IIB
106TH CONGRESS
1ST SESSION
H. R. 2506
IN THE SENATE OF THE UNITED STATES
SEPTEMBER 30, 1999
Received; read twice and referred to the Committee on Health, Education,
Labor, and Pensions
AN ACT
To amend title IX of the Public Health Service Act to
revise and extend the Agency for Health Care Policy
and Research.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
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SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Health Research and
Quality Act of 1999’’.
SEC. 2. AMENDMENT TO THE PUBLIC HEALTH SERVICE
ACT.
(a) IN GENERAL.—Title IX of the Public Health
Service Act (42 U.S.C. 299 et seq.) is amended to read
as follows:
‘‘TITLE 
IX—AGENCY 
FOR
HEALTH 
RESEARCH 
AND
QUALITY
‘‘PART A—ESTABLISHMENT AND GENERAL
DUTIES
‘‘SEC. 901. MISSION AND DUTIES.
‘‘(a) IN GENERAL.—There is established within the
Public Health Service an agency to be known as the Agen-
cy for Health Research and Quality, which shall be headed
by a director appointed by the Secretary. The Secretary
shall carry out this title acting through the Director.
‘‘(b) MISSION.—The purpose of the Agency is to en-
hance the quality, appropriateness, and effectiveness of
health services, and access to such services, through the
establishment of a broad base of scientific research and
through the promotion of improvements in clinical and
health system practices, including the prevention of dis-
eases and other health conditions. The Agency shall pro-
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mote health care quality improvement by conducting and
supporting—
‘‘(1) research that develops and presents sci-
entific evidence regarding all aspects of health,
including—
‘‘(A) the development and assessment of
methods for enhancing patient participation in
their own care and for facilitating shared pa-
tient-physician decision-making;
‘‘(B) the outcomes, effectiveness, and cost-
effectiveness of health care practices, including
preventive measures and long-term care;
‘‘(C) existing and innovative technologies;
‘‘(D) the costs and utilization of, and ac-
cess to health care;
‘‘(E) the ways in which health care services
are organized, delivered, and financed and the
interaction and impact of these factors on the
quality of patient care;
‘‘(F) methods for measuring quality and
strategies for improving quality; and
‘‘(G) ways in which patients, consumers,
purchasers, and practitioners acquire new infor-
mation about best practices and health benefits,
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the determinants and impact of their use of this
information;
‘‘(2) the synthesis and dissemination of avail-
able scientific evidence for use by patients, con-
sumers, practitioners, providers, purchasers, policy
makers, and educators; and
‘‘(3) initiatives to advance private and public ef-
forts to improve health care quality.
‘‘(c) REQUIREMENTS WITH RESPECT TO SPECIAL
POPULATIONS.—There is established within the Agency
an office to be known as the Office on Special Populations,
which shall be headed by an official appointed by the Di-
rector. The Director, acting through such Office, shall
conduct and support research and evaluations, and sup-
port demonstration projects, with respect to—
‘‘(1) the delivery of health services in inner-city
areas and in rural areas (including frontier areas);
‘‘(2) health services for low-income groups, and
minority groups;
‘‘(3) the health of children;
‘‘(4) the elderly; and
‘‘(5) people with special health care needs, in-
cluding disabilities, chronic care and end-of-life
health care.
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‘‘SEC. 902. GENERAL AUTHORITIES.
‘‘(a) IN GENERAL.—In carrying out section 901(b),
the Director shall conduct and support research, evalua-
tions, and training, support demonstration projects, re-
search networks, and multi-disciplinary centers, provide
technical assistance, and disseminate information on
health care and on systems for the delivery of such care,
including activities with respect to—
‘‘(1) the quality, effectiveness, efficiency, appro-
priateness and value of health care services;
‘‘(2) quality measurement and improvement;
‘‘(3) the outcomes, cost, cost-effectiveness, and
use of health care services and access to such serv-
ices;
‘‘(4) clinical practice, including primary care
and practice-oriented research;
‘‘(5) health care technologies, facilities, and
equipment;
‘‘(6) health care costs, productivity, organiza-
tion, and market forces;
‘‘(7) health promotion and disease prevention,
including clinical preventive services;
‘‘(8) health statistics, surveys, database devel-
opment, and epidemiology; and
‘‘(9) medical liability.
‘‘(b) HEALTH SERVICES TRAINING GRANTS.—
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‘‘(1) IN GENERAL.—The Director may provide
training grants in the field of health services re-
search related to activities authorized under sub-
section (a), to include pre- and post-doctoral fellow-
ships and training programs, young investigator
awards, and other programs and activities as appro-
priate. In carrying out this subsection, the Director
shall make use of funds made available under sec-
tion 487(d)(3) for the Agency.
‘‘(2) REQUIREMENTS.—In developing priorities
for the allocation of training funds under this sub-
section, the Director shall take into consideration
shortages in the number of trained researchers who
are members of one of the priority populations and
the number of trained researchers who are address-
ing the priority populations.
‘‘(c) MULTIDISCIPLINARY CENTERS.—The Director
may provide financial assistance to assist in meeting the
costs of planning and establishing new centers, and oper-
ating existing and new centers, for multidisciplinary
health services research, demonstration projects, evalua-
tions, training, and policy analysis with respect to the mat-
ters referred to in subsection (a).
‘‘(d) RELATION TO CERTAIN AUTHORITIES REGARD-
ING SOCIAL SECURITY.—Activities authorized in this sec-
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tion shall be appropriately coordinated with experiments,
demonstration projects, and other related activities au-
thorized by the Social Security Act and the Social Security
Amendments of 1967. Activities under subsection (a)(2)
of this section that affect the programs under titles XVIII,
XIX and XXI of the Social Security Act shall be carried
out consistent with section 1142 of such Act.
‘‘(e) DISCLAIMER.—The Agency shall not mandate
national standards of clinical practice or quality health
care standards. Recommendations resulting from projects
funded and published by the Agency shall include a cor-
responding disclaimer.
‘‘(f) RULE OF CONSTRUCTION.—Nothing in this sec-
tion shall be construed to imply that the Agency’s role is
to mandate a national standard or specific approach to
quality measurement and reporting. In research and qual-
ity improvement activities, the Agency shall consider a
wide range of choices, providers, health care delivery sys-
tems, and individual preferences.
‘‘(g) ANNUAL REPORT.—Beginning with fiscal year
2003, the Director shall annually submit to the Congress
a report regarding prevailing disparities in health care de-
livery as it relates to racial factors and socioeconomic fac-
tors in priority populations.
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‘‘PART B—HEALTH CARE IMPROVEMENT
RESEARCH
‘‘SEC. 911. HEALTH CARE OUTCOME IMPROVEMENT RE-
SEARCH.
‘‘(a) EVIDENCE RATING SYSTEMS.—In collaboration
with experts from the public and private sector, the Agen-
cy shall identify and disseminate methods or systems to
assess health care research results, particularly methods
or systems to rate the strength of the scientific evidence
underlying health care practice, recommendations in the
research literature, and technology assessments. The
Agency shall make methods or systems for evidence rating
widely available. Agency publications containing health
care recommendations shall indicate the level of substan-
tiating evidence using such methods or systems.
‘‘(b) HEALTH CARE IMPROVEMENT RESEARCH CEN-
TERS AND PROVIDER-BASED RESEARCH NETWORKS.—
‘‘(1) IN GENERAL.—In order to address the full
continuum of care and outcomes research, to link re-
search to practice improvement, and to speed the
dissemination of research findings to community
practice settings, the Agency shall employ research
strategies and mechanisms that will link research di-
rectly with clinical practice in geographically diverse
locations throughout the United States, including—
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‘‘(A) health care improvement research
centers that combine demonstrated multidisci-
plinary expertise in outcomes or quality im-
provement research with linkages to relevant
sites of care;
‘‘(B) provider-based research networks, in-
cluding plan, facility, or delivery system sites of
care (especially primary care), that can evaluate
outcomes and evaluate and promote quality im-
provement; and
‘‘(C) other innovative mechanisms or strat-
egies to link research with clinical practice.
‘‘(2) REQUIREMENTS.—The Director is author-
ized to establish the requirements for entities apply-
ing for grants under this subsection.
‘‘SEC. 912. PRIVATE-PUBLIC PARTNERSHIPS TO IMPROVE
ORGANIZATION AND DELIVERY.
‘‘(a) SUPPORT FOR EFFORTS TO DEVELOP INFOR-
MATION ON QUALITY.—
‘‘(1) SCIENTIFIC AND TECHNICAL SUPPORT.—
In its role as the principal agency for health re-
search and quality, the Agency may provide sci-
entific and technical support for private and public
efforts to improve health care quality, including the
activities of accrediting organizations.
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‘‘(2) ROLE OF THE AGENCY.—With respect to
paragraph (1), the role of the Agency shall include—
‘‘(A) the identification and assessment of
methods for the evaluation of the health of—
‘‘(i) enrollees in health plans by type
of plan, provider, and provider arrange-
ments; and
‘‘(ii) 
other 
populations, 
including
those receiving long-term care services;
‘‘(B) the ongoing development, testing, and
dissemination of quality measures, including
measures of health and functional outcomes;
‘‘(C) the compilation and dissemination of
health care quality measures developed in the
private and public sector;
‘‘(D) assistance in the development of im-
proved health care information systems;
‘‘(E) the development of survey tools for
the purpose of measuring participant and bene-
ficiary assessments of their health care; and
‘‘(F) identifying and disseminating infor-
mation on mechanisms for the integration of in-
formation on quality into purchaser and con-
sumer decision-making processes.
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‘‘(b) CENTERS FOR EDUCATION AND RESEARCH ON
THERAPEUTICS.—
‘‘(1) IN
GENERAL.—The Secretary, acting
through the Director and in consultation with the
Commissioner of Food and Drugs, shall establish a
program for the purpose of making one or more
grants for the establishment and operation of one or
more centers to carry out the activities specified in
paragraph (2).
‘‘(2) REQUIRED ACTIVITIES.—The activities re-
ferred to in this paragraph are the following:
‘‘(A) The conduct of state-of-the-art re-
search for the following purposes:
‘‘(i) To increase awareness of—
‘‘(I) new uses of drugs, biological
products, and devices;
‘‘(II) ways to improve the effec-
tive use of drugs, biological products,
and devices; and
‘‘(III) risks of new uses and risks
of combinations of drugs and biologi-
cal products.
‘‘(ii) To provide objective clinical in-
formation to the following individuals and
entities:
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‘‘(I) Health care practitioners
and other providers of health care
goods or services.
‘‘(II) 
Pharmacists, 
pharmacy
benefit managers and purchasers.
‘‘(III) Health maintenance orga-
nizations and other managed health
care organizations.
‘‘(IV) Health care insurers and
governmental agencies.
‘‘(V) Patients and consumers.
‘‘(iii) To improve the quality of health
care while reducing the cost of health care
through—
‘‘(I) an increase in the appro-
priate use of drugs, biological prod-
ucts, or devices; and
‘‘(II) the prevention of adverse
effects of drugs, biological products,
and devices and the consequences of
such effects, such as unnecessary hos-
pitalizations.
‘‘(B) The conduct of research on the com-
parative effectiveness, cost-effectiveness, and
safety of drugs, biological products, and devices.
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‘‘(C) The conduct of research on methods
to reduce the costs to consumers of obtaining
prescription drugs.
‘‘(D) Such other activities as the Secretary
determines to be appropriate, except that a
grant may not be expended to assist the Sec-
retary in the review of new drugs.
‘‘(c) REDUCING ERRORS IN MEDICINE.—The Direc-
tor shall conduct and support research and build private-
public partnerships to—
‘‘(1) identify the causes of preventable health
care errors and patient injury in health care deliv-
ery;
‘‘(2) develop, demonstrate, and evaluate strate-
gies for reducing errors and improving patient safe-
ty; and
‘‘(3) promote the implementation of effective
strategies throughout the health care industry.
‘‘(d) CANCER AND CARDIOVASCULAR DISEASES IN
WOMEN.—The Director shall conduct and support re-
search and build private-public partnerships to enhance
the quality, appropriateness, and effectiveness of and ac-
cess to health services regarding cancer and cardiovascular
diseases in women, including with respect to the compara-
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tive effectiveness, cost-effectiveness, and safety of such
services.
‘‘(e) STUDIES OF METHODS TO IMPROVE ACCESS TO
HEALTH SERVICES.—The Director shall conduct, and
shall provide scientific and technical support for private
and public efforts to conduct, studies of the organization,
delivery, and financing of health services in order to deter-
mine the cost and quality effects of various methods of
substantially increasing the number of individuals in the
United States who have access to health services. Such
studies shall include an examination of the financial im-
pacts of a range of health reform proposals to include,
but not be limited to, a single payor insurance program
compared to the current system across an 8 year period
beginning in fiscal year 2000.
‘‘SEC. 913. INFORMATION ON QUALITY AND COST OF CARE.
‘‘(a) IN GENERAL.—The Director shall—
‘‘(1) conduct a survey to collect data on a
nationally representative sample of the population on
the cost, use and, for fiscal year 2001 and subse-
quent fiscal years, quality of health care, including
the types of health care services Americans use,
their access to health care services, frequency of use,
how much is paid for the services used, the source
of those payments, the types and costs of private
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health insurance, access, satisfaction, and quality of
care for the general population and also for popu-
lations identified in section 901(c); and
‘‘(2) develop databases and tools that provide
information to States on the quality, access, and use
of health care services provided to their residents.
‘‘(b) QUALITY AND OUTCOMES INFORMATION.—
‘‘(1) IN
GENERAL.—Beginning in fiscal year
2001, the Director shall ensure that the survey con-
ducted under subsection (a)(1) will—
‘‘(A) identify determinants of health out-
comes and functional status, including the
health care needs of populations identified in
section 901(c), provide data to study the rela-
tionships between health care quality, outcomes,
access, use, and cost, measure changes over
time, and monitor the overall national impact of
Federal and State policy changes on health
care;
‘‘(B) provide information on the quality of
care and patient outcomes for frequently occur-
ring clinical conditions for a nationally rep-
resentative sample of the population; and
‘‘(C) provide reliable national estimates for
children and persons with special health care
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needs through the use of supplements or peri-
odic expansions of the survey.
In expanding the Medical Expenditure Panel Survey,
as in existence on the date of the enactment of this
title in fiscal year 2001 to collect information on the
quality of care, the Director shall take into account
any outcomes measurements generally collected by
private sector accreditation organizations.
‘‘(2) ANNUAL
REPORT.—Beginning in fiscal
year 2003, the Secretary, acting through the Direc-
tor, shall submit to Congress an annual report on
national trends in the quality of health care provided
to the American people.
‘‘SEC. 914. INFORMATION SYSTEMS FOR HEALTH CARE IM-
PROVEMENT.
‘‘(a) IN GENERAL.—In order to foster a range of in-
novative approaches to the management and communica-
tion of health information, the Agency shall conduct and
support research, evaluations, and initiatives to advance—
‘‘(1) the use of information systems for the
study of health care quality and outcomes, including
the generation of both individual provider and plan-
level comparative performance data;
‘‘(2) training for health care practitioners and
researchers in the use of information systems;
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‘‘(3) the creation of effective linkages between
various sources of health information, including the
development of information networks;
‘‘(4) the delivery and coordination of evidence-
based health care services, including the use of real-
time health care decision-support programs;
‘‘(5) the structure, content, definition, and cod-
ing of health information data and medical vocabu-
laries in consultation with appropriate Federal enti-
ties and shall seek input from appropriate private
entities;
‘‘(6) the use of computer-based health records
in outpatient and inpatient settings as a personal
health record for individual health assessment and
maintenance, and for monitoring public health and
outcomes of care within populations; and
‘‘(7) the protection of individually identifiable
information in health services research and health
care quality improvement.
‘‘(b) DEMONSTRATION.—The Agency shall support
demonstrations into the use of new information tools
aimed at improving shared decision-making between pa-
tients and their care-givers.
‘‘(c) CERTAIN LINKAGES REGARDING HEALTH IN-
FORMATION.—Initiatives under subsection (a) shall in-
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clude the establishment, through a site maintained by the
Director on the telecommunications medium known as the
World Wide Web, of linkages meeting appropriate criteria
that enable users of the site to obtain information from
consumer satisfaction agencies or other entities that per-
form evaluations regarding the quality of health care, in-
cluding more than one link to entities that evaluate health
maintenance organizations, and including a link to the
National Committee for Quality Assurance.
‘‘SEC. 915. RESEARCH SUPPORTING PRIMARY CARE AND
ACCESS IN UNDERSERVED AREAS.
‘‘(a) PREVENTIVE SERVICES TASK FORCE.—
‘‘(1) PURPOSE.—The Agency shall provide on-
going administrative, research, and technical support
for the operation of the Preventive Services Task
Force. The Agency shall coordinate and support the
dissemination of the Preventive Services Task Force
recommendations.
‘‘(2) OPERATION.—The Preventive Services
Task Force shall review the scientific evidence re-
lated to the effectiveness, appropriateness, and cost-
effectiveness of clinical preventive services for the
purpose of developing recommendations for the
health care community, and updating previous rec-
ommendations, regarding their usefulness in daily
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clinical practice. In carrying out its responsibilities
under paragraph (1), the Task Force shall not be
subject to the provisions of Appendix 2 of title 5,
United States Code.
‘‘(b) PRIMARY CARE RESEARCH.—
‘‘(1) IN GENERAL.—There is established within
the Agency a Center for Primary Care Research (re-
ferred to in this subsection as the ‘Center’) that
shall serve as the principal source of funding for pri-
mary care practice research in the Department of
Health and Human Services. For purposes of this
paragraph, primary care research focuses on the
first contact when illness or health concerns arise,
the diagnosis, treatment or referral to specialty care,
preventive care, and the relationship between the cli-
nician and the patient in the context of the family
and community.
‘‘(2) RESEARCH.—In carrying out this section,
the Center shall conduct and support research
concerning—
‘‘(A) the nature and characteristics of pri-
mary care practice;
‘‘(B) the management of commonly occur-
ring clinical problems;
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‘‘(C) the management of undifferentiated
clinical problems; and
‘‘(D) the continuity and coordination of
health services.
‘‘SEC. 916. CLINICAL PRACTICE AND TECHNOLOGY INNOVA-
TION.
‘‘(a) IN GENERAL.—The Director shall promote inno-
vation in evidence-based health care practices and tech-
nologies by—
‘‘(1) conducting and supporting research on the
development, diffusion, and use of health care tech-
nology;
‘‘(2) developing, evaluating, and disseminating
methodologies for assessments of health care prac-
tices and technologies;
‘‘(3) conducting intramural and supporting ex-
tramural assessments of existing and new health
care practices and technologies;
‘‘(4) promoting education and training and pro-
viding technical assistance in the use of health care
practice and technology assessment methodologies
and results; and
‘‘(5) working with the National Library of Med-
icine and the public and private sector to develop an
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electronic clearinghouse of currently available assess-
ments and those in progress.
‘‘(b) SPECIFICATION OF PROCESS.—
‘‘(1) IN GENERAL.—Not later than December
31, 2000, the Director shall develop and publish a
description of the methods used by the Agency and
its contractors for practice and technology assess-
ment.
‘‘(2) CONSULTATIONS.—In carrying out this
subsection, the Director shall cooperate and consult
with the Assistant Secretary for Health, the Admin-
istrator of the Health Care Financing Administra-
tion, the Director of the National Institutes of
Health, the Commissioner of Food and Drugs, and
the heads of any other interested Federal depart-
ment or agency, and shall seek input, where appro-
priate, from professional societies and other private
and public entities.
‘‘(3) METHODOLOGY.—The Director shall, in
developing the methods used under paragraph (1),
consider—
‘‘(A) safety, efficacy, and effectiveness;
‘‘(B) legal, social, and ethical implications;
‘‘(C) costs, benefits, and cost-effectiveness;
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‘‘(D) comparisons to alternate health care
technologies and practices; and
‘‘(E) requirements of Food and Drug Ad-
ministration approval to avoid duplication.
‘‘(c) SPECIFIC ASSESSMENTS.—
‘‘(1) IN GENERAL.—The Director shall conduct
or support specific assessments of health care tech-
nologies and practices.
‘‘(2) REQUESTS FOR ASSESSMENTS.—The Di-
rector is authorized to conduct or support assess-
ments, on a reimbursable basis, for the Health Care
Financing Administration, the Department of De-
fense, the Department of Veterans Affairs, the Of-
fice of Personnel Management, and other public or
private entities.
‘‘(3) GRANTS AND CONTRACTS.—In addition to
conducting assessments, the Director may make
grants to, or enter into cooperative agreements or
contracts with, entities described in paragraph (4)
for the purpose of conducting assessments of experi-
mental, emerging, existing, or potentially outmoded
health care technologies, and for related activities.
‘‘(4) ELIGIBLE ENTITIES.—An entity described
in this paragraph is an entity that is determined to
be appropriate by the Director, including academic
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medical centers, research institutions and organiza-
tions, professional organizations, third party payers,
governmental agencies, minority institutions of high-
er education (such as Historically Black Colleges
and Universities, and Hispanic institutions), and
consortia of appropriate research entities established
for the purpose of conducting technology assess-
ments.
‘‘(d) MEDICAL EXAMINATION
OF CERTAIN VIC-
TIMS.—
‘‘(1) IN GENERAL.—In carrying out subsection
(a), the Director shall promote evidence-based clin-
ical practices for—
‘‘(A) the examination and treatment by
health professionals of individuals who are vic-
tims of sexual assault (including child molesta-
tion) or attempted sexual assault; and
‘‘(B) the training of health professionals
on performing medical evidentiary examinations
of individuals who are victims of child abuse or
neglect, sexual assault, elder abuse, or domestic
violence.
‘‘(2) 
CERTAIN
CONSIDERATIONS.—Evidence-
based clinical practices promoted under paragraph
(1) shall take into consideration the expertise and
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experience of Federal and State law enforcement of-
ficials regarding the victims referred to in such
paragraph, and of other appropriate public and pri-
vate entities (including medical societies, victim serv-
ices organizations, sexual assault prevention organi-
zations, and social services organizations).
‘‘(e) CERTAIN TECHNOLOGIES AND PRACTICES RE-
GARDING SURVIVAL RATES FOR CARDIAC ARREST.—In
carrying out subsection (a) with respect to innovations in
health care technologies and clinical practice, the Director
shall, in consultation with appropriate public and private
entities, develop recommendations regarding the place-
ment of automatic external defibrillators in Federal build-
ings as a means of improving the survival rates of individ-
uals who experience cardiac arrest in such buildings, in-
cluding recommendations on training, maintenance, and
medical oversight, and on coordinating with the system for
emergency medical services.
‘‘SEC. 917. COORDINATION OF FEDERAL GOVERNMENT
QUALITY IMPROVEMENT EFFORTS.
‘‘(a) REQUIREMENT.—
‘‘(1) IN GENERAL.—To avoid duplication and
ensure that Federal resources are used efficiently
and effectively, the Secretary, acting through the Di-
rector, shall coordinate all research, evaluations, and
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demonstrations related to health services research,
quality measurement and quality improvement ac-
tivities undertaken and supported by the Federal
Government.
‘‘(2) SPECIFIC
ACTIVITIES.—The Director, in
collaboration with the appropriate Federal officials
representing all concerned executive agencies and de-
partments, shall develop and manage a process to—
‘‘(A) improve interagency coordination, pri-
ority setting, and the use and sharing of re-
search findings and data pertaining to Federal
quality improvement programs, technology as-
sessment, and health services research;
‘‘(B) strengthen the research information
infrastructure, including databases, pertaining
to Federal health services research and health
care quality improvement initiatives;
‘‘(C) set specific goals for participating
agencies and departments to further health
services research and health care quality im-
provement; and
‘‘(D) strengthen the management of Fed-
eral health care quality improvement programs.
‘‘(b) STUDY BY THE INSTITUTE OF MEDICINE.—
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‘‘(1) IN GENERAL.—To provide Congress, the
Department of Health and Human Services, and
other relevant departments with an independent, ex-
ternal review of their quality oversight, quality im-
provement and quality research programs, the Sec-
retary shall enter into a contract with the Institute
of Medicine—
‘‘(A) to describe and evaluate current qual-
ity improvement, quality research and quality
monitoring processes through—
‘‘(i) an overview of pertinent health
services research activities and quality im-
provement efforts conducted by all Federal
programs, with particular attention paid to
those under titles XVIII, XIX, and XXI of
the Social Security Act; and
‘‘(ii) a summary of the partnerships
that the Department of Health and
Human Services has pursued with private
accreditation, quality measurement and
improvement organizations; and
‘‘(B) to identify options and make rec-
ommendations to improve the efficiency and ef-
fectiveness of quality improvement programs
through—
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‘‘(i) the improved coordination of ac-
tivities across the medicare, medicaid and
child health insurance programs under ti-
tles XVIII, XIX and XXI of the Social Se-
curity Act and health services research
programs;
‘‘(ii) the strengthening of patient
choice and participation by incorporating
state-of-the-art quality monitoring tools
and making information on quality avail-
able; and
‘‘(iii) the enhancement of the most ef-
fective programs, consolidation as appro-
priate, and elimination of duplicative ac-
tivities within various federal agencies.
‘‘(2) REQUIREMENTS.—
‘‘(A) IN
GENERAL.—The Secretary shall
enter into a contract with the Institute of Medi-
cine for the preparation—
‘‘(i) not later than 12 months after
the date of the enactment of this title, of
a report providing an overview of the qual-
ity improvement programs of the Depart-
ment of Health and Human Services for
the medicare, medicaid, and CHIP pro-
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grams under titles XVIII, XIX, and XXI
of the Social Security Act; and
‘‘(ii) not later than 24 months after
the date of the enactment of this title, of
a final report containing recommendations.
‘‘(B) REPORTS.—The Secretary shall sub-
mit the reports described in subparagraph (A)
to the Committee on Finance and the Com-
mittee on Health, Education, Labor, and Pen-
sions of the Senate and the Committee on Ways
and Means and the Committee on Commerce of
the House of Representatives.
‘‘PART C—GENERAL PROVISIONS
‘‘SEC. 921. ADVISORY COUNCIL FOR HEALTH CARE RE-
SEARCH AND QUALITY.
‘‘(a) ESTABLISHMENT.—There is established an advi-
sory council to be known as the National Advisory Council
for Health Care Research and Quality.
‘‘(b) DUTIES.—
‘‘(1) IN GENERAL.—The Advisory Council shall
advise the Secretary and the Director with respect
to activities proposed or undertaken to carry out the
purpose of the Agency under section 901(b).
‘‘(2) CERTAIN
RECOMMENDATIONS.—Activities
of the Advisory Council under paragraph (1) shall
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include making recommendations to the Director
regarding—
‘‘(A) priorities regarding health care re-
search, especially studies related to quality, out-
comes, cost and the utilization of, and access
to, health care services;
‘‘(B) the field of health care research and
related disciplines, especially issues related to
training needs, and dissemination of informa-
tion pertaining to health care quality; and
‘‘(C) the appropriate role of the Agency in
each of these areas in light of private sector ac-
tivity and identification of opportunities for
public-private sector partnerships.
‘‘(c) MEMBERSHIP.—
‘‘(1) IN GENERAL.—The Advisory Council shall,
in accordance with this subsection, be composed of
appointed members and ex officio members. All
members of the Advisory Council shall be voting
members other than the individuals designated
under paragraph (3)(B) as ex officio members.
‘‘(2) APPOINTED
MEMBERS.—The Secretary
shall appoint to the Advisory Council 18 appro-
priately qualified individuals. At least 14 members of
the Advisory Council shall be representatives of the
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public who are not officers or employees of the
United States. The Secretary shall ensure that the
appointed members of the Council, as a group, are
representative of professions and entities concerned
with, or affected by, activities under this title and
under section 1142 of the Social Security Act. Of
such members—
‘‘(A) three shall be individuals distin-
guished in the conduct of research, demonstra-
tion projects, and evaluations with respect to
health care;
‘‘(B) three shall be individuals distin-
guished in the practice of medicine of which at
least one shall be a primary care practitioner;
‘‘(C) three shall be individuals distin-
guished in the other health professions;
‘‘(D) three shall be individuals either rep-
resenting the private health care sector, includ-
ing health plans, providers, and purchasers or
individuals distinguished as administrators of
health care delivery systems;
‘‘(E) three shall be individuals distin-
guished in the fields of health care quality im-
provement, economics, information systems,
law, ethics, business, or public policy; and
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‘‘(F) three shall be individuals representing
the interests of patients and consumers of
health care.
‘‘(3) EX
OFFICIO
MEMBERS.—The Secretary
shall designate as ex officio members of the Advisory
Council—
‘‘(A) the Assistant Secretary for Health,
the Director of the National Institutes of
Health, the Director of the Centers for Disease
Control and Prevention, the Administrator of
the Health Care Financing Administration, the
Assistant Secretary of Defense (Health Af-
fairs), and the Under Secretary for Health of
the Department of Veterans Affairs; and
‘‘(B) such other Federal officials as the
Secretary may consider appropriate.
‘‘(d) TERMS.—Members of the Advisory Council ap-
pointed under subsection (c)(2) shall serve for a term of
3 years. A member of the Council appointed under such
subsection may continue to serve after the expiration of
the term of the members until a successor is appointed.
‘‘(e) VACANCIES.—If a member of the Advisory
Council appointed under subsection (c)(2) does not serve
the full term applicable under subsection (d), the indi-
vidual appointed to fill the resulting vacancy shall be ap-
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pointed for the remainder of the term of the predecessor
of the individual.
‘‘(f) CHAIR.—The Director shall, from among the
members of the Advisory Council appointed under sub-
section (c)(2), designate an individual to serve as the chair
of the Advisory Council.
‘‘(g) MEETINGS.—The Advisory Council shall meet
not less than once during each discrete 4-month period
and shall otherwise meet at the call of the Director or the
chair.
‘‘(h) COMPENSATION
AND
REIMBURSEMENT
OF
EXPENSES.—
‘‘(1) APPOINTED MEMBERS.—Members of the
Advisory Council appointed under subsection (c)(2)
shall receive compensation for each day (including
travel time) engaged in carrying out the duties of
the Advisory Council unless declined by the member.
Such compensation may not be in an amount in ex-
cess of the daily equivalent of the annual rate of
basic pay prescribed for level IV of the Executive
Schedule under section 5315 of title 5, United
States Code, for each day during which such mem-
ber is engaged in the performance of the duties of
the Advisory Council.
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‘‘(2) EX
OFFICIO
MEMBERS.—Officials des-
ignated under subsection (c)(3) as ex officio mem-
bers of the Advisory Council may not receive com-
pensation for service on the Advisory Council in ad-
dition to the compensation otherwise received for du-
ties carried out as officers of the United States.
‘‘(i) STAFF.—The Director shall provide to the Advi-
sory Council such staff, information, and other assistance
as may be necessary to carry out the duties of the Council.
‘‘SEC. 922. PEER REVIEW WITH RESPECT TO GRANTS AND
CONTRACTS.
‘‘(a) REQUIREMENT OF REVIEW.—
‘‘(1) IN GENERAL.—Appropriate technical and
scientific peer review shall be conducted with respect
to each application for a grant, cooperative agree-
ment, or contract under this title.
‘‘(2) REPORTS TO DIRECTOR.—Each peer re-
view group to which an application is submitted pur-
suant to paragraph (1) shall report its finding and
recommendations respecting the application to the
Director in such form and in such manner as the
Director shall require.
‘‘(b) APPROVAL AS PRECONDITION OF AWARDS.—
The Director may not approve an application described in
subsection (a)(1) unless the application is recommended
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for approval by a peer review group established under sub-
section (c).
‘‘(c) ESTABLISHMENT OF PEER REVIEW GROUPS.—
‘‘(1) IN GENERAL.—The Director shall establish
such technical and scientific peer review groups as
may be necessary to carry out this section. Such
groups shall be established without regard to the
provisions of title 5, United States Code, that govern
appointments in the competitive service, and without
regard to the provisions of chapter 51, and sub-
chapter III of chapter 53, of such title that relate
to classification and pay rates under the General
Schedule.
‘‘(2) MEMBERSHIP.—The members of any peer
review group established under this section shall be
appointed from among individuals who by virtue of
their training or experience are eminently qualified
to carry out the duties of such peer review group.
Officers and employees of the United States may not
constitute more than 25 percent of the membership
of any such group. Such officers and employees may
not receive compensation for service on such groups
in addition to the compensation otherwise received
for these duties carried out as such officers and em-
ployees.
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‘‘(3) 
DURATION.—Notwithstanding 
section
14(a) of the Federal Advisory Committee Act, peer
review groups established under this section may
continue in existence until otherwise provided by
law.
‘‘(4) QUALIFICATIONS.—Members of any peer-
review group shall, at a minimum, meet the fol-
lowing requirements:
‘‘(A) Such members shall agree in writing
to treat information received, pursuant to their
work for the group, as confidential information,
except that this subparagraph shall not apply to
public records and public information.
‘‘(B) Such members shall agree in writing
to recuse themselves from participation in the
peer-review 
of 
specific 
applications 
which
present a potential personal conflict of interest
or appearance of such conflict, including em-
ployment in a directly affected organization,
stock ownership, or any financial or other ar-
rangement that might introduce bias in the
process of peer-review.
‘‘(d) AUTHORITY FOR PROCEDURAL ADJUSTMENTS
IN CERTAIN CASES.—In the case of applications for finan-
cial assistance whose direct costs will not exceed $100,000,
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the Director may make appropriate adjustments in the
procedures otherwise established by the Director for the
conduct of peer review under this section. Such adjust-
ments may be made for the purpose of encouraging the
entry of individuals into the field of research, for the pur-
pose of encouraging clinical practice-oriented or provider-
based research, and for such other purposes as the Direc-
tor may determine to be appropriate.
‘‘(e) REGULATIONS.—The Director shall issue regula-
tions for the conduct of peer review under this section.
‘‘SEC. 923. CERTAIN PROVISIONS WITH RESPECT TO DEVEL-
OPMENT, COLLECTION, AND DISSEMINATION
OF DATA.
‘‘(a) STANDARDS WITH RESPECT TO UTILITY OF
DATA.—
‘‘(1) IN GENERAL.—To ensure the utility, accu-
racy, and sufficiency of data collected by or for the
Agency for the purpose described in section 901(b),
the Director shall establish standard methods for de-
veloping and collecting such data, taking into
consideration—
‘‘(A) other Federal health data collection
standards; and
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‘‘(B) the differences between types of
health care plans, delivery systems, health care
providers, and provider arrangements.
‘‘(2) RELATIONSHIP WITH OTHER DEPARTMENT
PROGRAMS.—In any case where standards under
paragraph (1) may affect the administration of other
programs carried out by the Department of Health
and Human Services, including the programs under
title XVIII, XIX or XXI of the Social Security Act,
or may affect health information that is subject to
a standard developed under part C of title XI of the
Social Security Act, they shall be in the form of rec-
ommendations to the Secretary for such program.
‘‘(b) STATISTICS
AND
ANALYSES.—The Director
shall—
‘‘(1) take appropriate action to ensure that sta-
tistics and analyses developed under this title are of
high quality, timely, and duly comprehensive, and
that the statistics are specific, standardized, and
adequately analyzed and indexed; and
‘‘(2) publish, make available, and disseminate
such statistics and analyses on as wide a basis as is
practicable.
‘‘(c) AUTHORITY REGARDING CERTAIN REQUESTS.—
Upon request of a public or private entity, the Director
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may conduct or support research or analyses otherwise au-
thorized by this title pursuant to arrangements under
which such entity will pay the cost of the services provided.
Amounts received by the Director under such arrange-
ments shall be available to the Director for obligation until
expended.
‘‘SEC. 924. DISSEMINATION OF INFORMATION.
‘‘(a) IN GENERAL.—The Director shall—
‘‘(1) without regard to section 501 of title 44,
United States Code, promptly publish, make avail-
able, and otherwise disseminate, in a form under-
standable and on as broad a basis as practicable so
as to maximize its use, the results of research, dem-
onstration projects, and evaluations conducted or
supported under this title;
‘‘(2) ensure that information disseminated by
the Agency is science-based and objective and under-
takes consultation as necessary to assess the appro-
priateness and usefulness of the presentation of in-
formation that is targeted to specific audiences;
‘‘(3) promptly make available to the public data
developed in such research, demonstration projects,
and evaluations;
‘‘(4) provide, in collaboration with the National
Library of Medicine where appropriate, indexing, ab-
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stracting, translating, publishing, and other services
leading to a more effective and timely dissemination
of information on research, demonstration projects,
and evaluations with respect to health care to public
and private entities and individuals engaged in the
improvement of health care delivery and the general
public, and undertake programs to develop new or
improved methods for making such information
available; and
‘‘(5) as appropriate, provide technical assistance
to State and local government and health agencies
and conduct liaison activities to such agencies to fos-
ter dissemination.
‘‘(b) PROHIBITION AGAINST RESTRICTIONS.—Except
as provided in subsection (c), the Director may not restrict
the publication or dissemination of data from, or the re-
sults of, projects conducted or supported under this title.
‘‘(c) LIMITATION ON USE OF CERTAIN INFORMA-
TION.—No information, if an establishment or person sup-
plying the information or described in it is identifiable,
obtained in the course of activities undertaken or sup-
ported under this title may be used for any purpose other
than the purpose for which it was supplied unless such
establishment or person has consented (as determined
under regulations of the Director) to its use for such other
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purpose. Such information may not be published or re-
leased in other form if the person who supplied the infor-
mation or who is described in it is identifiable unless such
person has consented (as determined under regulations of
the Director) to its publication or release in other form.
‘‘(d) PENALTY.—Any person who violates subsection
(c) shall be subject to a civil monetary penalty of not more
than $10,000 for each such violation involved. Such pen-
alty shall be imposed and collected in the same manner
as civil money penalties under subsection (a) of section
1128A of the Social Security Act are imposed and col-
lected.
‘‘SEC. 925. ADDITIONAL PROVISIONS WITH RESPECT TO
GRANTS AND CONTRACTS.
‘‘(a) FINANCIAL CONFLICTS
OF INTEREST.—With
respect to projects for which awards of grants, cooperative
agreements, or contracts are authorized to be made under
this title, the Director shall by regulation define—
‘‘(1) the specific circumstances that constitute
financial interests in such projects that will, or may
be reasonably expected to, create a bias in favor of
obtaining results in the projects that are consistent
with such interests; and
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‘‘(2) the actions that will be taken by the Direc-
tor in response to any such interests identified by
the Director.
‘‘(b) REQUIREMENT OF APPLICATION.—The Director
may not, with respect to any program under this title au-
thorizing the provision of grants, cooperative agreements,
or contracts, provide any such financial assistance unless
an application for the assistance is submitted to the Sec-
retary and the application is in such form, is made in such
manner, and contains such agreements, assurances, and
information as the Director determines to be necessary to
carry out the program involved.
‘‘(c) PROVISION
OF SUPPLIES
AND SERVICES
IN
LIEU OF FUNDS.—
‘‘(1) IN GENERAL.—Upon the request of an en-
tity receiving a grant, cooperative agreement, or con-
tract under this title, the Secretary may, subject to
paragraph (2), provide supplies, equipment, and
services for the purpose of aiding the entity in car-
rying out the project involved and, for such purpose,
may detail to the entity any officer or employee of
the Department of Health and Human Services.
‘‘(2) CORRESPONDING REDUCTION IN FUNDS.—
With respect to a request described in paragraph
(1), the Secretary shall reduce the amount of the fi-
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nancial assistance involved by an amount equal to
the costs of detailing personnel and the fair market
value of any supplies, equipment, or services pro-
vided by the Director. The Secretary shall, for the
payment of expenses incurred in complying with
such request, expend the amounts withheld.
‘‘(d) APPLICABILITY OF CERTAIN PROVISIONS WITH
RESPECT TO CONTRACTS.—Contracts may be entered into
under this part without regard to sections 3648 and 3709
of the Revised Statutes (31 U.S.C. 529 and 41 U.S.C.
5).
‘‘SEC. 926. CERTAIN ADMINISTRATIVE AUTHORITIES.
‘‘(a) DEPUTY DIRECTOR AND OTHER OFFICERS AND
EMPLOYEES.—
‘‘(1) DEPUTY
DIRECTOR.—The Director may
appoint a deputy director for the Agency.
‘‘(2) OTHER OFFICERS AND EMPLOYEES.—The
Director may appoint and fix the compensation of
such officers and employees as may be necessary to
carry out this title. Except as otherwise provided by
law, such officers and employees shall be appointed
in accordance with the civil service laws and their
compensation fixed in accordance with title 5,
United States Code.
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‘‘(b) FACILITIES.—The Secretary, in carrying out
this title—
‘‘(1) may acquire, without regard to the Act of
March 3, 1877 (40 U.S.C. 34), by lease or otherwise
through the Director of General Services, buildings
or portions of buildings in the District of Columbia
or communities located adjacent to the District of
Columbia for use for a period not to exceed 10
years; and
‘‘(2) may acquire, construct, improve, repair,
operate, and maintain laboratory, research, and
other necessary facilities and equipment, and such
other real or personal property (including patents)
as the Secretary deems necessary.
‘‘(c) PROVISION OF FINANCIAL ASSISTANCE.—The
Director, in carrying out this title, may make grants to
public and nonprofit entities and individuals, and may
enter into cooperative agreements or contracts with public
and private entities and individuals.
‘‘(d) UTILIZATION OF CERTAIN PERSONNEL AND RE-
SOURCES.—
‘‘(1) DEPARTMENT
OF
HEALTH
AND
HUMAN
SERVICES.—The Director, in carrying out this title,
may utilize personnel and equipment, facilities, and
other physical resources of the Department of
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Health and Human Services, permit appropriate (as
determined by the Secretary) entities and individuals
to utilize the physical resources of such Department,
and provide technical assistance and advice.
‘‘(2) OTHER AGENCIES.—The Director, in car-
rying out this title, may use, with their consent, the
services, equipment, personnel, information, and fa-
cilities of other Federal, State, or local public agen-
cies, or of any foreign government, with or without
reimbursement of such agencies.
‘‘(e) CONSULTANTS.—The Secretary, in carrying out
this title, may secure, from time to time and for such peri-
ods as the Director deems advisable but in accordance
with section 3109 of title 5, United States Code, the as-
sistance and advice of consultants from the United States
or abroad.
‘‘(f) EXPERTS.—
‘‘(1) IN GENERAL.—The Secretary may, in car-
rying out this title, obtain the services of not more
than 50 experts or consultants who have appropriate
scientific or professional qualifications. Such experts
or consultants shall be obtained in accordance with
section 3109 of title 5, United States Code, except
that the limitation in such section on the duration
of service shall not apply.
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‘‘(2) TRAVEL EXPENSES.—
‘‘(A) IN GENERAL.—Experts and consult-
ants whose services are obtained under para-
graph (1) shall be paid or reimbursed for their
expenses associated with traveling to and from
their assignment location in accordance with
sections 
5724, 
5724a(a), 
5724a(c), 
and
5726(C) of title 5, United States Code.
‘‘(B) LIMITATION.—Expenses specified in
subparagraph (A) may not be allowed in con-
nection with the assignment of an expert or
consultant whose services are obtained under
paragraph (1) unless and until the expert
agrees in writing to complete the entire period
of assignment, or 1 year, whichever is shorter,
unless separated or reassigned for reasons that
are beyond the control of the expert or consult-
ant and that are acceptable to the Secretary. If
the expert or consultant violates the agreement,
the money spent by the United States for the
expenses specified in subparagraph (A) is recov-
erable from the expert or consultant as a statu-
tory obligation owed to the United States. The
Secretary may waive in whole or in part a right
of recovery under this subparagraph.
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‘‘(g) VOLUNTARY
AND
UNCOMPENSATED
SERV-
ICES.—The Director, in carrying out this title, may accept
voluntary and uncompensated services.
‘‘SEC. 927. FUNDING.
‘‘(a) INTENT.—To ensure that the United States in-
vestment in biomedical research is rapidly translated into
improvements in the quality of patient care, there must
be a corresponding investment in research on the most ef-
fective clinical and organizational strategies for use of
these findings in daily practice. The authorization levels
in subsections (b) and (c) provide for a proportionate in-
crease in health care research as the United States invest-
ment in biomedical research increases.
‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—For the
purpose of carrying out this title, there are authorized to
be appropriated $250,000,000 for fiscal year 2000, and
such sums as may be necessary for each of the fiscal years
2001 through 2004.
‘‘(c) EVALUATIONS.—In addition to amounts avail-
able pursuant to subsection (b) for carrying out this title,
there shall be made available for such purpose, from the
amounts made available pursuant to section 241 (relating
to evaluations), an amount equal to 40 percent of the max-
imum amount authorized in such section 241 to be made
available for a fiscal year.
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‘‘SEC. 928. DEFINITIONS.
‘‘In this title:
‘‘(1) ADVISORY COUNCIL.—The term ‘Advisory
Council’ means the National Advisory Council on
Health Care Research and Quality established under
section 921.
‘‘(2) AGENCY.—The term ‘Agency’ means the
Agency for Health Research and Quality.
‘‘(3) DIRECTOR.—The term ‘Director’ means
the Director of the Agency for Health Research and
Quality.’’.
(b) RULES OF CONSTRUCTION.—
(1) IN GENERAL.—Section 901(a) of the Public
Health Service Act (as added by subsection (a) of
this section) applies as a redesignation of the agency
that carried out title IX of such Act on the day be-
fore the date of the enactment of this Act, and not
as the termination of such agency and the establish-
ment of a different agency. The amendment made
by subsection (a) of this section does not affect ap-
pointments of the personnel of such agency who
were employed at the agency on the day before such
date.
(2) REFERENCES.—Any reference in law to the
Agency for Health Care Policy and Research is
deemed to be a reference to the Agency for Health
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Research and Quality, and any reference in law to
the Administrator for Health Care Policy and Re-
search is deemed to be a reference to the Director
of the Agency for Health Research and Quality.
SEC. 3. GRANTS REGARDING UTILIZATION OF PREVENTIVE
HEALTH SERVICES.
Subpart I of part D of title III of the Public Health
Service Act (42 U.S.C. 254b et seq.) is amended by adding
at the end the following section:
‘‘SEC. 330D. CENTERS FOR STRATEGIES ON FACILITATING
UTILIZATION OF PREVENTIVE HEALTH SERV-
ICES AMONG VARIOUS POPULATIONS.
‘‘(a) IN GENERAL.—The Secretary, acting through
the appropriate agencies of the Public Health Service,
shall make grants to public or nonprofit private entities
for the establishment and operation of regional centers
whose purpose is to identify particular populations of pa-
tients and facilitate the appropriate utilization of preven-
tive health services by patients in the populations through
developing and disseminating strategies to improve the
methods used by public and private health care programs
and providers in interacting with such patients.
‘‘(b) RESEARCH AND TRAINING.—The activities car-
ried out by a center under subsection (a) may include es-
tablishing programs of research and training with respect
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to the purpose described in such subsection, including the
development of curricula for training individuals in imple-
menting the strategies developed under such subsection.
‘‘(c) QUALITY MANAGEMENT.—A condition for the
receipt of a grant under subsection (a) is that the appli-
cant involved agree that, in order to ensure that the strat-
egies developed under such subsection take into account
principles of quality management with respect to con-
sumer satisfaction, the applicant will make arrangements
with one or more private entities that have experience in
applying such principles.
‘‘(d) PRIORITY REGARDING INFANTS
AND CHIL-
DREN.—In carrying out the purpose described in sub-
section (a), the Secretary shall give priority to various
populations of infants, young children, and their mothers.
‘‘(e) EVALUATIONS.—The Secretary, acting through
the appropriate agencies of the Public Health Service,
shall (directly or through grants or contracts) provide for
the evaluation of strategies under subsection (a) in order
to determine the extent to which the strategies have been
effective in facilitating the appropriate utilization of pre-
ventive health services in the populations with respect to
which the strategies were developed.
‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—For the
purpose of carrying out this section, there are authorized
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to be appropriated such sums as may be necessary for
each of the fiscal years 2000 through 2004.’’.
SEC. 4. PROGRAM OF PAYMENTS TO CHILDREN’S HOS-
PITALS THAT OPERATE GRADUATE MEDICAL
EDUCATION PROGRAMS.
Part D of title III of the Public Health Service Act
(42 U.S.C. 254b et seq.) is amended by adding at the end
the following subpart:
‘‘Subpart IX—Support of Graduate Medical Education
Programs in Children’s Hospitals
‘‘SEC. 340E. PROGRAM OF PAYMENTS TO CHILDREN’S HOS-
PITALS THAT OPERATE GRADUATE MEDICAL
EDUCATION PROGRAMS.
‘‘(a) PAYMENTS.—The Secretary shall make two pay-
ments under this section to each children’s hospital for
each of fiscal years 2000 and 2001, one for the direct ex-
penses and the other for indirect expenses associated with
operating approved graduate medical residency training
programs.
‘‘(b) AMOUNT OF PAYMENTS.—
‘‘(1) IN GENERAL.—Subject to paragraph (2),
the amounts payable under this section to a chil-
dren’s hospital for an approved graduate medical
residency training program for a fiscal year are each
of the following amounts:
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under paragraph (1)(A), the Secretary shall re-
duce the amounts so payable on a pro rata
basis to reflect such shortfall.
‘‘(c) AMOUNT OF PAYMENT FOR DIRECT GRADUATE
MEDICAL EDUCATION.—
‘‘(1) IN
GENERAL.—The amount determined
under this subsection for payments to a children’s
hospital for direct graduate expenses relating to ap-
proved graduate medical residency training pro-
grams for a fiscal year is equal to the product of—
‘‘(A) the updated per resident amount for
direct graduate medical education, as deter-
mined under paragraph (2); and
‘‘(B) the average number of full-time
equivalent residents in the hospital’s graduate
approved medical residency training programs
(as determined under section 1886(h)(4) of the
Social Security Act during the fiscal year.
‘‘(2) UPDATED PER RESIDENT AMOUNT FOR DI-
RECT
GRADUATE
MEDICAL
EDUCATION.—The up-
dated per resident amount for direct graduate med-
ical education for a hospital for a fiscal year is an
amount determined as follows:
‘‘(A) DETERMINATION OF HOSPITAL SIN-
GLE PER RESIDENT AMOUNT.—The Secretary
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shall compute for each hospital operating an
approved graduate medical education program
(regardless of whether or not it is a children’s
hospital) a single per resident amount equal to
the average (weighted by number of full-time
equivalent residents) of the primary care per
resident amount and the non-primary care per
resident 
amount 
computed 
under 
section
1886(h)(2) of the Social Security Act for cost
reporting periods ending during fiscal year
1997.
‘‘(B) DETERMINATION OF WAGE AND NON-
WAGE-RELATED PROPORTION OF THE SINGLE
PER RESIDENT AMOUNT.—The Secretary shall
estimate the average proportion of the single
per resident amounts computed under subpara-
graph (A) that is attributable to wages and
wage-related costs.
‘‘(C) 
STANDARDIZING
PER
RESIDENT
AMOUNTS.—The Secretary shall establish a
standardized per resident amount for each such
hospital—
‘‘(i) by dividing the single per resident
amount computed under subparagraph (A)
into a wage-related portion and a non-
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wage-related portion by applying the pro-
portion determined under subparagraph
(B);
‘‘(ii) by dividing the wage-related por-
tion by the factor applied under section
1886(d)(3)(E) of the Social Security Act
for discharges occurring during fiscal year
1999 for the hospital’s area; and
‘‘(iii) by adding the non-wage-related
portion to the amount computed under
clause (ii).
‘‘(D) DETERMINATION OF NATIONAL AV-
ERAGE.—The Secretary shall compute a na-
tional average per resident amount equal to the
average of the standardized per resident
amounts computed under subparagraph (C) for
such hospitals, with the amount for each hos-
pital weighted by the average number of full-
time equivalent residents at such hospital.
‘‘(E) APPLICATION
TO
INDIVIDUAL
HOS-
PITALS.—The Secretary shall compute for each
such hospital that is a children’s hospital a per
resident amount—
‘‘(i) by dividing the national average
per resident amount computed under sub-
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paragraph (D) into a wage-related portion
and a non-wage-related portion by applying
the proportion determined under subpara-
graph (B);
‘‘(ii) by multiplying the wage-related
portion by the factor described in subpara-
graph (C)(ii) for the hospital’s area; and
‘‘(iii) by adding the non-wage-related
portion to the amount computed under
clause (ii).
‘‘(F) UPDATING
RATE.—The Secretary
shall update such per resident amount for each
such children’s hospital by the estimated per-
centage increase in the consumer price index for
all urban consumers during the period begin-
ning October 1997 and ending with the mid-
point of the hospital’s cost reporting period that
begins during fiscal year 2000.
‘‘(d) AMOUNT OF PAYMENT FOR INDIRECT MEDICAL
EDUCATION.—
‘‘(1) IN
GENERAL.—The amount determined
under this subsection for payments to a children’s
hospital for indirect expenses associated with the
treatment of more severely ill patients and the addi-
tional costs related to the teaching of residents for
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a fiscal year is equal to an amount determined ap-
propriate by the Secretary.
‘‘(2) FACTORS.—In determining the amount
under paragraph (1), the Secretary shall—
‘‘(A) take into account variations in case
mix among children’s hospitals and the number
of full-time equivalent residents in the hospitals’
approved graduate medical residency training
programs; and
‘‘(B) assure that the aggregate of the pay-
ments for indirect expenses associated with the
treatment of more severely ill patients and the
additional costs related to the teaching of resi-
dents under this section in a fiscal year are
equal to the amount appropriated for such ex-
penses for the fiscal year involved under sub-
section (f)(2).
‘‘(e) MAKING OF PAYMENTS.—
‘‘(1) INTERIM PAYMENTS.—The Secretary shall
determine, before the beginning of each fiscal year
involved for which payments may be made for a hos-
pital under this section, the amounts of the pay-
ments for direct graduate medical education and in-
direct medical education for such fiscal year and
shall (subject to paragraph (2)) make the payments
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of such amounts in 26 equal interim installments
during such period.
‘‘(2) WITHHOLDING.—The Secretary shall with-
hold up to 25 percent from each interim installment
for direct graduate medical education paid under
paragraph (1).
‘‘(3) RECONCILIATION.—At the end of each fis-
cal year for which payments may be made under this
section, the hospital shall submit to the Secretary
such information as the Secretary determines to be
necessary to determine the percent (if any) of the
total amount withheld under paragraph (2) that is
due under this section for the hospital for the fiscal
year. Based on such determination, the Secretary
shall recoup any overpayments made, or pay any
balance due. The amount so determined shall be
considered a final intermediary determination for
purposes of applying section 1878 of the Social Se-
curity Act and shall be subject to review under that
section in the same manner as the amount of pay-
ment under section 1886(d) of such Act is subject
to review under such section.
‘‘(f) AUTHORIZATION OF APPROPRIATIONS.—
‘‘(1) 
DIRECT
GRADUATE
MEDICAL
EDU-
CATION.—
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‘‘(A) IN GENERAL.—There are hereby au-
thorized to be appropriated, out of any money
in the Treasury not otherwise appropriated, for
payments under subsection (b)(1)(A)—
‘‘(i) for fiscal year 2000, $90,000,000;
and
‘‘(ii) 
for 
fiscal 
year 
2001,
$95,000,000.
‘‘(B) 
CARRYOVER
OF
EXCESS.—The
amounts appropriated under subparagraph (A)
for fiscal year 2000 shall remain available for
obligation through the end of fiscal year 2001.
‘‘(2) INDIRECT
MEDICAL
EDUCATION.—There
are hereby authorized to be appropriated, out of any
money in the Treasury not otherwise appropriated,
for payments under subsection (b)(1)(A)—
‘‘(A) for fiscal year 2000, $190,000,000;
and
‘‘(B) for fiscal year 2001, $190,000,000.
‘‘(g) DEFINITIONS.—In this section:
‘‘(1) APPROVED
GRADUATE
MEDICAL
RESI-
DENCY
TRAINING
PROGRAM.—The term ‘approved
graduate medical residency training program’ has
the meaning given the term ‘approved medical resi-
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dency training program’ in section 1886(h)(5)(A) of
the Social Security Act.
‘‘(2) CHILDREN’S HOSPITAL.—The term ‘chil-
dren’s hospital’ means a hospital described in section
1886(d)(1)(B)(iii) of the Social Security Act.
‘‘(3) DIRECT GRADUATE MEDICAL EDUCATION
COSTS.—The term ‘direct graduate medical edu-
cation costs’ has the meaning given such term in
section 1886(h)(5)(C) of the Social Security Act.’’.
SEC. 5. STUDY REGARDING SHORTAGES OF LICENSED
PHARMACISTS.
(a) IN GENERAL.—The Secretary of Health and
Human Services (in this section referred to as the ‘‘Sec-
retary’’), acting through the appropriate agencies of the
Public Health Services, shall conduct a study to determine
whether and to what extent there is a shortage of licensed
pharmacists. In carrying out the study, the Secretary shall
seek the comments of appropriate public and private enti-
ties regarding any such shortage.
(b) REPORT TO CONGRESS.—Not later than 1 year
after the date of the enactment of this Act, the Secretary
shall complete the study under subsection (a) and submit
to the Congress a report that describes the findings made
through the study and that contains a summary of the
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comments received by the Secretary pursuant to such sub-
section.
SEC. 6. REPORT ON TELEMEDICINE.
Not later than January 10, 2001, the Director of the
Agency for Health Research and Quality shall submit to
the Congress a report that—
(1) identifies any factors that inhibit the expan-
sion and accessibility of telemedicine services, includ-
ing factors relating to telemedicine networks;
(2) identifies any factors that, in addition to
geographical isolation, should be used to determine
which patients need or require access to telemedicine
care;
(3) determines the extent to which—
(A) patients receiving telemedicine service
have benefited from the services, and are satis-
fied with the treatment received pursuant to the
services; and
(B) the medical outcomes for such patients
would have differed if telemedicine services had
not been available to the patients;
(4) determines the extent to which physicians
involved with telemedicine services have been satis-
fied with the medical aspects of the services;
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(5) determines the extent to which primary care
physicians are enhancing their medical knowledge
and experience through the interaction with special-
ists provided by telemedicine consultations; and
(6) identifies legal and medical issues relating
to State licensing of health professionals that are
presented by telemedicine services, and provides any
recommendations of the Director for responding to
such issues.
SEC. 7. BUY AMERICAN PROVISIONS.
(a) COMPLIANCE WITH BUY AMERICAN ACT.—No
funds authorized pursuant to this Act may be expended
by an entity unless the entity agrees that in expending
the assistance the entity will comply with sections 2
through 4 of the Act of March 3, 1933 (41 U.S.C. 10a–
10c, popularly known as the ‘‘Buy American Act’’).
(b) SENSE OF THE CONGRESS; REQUIREMENT RE-
GARDING NOTICE.—
(1) PURCHASE OF AMERICAN-MADE EQUIPMENT
AND PRODUCTS.—In the case of any equipment or
products that may be authorized to be purchased
with financial assistance provided under this Act, it
is the sense of the Congress that entities receiving
such assistance should, in expending the assistance,
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purchase only American-made equipment and prod-
ucts.
(2) NOTICE TO RECIPIENTS OF ASSISTANCE.—
In providing financial assistance under this Act, the
Secretary of Health and Human Services shall pro-
vide to each recipient of the assistance a notice de-
scribing the statement made in paragraph (1) by the
Congress.
Passed the House of Representatives September 28,
1999.
Attest:
JEFF TRANDAHL,
Clerk.