and for the use and 
disclosure of limited data sets of such in-
formation. 
‘‘(ii) A nationwide health information 
technology infrastructure that allows for 
the electronic use and accurate exchange of 
health information. 
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‘‘(iii) The utilization of a certified 
electronic health record for each person in 
the United States by 2014. 
‘‘(iv) Technologies that as a part of a 
qualified electronic health record allow for 
an accounting of disclosures made by a 
covered entity (as defined for purposes of 
regulations
promulgated
under
section 
264(c) of the Health Insurance Portability 
and Accountability Act of 1996) for pur-
poses of treatment, payment, and health 
care operations (as such terms are defined 
for purposes of such regulations). 
‘‘(v) The use of certified electronic 
health records to improve the quality of 
health care, such as by promoting the co-
ordination of health care and improving 
continuity of health care among health 
care providers, by reducing medical errors, 
by improving population health, by reduc-
ing health disparities, and by advancing re-
search and education. 
‘‘(vi) Technologies that allow individ-
ually identifiable health information to be 
rendered unusable, unreadable, or indeci-
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pherable to unauthorized individuals when 
such information is transmitted in the na-
tionwide health information network or 
physically transported outside of the se-
cured, physical perimeter of a health care 
provider, health plan, or health care clear-
inghouse. 
‘‘(C)
OTHER
AREAS
FOR
CONSIDER-
ATION.—In
making
recommendations
under 
subparagraph (A), the HIT Policy Committee 
may consider the following additional areas: 
‘‘(i) The appropriate uses of a nation-
wide health information infrastructure, in-
cluding for purposes of— 
‘‘(I) the collection of quality data 
and public reporting; 
‘‘(II) biosurveillance and public 
health; 
‘‘(III) medical and clinical re-
search; and 
‘‘(IV) drug safety. 
‘‘(ii) Self-service technologies that fa-
cilitate the use and exchange of patient in-
formation and reduce wait times. 
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‘‘(iii)
Telemedicine
technologies,
in 
order to reduce travel requirements for pa-
tients in remote areas. 
‘‘(iv) Technologies that facilitate home 
health care and the monitoring of patients 
recuperating at home. 
‘‘(v) Technologies that help reduce 
medical errors. 
‘‘(vi) Technologies that facilitate the 
continuity of care among health settings. 
‘‘(vii)
Technologies
that
meet
the 
needs of diverse populations. 
‘‘(viii) Any other technology that the 
HIT Policy Committee finds to be among 
the technologies with the greatest potential 
to improve the quality and efficiency of 
health care. 
‘‘(3) FORUM.—The HIT Policy Committee shall 
serve as a forum for broad stakeholder input with 
specific expertise in policies relating to the matters 
described in paragraphs (1) and (2). 
‘‘(c) MEMBERSHIP AND OPERATIONS.— 
‘‘(1) IN GENERAL.—The National Coordinator 
shall provide leadership in the establishment and op-
erations of the HIT Policy Committee. 
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‘‘(2) MEMBERSHIP.—The membership of the 
HIT Policy Committee shall at least reflect pro-
viders, ancillary healthcare workers, consumers, pur-
chasers, health plans, technology vendors, research-
ers, relevant Federal agencies, and individuals with 
technical expertise on health care quality, privacy 
and security, and on the electronic exchange and use 
of health information. 
‘‘(3) CONSIDERATION.—The National Coordi-
nator shall ensure that the relevant recommenda-
tions and comments from the National Committee 
on Vital and Health Statistics are considered in the 
development of policies. 
‘‘(d) APPLICATION OF FACA.—The Federal Advisory 
Committee Act (5 U.S.C. App.), other than section 14 of 
such Act, shall apply to the HIT Policy Committee. 
‘‘(e) PUBLICATION.—The Secretary shall provide for 
publication in the Federal Register and the posting on the 
Internet website of the Office of the National Coordinator 
for Health Information Technology of all policy rec-
ommendations made by the HIT Policy Committee under 
this section. 
‘‘SEC. 3003. HIT STANDARDS COMMITTEE. 
‘‘(a) ESTABLISHMENT.—There is established a com-
mittee to be known as the HIT Standards Committee to 
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recommend to the National Coordinator standards, imple-
mentation specifications, and certification criteria for the 
electronic exchange and use of health information for pur-
poses of adoption under section 3004, consistent with the 
implementation of the strategic plan described in section 
3001(c)(3) and beginning with the areas listed in section 
3002(b)(2)(B) in accordance with policies developed by 
the HIT Policy Committee. 
‘‘(b) DUTIES.— 
‘‘(1) STANDARDS DEVELOPMENT.— 
‘‘(A) IN GENERAL.—The HIT Standards 
Committee shall recommend to the National 
Coordinator standards, implementation speci-
fications, and certification criteria described in 
subsection (a) that have been developed, har-
monized, or recognized by the HIT Standards 
Committee.
The
HIT
Standards
Committee 
shall update such recommendations and make 
new recommendations as appropriate, including 
in response to a notification sent under section 
3004(a)(2)(B). Such recommendations shall be 
consistent
with
the
latest
recommendations 
made by the HIT Policy Committee. 
‘‘(B) PILOT TESTING OF STANDARDS AND 
IMPLEMENTATION SPECIFICATIONS.—In the de-
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velopment,
harmonization,
or
recognition
of 
standards
and
implementation
specifications, 
the HIT Standards Committee shall, as appro-
priate, provide for the testing of such standards 
and specifications by the National Institute for 
Standards
and
Technology
under
section 
4201(a) of the HITECH Act. 
‘‘(C) CONSISTENCY.—The standards, im-
plementation
specifications,
and
certification 
criteria
recommended
under
this
subsection 
shall be consistent with the standards for infor-
mation transactions and data elements adopted 
pursuant to section 1173 of the Social Security 
Act. 
‘‘(2) FORUM.—The HIT Standards Committee 
shall serve as a forum for the participation of a 
broad range of stakeholders to provide input on the 
development,
harmonization,
and
recognition
of 
standards, implementation specifications, and certifi-
cation criteria necessary for the development and 
adoption of a nationwide health information tech-
nology infrastructure that allows for the electronic 
use and exchange of health information. 
‘‘(3) SCHEDULE.—Not later than 90 days after 
the date of the enactment of this title, the HIT 
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Standards Committee shall develop a schedule for 
the assessment of policy recommendations developed 
by the HIT Policy Committee under section 3002. 
The HIT Standards Committee shall update such 
schedule annually. The Secretary shall publish such 
schedule in the Federal Register. 
‘‘(4)
PUBLIC
INPUT.—The
HIT
Standards 
Committee shall conduct open public meetings and 
develop a process to allow for public comment on the 
schedule
described
in
paragraph
(3)
and
rec-
ommendations described in this subsection. Under 
such process comments shall be submitted in a time-
ly manner after the date of publication of a rec-
ommendation under this subsection. 
‘‘(c) MEMBERSHIP AND OPERATIONS.— 
‘‘(1) IN GENERAL.—The National Coordinator 
shall provide leadership in the establishment and op-
erations of the HIT Standards Committee. 
‘‘(2) MEMBERSHIP.—The membership of the 
HIT Standards Committee shall at least reflect pro-
viders, ancillary healthcare workers, consumers, pur-
chasers, health plans, technology vendors, research-
ers, relevant Federal agencies, and individuals with 
technical expertise on health care quality, privacy 
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and security, and on the electronic exchange and use 
of health information. 
‘‘(3) CONSIDERATION.—The National Coordi-
nator shall ensure that the relevant recommenda-
tions and comments from the National Committee 
on Vital and Health Statistics are considered in the 
development of standards. 
‘‘(4) ASSISTANCE.—For the purposes of car-
rying out this section, the Secretary may provide or 
ensure that financial assistance is provided by the 
HIT Standards Committee to defray in whole or in 
part any membership fees or dues charged by such 
Committee to those consumer advocacy groups and 
not for profit entities that work in the public inter-
est as a part of their mission. 
‘‘(d) APPLICATION OF FACA.—The Federal Advisory 
Committee Act (5 U.S.C. App.), other than section 14, 
shall apply to the HIT Standards Committee. 
‘‘(e) PUBLICATION.—The Secretary shall provide for 
publication in the Federal Register and the posting on the 
Internet website of the Office of the National Coordinator 
for Health Information Technology of all recommenda-
tions made by the HIT Standards Committee under this 
section. 
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‘‘SEC. 3004. PROCESS FOR ADOPTION OF ENDORSED REC-
OMMENDATIONS; ADOPTION OF INITIAL SET 
OF
STANDARDS,
IMPLEMENTATION
SPECI-
FICATIONS, AND CERTIFICATION CRITERIA. 
‘‘(a) PROCESS FOR ADOPTION OF ENDORSED REC-
OMMENDATIONS.— 
‘‘(1) REVIEW OF ENDORSED STANDARDS, IM-
PLEMENTATION
SPECIFICATIONS,
AND
CERTIFI-
CATION CRITERIA.—Not later than 90 days after the 
date of receipt of standards, implementation speci-
fications, or certification criteria endorsed under sec-
tion 3001(c), the Secretary, in consultation with rep-
resentatives of other relevant Federal agencies, shall 
jointly review such standards, implementation speci-
fications, or certification criteria and shall determine 
whether or not to propose adoption of such stand-
ards, implementation specifications, or certification 
criteria. 
‘‘(2) DETERMINATION TO ADOPT STANDARDS, 
IMPLEMENTATION
SPECIFICATIONS,
AND
CERTIFI-
CATION CRITERIA.—If the Secretary determines— 
‘‘(A) to propose adoption of any grouping 
of such standards, implementation specifica-
tions, or certification criteria, the Secretary 
shall, by regulation, determine whether or not 
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to adopt such grouping of standards, implemen-
tation specifications, or certification criteria; or 
‘‘(B) not to propose adoption of any group-
ing of standards, implementation specifications, 
or certification criteria, the Secretary shall no-
tify the National Coordinator and the HIT 
Standards Committee in writing of such deter-
mination and the reasons for not proposing the 
adoption of such recommendation. 
‘‘(3) PUBLICATION.—The Secretary shall pro-
vide for publication in the Federal Register of all de-
terminations made by the Secretary under para-
graph (1). 
‘‘(b) ADOPTION OF INITIAL SET OF STANDARDS, IM-
PLEMENTATION SPECIFICATIONS,
AND CERTIFICATION 
CRITERIA.— 
‘‘(1) IN GENERAL.—Not later than December 
31, 2009, the Secretary shall, through the rule-
making process described in section 3004(a), adopt 
an initial set of standards, implementation specifica-
tions, and certification criteria for the areas required 
for consideration under section 3002(b)(2)(B). 
‘‘(2) APPLICATION
OF
CURRENT
STANDARDS, 
IMPLEMENTATION
SPECIFICATIONS,
AND
CERTIFI-
CATION CRITERIA.—The standards, implementation 
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specifications, and certification criteria adopted be-
fore the date of the enactment of this title through 
the process existing through the Office of the Na-
tional Coordinator for Health Information Tech-
nology may be applied towards meeting the require-
ment of paragraph (1). 
‘‘SEC. 3005. APPLICATION AND USE OF ADOPTED STAND-
ARDS
AND
IMPLEMENTATION
SPECIFICA-
TIONS BY FEDERAL AGENCIES. 
‘‘For requirements relating to the application and use 
by Federal agencies of the standards and implementation 
specifications adopted under section 3004, see section 
4111 of the HITECH Act. 
‘‘SEC. 3006. VOLUNTARY APPLICATION AND USE OF ADOPT-
ED
STANDARDS
AND
IMPLEMENTATION 
SPECIFICATIONS BY PRIVATE ENTITIES. 
‘‘(a) IN GENERAL.—Except as provided under section 
4112 of the HITECH Act, any standard or implementa-
tion specification adopted under section 3004 shall be vol-
untary with respect to private entities. 
‘‘(b) RULE OF CONSTRUCTION.—Nothing in this sub-
title shall be construed to require that a private entity that 
enters into a contract with the Federal Government apply 
or use the standards and implementation specifications 
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adopted under section 3004 with respect to activities not 
related to the contract. 
‘‘SEC.
3007.
FEDERAL
HEALTH
INFORMATION
TECH-
NOLOGY. 
‘‘(a) IN GENERAL.—The National Coordinator shall 
support the development, routine updating, and provision 
of qualified EHR technology (as defined in section 3000) 
consistent with subsections (b) and (c) unless the Sec-
retary determines that the needs and demands of pro-
viders are being substantially and adequately met through 
the marketplace. 
‘‘(b) CERTIFICATION.—In making such EHR tech-
nology publicly available, the National Coordinator shall 
ensure that the qualified EHR technology described in 
subsection (a) is certified under the program developed 
under section 3001(c)(3) to be in compliance with applica-
ble standards adopted under section 3003(a). 
‘‘(c)
AUTHORIZATION
TO
CHARGE
A
NOMINAL 
FEE.—The National Coordinator may impose a nominal 
fee for the adoption by a health care provider of the health 
information technology system developed or approved 
under subsection (a) and (b). Such fee shall take into ac-
count the financial circumstances of smaller providers, low 
income providers, and providers located in rural or other 
medically underserved areas. 
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‘‘(d) RULE OF CONSTRUCTION.—Nothing in this sec-
tion shall be construed to require that a private or govern-
ment entity adopt or use the technology provided under 
this section. 
‘‘SEC. 3008. TRANSITIONS. 
‘‘(a) ONCHIT.—To the extent consistent with sec-
tion 3001, all functions, personnel, assets, liabilities, and 
administrative actions applicable to the National Coordi-
nator for Health Information Technology appointed under 
Executive Order No. 13335 or the Office of such National 
Coordinator on the date before the date of the enactment 
of this title shall be transferred to the National Coordi-
nator appointed under section 3001(a) and the Office of 
such National Coordinator as of the date of the enactment 
of this title. 
‘‘(b) AHIC.— 
‘‘(1) To the extent consistent with sections 
3002 and 3003, all functions, personnel, assets, and 
liabilities applicable to the AHIC Successor, Inc. 
doing business as the National eHealth Collaborative 
as of the day before the date of the enactment of 
this title shall be transferred to the HIT Policy 
Committee or the HIT Standards Committee, estab-
lished under section 3002(a) or 3003(a), as appro-
priate, as of the date of the enactment of this title. 
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‘‘(2) In carrying out section 3003(b)(1)(A), 
until recommendations are made by the HIT Policy 
Committee, recommendations of the HIT Standards 
Committee shall be consistent with the most recent 
recommendations made by such AHIC Successor, 
Inc. 
‘‘(c) RULES OF CONSTRUCTION.— 
‘‘(1) ONCHIT.—Nothing in section 3001 or 
subsection (a) shall be construed as requiring the 
creation of a new entity to the extent that the Office 
of the National Coordinator for Health Information 
Technology established pursuant to Executive Order 
No. 13335 is consistent with the provisions of sec-
tion 3001. 
‘‘(2) AHIC.—Nothing in sections 3002 or 3003 
or subsection (b) shall be construed as prohibiting 
the AHIC Successor, Inc. doing business as the Na-
tional eHealth Collaborative from modifying its char-
ter, duties, membership, and any other structure or 
function required to be consistent with section 3002 
and 3003 in a manner that would permit the Sec-
retary to choose to recognize such AHIC Successor, 
Inc. as the HIT Policy Committee or the HIT 
Standards Committee. 
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‘‘SEC. 3009. RELATION TO HIPAA PRIVACY AND SECURITY 
LAW. 
‘‘(a) IN GENERAL.—With respect to the relation of 
this title to HIPAA privacy and security law: 
‘‘(1) This title may not be construed as having 
any effect on the authorities of the Secretary under 
HIPAA privacy and security law. 
‘‘(2) The purposes of this title include ensuring 
that the health information technology standards 
and implementation specifications adopted under 
section 3004 take into account the requirements of 
HIPAA privacy and security law. 
‘‘(b) DEFINITION.—For purposes of this section, the 
term ‘HIPAA privacy and security law’ means— 
‘‘(1) the provisions of part C of title XI of the 
Social Security Act, section 264 of the Health Insur-
ance Portability and Accountability Act of 1996, and 
subtitle D of title IV of the HITECH Act; and 
‘‘(2) regulations under such provisions. 
‘‘SEC. 3010. AUTHORIZATION FOR APPROPRIATIONS. 
‘‘There is authorized to be appropriated to the Office 
of the National Coordinator for Health Information Tech-
nology to carry out this subtitle $250,000,000 for fiscal 
year 2009.’’. 
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SEC. 4102. TECHNICAL AMENDMENT. 
Section 1171(5) of the Social Security Act (42 U.S.C. 
1320d) is amended by striking ‘‘or C’’ and inserting ‘‘C, 
or D’’. 
PART II—APPLICATION AND USE OF ADOPTED 
HEALTH
INFORMATION
TECHNOLOGY 
STANDARDS; REPORTS 
SEC. 4111. COORDINATION OF FEDERAL ACTIVITIES WITH 
ADOPTED
STANDARDS
AND
IMPLEMENTA-
TION SPECIFICATIONS. 
(a) SPENDING
ON HEALTH INFORMATION TECH-
NOLOGY SYSTEMS.—As each agency (as defined in the Ex-
ecutive order issued on August 22, 2006, relating to pro-
moting quality and efficient health care in Federal govern-
ment administered or sponsored health care programs) im-
plements, acquires, or upgrades health information tech-
nology systems used for the direct exchange of individually 
identifiable health information between agencies and with 
non-Federal entities, it shall utilize, where available, 
health information technology systems and products that 
meet standards and implementation specifications adopted 
under section 3004 of the Public Health Service Act, as 
added by section 4101. 
(b) FEDERAL INFORMATION COLLECTION ACTIVI-
TIES.—With respect to a standard or implementation 
specification adopted under section 3004 of the Public 
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Health Service Act, as added by section 4101, the Presi-
dent shall take measures to ensure that Federal activities 
involving the broad collection and submission of health in-
formation are consistent with such standard or implemen-
tation specification, respectively, within three years after 
the date of such adoption. 
(c) APPLICATION OF DEFINITIONS.—The definitions 
contained in section 3000 of the Public Health Service 
Act, as added by section 4101, shall apply for purposes 
of this part. 
SEC. 4112. APPLICATION TO PRIVATE ENTITIES. 
Each agency (as defined in such Executive Order 
issued on August 22, 2006, relating to promoting quality 
and efficient health care in Federal government adminis-
tered or sponsored health care programs) shall require in 
contracts or agreements with health care providers, health 
plans, or health insurance issuers that as each provider, 
plan, or issuer implements, acquires, or upgrades health 
information technology systems, it shall utilize, where 
available, health information technology systems and prod-
ucts that meet standards and implementation specifica-
tions adopted under section 3004 of the Public Health 
Service Act, as added by section 4101. 
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SEC. 4113. STUDY AND REPORTS. 
(a) REPORT ON ADOPTION OF NATIONWIDE SYS-
TEM.—Not later than 2 years after the date of the enact-
ment of this Act and annually thereafter, the Secretary 
of Health and Human Services shall submit to the appro-
priate committees of jurisdiction of the House of Rep-
resentatives and the Senate a report that— 
(1) describes the specific actions that have been 
taken by the Federal Government and private enti-
ties to facilitate the adoption of a nationwide system 
for the electronic use and exchange of health infor-
mation; 
(2) describes barriers to the adoption of such a 
nationwide system; and 
(3) contains recommendations to achieve full 
implementation of such a nationwide system. 
(b) REIMBURSEMENT INCENTIVE STUDY AND RE-
PORT.— 
(1)
STUDY.—The
Secretary
of
Health
and 
Human Services shall carry out, or contract with a 
private entity to carry out, a study that examines 
methods to create efficient reimbursement incentives 
for improving health care quality in Federally quali-
fied health centers, rural health clinics, and free 
clinics. 
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(2) REPORT.—Not later than 2 years after the 
date of the enactment of this Act, the Secretary of 
Health and Human Services shall submit to the ap-
propriate committees of jurisdiction of the House of 
Representatives and the Senate a report on the 
study carried out under paragraph (1). 
(c) AGING SERVICES TECHNOLOGY STUDY AND RE-
PORT.— 
(1) IN GENERAL.—The Secretary of Health and 
Human Services shall carry out, or contract with a 
private entity to carry out, a study of matters relat-
ing to the potential use of new aging services tech-
nology to assist seniors, individuals with disabilities, 
and their caregivers throughout the aging process. 
(2) MATTERS
TO
BE
STUDIED.—The study 
under paragraph (1) shall include— 
(A) an evaluation of— 
(i) methods for identifying current, 
emerging, and future health technology 
that can be used to meet the needs of sen-
iors and individuals with disabilities and 
their caregivers across all aging services 
settings, as specified by the Secretary; 
(ii) methods for fostering scientific in-
novation with respect to aging services 
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technology within the business and aca-
demic communities; and 
(iii) developments in aging services 
technology in other countries that may be 
applied in the United States; and 
(B) identification of— 
(i) barriers to innovation in aging 
services technology and devising strategies 
for removing such barriers; and 
(ii) barriers to the adoption of aging 
services technology by health care pro-
viders and consumers and devising strate-
gies to removing such barriers. 
(3) REPORT.—Not later than 24 months after 
the date of the enactment of this Act, the Secretary 
shall submit to the appropriate committees of juris-
diction of the House of Representatives and of the 
Senate a report on the study carried out under para-
graph (1). 
(4) DEFINITIONS.—For purposes of this sub-
section: 
(A) AGING SERVICES TECHNOLOGY.—The 
term ‘‘aging services technology’’ means health 
technology that meets the health care needs of 
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seniors, individuals with disabilities, and the 
caregivers of such seniors and individuals. 
(B) SENIOR.—The term ‘‘senior’’ has such 
meaning as specified by the Secretary. 
Subtitle B—Testing of Health 
Information Technology 
SEC.
4201.
NATIONAL
INSTITUTE
FOR
STANDARDS
AND 
TECHNOLOGY TESTING. 
(a) PILOT TESTING OF STANDARDS AND IMPLEMEN-
TATION SPECIFICATIONS.—In coordination with the HIT 
Standards Committee established under section 3003 of 
the Public Health Service Act, as added by section 4101, 
with respect to the development of standards and imple-
mentation specifications under such section, the Director 
of the National Institute for Standards and Technology 
shall test such standards and implementation specifica-
tions, as appropriate, in order to assure the efficient im-
plementation and use of such standards and implementa-
tion specifications. 
(b) VOLUNTARY TESTING PROGRAM.—In coordina-
tion with the HIT Standards Committee established under 
section 3003 of the Public Health Service Act, as added 
by section 4101, with respect to the development of stand-
ards and implementation specifications under such sec-
tion, the Director of the National Institute of Standards 
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and Technology shall support the establishment of a con-
formance testing infrastructure, including the develop-
ment of technical test beds. The development of this con-
formance testing infrastructure may include a program to 
accredit independent, non-Federal laboratories to perform 
testing. 
SEC. 4202. RESEARCH AND DEVELOPMENT PROGRAMS. 
(a) HEALTH CARE INFORMATION ENTERPRISE INTE-
GRATION RESEARCH CENTERS.— 
(1) IN GENERAL.—The Director of the National 
Institute of Standards and Technology, in consulta-
tion with the Director of the National Science Foun-
dation and other appropriate Federal agencies, shall 
establish a program of assistance to institutions of 
higher education (or consortia thereof which may in-
clude nonprofit entities and Federal Government 
laboratories) to establish multidisciplinary Centers 
for Health Care Information Enterprise Integration. 
(2) REVIEW;
COMPETITION.—Grants shall be 
awarded under this subsection on a merit-reviewed, 
competitive basis. 
(3) PURPOSE.—The purposes of the Centers de-
scribed in paragraph (1) shall be— 
(A) to generate innovative approaches to 
health care information enterprise integration 
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by
conducting
cutting-edge,
multidisciplinary 
research on the systems challenges to health 
care delivery; and 
(B) the development and use of health in-
formation technologies and other complemen-
tary fields. 
(4) RESEARCH AREAS.—Research areas may in-
clude— 
(A) interfaces between human information 
and communications technology systems; 
(B) voice-recognition systems; 
(C) software that improves interoperability 
and connectivity among health information sys-
tems; 
(D) software dependability in systems crit-
ical to health care delivery; 
(E) measurement of the impact of informa-
tion technologies on the quality and productivity 
of health care; 
(F) health information enterprise manage-
ment; 
(G) health information technology security 
and integrity; and 
(H) relevant health information technology 
to reduce medical errors. 
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(5) APPLICATIONS.—An institution of higher 
education (or a consortium thereof) seeking funding 
under this subsection shall submit an application to 
the Director of the National Institute of Standards 
and Technology at such time, in such manner, and 
containing such information as the Director may re-
quire. The application shall include, at a minimum, 
a description of— 
(A) the research projects that will be un-
dertaken by the Center established pursuant to 
assistance under paragraph (1) and the respec-
tive contributions of the participating entities; 
(B) how the Center will promote active col-
laboration among scientists and engineers from 
different disciplines, such as information tech-
nology, biologic sciences, management, social 
sciences, and other appropriate disciplines; 
(C) technology transfer activities to dem-
onstrate and diffuse the research results, tech-
nologies, and knowledge; and 
(D) how the Center will contribute to the 
education and training of researchers and other 
professionals in fields relevant to health infor-
mation enterprise integration. 
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(b)
NATIONAL
INFORMATION
TECHNOLOGY
RE-
SEARCH AND DEVELOPMENT PROGRAM.—The National 
High-Performance Computing Program established by 
section 101 of the High-Performance Computing Act of 
1991 (15 U.S.C. 5511) shall coordinate Federal research 
and development programs related to the development and 
deployment of health information technology, including ac-
tivities related to— 
(1) computer infrastructure; 
(2) data security; 
(3) development of large-scale, distributed, reli-
able computing systems; 
(4) wired, wireless, and hybrid high-speed net-
working; 
(5) development of software and software-inten-
sive systems; 
(6) human-computer interaction and informa-
tion management technologies; and 
(7) the social and economic implications of in-
formation technology. 
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Subtitle C—Incentives for the Use 
of Health Information Technology 
PART I—GRANTS AND LOANS FUNDING 
SEC.
4301.
GRANT,
LOAN,
AND
DEMONSTRATION
PRO-
GRAMS. 
Title XXX of the Public Health Service Act, as added 
by section 4101, is amended by adding at the end the fol-
lowing new subtitle: 
‘‘Subtitle B—Incentives for the Use 
of Health Information Technology 
‘‘SEC. 3011. IMMEDIATE FUNDING TO STRENGTHEN THE 
HEALTH INFORMATION TECHNOLOGY INFRA-
STRUCTURE. 
‘‘(a)
IN
GENERAL.—The
Secretary
shall,
using 
amounts appropriated under section 3018, invest in the 
infrastructure necessary to allow for and promote the elec-
tronic exchange and use of health information for each 
individual in the United States consistent with the goals 
outlined in the strategic plan developed by the National 
Coordinator (and as available) under section 3001. To the 
greatest extent practicable, the Secretary shall ensure that 
any funds so appropriated shall be used for the acquisition 
of health information technology that meets standards and 
certification criteria adopted before the date of the enact-
ment of this title until such date as the standards are 
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adopted under section 3004. The Secretary shall invest 
funds through the different agencies with expertise in such 
goals, such as the Office of the National Coordinator for 
Health Information Technology, the Health Resources and 
Services Administration, the Agency for Healthcare Re-
search and Quality, the Centers of Medicare & Medicaid 
Services, the Centers for Disease Control and Prevention, 
and the Indian Health Service to support the following: 
‘‘(1) Health information technology architecture 
that will support the nationwide electronic exchange 
and use of health information in a secure, private, 
and accurate manner, including connecting health 
information exchanges, and which may include up-
dating and implementing the infrastructure nec-
essary within different agencies of the Department 
of Health and Human Services to support the elec-
tronic use and exchange of health information. 
‘‘(2) Development and adoption of appropriate 
certified electronic health records for categories of 
providers, as defined in section 3000, not eligible for 
support under title XVIII or XIX of the Social Secu-
rity Act for the adoption of such records. 
‘‘(3) Training on and dissemination of informa-
tion on best practices to integrate health information 
technology, including electronic health records, into 
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a provider’s delivery of care, consistent with best 
practices learned from the Health Information Tech-
nology Research Center developed under section 
3012(b), including community health centers receiv-
ing assistance under section 330, covered entities 
under section 340B, and providers participating in 
one or more of the programs under titles XVIII, 
XIX, and XXI of the Social Security Act (relating 
to Medicare, Medicaid, and the State Children’s 
Health Insurance Program). 
‘‘(4) Infrastructure and tools for the promotion 
of telemedicine, including coordination among Fed-
eral agencies in the promotion of telemedicine. 
‘‘(5) Promotion of the interoperability of clinical 
data repositories or registries. 
‘‘(6) Promotion of technologies and best prac-
tices that enhance the protection of health informa-
tion by all holders of individually identifiable health 
information. 
‘‘(7) Improvement and expansion of the use of 
health information technology by public health de-
partments. 
‘‘(8) Provision of $300 million to support re-
gional or sub-national efforts towards health infor-
mation exchange. 
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‘‘(b) COORDINATION.—The Secretary shall ensure 
funds under this section are used in a coordinated manner 
with other health information promotion activities. 
‘‘(c) ADDITIONAL USE OF FUNDS.—In addition to 
using funds as provided in subsection (a), the Secretary 
may use amounts appropriated under section 3018 to 
carry out health information technology activities that are 
provided for under laws in effect on the date of the enact-
ment of this title. 
‘‘SEC. 3012. HEALTH INFORMATION TECHNOLOGY IMPLE-
MENTATION ASSISTANCE. 
‘‘(a) HEALTH INFORMATION TECHNOLOGY EXTEN-
SION PROGRAM.—To assist health care providers to adopt, 
implement, and effectively use certified EHR technology 
that allows for the electronic exchange and use of health 
information, the Secretary, acting through the Office of 
the National Coordinator, shall establish a health informa-
tion technology extension program to provide health infor-
mation technology assistance services to be carried out 
through the Department of Health and Human Services. 
The National Coordinator shall consult with other Federal 
agencies with demonstrated experience and expertise in in-
formation technology services, such as the National Insti-
tute of Standards and Technology, in developing and im-
plementing this program. 
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‘‘(b)
HEALTH
INFORMATION
TECHNOLOGY
RE-
SEARCH CENTER.— 
‘‘(1) IN GENERAL.—The Secretary shall create 
a Health Information Technology Research Center 
(in this section referred to as the ‘Center’) to pro-
vide technical assistance and develop or recognize 
best practices to support and accelerate efforts to 
adopt, implement, and effectively utilize health infor-
mation technology that allows for the electronic ex-
change and use of information in compliance with 
standards, implementation specifications, and certifi-
cation criteria adopted under section 3004. 
‘‘(2)
INPUT.—The
Center
shall
incorporate 
input from— 
‘‘(A) other Federal agencies with dem-
onstrated experience and expertise in informa-
tion technology services such as the National 
Institute of Standards and Technology; 
‘‘(B) users of health information tech-
nology, such as providers and their support and 
clerical staff and others involved in the care and 
care coordination of patients, from the health 
care and health information technology indus-
try; and 
‘‘(C) others as appropriate. 
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‘‘(3) PURPOSES.—The purposes of the Center 
are to— 
‘‘(A) provide a forum for the exchange of 
knowledge and experience; 
‘‘(B) accelerate the transfer of lessons 
learned from existing public and private sector 
initiatives, including those currently receiving 
Federal financial support; 
‘‘(C) assemble, analyze, and widely dis-
seminate evidence and experience related to the 
adoption, implementation, and effective use of 
health information technology that allows for 
the electronic exchange and use of information 
including through the regional centers described 
in subsection (c); 
‘‘(D) provide technical assistance for the 
establishment and evaluation of regional and 
local health information networks to facilitate 
the electronic exchange of information across 
health care settings and improve the quality of 
health care; 
‘‘(E) provide technical assistance for the 
development and dissemination of solutions to 
barriers to the exchange of electronic health in-
formation; and 
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‘‘(F) learn about effective strategies to 
adopt and utilize health information technology 
in medically underserved communities. 
‘‘(c)
HEALTH
INFORMATION
TECHNOLOGY
RE-
GIONAL EXTENSION CENTERS.— 
‘‘(1) IN GENERAL.—The Secretary shall provide 
assistance for the creation and support of regional 
centers (in this subsection referred to as ‘regional 
centers’) to provide technical assistance and dissemi-
nate best practices and other information learned 
from the Center to support and accelerate efforts to 
adopt, implement, and effectively utilize health infor-
mation technology that allows for the electronic ex-
change and use of information in compliance with 
standards, implementation specifications, and certifi-
cation criteria adopted under section 3004. Activities 
conducted under this subsection shall be consistent 
with the strategic plan developed by the National 
Coordinator, (and, as available) under section 3001. 
‘‘(2) AFFILIATION.—Regional centers shall be 
affiliated with any United States-based nonprofit in-
stitution or organization, or group thereof, that ap-
plies and is awarded financial assistance under this 
section. Individual awards shall be decided on the 
basis of merit. 
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‘‘(3) OBJECTIVE.—The objective of the regional 
centers is to enhance and promote the adoption of 
health information technology through— 
‘‘(A) assistance with the implementation, 
effective use, upgrading, and ongoing mainte-
nance of health information technology, includ-
ing electronic health records, to healthcare pro-
viders nationwide; 
‘‘(B)
broad
participation
of
individuals 
from industry, universities, and State govern-
ments; 
‘‘(C) active dissemination of best practices 
and research on the implementation, effective 
use, upgrading, and ongoing maintenance of 
health information technology, including elec-
tronic health records, to health care providers 
in order to improve the quality of healthcare 
and protect the privacy and security of health 
information; 
‘‘(D) participation, to the extent prac-
ticable, in health information exchanges; 
‘‘(E) utilization, when appropriate, of the 
expertise and capability that exists in Federal 
agencies other than the Department; and 
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‘‘(F)
integration
of
health
information 
technology, including electronic health records, 
into the initial and ongoing training of health 
professionals and others in the healthcare in-
dustry that would be instrumental to improving 
the quality of healthcare through the smooth 
and accurate electronic use and exchange of 
health information. 
‘‘(4) REGIONAL
ASSISTANCE.—Each regional 
center shall aim to provide assistance and education 
to all providers in a region, but shall prioritize any 
direct assistance first to the following: 
‘‘(A) Public or not-for-profit hospitals or 
critical access hospitals. 
‘‘(B) Federally qualified health centers (as 
defined in section 1861(aa)(4) of the Social Se-
curity Act). 
‘‘(C) Entities that are located in rural and 
other areas that serve uninsured, underinsured, 
and medically underserved individuals (regard-
less of whether such area is urban or rural). 
‘‘(D) Individual or small group practices 
(or a consortium thereof) that are primarily fo-
cused on primary care. 
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‘‘(5) FINANCIAL SUPPORT.—The Secretary may 
provide financial support to any regional center cre-
ated under this subsection for a period not to exceed 
four years. The Secretary may not provide more 
than 50 percent of the capital and annual operating 
and maintenance funds required to create and main-
tain such a center, except in an instance of national 
economic conditions which would render this cost- 
share requirement detrimental to the program and 
upon notification to Congress as to the justification 
to waive the cost-share requirement. 
‘‘(6) NOTICE OF PROGRAM DESCRIPTION AND 
AVAILABILITY OF FUNDS.—The Secretary shall pub-
lish in the Federal Register, not later than 90 days 
after the date of the enactment of this title, a draft 
description of the program for establishing regional 
centers under this subsection. Such description shall 
include the following: 
‘‘(A) A detailed explanation of the program 
and the programs goals. 
‘‘(B) Procedures to be followed by the ap-
plicants. 
‘‘(C) Criteria for determining qualified ap-
plicants. 
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‘‘(D) Maximum support levels expected to 
be available to centers under the program. 
‘‘(7)
APPLICATION
REVIEW.—The
Secretary 
shall subject each application under this subsection 
to merit review. In making a decision whether to ap-
prove such application and provide financial support, 
the Secretary shall consider at a minimum the mer-
its of the application, including those portions of the 
application regarding— 
‘‘(A) the ability of the applicant to provide 
assistance under this subsection and utilization 
of health information technology appropriate to 
the needs of particular categories of health care 
providers; 
‘‘(B) the types of service to be provided to 
health care providers; 
‘‘(C) geographical diversity and extent of 
service area; and 
‘‘(D)
the
percentage
of
funding
and 
amount
of
in-kind
commitment
from
other 
sources. 
‘‘(8) BIENNIAL
EVALUATION.—Each regional 
center which receives financial assistance under this 
subsection shall be evaluated biennially by an evalua-
tion panel appointed by the Secretary. Each evalua-
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tion panel shall be composed of private experts, none 
of whom shall be connected with the center involved, 
and of Federal officials. Each evaluation panel shall 
measure the involved center’s performance against 
the objective specified in paragraph (3). The Sec-
retary shall not continue to provide funding to a re-
gional center unless its evaluation is overall positive. 
‘‘(9) CONTINUING SUPPORT.—After the second 
year of assistance under this subsection, a regional 
center may receive additional support under this 
subsection if it has received positive evaluations and 
a finding by the Secretary that continuation of Fed-
eral funding to the center was in the best interest 
of provision of health information technology exten-
sion services. 
‘‘SEC. 3013. STATE GRANTS TO PROMOTE HEALTH INFOR-
MATION TECHNOLOGY. 
‘‘(a) IN GENERAL.—The Secretary, acting through 
the National Coordinator, shall establish a program in ac-
cordance with this section to facilitate and expand the 
electronic movement and use of health information among 
organizations according to nationally recognized stand-
ards. 
‘‘(b) PLANNING GRANTS.—The Secretary may award 
a grant to a State or qualified State-designated entity (as 
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described in subsection (f)) that submits an application 
to the Secretary at such time, in such manner, and con-
taining such information as the Secretary may specify, for 
the purpose of planning activities described in subsection 
(d). 
‘‘(c)
IMPLEMENTATION
GRANTS.—The
Secretary 
may award a grant to a State or qualified State designated 
entity that— 
‘‘(1) has submitted, and the Secretary has ap-
proved, a plan described in subsection (e) (regardless 
of whether such plan was prepared using amounts 
awarded under subsection (b); and 
‘‘(2) submits an application at such time, in 
such manner, and containing such information as 
the Secretary may specify. 
‘‘(d) USE OF FUNDS.—Amounts received under a 
grant under subsection (c) shall be used to conduct activi-
ties to facilitate and expand the electronic movement and 
use of health information among organizations according 
to nationally recognized standards through activities that 
include— 
‘‘(1) enhancing broad and varied participation 
in the authorized and secure nationwide electronic 
use and exchange of health information; 
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‘‘(2) identifying State or local resources avail-
able towards a nationwide effort to promote health 
information technology; 
‘‘(3) complementing other Federal grants, pro-
grams, and efforts towards the promotion of health 
information technology; 
‘‘(4) providing technical assistance for the de-
velopment and dissemination of solutions to barriers 
to the exchange of electronic health information; 
‘‘(5) promoting effective strategies to adopt and 
utilize health information technology in medically 
underserved communities; 
‘‘(6) assisting patients in utilizing health infor-
mation technology; 
‘‘(7) encouraging clinicians to work with Health 
Information Technology Regional Extension Centers 
as described in section 3012, to the extent they are 
available and valuable; 
‘‘(8) supporting public health agencies’ author-
ized use of and access to electronic health informa-
tion; 
‘‘(9) promoting the use of electronic health 
records for quality improvement including through 
quality measures reporting; and 
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‘‘(10) such other activities as the Secretary may 
specify. 
‘‘(e) PLAN.— 
‘‘(1) IN GENERAL.—A plan described in this 
subsection is a plan that describes the activities to 
be carried out by a State or by the qualified State- 
designated entity within such State to facilitate and 
expand the electronic movement and use of health 
information among organizations according to na-
tionally recognized standards and implementation 
specifications. 
‘‘(2) REQUIRED ELEMENTS.—A plan described 
in paragraph (1) shall— 
‘‘(A) be pursued in the public interest; 
‘‘(B) be consistent with the strategic plan 
developed by the National Coordinator, (and, as 
available) under section 3001; 
‘‘(C) include a description of the ways the 
State or qualified State-designated entity will 
carry out the activities described in subsection 
(b); and 
‘‘(D) contain such elements as the Sec-
retary may require. 
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‘‘(f) QUALIFIED STATE-DESIGNATED ENTITY.—For 
purposes of this section, to be a qualified State-designated 
entity, with respect to a State, an entity shall— 
‘‘(1) be designated by the State as eligible to 
receive awards under this section; 
‘‘(2) be a not-for-profit entity with broad stake-
holder representation on its governing board; 
‘‘(3) demonstrate that one of its principal goals 
is to use information technology to improve health 
care quality and efficiency through the authorized 
and secure electronic exchange and use of health in-
formation; 
‘‘(4) adopt nondiscrimination and conflict of in-
terest policies that demonstrate a commitment to 
open, fair, and nondiscriminatory participation by 
stakeholders; and 
‘‘(5) conform to such other requirements as the 
Secretary may establish. 
‘‘(g) REQUIRED CONSULTATION.—In carrying out 
activities described in subsections (b) and (c), a State or 
qualified State-designated entity shall consult with and 
consider the recommendations of— 
‘‘(1) health care providers (including providers 
that provide services to low income and underserved 
populations); 
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‘‘(2) health plans; 
‘‘(3) patient or consumer organizations that 
represent the population to be served; 
‘‘(4) health information technology vendors; 
‘‘(5) health care purchasers and employers; 
‘‘(6) public health agencies; 
‘‘(7) health professions schools, universities and 
colleges; 
‘‘(8) clinical researchers; 
‘‘(9) other users of health information tech-
nology such as the support and clerical staff of pro-
viders and others involved in the care and care co-
ordination of patients; and 
‘‘(10) such other entities, as may be determined 
appropriate by the Secretary. 
‘‘(h) CONTINUOUS IMPROVEMENT.—The Secretary 
shall annually evaluate the activities conducted under this 
section and shall, in awarding grants under this section, 
implement the lessons learned from such evaluation in a 
manner so that awards made subsequent to each such 
evaluation are made in a manner that, in the determina-
tion of the Secretary, will lead towards the greatest im-
provement in quality of care, decrease in costs, and the 
most effective authorized and secure electronic exchange 
of health information. 
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‘‘SEC. 3014. COMPETITIVE GRANTS TO STATES AND INDIAN 
TRIBES FOR THE DEVELOPMENT OF LOAN 
PROGRAMS
TO
FACILITATE
THE
WIDE-
SPREAD ADOPTION OF CERTIFIED EHR TECH-
NOLOGY. 
‘‘(a) IN GENERAL.—The National Coordinator may 
award competitive grants to eligible entities for the estab-
lishment of programs for loans to health care providers 
to conduct the activities described in subsection (e). 
‘‘(b) ELIGIBLE ENTITY DEFINED.—For purposes of 
this subsection, the term ‘eligible entity’ means a State 
or Indian tribe (as defined in the Indian Self-Determina-
tion and Education Assistance Act) that— 
‘‘(1) submits to the National Coordinator an 
application at such time, in such manner, and con-
taining such information as the National Coordi-
nator may require; 
‘‘(2) submits to the National Coordinator a 
strategic plan in accordance with subsection (d) and 
provides to the National Coordinator assurances that 
the entity will update such plan annually in accord-
ance with such subsection; 
‘‘(3) provides assurances to the National Coor-
dinator that the entity will establish a Loan Fund 
in accordance with subsection (c); 
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‘‘(4) provides assurances to the National Coor-
dinator that the entity will not provide a loan from 
the Loan Fund to a health care provider unless the 
provider agrees to— 
‘‘(A) submit reports on quality measures 
adopted by the Federal Government (by not 
later than 90 days after the date on which such 
measures are adopted), to— 
‘‘(i) the Administrator of the Centers 
for Medicare & Medicaid Services (or his 
or her designee), in the case of an entity 
participating
in
the
Medicare
program 
under title XVIII of the Social Security 
Act or the Medicaid program under title 
XIX of such Act; or 
‘‘(ii) the Secretary in the case of other 
entities; 
‘‘(B) demonstrate to the satisfaction of the 
Secretary (through criteria established by the 
Secretary) that any certified EHR technology 
purchased, improved, or otherwise financially 
supported under a loan under this section is 
used to exchange health information in a man-
ner that, in accordance with law and standards 
(as adopted under section 3004) applicable to 
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the exchange of information, improves the qual-
ity of health care, such as promoting care co-
ordination; and 
‘‘(C) comply with such other requirements 
as the entity or the Secretary may require; 
‘‘(D) include a plan on how health care 
providers involved intend to maintain and sup-
port the certified EHR technology over time; 
‘‘(E) include a plan on how the health care 
providers involved intend to maintain and sup-
port the certified EHR technology that would 
be purchased with such loan, including the type 
of resources expected to be involved and any 
such other information as the State or Indian 
Tribe, respectively, may require; and 
‘‘(5) agrees to provide matching funds in ac-
cordance with subsection (h). 
‘‘(c) ESTABLISHMENT OF FUND.—For purposes of 
subsection (b)(3), an eligible entity shall establish a cer-
tified EHR technology loan fund (referred to in this sub-
section as a ‘Loan Fund’) and comply with the other re-
quirements contained in this section. A grant to an eligible 
entity under this section shall be deposited in the Loan 
Fund established by the eligible entity. No funds author-
ized by other provisions of this title to be used for other 
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purposes specified in this title shall be deposited in any 
Loan Fund. 
‘‘(d) STRATEGIC PLAN.— 
‘‘(1) IN GENERAL.—For purposes of subsection 
(b)(2), a strategic plan of an eligible entity under 
this subsection shall identify the intended uses of 
amounts available to the Loan Fund of such entity. 
‘‘(2) CONTENTS.—A strategic plan under para-
graph (1), with respect to a Loan Fund of an eligi-
ble entity, shall include for a year the following: 
‘‘(A) A list of the projects to be assisted 
through the Loan Fund during such year. 
‘‘(B) A description of the criteria and 
methods
established
for
the
distribution
of 
funds from the Loan Fund during the year. 
‘‘(C) A description of the financial status 
of the Loan Fund as of the date of submission 
of the plan. 
‘‘(D) The short-term and long-term goals 
of the Loan Fund. 
‘‘(e) USE OF FUNDS.—Amounts deposited in a Loan 
Fund, including loan repayments and interest earned on 
such amounts, shall be used only for awarding loans or 
loan guarantees, making reimbursements described in sub-
section (g)(4)(A), or as a source of reserve and security 
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for leveraged loans, the proceeds of which are deposited 
in the Loan Fund established under subsection (c). Loans 
under this section may be used by a health care provider 
to— 
‘‘(1) facilitate the purchase of certified EHR 
technology; 
‘‘(2) enhance the utilization of certified EHR 
technology; 
‘‘(3) train personnel in the use of such tech-
nology; or 
‘‘(4) improve the secure electronic exchange of 
health information. 
‘‘(f) TYPES OF ASSISTANCE.—Except as otherwise 
limited by applicable State law, amounts deposited into a 
Loan Fund under this section may only be used for the 
following: 
‘‘(1) To award loans that comply with the fol-
lowing: 
‘‘(A) The interest rate for each loan shall 
not exceed the market interest rate. 
‘‘(B) The principal and interest payments 
on each loan shall commence not later than 1 
year after the date the loan was awarded, and 
each loan shall be fully amortized not later than 
10 years after the date of the loan. 
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‘‘(C) The Loan Fund shall be credited with 
all payments of principal and interest on each 
loan awarded from the Loan Fund. 
‘‘(2) To guarantee, or purchase insurance for, 
a local obligation (all of the proceeds of which fi-
nance a project eligible for assistance under this 
subsection) if the guarantee or purchase would im-
prove credit market access or reduce the interest 
rate applicable to the obligation involved. 
‘‘(3) As a source of revenue or security for the 
payment of principal and interest on revenue or gen-
eral obligation bonds issued by the eligible entity if 
the proceeds of the sale of the bonds will be depos-
ited into the Loan Fund. 
‘‘(4) To earn interest on the amounts deposited 
into the Loan Fund. 
‘‘(5) To make reimbursements described in sub-
section (g)(4)(A). 
‘‘(g) ADMINISTRATION OF LOAN FUNDS.— 
‘‘(1) COMBINED FINANCIAL ADMINISTRATION.— 
An eligible entity may (as a convenience and to 
avoid unnecessary administrative costs) combine, in 
accordance with applicable State law, the financial 
administration of a Loan Fund established under 
this subsection with the financial administration of 
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any other revolving fund established by the entity if 
otherwise not prohibited by the law under which the 
Loan Fund was established. 
‘‘(2) COST OF ADMINISTERING FUND.—Each el-
igible entity may annually use not to exceed 4 per-
cent of the funds provided to the entity under a 
grant under this section to pay the reasonable costs 
of the administration of the programs under this 
section, including the recovery of reasonable costs 
expended to establish a Loan Fund which are in-
curred after the date of the enactment of this title. 
‘‘(3) GUIDANCE AND REGULATIONS.—The Na-
tional Coordinator shall publish guidance and pro-
mulgate regulations as may be necessary to carry 
out the provisions of this section, including— 
‘‘(A) provisions to ensure that each eligible 
entity commits and expends funds allotted to 
the entity under this section as efficiently as 
possible in accordance with this title and appli-
cable State laws; and 
‘‘(B) guidance to prevent waste, fraud, and 
abuse. 
‘‘(4) PRIVATE SECTOR CONTRIBUTIONS.— 
‘‘(A) IN GENERAL.—A Loan Fund estab-
lished under this section may accept contribu-
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tions from private sector entities, except that 
such entities may not specify the recipient or 
recipients of any loan issued under this sub-
section. An eligible entity may agree to reim-
burse a private sector entity for any contribu-
tion made under this subparagraph, except that 
the amount of such reimbursement may not be 
greater than the principal amount of the con-
tribution made. 
‘‘(B) AVAILABILITY
OF
INFORMATION.— 
An eligible entity shall make publicly available 
the identity of, and amount contributed by, any 
private sector entity under subparagraph (A) 
and may issue letters of commendation or make 
other awards (that have no financial value) to 
any such entity. 
‘‘(h) MATCHING REQUIREMENTS.— 
‘‘(1) IN GENERAL.—The National Coordinator 
may not make a grant under subsection (a) to an el-
igible entity unless the entity agrees to make avail-
able (directly or through donations from public or 
private entities) non-Federal contributions in cash to 
the costs of carrying out the activities for which the 
grant is awarded in an amount equal to not less 
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than $1 for each $5 of Federal funds provided under 
the grant. 
‘‘(2) DETERMINATION
OF
AMOUNT
OF
NON- 
FEDERAL
CONTRIBUTION.—In
determining
the 
amount of non-Federal contributions that an eligible 
entity has provided pursuant to subparagraph (A), 
the
National
Coordinator
may
not
include
any 
amounts provided to the entity by the Federal Gov-
ernment. 
‘‘(i) EFFECTIVE DATE.—The Secretary may not 
make an award under this section prior to January 1, 
2010. 
‘‘SEC. 3015. DEMONSTRATION PROGRAM TO INTEGRATE IN-
FORMATION
TECHNOLOGY
INTO
CLINICAL 
EDUCATION. 
‘‘(a) IN GENERAL.—The Secretary may award grants 
under this section to carry out demonstration projects to 
develop academic curricula integrating certified EHR 
technology in the clinical education of health professionals. 
Such awards shall be made on a competitive basis and 
pursuant to peer review. 
‘‘(b) ELIGIBILITY.—To be eligible to receive a grant 
under subsection (a), an entity shall— 
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‘‘(1) submit to the Secretary an application at 
such time, in such manner, and containing such in-
formation as the Secretary may require; 
‘‘(2) submit to the Secretary a strategic plan 
for integrating certified EHR technology in the clin-
ical education of health professionals to reduce med-
ical errors and enhance health care quality; 
‘‘(3) be— 
‘‘(A) a school of medicine, osteopathic 
medicine, dentistry, or pharmacy, a graduate 
program in behavioral or mental health, or any 
other graduate health professions school; 
‘‘(B) a graduate school of nursing or phy-
sician assistant studies; 
‘‘(C) a consortium of two or more schools 
described in subparagraph (A) or (B); or 
‘‘(D) an institution with a graduate med-
ical education program in medicine, osteopathic 
medicine, dentistry, pharmacy, nursing, or phy-
sician assistance studies; 
‘‘(4) provide for the collection of data regarding 
the effectiveness of the demonstration project to be 
funded under the grant in improving the safety of 
patients, the efficiency of health care delivery, and 
in increasing the likelihood that graduates of the 
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grantee will adopt and incorporate certified EHR 
technology, in the delivery of health care services; 
and 
‘‘(5) provide matching funds in accordance with 
subsection (d). 
‘‘(c) USE OF FUNDS.— 
‘‘(1) IN GENERAL.—With respect to a grant 
under subsection (a), an eligible entity shall— 
‘‘(A) use grant funds in collaboration with 
2 or more disciplines; and 
‘‘(B) use grant funds to integrate certified 
EHR technology into community-based clinical 
education. 
‘‘(2) LIMITATION.—An eligible entity shall not 
use amounts received under a grant under sub-
section (a) to purchase hardware, software, or serv-
ices. 
‘‘(d) FINANCIAL SUPPORT.—The Secretary may not 
provide more than 50 percent of the costs of any activity 
for which assistance is provided under subsection (a), ex-
cept in an instance of national economic conditions which 
would render the cost-share requirement under this sub-
section detrimental to the program and upon notification 
to Congress as to the justification to waive the cost-share 
requirement. 
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‘‘(e) EVALUATION.—The Secretary shall take such 
action as may be necessary to evaluate the projects funded 
under this section and publish, make available, and dis-
seminate the results of such evaluations on as wide a basis 
as is practicable. 
‘‘(f) REPORTS.—Not later than 1 year after the date 
of enactment of this title, and annually thereafter, the Sec-
retary shall submit to the Committee on Health, Edu-
cation, Labor, and Pensions and the Committee on Fi-
nance of the Senate, and the Committee on Energy and 
Commerce of the House of Representatives a report 
that— 
‘‘(1) describes the specific projects established 
under this section; and 
‘‘(2) contains recommendations for Congress 
based on the evaluation conducted under subsection 
(e). 
‘‘SEC. 3016. INFORMATION TECHNOLOGY PROFESSIONALS 
ON HEALTH CARE. 
‘‘(a) IN GENERAL.—The Secretary, in consultation 
with the Director of the National Science Foundation, 
shall provide assistance to institutions of higher education 
(or consortia thereof) to establish or expand medical 
health informatics education programs, including certifi-
cation, undergraduate, and masters degree programs, for 
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both health care and information technology students to 
ensure the rapid and effective utilization and development 
of health information technologies (in the United States 
health care infrastructure). 
‘‘(b) ACTIVITIES.—Activities for which assistance 
may be provided under subsection (a) may include the fol-
lowing: 
‘‘(1) Developing and revising curricula in med-
ical health informatics and related disciplines. 
‘‘(2) Recruiting and retaining students to the 
program involved. 
‘‘(3) Acquiring equipment necessary for student 
instruction in these programs, including the installa-
tion of testbed networks for student use. 
‘‘(4) Establishing or enhancing bridge programs 
in the health informatics fields between community 
colleges and universities. 
‘‘(c) PRIORITY.—In providing assistance under sub-
section (a), the Secretary shall give preference to the fol-
lowing: 
‘‘(1) Existing education and training programs. 
‘‘(2) Programs designed to be completed in less 
than six months. 
‘‘(d) FINANCIAL SUPPORT.—The Secretary may not 
provide more than 50 percent of the costs of any activity 
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for which assistance is provided under subsection (a), ex-
cept in an instance of national economic conditions which 
would render the cost-share requirement under this sub-
section detrimental to the program and upon notification 
to Congress as to the justification to waive the cost-share 
requirement. 
‘‘SEC. 3017. GENERAL GRANT AND LOAN PROVISIONS. 
‘‘(a) REPORTS.—The Secretary may require that an 
entity receiving assistance under this subtitle shall submit 
to the Secretary, not later than the date that is 1 year 
after the date of receipt of such assistance, a report that 
includes— 
‘‘(1) an analysis of the effectiveness of the ac-
tivities for which the entity receives such assistance, 
as compared to the goals for such activities; and 
‘‘(2) an analysis of the impact of the project on 
health care quality and safety. 
‘‘(b) REQUIREMENT TO IMPROVE QUALITY OF CARE 
AND DECREASE IN COSTS.—The National Coordinator 
shall annually evaluate the activities conducted under this 
subtitle and shall, in awarding grants, implement the les-
sons learned from such evaluation in a manner so that 
awards made subsequent to each such evaluation are made 
in a manner that, in the determination of the National 
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Coordinator, will result in the greatest improvement in the 
quality and efficiency of health care. 
‘‘SEC. 3018. AUTHORIZATION FOR APPROPRIATIONS. 
‘‘For the purposes of carrying out this subtitle, there 
is authorized to be appropriated such sums as may be nec-
essary for each of the fiscal years 2009 through 2013. 
Amounts so appropriated shall remain available until ex-
pended.’’. 
PART II—MEDICARE PROGRAM 
SEC. 4311. INCENTIVES FOR ELIGIBLE PROFESSIONALS. 
(a) INCENTIVE PAYMENTS.—Section 1848 of the So-
cial Security Act (42 U.S.C. 1395w–4) is amended by add-
ing at the end the following new subsection: 
‘‘(o) INCENTIVES FOR ADOPTION AND MEANINGFUL 
USE OF CERTIFIED EHR TECHNOLOGY.— 
‘‘(1) INCENTIVE PAYMENTS.— 
‘‘(A) IN
GENERAL.—Subject to the suc-
ceeding subparagraphs of this paragraph, with 
respect to covered professional services fur-
nished by an eligible professional during a pay-
ment year (as defined in subparagraph (E)), if 
the eligible professional is a meaningful EHR 
user (as determined under paragraph (2)) for 
the reporting period with respect to such year, 
in addition to the amount otherwise paid under 
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this part, there also shall be paid to the eligible 
professional (or to an employer or facility in the 
cases
described
in
clause
(A)
of
section 
1842(b)(6)), from the Federal Supplementary 
Medical
Insurance
Trust
Fund
established 
under section 1841 an amount equal to 75 per-
cent of the Secretary’s estimate (based on 
claims submitted not later than 2 months after 
the end of the payment year) of the allowed 
charges under this part for all such covered 
professional services furnished by the eligible 
professional during such year. 
‘‘(B) LIMITATIONS
ON
AMOUNTS
OF
IN-
CENTIVE PAYMENTS.— 
‘‘(i) IN GENERAL.—In no case shall 
the amount of the incentive payment pro-
vided under this paragraph for an eligible 
professional for a payment year exceed the 
applicable amount specified under this sub-
paragraph with respect to such eligible 
professional and such year. 
‘‘(ii)
AMOUNT.—Subject
to
clause 
(iii), the applicable amount specified in this 
subparagraph for an eligible professional is 
as follows: 
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‘‘(I) For the first payment year 
for such professional, $15,000. 
‘‘(II) For the second payment 
year for such professional, $12,000. 
‘‘(III)
For
the
third
payment 
year for such professional, $8,000. 
‘‘(IV) For the fourth payment 
year for such professional, $4,000. 
‘‘(V) For the fifth payment year 
for such professional, $2,000. 
‘‘(VI) For any succeeding pay-
ment year for such professional, $0. 
‘‘(iii) PHASE
DOWN
FOR
ELIGIBLE 
PROFESSIONALS
FIRST
ADOPTING
EHR 
AFTER 2013.—If the first payment year for 
an eligible professional is after 2013, then 
the amount specified in this subparagraph 
for a payment year for such professional is 
the same as the amount specified in clause 
(ii) for such payment year for an eligible 
professional whose first payment year is 
2013. If the first payment year for an eli-
gible professional is after 2015 then the 
applicable amount specified in this sub-
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paragraph for such professional for such 
year and any subsequent year shall be $0. 
‘‘(C)
NON-APPLICATION
TO
HOSPITAL- 
BASED ELIGIBLE PROFESSIONALS.— 
‘‘(i) IN GENERAL.—No incentive pay-
ment may be made under this paragraph 
in the case of a hospital-based eligible pro-
fessional. 
‘‘(ii) HOSPITAL-BASED ELIGIBLE PRO-
FESSIONAL.—For purposes of clause (i), 
the term ‘hospital-based eligible profes-
sional’ means, with respect to covered pro-
fessional services furnished by an eligible 
professional during the reporting period for 
a payment year, an eligible professional, 
such as a pathologist, anesthesiologist, or 
emergency physician, who furnishes sub-
stantially all of such services in a hospital 
setting (whether inpatient or outpatient) 
and through the use of the facilities and 
equipment, including computer equipment, 
of the hospital. 
‘‘(D) PAYMENT.— 
‘‘(i) FORM OF PAYMENT.—The pay-
ment under this paragraph may be in the 
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form of a single consolidated payment or 
in the form of such periodic installments 
as the Secretary may specify. 
‘‘(ii) COORDINATION OF APPLICATION 
OF
LIMITATION
FOR
PROFESSIONALS
IN 
DIFFERENT PRACTICES.—In the case of an 
eligible professional furnishing covered pro-
fessional services in more than one practice 
(as specified by the Secretary), the Sec-
retary shall establish rules to coordinate 
the incentive payments, including the ap-
plication of the limitation on amounts of 
such incentive payments under this para-
graph, among such practices. 
‘‘(iii)
COORDINATION
WITH
MED-
ICAID.—The Secretary shall seek, to the 
maximum extent practicable, to avoid du-
plicative requirements from Federal and 
State Governments to demonstrate mean-
ingful use of certified EHR technology 
under this title and title XIX. The Sec-
retary may also adjust the reporting peri-
ods under such title and such subsections 
in order to carry out this clause. 
‘‘(E) PAYMENT YEAR DEFINED.— 
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‘‘(i) IN
GENERAL.—For purposes of 
this subsection, the term ‘payment year’ 
means a year beginning with 2011. 
‘‘(ii) FIRST, SECOND, ETC. PAYMENT 
YEAR.—The
term
‘first
payment
year’ 
means, with respect to covered professional 
services furnished by an eligible profes-
sional, the first year for which an incentive 
payment is made for such services under 
this subsection. The terms ‘second pay-
ment year’, ‘third payment year’, ‘fourth 
payment year’, and ‘fifth payment year’ 
mean, with respect to covered professional 
services furnished by such eligible profes-
sional, each successive year immediately 
following the first payment year for such 
professional. 
‘‘(2) MEANINGFUL EHR USER.— 
‘‘(A) IN GENERAL.—For purposes of para-
graph (1), an eligible professional shall be 
treated as a meaningful EHR user for a report-
ing period for a payment year (or, for purposes 
of subsection (a)(7), for a reporting period 
under such subsection for a year) if each of the 
following requirements is met: 
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‘‘(i) MEANINGFUL USE OF CERTIFIED 
EHR
TECHNOLOGY.—The eligible profes-
sional demonstrates to the satisfaction of 
the Secretary, in accordance with subpara-
graph (C)(i), that during such period the 
professional is using certified EHR tech-
nology in a meaningful manner, which 
shall include the use of electronic pre-
scribing as determined to be appropriate 
by the Secretary. 
‘‘(ii) INFORMATION EXCHANGE.—The 
eligible professional demonstrates to the 
satisfaction of the Secretary, in accordance 
with subparagraph (C)(i), that during such 
period such certified EHR technology is 
connected in a manner that provides, in 
accordance with law and standards appli-
cable to the exchange of information, for 
the electronic exchange of health informa-
tion to improve the quality of health care, 
such as promoting care coordination. 
‘‘(iii)
REPORTING
ON
MEASURES 
USING
EHR.—Subject
to
subparagraph 
(B)(ii) and using such certified EHR tech-
nology, the eligible professional submits in-
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formation for such period, in a form and 
manner specified by the Secretary, on such 
clinical quality measures and such other 
measures
as
selected
by
the
Secretary 
under subparagraph (B)(i). 
The Secretary may provide for the use of alter-
native means for meeting the requirements of 
clauses (i), (ii), and (iii) in the case of an eligi-
ble professional furnishing covered professional 
services in a group practice (as defined by the 
Secretary). The Secretary shall seek to improve 
the use of electronic health records and health 
care quality over time by requiring more strin-
gent measures of meaningful use selected under 
this paragraph. 
‘‘(B) REPORTING ON MEASURES.— 
‘‘(i) SELECTION.—The Secretary shall 
select measures for purposes of subpara-
graph (A)(iii) but only consistent with the 
following: 
‘‘(I) The Secretary shall provide 
preference to clinical quality measures 
that have been endorsed by the entity 
with a contract with the Secretary 
under section 1890(a). 
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‘‘(II) Prior to any measure being 
selected under this subparagraph, the 
Secretary shall publish in the Federal 
Register such measure and provide for 
a period of public comment on such 
measure. 
‘‘(ii)
LIMITATION.—The
Secretary 
may not require the electronic reporting of 
information on clinical quality measures 
under
subparagraph
(A)(iii)
unless
the 
Secretary has the capacity to accept the in-
formation electronically, which may be on 
a pilot basis. 
‘‘(iii) COORDINATION OF REPORTING 
OF
INFORMATION.—In
selecting
such 
measures, and in establishing the form and 
manner for reporting measures under sub-
paragraph (A)(iii), the Secretary shall seek 
to avoid redundant or duplicative reporting 
otherwise
required,
including
reporting 
under subsection (k)(2)(C). 
‘‘(C) DEMONSTRATION
OF
MEANINGFUL 
USE OF CERTIFIED EHR TECHNOLOGY AND IN-
FORMATION EXCHANGE.— 
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‘‘(i)
IN
GENERAL.—A
professional 
may satisfy the demonstration requirement 
of clauses (i) and (ii) of subparagraph (A) 
through means specified by the Secretary, 
which may include— 
‘‘(I) an attestation; 
‘‘(II) the submission of claims 
with appropriate coding (such as a 
code indicating that a patient encoun-
ter was documented using certified 
EHR technology); 
‘‘(III) a survey response; 
‘‘(IV) reporting under subpara-
graph (A)(iii); and 
‘‘(V) other means specified by the 
Secretary. 
‘‘(ii) USE
OF
PART
D
DATA.—Not-
withstanding sections 1860D–15(d)(2)(B) 
and 1860D–15(f)(2), the Secretary may 
use data regarding drug claims submitted 
for purposes of section 1860D–15 that are 
necessary for purposes of subparagraph 
(A). 
‘‘(3) APPLICATION.— 
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‘‘(A)
PHYSICIAN
REPORTING
SYSTEM 
RULES.—Paragraphs (5), (6), and (8) of sub-
section (k) shall apply for purposes of this sub-
section in the same manner as they apply for 
purposes of such subsection. 
‘‘(B) COORDINATION
WITH
OTHER
PAY-
MENTS.—The provisions of this subsection shall 
not be taken into account in applying the provi-
sions of subsection (m) of this section and of 
section 1833(m) and any payment under such 
provisions shall not be taken into account in 
computing allowable charges under this sub-
section. 
‘‘(C)
LIMITATIONS
ON
REVIEW.—There 
shall be no administrative or judicial review 
under section 1869, section 1878, or otherwise 
of the determination of any incentive payment 
under this subsection and the payment adjust-
ment under subsection (a)(7), including the de-
termination of a meaningful EHR user under 
paragraph (2), a limitation under paragraph 
(1)(B), and the exception under subsection 
(a)(7)(B). 
‘‘(D) POSTING
ON
WEBSITE.—The Sec-
retary shall post on the Internet website of the 
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Centers for Medicare & Medicaid Services, in an 
easily understandable format, a list of the 
names, business addresses, and business phone 
numbers of the eligible professionals who are 
meaningful EHR users and, as determined ap-
propriate by the Secretary, of group practices 
receiving incentive payments under paragraph 
(1). 
‘‘(4) CERTIFIED EHR TECHNOLOGY DEFINED.— 
For purposes of this section, the term ‘certified 
EHR technology’ means a qualified electronic health 
record (as defined in 3000(13) of the Public Health 
Service Act) that is certified pursuant to section 
3001(c)(5) of such Act as meeting standards adopt-
ed under section 3004 of such Act that are applica-
ble to the type of record involved (as determined by 
the Secretary, such as an ambulatory electronic 
health record for office-based physicians or an inpa-
tient hospital electronic health record for hospitals). 
‘‘(5) DEFINITIONS.—For purposes of this sub-
section: 
‘‘(A)
COVERED
PROFESSIONAL
SERV-
ICES.—The term ‘covered professional services’ 
has the meaning given such term in subsection 
(k)(3). 
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‘‘(B) ELIGIBLE PROFESSIONAL.—The term 
‘eligible professional’ means a physician, as de-
fined in section 1861(r). 
‘‘(C) REPORTING PERIOD.—The term ‘re-
porting period’ means any period (or periods), 
with respect to a payment year, as specified by 
the Secretary.’’. 
(b) INCENTIVE PAYMENT ADJUSTMENT.—Section 
1848(a) of the Social Security Act (42 U.S.C. 1395w– 
4(a)) is amended by adding at the end the following new 
paragraph: 
‘‘(7) INCENTIVES
FOR
MEANINGFUL
USE
OF 
CERTIFIED EHR TECHNOLOGY.— 
‘‘(A) ADJUSTMENT.— 
‘‘(i) IN
GENERAL.—Subject to sub-
paragraphs (B) and (D), with respect to 
covered professional services furnished by 
an eligible professional during 2016 or any 
subsequent payment year, if the eligible 
professional is not a meaningful EHR user 
(as determined under subsection (o)(2)) for 
a reporting period for the year, the fee 
schedule amount for such services fur-
nished by such professional during the year 
(including the fee schedule amount for pur-
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poses of determining a payment based on 
such amount) shall be equal to the applica-
ble percent of the fee schedule amount that 
would otherwise apply to such services 
under this subsection (determined after ap-
plication of paragraph (3) but without re-
gard to this paragraph). 
‘‘(ii) APPLICABLE PERCENT.—Subject 
to clause (iii), for purposes of clause (i), 
the term ‘applicable percent’ means— 
‘‘(I) for 2016, 99 percent; 
‘‘(II) for 2017, 98 percent; and 
‘‘(III) for 2018 and each subse-
quent year, 97 percent. 
‘‘(iii) AUTHORITY TO DECREASE AP-
PLICABLE
PERCENTAGE
FOR
2019
AND 
SUBSEQUENT YEARS.—For 2019 and each 
subsequent year, if the Secretary finds that 
the proportion of eligible professionals who 
are meaningful EHR users (as determined 
under subsection (o)(2)) is less than 75 
percent, the applicable percent shall be de-
creased by 1 percentage point from the ap-
plicable percent in the preceding year, but 
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in no case shall the applicable percent be 
less than 95 percent. 
‘‘(B)
SIGNIFICANT
HARDSHIP
EXCEP-
TION.—The Secretary may, on a case-by-case 
basis, exempt an eligible professional from the 
application of the payment adjustment under 
subparagraph (A) if the Secretary determines, 
subject to annual renewal, that compliance with 
the requirement for being a meaningful EHR 
user would result in a significant hardship, such 
as in the case of an eligible professional who 
practices in a rural area without sufficient 
Internet access. In no case may an eligible pro-
fessional be granted an exemption under this 
subparagraph for more than 5 years. 
‘‘(C) APPLICATION OF PHYSICIAN REPORT-
ING SYSTEM RULES.—Paragraphs (5), (6), and 
(8) of subsection (k) shall apply for purposes of 
this paragraph in the same manner as they 
apply for purposes of such subsection. 
‘‘(D)
NON-APPLICATION
TO
HOSPITAL- 
BASED
ELIGIBLE
PROFESSIONALS.—No
pay-
ment adjustment may be made under subpara-
graph (A) in the case of hospital-based eligible 
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professionals
(as
defined
in
subsection 
(o)(1)(C)(ii)). 
‘‘(E) DEFINITIONS.—For purposes of this 
paragraph: 
‘‘(i) COVERED
PROFESSIONAL
SERV-
ICES.—The
term
‘covered
professional 
services’ has the meaning given such term 
in subsection (k)(3). 
‘‘(ii) ELIGIBLE PROFESSIONAL.—The 
term ‘eligible professional’ means a physi-
cian, as defined in section 1861(r). 
‘‘(iii) REPORTING PERIOD.—The term 
‘reporting period’ means, with respect to a 
year, a period specified by the Secretary.’’. 
(c) APPLICATION
TO CERTAIN HMO-AFFILIATED 
ELIGIBLE PROFESSIONALS.—Section 1853 of the Social 
Security Act (42 U.S.C. 1395w–23) is amended by adding 
at the end the following new subsection: 
‘‘(l) APPLICATION OF ELIGIBLE PROFESSIONAL IN-
CENTIVES FOR CERTAIN MA ORGANIZATIONS FOR ADOP-
TION AND MEANINGFUL USE OF CERTIFIED EHR TECH-
NOLOGY.— 
‘‘(1) IN GENERAL.—Subject to paragraphs (3) 
and (4), in the case of a qualifying MA organization, 
the provisions of sections 1848(o) and 1848(a)(7) 
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shall apply with respect to eligible professionals de-
scribed in paragraph (2) of the organization who the 
organization attests under paragraph (6) to be 
meaningful EHR users in a similar manner as they 
apply to eligible professionals under such sections. 
Incentive payments under paragraph (3) shall be 
made to and payment adjustments under paragraph 
(4) shall apply to such qualifying organizations. 
‘‘(2) ELIGIBLE
PROFESSIONAL
DESCRIBED.— 
With respect to a qualifying MA organization, an eli-
gible professional described in this paragraph is an 
eligible professional (as defined for purposes of sec-
tion 1848(o)) who— 
‘‘(A)(i) is employed by the organization; or 
‘‘(ii)(I) is employed by, or is a partner of, 
an entity that through contract with the organi-
zation furnishes at least 80 percent of the enti-
ty’s patient care services to enrollees of such or-
ganization; and 
‘‘(II) furnishes at least 80 percent of the 
professional services of the eligible professional 
to enrollees of the organization; and 
‘‘(B) furnishes, on average, at least 20 
hours per week of patient care services. 
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‘‘(3) ELIGIBLE PROFESSIONAL INCENTIVE PAY-
MENTS.— 
‘‘(A) IN
GENERAL.—In applying section 
1848(o) under paragraph (1), instead of the ad-
ditional
payment
amount
under
section 
1848(o)(1)(A)
and
subject
to
subparagraph 
(B), the Secretary may substitute an amount 
determined by the Secretary to the extent fea-
sible and practical to be similar to the esti-
mated amount in the aggregate that would be 
payable if payment for services furnished by 
such professionals was payable under part B in-
stead of this part. 
‘‘(B)
AVOIDING
DUPLICATION
OF
PAY-
MENTS.— 
‘‘(i) IN GENERAL.—If an eligible pro-
fessional described in paragraph (2) is eli-
gible for the maximum incentive payment 
under section 1848(o)(1)(A) for the same 
payment
period,
the
payment
incentive 
shall be made only under such section and 
not under this subsection. 
‘‘(ii) METHODS.—In the case of an el-
igible professional described in paragraph 
(2) who is eligible for an incentive payment 
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under section 1848(o)(1)(A) but is not de-
scribed in clause (i) for the same payment 
period, the Secretary shall develop a proc-
ess— 
‘‘(I) to ensure that duplicate pay-
ments are not made with respect to 
an eligible professional both under 
this
subsection
and
under
section 
1848(o)(1)(A); and 
‘‘(II) to collect data from Medi-
care Advantage organizations to en-
sure against such duplicate payments. 
‘‘(C) FIXED SCHEDULE FOR APPLICATION 
OF LIMITATION ON INCENTIVE PAYMENTS FOR 
ALL
ELIGIBLE
PROFESSIONALS.—In applying 
section 1848(o)(1)(B)(ii) under subparagraph 
(A), in accordance with rules specified by the 
Secretary, a qualifying MA organization shall 
specify a year (not earlier than 2011) that shall 
be treated as the first payment year for all eli-
gible professionals with respect to such organi-
zation. 
‘‘(4) PAYMENT ADJUSTMENT.— 
‘‘(A) IN
GENERAL.—In applying section 
1848(a)(7) under paragraph (1), instead of the 
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payment adjustment being an applicable per-
cent of the fee schedule amount for a year 
under such section, subject to subparagraph 
(D), the payment adjustment under paragraph 
(1) shall be equal to the percent specified in 
subparagraph (B) for such year of the payment 
amount otherwise provided under this section 
for such year. 
‘‘(B) SPECIFIED
PERCENT.—The percent 
specified under this subparagraph for a year is 
100 percent minus a number of percentage 
points equal to the product of— 
‘‘(i) the number of percentage points 
by which the applicable percent (under sec-
tion 1848(a)(7)(A)(ii)) for the year is less 
than 100 percent; and 
‘‘(ii) the Medicare physician expendi-
ture proportion specified in subparagraph 
(C) for the year. 
‘‘(C) MEDICARE PHYSICIAN EXPENDITURE 
PROPORTION.—The Medicare physician expend-
iture proportion under this subparagraph for a 
year is the Secretary’s estimate of the propor-
tion, of the expenditures under parts A and B 
that are not attributable to this part, that are 
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attributable
to
expenditures
for
physicians’ 
services. 
‘‘(D) APPLICATION OF PAYMENT ADJUST-
MENT.—In the case that a qualifying MA orga-
nization attests that not all eligible profes-
sionals are meaningful EHR users with respect 
to a year, the Secretary shall apply the payment 
adjustment under this paragraph based on the 
proportion of such eligible professionals that are 
not meaningful EHR users for such year. 
‘‘(5)
QUALIFYING
MA
ORGANIZATION
DE-
FINED.—In this subsection and subsection (m), the 
term ‘qualifying MA organization’ means a Medicare 
Advantage organization that is organized as a health 
maintenance organization (as defined in section 
2791(b)(3) of the Public Health Service Act). 
‘‘(6) MEANINGFUL EHR USER ATTESTATION.— 
For purposes of this subsection and subsection (m), 
a qualifying MA organization shall submit an attes-
tation, in a form and manner specified by the Sec-
retary which may include the submission of such at-
testation as part of submission of the initial bid 
under section 1854(a)(1)(A)(iv), identifying— 
‘‘(A) whether each eligible professional de-
scribed in paragraph (2), with respect to such 
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(e)
CONFORMING
AMENDMENTS
TO
E-PRE-
SCRIBING.— 
(1) Section 1848(a)(5)(A) of the Social Security 
Act (42 U.S.C. 1395w–4(a)(5)(A)) is amended— 
(A) in clause (i), by striking ‘‘or any sub-
sequent year’’ and inserting ‘‘, 2013, 2014, or 
2015’’; and 
(B) in clause (ii), by striking ‘‘and each 
subsequent year’’ and inserting ‘‘and 2015’’. 
(2) Section 1848(m)(2) of such Act (42 U.S.C. 
1395w–4(m)(2)) is amended— 
(A) in subparagraph (A), by striking ‘‘For 
2009’’ and inserting ‘‘Subject to subparagraph 
(D), for 2009’’; and 
(B) by adding at the end the following new 
subparagraph: 
‘‘(D) LIMITATION WITH RESPECT TO EHR 
INCENTIVE PAYMENTS.—The provisions of this 
paragraph shall not apply to an eligible profes-
sional (or, in the case of a group practice under 
paragraph (3)(C), to the group practice) if, for 
the reporting period the eligible professional (or 
group practice) receives an incentive payment 
under subsection (o)(1)(A) with respect to a 
certified EHR technology (as defined in sub-
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section (o)(4)) that has the capability of elec-
tronic prescribing.’’. 
SEC. 4312. INCENTIVES FOR HOSPITALS. 
(a) INCENTIVE PAYMENT.—Section 1886 of the So-
cial Security Act (42 U.S.C. 1395ww) is amended by add-
ing at the end the following new subsection: 
‘‘(n) INCENTIVES FOR ADOPTION AND MEANINGFUL 
USE OF CERTIFIED EHR TECHNOLOGY.— 
‘‘(1) IN GENERAL.—Subject to the succeeding 
provisions of this subsection, with respect to inpa-
tient hospital services furnished by an eligible hos-
pital during a payment year (as defined in para-
graph (2)(G)), if the eligible hospital is a meaningful 
EHR user (as determined under paragraph (3)) for 
the reporting period with respect to such year, in ad-
dition to the amount otherwise paid under this sec-
tion, there also shall be paid to the eligible hospital, 
from the Federal Hospital Insurance Trust Fund es-
tablished under section 1817, an amount equal to 
the applicable amount specified in paragraph (2)(A) 
for the hospital for such payment year. 
‘‘(2) PAYMENT AMOUNT.— 
‘‘(A) IN
GENERAL.—Subject to the suc-
ceeding subparagraphs of this paragraph, the 
applicable amount specified in this subpara-
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graph for an eligible hospital for a payment 
year is equal to the product of the following: 
‘‘(i) INITIAL AMOUNT.—The sum of— 
‘‘(I) the base amount specified in 
subparagraph (B); plus 
‘‘(II)
the
discharge
related 
amount specified in subparagraph (C) 
for a 12-month period selected by the 
Secretary with respect to such pay-
ment year. 
‘‘(ii) MEDICARE
SHARE.—The Medi-
care share as specified in subparagraph 
(D) for the hospital for a period selected 
by the Secretary with respect to such pay-
ment year. 
‘‘(iii)
TRANSITION
FACTOR.—The 
transition factor specified in subparagraph 
(E) for the hospital for the payment year. 
‘‘(B) BASE
AMOUNT.—The base amount 
specified in this subparagraph is $2,000,000. 
‘‘(C) DISCHARGE RELATED AMOUNT.—The 
discharge related amount specified in this sub-
paragraph for a 12-month period selected by 
the Secretary shall be determined as the sum of 
the amount, based upon total discharges (re-
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gardless of any source of payment) for the pe-
riod, for each discharge up to the 23,000th dis-
charge as follows: 
‘‘(i) For the 1,150th through the 
23,000th discharge, $200. 
‘‘(ii) For any discharge greater than 
the 23,000th, $0. 
‘‘(D) MEDICARE
SHARE.—The Medicare 
share specified under this subparagraph for a 
hospital for a period selected by the Secretary 
for a payment year is equal to the fraction— 
‘‘(i) the numerator of which is the 
sum (for such period and with respect to 
the hospital) of— 
‘‘(I) the number of inpatient-bed- 
days (as established by the Secretary) 
which are attributable to individuals 
with respect to whom payment may be 
made under part A; and 
‘‘(II) the number of inpatient- 
bed-days (as so established) which are 
attributable to individuals who are en-
rolled with a Medicare Advantage or-
ganization under part C; and 
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‘‘(ii) the denominator of which is the 
product of— 
‘‘(I) the total number of inpa-
tient-bed-days with respect to the hos-
pital during such period; and 
‘‘(II) the total amount of the hos-
pital’s charges during such period, not 
including any charges that are attrib-
utable to charity care (as such term is 
used for purposes of hospital cost re-
porting under this title), divided by 
the total amount of the hospital’s 
charges during such period. 
Insofar as the Secretary determines that data 
are not available on charity care necessary to 
calculate the portion of the formula specified in 
clause (ii)(II), the Secretary shall use data on 
uncompensated care and may adjust such data 
so as to be an appropriate proxy for charity 
care including a downward adjustment to elimi-
nate bad debt data from uncompensated care 
data. In the absence of the data necessary, with 
respect to a hospital, for the Secretary to com-
pute the amount described in clause (ii)(II), the 
amount under such clause shall be deemed to 
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be 1. In the absence of data, with respect to a 
hospital, necessary to compute the amount de-
scribed in clause (i)(II), the amount under such 
clause shall be deemed to be 0. 
‘‘(E) TRANSITION FACTOR SPECIFIED.— 
‘‘(i) IN GENERAL.—Subject to clause 
(ii), the transition factor specified in this 
subparagraph for an eligible hospital for a 
payment year is as follows: 
‘‘(I) For the first payment year 
for such hospital, 1. 
‘‘(II) For the second payment 
year for such hospital, 3⁄4. 
‘‘(III)
For
the
third
payment 
year for such hospital, 1⁄2. 
‘‘(IV) For the fourth payment 
year for such hospital, 1⁄4. 
‘‘(V) For any succeeding pay-
ment year for such hospital, 0. 
‘‘(ii)
PHASE
DOWN
FOR
ELIGIBLE 
HOSPITALS FIRST ADOPTING EHR AFTER 
2013.—If the first payment year for an eli-
gible hospital is after 2013, then the tran-
sition factor specified in this subparagraph 
for a payment year for such hospital is the 
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same as the amount specified in clause (i) 
for such payment year for an eligible hos-
pital for which the first payment year is 
2013. If the first payment year for an eli-
gible hospital is after 2015 then the transi-
tion factor specified in this subparagraph 
for such hospital and for such year and 
any subsequent year shall be 0. 
‘‘(F) FORM OF PAYMENT.—The payment 
under this subsection for a payment year may 
be in the form of a single consolidated payment 
or in the form of such periodic installments as 
the Secretary may specify. 
‘‘(G) PAYMENT YEAR DEFINED.— 
‘‘(i) IN
GENERAL.—For purposes of 
this subsection, the term ‘payment year’ 
means a fiscal year beginning with fiscal 
year 2011. 
‘‘(ii) FIRST, SECOND, ETC. PAYMENT 
YEAR.—The
term
‘first
payment
year’ 
means, with respect to inpatient hospital 
services furnished by an eligible hospital, 
the first fiscal year for which an incentive 
payment is made for such services under 
this subsection. The terms ‘second pay-
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ment
year’,
‘third
payment
year’,
and 
‘fourth payment year’ mean, with respect 
to an eligible hospital, each successive year 
immediately following the first payment 
year for that hospital. 
‘‘(3) MEANINGFUL EHR USER.— 
‘‘(A) IN GENERAL.—For purposes of para-
graph (1), an eligible hospital shall be treated 
as a meaningful EHR user for a reporting pe-
riod for a payment year (or, for purposes of 
subsection (b)(3)(B)(ix), for a reporting period 
under such subsection for a fiscal year) if each 
of the following requirements are met: 
‘‘(i) MEANINGFUL USE OF CERTIFIED 
EHR TECHNOLOGY.—The eligible hospital 
demonstrates to the satisfaction of the Sec-
retary, in accordance with subparagraph 
(C)(i), that during such period the hospital 
is using certified EHR technology in a 
meaningful manner. 
‘‘(ii) INFORMATION EXCHANGE.—The 
eligible hospital demonstrates to the satis-
faction of the Secretary, in accordance 
with subparagraph (C)(i), that during such 
period such certified EHR technology is 
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