H. R. 3590—803 
2008, as of September 30, 2009, the applicable 
percentage is equal to 17.5 percent; 
‘‘(III) if the State is not a low DSH State 
described in paragraph (5)(B) and has spent not 
more than 99.90 percent of the DSH allotments 
for the State on average for the period of fiscal 
years 2004 through 2008, as of September 30, 
2009, the applicable percentage is equal to 50 per-
cent; and 
‘‘(IV) if the State is not a low DSH State 
described in paragraph (5)(B) and has spent more 
than 99.90 percent of the DSH allotments for the 
State on average for the period of fiscal years 
2004 through 2008, as of September 30, 2009, the 
applicable percentage is equal to 35 percent.’’; 
(II) in clause (ii), by striking subclauses (I) and 
(II), and inserting the following: 
‘‘(I) if the State is a low DSH State described 
in paragraph (5)(B) and has spent not more than 
99.90 percent of the DSH allotments for the State 
on average for the period of fiscal years 2004 
through 2008, as of September 30, 2009, the 
applicable percentage is equal to the product of 
the percentage reduction in uncovered individuals 
for the fiscal year from the preceding fiscal year 
and 27.5 percent; 
‘‘(II) if the State is a low DSH State described 
in paragraph (5)(B) and has spent more than 99.90 
percent of the DSH allotments for the State on 
average for the period of fiscal years 2004 through 
2008, as of September 30, 2009, the applicable 
percentage is equal to the product of the percent-
age reduction in uncovered individuals for the 
fiscal year from the preceding fiscal year and 20 
percent; 
‘‘(III) if the State is not a low DSH State 
described in paragraph (5)(B) and has spent not 
more than 99.90 percent of the DSH allotments 
for the State on average for the period of fiscal 
years 2004 through 2008, as of September 30, 
2009, the applicable percentage is equal to the 
product of the percentage reduction in uncovered 
individuals for the fiscal year from the preceding 
fiscal year and 55 percent; and 
‘‘(IV) if the State is not a low DSH State 
described in paragraph (5)(B) and has spent more 
than 99.90 percent of the DSH allotments for the 
State on average for the period of fiscal years 
2004 through 2008, as of September 30, 2009, the 
applicable percentage is equal to the product of 
the percentage reduction in uncovered individuals 
for the fiscal year from the preceding fiscal year 
and 40 percent.’’; 
(III) in subparagraph (E), by striking ‘‘35 percent’’ 
and inserting ‘‘50 percent’’; and 
(IV) by adding at the end the following:
H. R. 3590—804 
‘‘(G) NONAPPLICATION.—The preceding provisions of 
this paragraph shall not apply to the DSH allotment deter-
mined for the State of Hawaii for a fiscal year under 
paragraph (6).’’. 
(f) Section 2551 of this Act is amended by striking subsection 
(b). 
(g) Section 2105(d)(3)(B) of the Social Security Act (42 U.S.C. 
1397ee(d)(3)(B)), as added by section 2101(b)(1), is amended by 
adding at the end the following: ‘‘For purposes of eligibility for 
premium assistance for the purchase of a qualified health plan 
under section 36B of the Internal Revenue Code of 1986 and reduced 
cost-sharing under section 1402 of the Patient Protection and 
Affordable Care Act, children described in the preceding sentence 
shall be deemed to be ineligible for coverage under the State child 
health plan.’’. 
(h) Clause (i) of subparagraph (C) of section 513(b)(2) of the 
Social Security Act, as added by section 2953 of this Act, is amended 
to read as follows: 
‘‘(i) Healthy relationships, including marriage and 
family interactions.’’. 
(i) Section 1115 of the Social Security Act (42 U.S.C. 1315) 
is amended by inserting after subsection (c) the following: 
‘‘(d)(1) An application or renewal of any experimental, pilot, 
or demonstration project undertaken under subsection (a) to pro-
mote the objectives of title XIX or XXI in a State that would 
result in an impact on eligibility, enrollment, benefits, cost-sharing, 
or financing with respect to a State program under title XIX or 
XXI (in this subsection referred to as a ‘demonstration project’) 
shall be considered by the Secretary in accordance with the regula-
tions required to be promulgated under paragraph (2). 
‘‘(2) Not later than 180 days after the date of enactment of 
this subsection, the Secretary shall promulgate regulations relating 
to applications for, and renewals of, a demonstration project that 
provide for— 
‘‘(A) a process for public notice and comment at the State 
level, including public hearings, sufficient to ensure a meaning-
ful level of public input; 
‘‘(B) requirements relating to— 
‘‘(i) the goals of the program to be implemented or 
renewed under the demonstration project; 
‘‘(ii) the expected State and Federal costs and coverage 
projections of the demonstration project; and 
‘‘(iii) the specific plans of the State to ensure that 
the demonstration project will be in compliance with title 
XIX or XXI; 
‘‘(C) a process for providing public notice and comment 
after the application is received by the Secretary, that is suffi-
cient to ensure a meaningful level of public input; 
‘‘(D) a process for the submission to the Secretary of peri-
odic reports by the State concerning the implementation of 
the demonstration project; and 
‘‘(E) a process for the periodic evaluation by the Secretary 
of the demonstration project. 
‘‘(3) The Secretary shall annually report to Congress concerning 
actions taken by the Secretary with respect to applications for 
demonstration projects under this section.’’.
H. R. 3590—805 
(j) Subtitle F of title III of this Act is amended by adding 
at the end the following: 
‘‘SEC. 3512. GAO STUDY AND REPORT ON CAUSES OF ACTION. 
‘‘(a) STUDY.— 
‘‘(1) IN GENERAL.—The Comptroller General of the United 
States shall conduct a study of whether the development, rec-
ognition, or implementation of any guideline or other standards 
under a provision described in paragraph (2) would result in 
the establishment of a new cause of action or claim. 
‘‘(2) PROVISIONS DESCRIBED.—The provisions described in 
this paragraph include the following: 
‘‘(A) Section 2701 (adult health quality measures). 
‘‘(B) Section 2702 (payment adjustments for health care 
acquired conditions). 
‘‘(C) Section 3001 (Hospital Value-Based Purchase Pro-
gram). 
‘‘(D) Section 3002 (improvements to the Physician 
Quality Reporting Initiative). 
‘‘(E) Section 3003 (improvements to the Physician Feed-
back Program). 
‘‘(F) Section 3007 (value based payment modifier under 
physician fee schedule). 
‘‘(G) Section 3008 (payment adjustment for conditions 
acquired in hospitals). 
‘‘(H) Section 3013 (quality measure development). 
‘‘(I) Section 3014 (quality measurement). 
‘‘(J) Section 3021 (Establishment of Center for Medi-
care and Medicaid Innovation). 
‘‘(K) Section 3025 (hospital readmission reduction pro-
gram). 
‘‘(L) Section 3501 (health care delivery system research, 
quality improvement). 
‘‘(M) Section 4003 (Task Force on Clinical and Preven-
tive Services). 
‘‘(N) Section 4301 (research to optimize deliver of public 
health services). 
‘‘(b) REPORT.—Not later than 2 years after the date of enact-
ment of this Act, the Comptroller General of the United States 
shall submit to the appropriate committees of Congress, a report 
containing the findings made by the Comptroller General under 
the study under subsection (a).’’. 
SEC. 10202. INCENTIVES FOR STATES TO OFFER HOME AND COMMU-
NITY-BASED SERVICES AS A LONG-TERM CARE ALTER-
NATIVE TO NURSING HOMES. 
(a) STATE BALANCING INCENTIVE PAYMENTS PROGRAM.—Not-
withstanding section 1905(b) of the Social Security Act (42 U.S.C. 
1396d(b)), in the case of a balancing incentive payment State, 
as defined in subsection (b), that meets the conditions described 
in subsection (c), during the balancing incentive period, the Federal 
medical assistance percentage determined for the State under sec-
tion 1905(b) of such Act and, if applicable, increased under sub-
section (z) or (aa) shall be increased by the applicable percentage 
points determined under subsection (d) with respect to eligible 
medical assistance expenditures described in subsection (e). 
(b) BALANCING INCENTIVE PAYMENT STATE.—A balancing incen-
tive payment State is a State—
H. R. 3590—806 
(1) in which less than 50 percent of the total expenditures 
for medical assistance under the State Medicaid program for 
a fiscal year for long-term services and supports (as defined 
by the Secretary under subsection (f))(1)) are for non-institution-
ally-based long-term services and supports described in sub-
section (f)(1)(B); 
(2) that submits an application and meets the conditions 
described in subsection (c); and 
(3) that is selected by the Secretary to participate in the 
State balancing incentive payment program established under 
this section. 
(c) CONDITIONS.—The conditions described in this subsection 
are the following: 
(1) APPLICATION.—The State submits an application to the 
Secretary that includes, in addition to such other information 
as the Secretary shall require— 
(A) a proposed budget that details the State’s plan 
to expand and diversify medical assistance for non-institu-
tionally-based long-term services and supports described 
in subsection (f)(1)(B) under the State Medicaid program 
during the balancing incentive period and achieve the tar-
get spending percentage applicable to the State under para-
graph (2), including through structural changes to how 
the State furnishes such assistance, such as through the 
establishment of a ‘‘no wrong door—single entry point 
system’’, optional presumptive eligibility, case management 
services, and the use of core standardized assessment 
instruments, and that includes a description of the new 
or expanded offerings of such services that the State will 
provide and the projected costs of such services; and 
(B) in the case of a State that proposes to expand 
the provision of home and community-based services under 
its State Medicaid program through a State plan amend-
ment under section 1915(i) of the Social Security Act, at 
the option of the State, an election to increase the income 
eligibility for such services from 150 percent of the poverty 
line to such higher percentage as the State may establish 
for such purpose, not to exceed 300 percent of the supple-
mental security income benefit rate established by section 
1611(b)(1) of the Social Security Act (42 U.S.C. 1382(b)(1)). 
(2) TARGET SPENDING PERCENTAGES.— 
(A) In the case of a balancing incentive payment State 
in which less than 25 percent of the total expenditures 
for long-term services and supports under the State Med-
icaid program for fiscal year 2009 are for home and commu-
nity-based services, the target spending percentage for the 
State to achieve by not later than October 1, 2015, is 
that 25 percent of the total expenditures for long-term 
services and supports under the State Medicaid program 
are for home and community-based services. 
(B) In the case of any other balancing incentive pay-
ment State, the target spending percentage for the State 
to achieve by not later than October 1, 2015, is that 50 
percent of the total expenditures for long-term services 
and supports under the State Medicaid program are for 
home and community-based services.