II 
111TH CONGRESS 
1ST SESSION H. R. 3961 
IN THE SENATE OF THE UNITED STATES 
NOVEMBER 20, 2009 
Received 
DECEMBER 24, 2009 
Read the first time 
AN ACT 
To amend title XVIII of the Social Security Act to reform 
the Medicare SGR payment system for physicians and 
to reinstitute and update the Pay-As-You-Go requirement 
of budget neutrality on new tax and mandatory spending 
legislation, enforced by the threat of annual, automatic 
sequestration. 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6652
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
DIVISION A—MEDICARE PHYSI-
CIAN PAYMENT REFORM ACT 
OF 2009 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This division may be cited as the 
‘‘Medicare Physician Payment Reform Act of 2009’’. 
(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
DIVISION A—MEDICARE PHYSICIAN PAYMENT REFORM ACT OF 
2009 
Sec. 1. Short title; table of contents. 
Sec. 2. Medicare sustainable growth rate reform. 
DIVISION B—STATUTORY PAY-AS-YOU-GO ACT OF 2009 
Sec. 101. Short Title. 
Sec. 102. Purpose. 
Sec. 103. Definitions. 
Sec. 104. PAYGO estimates and PAYGO scorecards. 
Sec. 105. Annual report and sequestration order. 
Sec. 106. Calculating a sequestration. 
Sec. 107. Current policy adjustment to the CBO estimates. 
Sec. 108. Application of BBEDCA. 
Sec. 109. Technical corrections. 
Sec. 110. Conforming amendments. 
Sec. 111. Exempt programs and activities. 
SEC. 2. MEDICARE SUSTAINABLE GROWTH RATE REFORM. 
(a) TRANSITIONAL
UPDATE
FOR
2010.—Section 
1848(d) of the Social Security Act (42 U.S.C. 1395w– 
4(d)) is amended by adding at the end the following new 
paragraph: 
‘‘(10) UPDATE FOR 2010.—The update to the 
single conversion factor established in paragraph 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
(1)(C) for 2010 shall be the percentage increase in 
the MEI (as defined in section 1842(i)(3)) for that 
year.’’. 
(b) REBASING SGR USING 2009; LIMITATION ON 
CUMULATIVE ADJUSTMENT PERIOD.—Section 1848(d)(4) 
of such Act (42 U.S.C. 1395w–4(d)(4)) is amended— 
(1) in subparagraph (B), by striking ‘‘subpara-
graph (D)’’ and inserting ‘‘subparagraphs (D) and 
(G)’’; and 
(2) by adding at the end the following new sub-
paragraph: 
‘‘(G) REBASING USING 2009 FOR FUTURE 
UPDATE
ADJUSTMENTS.—In determining the 
update adjustment factor under subparagraph 
(B) for 2011 and subsequent years— 
‘‘(i) the allowed expenditures for 2009 
shall be equal to the amount of the actual 
expenditures for physicians’ services during 
2009; and 
‘‘(ii) the reference in subparagraph 
(B)(ii)(I) to ‘April 1, 1996’ shall be treat-
ed as a reference to ‘January 1, 2009 (or, 
if later, the first day of the fifth year be-
fore the year involved)’.’’. 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
(c) LIMITATION
ON
PHYSICIANS’ SERVICES
IN-
CLUDED IN TARGET GROWTH RATE COMPUTATION TO 
SERVICES COVERED UNDER PHYSICIAN FEE SCHED-
ULE.—Effective for services furnished on or after January 
1, 2009, section 1848(f)(4)(A) of such Act is amended by 
striking ‘‘(such as clinical’’ and all that follows through 
‘‘in a physician’s office’’ and inserting ‘‘for which payment 
under this part is made under the fee schedule under this 
section, for services for practitioners described in section 
1842(b)(18)(C) on a basis related to such fee schedule, 
or for services described in section 1861(p) (other than 
such services when furnished in the facility of a provider 
of services)’’. 
(d) 
ESTABLISHMENT
OF
SEPARATE
TARGET 
GROWTH RATES FOR CATEGORIES OF SERVICES.— 
(1) 
ESTABLISHMENT
OF
SERVICE
CAT-
EGORIES.—Subsection (j) of section 1848 of the So-
cial Security Act (42 U.S.C. 1395w–4) is amended 
by adding at the end the following new paragraph: 
‘‘(5) SERVICE CATEGORIES.—For services fur-
nished on or after January 1, 2009, each of the fol-
lowing categories of physicians’ services (as defined 
in paragraph (3)) shall be treated as a separate 
‘service category’: 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘(A) Evaluation and management services 
that are procedure codes (for services covered 
under this title) for— 
‘‘(i) services in the category des-
ignated Evaluation and Management in the 
Health Care Common Procedure Coding 
System (established by the Secretary under 
subsection (c)(5) as of December 31, 2009, 
and as subsequently modified by the Sec-
retary); and 
‘‘(ii) preventive services (as defined in 
section 1861(iii)) for which payment is 
made under this section. 
‘‘(B) All other services not described in 
subparagraph (A). 
Service categories established under this paragraph 
shall apply without regard to the specialty of the 
physician furnishing the service.’’. 
(2) ESTABLISHMENT
OF
SEPARATE
CONVER-
SION
FACTORS
FOR
EACH
SERVICE
CATEGORY.— 
Subsection (d)(1) of section 1848 of the Social Secu-
rity Act (42 U.S.C. 1395w–4) is amended— 
(A) in subparagraph (A)— 
(i) by designating the sentence begin-
ning ‘‘The conversion factor’’ as clause (i) 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
with the heading ‘‘APPLICATION OF SIN-
GLE
CONVERSION
FACTOR.—’’ and with 
appropriate indentation; 
(ii) by striking ‘‘The conversion fac-
tor’’ and inserting ‘‘Subject to clause (ii), 
the conversion factor’’; and 
(iii) by adding at the end the fol-
lowing new clause: 
‘‘(ii) APPLICATION OF MULTIPLE CON-
VERSION
FACTORS
BEGINNING
WITH 
2011.— 
‘‘(I) IN
GENERAL.—In applying 
clause (i) for years beginning with 
2011, separate conversion factors 
shall be established for each service 
category of physicians’ services (as de-
fined in subsection (j)(5)) and any 
reference in this section to a conver-
sion factor for such years shall be 
deemed to be a reference to the con-
version factor for each of such cat-
egories. 
‘‘(II) INITIAL CONVERSION FAC-
TORS.—Such factors for 2011 shall be 
based upon the single conversion fac-
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
tor for the previous year multiplied by 
the update established under para-
graph (11) for such category for 
2011. 
‘‘(III) UPDATING
OF
CONVER-
SION
FACTORS.—Such factor for a 
service category for a subsequent year 
shall be based upon the conversion 
factor for such category for the pre-
vious year and adjusted by the update 
established for such category under 
paragraph (11) for the year in-
volved.’’; and 
(B) in subparagraph (D), by striking 
‘‘other physicians’ services’’ and inserting ‘‘for 
physicians’ services described in the service cat-
egory described in subsection (j)(5)(B)’’. 
(3) ESTABLISHING UPDATES FOR CONVERSION 
FACTORS
FOR
SERVICE
CATEGORIES.—Section 
1848(d) of the Social Security Act (42 U.S.C. 
1395w–4(d)), as amended by subsection (a), is 
amended— 
(A) in paragraph (4)(C)(iii), by striking 
‘‘The allowed’’ and inserting ‘‘Subject to para-
graph (11)(B), the allowed’’; and 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
(B) by adding at the end the following new 
paragraph: 
‘‘(11) UPDATES FOR SERVICE CATEGORIES BE-
GINNING WITH 2011.— 
‘‘(A) IN GENERAL.—In applying paragraph 
(4) for a year beginning with 2011, the fol-
lowing rules apply: 
‘‘(i) APPLICATION OF SEPARATE UP-
DATE ADJUSTMENTS FOR EACH SERVICE 
CATEGORY.—Pursuant 
to 
paragraph 
(1)(A)(ii)(I), the update shall be made to 
the conversion factor for each service cat-
egory (as defined in subsection (j)(5)) 
based upon an update adjustment factor 
for the respective category and year and 
the update adjustment factor shall be com-
puted, for a year, separately for each serv-
ice category. 
‘‘(ii) COMPUTATION OF ALLOWED AND 
ACTUAL EXPENDITURES BASED ON SERV-
ICE CATEGORIES.—In computing the prior 
year adjustment component and the cumu-
lative adjustment component under clauses 
(i) and (ii) of paragraph (4)(B), the fol-
lowing rules apply: 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘(I) APPLICATION
BASED
ON 
SERVICE
CATEGORIES.—The allowed 
expenditures and actual expenditures 
shall be the allowed and actual ex-
penditures for the service category, as 
determined under subparagraph (B). 
‘‘(II) APPLICATION OF CATEGORY 
SPECIFIC
TARGET
GROWTH
RATE.— 
The growth rate applied under clause 
(ii)(II) of such paragraph shall be the 
target growth rate for the service cat-
egory involved under subsection (f)(5). 
‘‘(B) DETERMINATION
OF
ALLOWED
EX-
PENDITURES.—In applying paragraph (4) for a 
year beginning with 2010, notwithstanding sub-
paragraph (C)(iii) of such paragraph, the al-
lowed expenditures for a service category for a 
year is an amount computed by the Secretary 
as follows: 
‘‘(i) FOR 2010.—For 2010: 
‘‘(I) TOTAL
2009
ACTUAL
EX-
PENDITURES FOR ALL SERVICES IN-
CLUDED
IN
SGR
COMPUTATION
FOR 
EACH SERVICE CATEGORY.—Compute 
total actual expenditures for physi-
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00009
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
cians’ services (as defined in sub-
section (f)(4)(A)) for 2009 for each 
service category. 
‘‘(II) 
INCREASE
BY
GROWTH 
RATE TO OBTAIN 2010 ALLOWED EX-
PENDITURES
FOR
SERVICE
CAT-
EGORY.—Compute allowed expendi-
tures for the service category for 2010 
by increasing the allowed expenditures 
for the service category for 2009 com-
puted under subclause (I) by the tar-
get growth rate for such service cat-
egory under subsection (f) for 2010. 
‘‘(ii) FOR SUBSEQUENT YEARS.—For 
a subsequent year, take the amount of al-
lowed expenditures for such category for 
the preceding year (under clause (i) or this 
clause) and increase it by the target 
growth rate determined under subsection 
(f) for such category and year.’’. 
(4) 
APPLICATION
OF
SEPARATE
TARGET 
GROWTH RATES FOR EACH CATEGORY.— 
(A) IN GENERAL.—Section 1848(f) of the 
Social Security Act (42 U.S.C. 1395w–4(f)) is 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00010
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
amended by adding at the end the following 
new paragraph: 
‘‘(5) APPLICATION
OF
SEPARATE
TARGET 
GROWTH RATES FOR EACH SERVICE CATEGORY BE-
GINNING WITH 2010.—The target growth rate for a 
year beginning with 2010 shall be computed and ap-
plied separately under this subsection for each serv-
ice category (as defined in subsection (j)(5)) and 
shall be computed using the same method for com-
puting the target growth rate except that the factor 
described in paragraph (2)(C) for— 
‘‘(A) the service category described in sub-
section (j)(5)(A) shall be increased by 0.02; and 
‘‘(B) the service category described in sub-
section (j)(5)(B) shall be increased by 0.01.’’. 
(B) USE OF TARGET GROWTH RATES.— 
Section 1848 of such Act is further amended— 
(i) in subsection (d)— 
(I) in paragraph (1)(E)(ii), by in-
serting ‘‘or target’’ after ‘‘sustain-
able’’; and 
(II) in paragraph (4)(B)(ii)(II), 
by inserting ‘‘or target’’ after ‘‘sus-
tainable’’; 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00011
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
(ii) in the heading of subsection (f), 
by inserting ‘‘AND
TARGET
GROWTH 
RATE’’ 
after 
‘‘SUSTAINABLE
GROWTH 
RATE’’; 
(iii) in subsection (f)(1)— 
(I) by striking ‘‘and’’ at the end 
of subparagraph (A); 
(II) in subparagraph (B), by in-
serting ‘‘before 2010’’ after ‘‘each 
succeeding year’’ and by striking the 
period at the end and inserting ‘‘; 
and’’; and 
(III) by adding at the end the 
following new subparagraph: 
‘‘(C) November 1 of each succeeding year 
the target growth rate for such succeeding year 
and each of the 2 preceding years.’’; and 
(iv) in subsection (f)(2), in the matter 
before subparagraph (A), by inserting after 
‘‘beginning with 2000’’ the following: ‘‘and 
ending with 2009’’. 
(e) APPLICATION TO HEALTH CARE GROUP DEM-
ONSTRATION PROGRAM AND SUCCESSOR ACCOUNTABLE 
CARE ORGANIZATION PILOT PROGRAM.—In applying the 
target growth rate under subsections (d) and (f) of section 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00012
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
1848 of the Social Security Act to services furnished by 
a practitioner to beneficiaries who are attributable to a 
health care group under the demonstration program pro-
vided under section 1886A of such Act (or to an account-
able care organization under a pilot program that is a 
succcessor to such demonstration program under a section 
of such Act), the Secretary of Health and Human Services 
shall develop, not later than January 1, 2012, for applica-
tion beginning with 2012, a method that— 
(1) allows each such group or organization to 
have its own expenditure targets and updates for 
such practitioners, with respect to beneficiaries who 
are attributable to that group or organization, that 
are consistent with the methodologies described in 
such subsection (f); and 
(2) provides that the target growth rate appli-
cable to other physicians shall not apply to such 
physicians to the extent that the physicians’ services 
are furnished through the group or organization. 
In applying paragraph (1), the Secretary of Health and 
Human Services may apply the difference in the update 
under such paragraph on a claim-by-claim or lump sum 
basis and such a payment shall be taken into account 
under the demonstration or pilot program. 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00013
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
DIVISION B—STATUTORY PAY- 
AS-YOU-GO ACT OF 2009 
SEC. 101. SHORT TITLE. 
This division may be cited as the ‘‘Statutory Pay-As- 
You-Go Act of 2009’’. 
SEC. 102. PURPOSE. 
The purpose of this division is to reestablish a statu-
tory procedure to enforce a rule of budget neutrality on 
new revenue and direct spending legislation. 
SEC. 103. DEFINITIONS. 
As used in this division— 
(1) The term ‘‘BBEDCA’’ means the Balanced 
Budget and Emergency Deficit Control Act of 1985. 
(2) The definitions set forth in section 3 of the 
Congressional Budget and Impoundment Control 
Act of 1974 and in section 250 of BBEDCA shall 
apply to this division, except to the extent that they 
are specifically modified as follows: 
(A) The term ‘‘outyear’’ means a fiscal 
year that occurs one or more years after the 
budget year. 
(B) In section 250(c)(8)(C), the reference 
to the food stamp program shall be deemed to 
be a reference to the Supplemental Nutrition 
Assistance Program. 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00014
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
(3) The term ‘‘AMT’’ means the Alternative 
Minimum Tax for individuals under sections 55–59 
of the Internal Revenue Code of 1986, the term 
‘‘EGTRRA’’ means the Economic Growth and Tax 
Relief Reconciliation Act of 2001 (Public Law 107– 
16), and the term ‘‘JGTRRA’’ means the Jobs and 
Growth Tax Relief and Reconciliation Act of 2003 
(Public Law 108–27). 
(4)(A) The term ‘‘budgetary effects’’ means the 
amounts by which PAYGO legislation changes direct 
spending or revenues relative to the baseline and 
shall be determined on the basis of estimates in-
cluded by reference in the PAYGO Act or prepared 
under section 104(d)(3), as applicable. Budgetary 
effects that increase direct spending or decrease rev-
enues are termed ‘‘costs’’ and budgetary effects that 
increase revenues or decrease direct spending are 
termed ‘‘savings’’. 
(B) For purposes of these definitions, off-budg-
et effects shall be counted as budgetary effects un-
less such changes flow directly from amendments to 
title II of the Social Security Act and related provi-
sions of the Internal Revenue Code of 1986 and debt 
service effects shall not be counted as budgetary ef-
fects. 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00015
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
(C) Solely for purposes of recording entries on 
a PAYGO scorecard, provisions in appropriations 
Acts are also considered to be budgetary effects for 
purposes of this division if such provisions make out-
year modifications to substantive law, except that 
provisions for which the outlay effects net to zero 
over a period consisting of the current year, the 
budget year, and the 4 subsequent years shall not be 
considered budgetary effects. For purposes of this 
paragraph, the term, ‘‘modifications to substantive 
law’’ refers to changes to or restrictions on entitle-
ment law or other mandatory spending contained in 
appropriations 
Acts, 
notwithstanding 
section 
250(c)(8) of BBEDCA. Provisions in appropriations 
Acts that are neither outyear modifications to sub-
stantive law nor changes in revenues have no budg-
etary effects for purposes of this division. 
(D) If a provision is designated as an emer-
gency requirement under this division and is also 
designated as an emergency requirement under the 
applicable rules of the House of Representatives, 
CBO shall not include the cost of such a provision 
in its estimate of the PAYGO legislation’s budgetary 
effects. 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00016
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
(5) The term ‘‘debit’’ refers to the net total 
amount, when positive, by which costs recorded on 
the PAYGO scorecards for a fiscal year exceed sav-
ings recorded on those scorecards for that year. 
(6) The term ‘‘entitlement law’’ refers to a sec-
tion of law which provides entitlement authority. 
(7) The term ‘‘PAYGO legislation’’ or a 
‘‘PAYGO Act’’ refers to a bill or joint resolution 
that affects direct spending or revenue relative to 
the baseline. The budgetary effects of changes in 
revenues and outyear modifications to substantive 
law included in appropriation Acts as defined in 
paragraph (4) shall be treated as if they were con-
tained in PAYGO legislation. 
(8) The term ‘‘timing shift’’ refers to a delay of 
the date on which direct spending would otherwise 
occur from the ninth outyear to the tenth outyear or 
an acceleration of the date on which revenues would 
otherwise occur from the tenth outyear to the ninth 
outyear. 
SEC. 104. PAYGO ESTIMATES AND PAYGO SCORECARDS. 
(a) PAYGO ESTIMATES.—(1) A PAYGO Act shall in-
clude by reference an estimate of its budgetary effects as 
determined under section 308(a)(3) of the Congressional 
Budget Act of 1974, if timely submitted for printing in 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00017
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
the Congressional Record by the chairs of the Committees 
on the Budget of the House of Representatives and the 
Senate, as applicable, before the vote on the PAYGO legis-
lation. The Clerk of the House or the Secretary of the 
Senate, as applicable, shall also incorporate by reference 
such estimate printed in the relevant portion of the Con-
gressional Record under section 308(a)(3) of the Congres-
sional Budget Act of 1974 into the enrollment of a 
PAYGO Act. Budgetary effects that are not so included 
shall be determined under section 104(d)(3). 
(2)(A) Section 308(a) of the Congressional Budget 
Act of 1974 is amended by adding at the end the following 
new paragraph: 
‘‘(3) CBO PAYGO ESTIMATES.—Before a vote in 
either House on a PAYGO Act that, if determined 
in the affirmative, would clear such Act for enroll-
ment, the chairs of the Committees on the Budget 
of the House and Senate, as applicable, shall request 
from the Director of the Congressional Budget Of-
fice an estimate of the budgetary effects of such Act 
under the Statutory Pay-As-You-Go Act of 2009. If 
such an estimate is timely provided, the chairs of the 
Committees on the Budget of the House of Rep-
resentatives and the Senate shall post such estimate 
on their respective committee websites and cause it 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00018
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
to be printed in the Congressional Record under the 
heading ‘PAYGO ESTIMATE’. For purposes of this 
section, the Director of the Congressional Budget 
Office shall not count timing shifts in his estimates 
of the budgetary effects of PAYGO legislation (as 
defined in section 103 of the Statutory Pay-As-You- 
Go Act of 2009).’’. 
(B) The side heading of section 308(a) of the Con-
gressional Budget Act of 1974 is amended by striking 
‘‘REPORTS ON’’. 
(b) Section 308 of the Congressional Budget Act of 
1974 is amended by adding at the end the following new 
subsection: 
‘‘(d) SCOREKEEPING GUIDELINES.—The Director of 
the Congressional Budget Office shall provide estimates 
under this section in accordance with the scorekeeping 
guidelines determined under section 252(d)(5) of the Bal-
anced Budget and Emergency Deficit Control Act of 1985. 
Upon agreement, the chairs of the Committees on the 
Budget of the House of Representatives and the Senate 
shall submit updates to such guidelines for printing in the 
Congressional Record.’’. 
(c) CURRENT POLICY ADJUSTMENTS FOR CERTAIN 
LEGISLATION.—For purposes of calculating budgetary ef-
fects under this division, CBO shall adjust its estimates 
VerDate Nov 24 2008 
22:18 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00019
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
as described below for any provision of legislation des-
ignated as meeting the criteria in subsection (b), (c), or 
(d) of section 107 and which the chairman of the Com-
mittee on the Budget of the House of Representatives or 
the Senate, as applicable, designates as meeting those cri-
teria. A single piece of legislation may contain provisions 
designated as meeting criteria in more than one of the 
subsections listed above. For appropriately designated pro-
visions, CBO shall exclude from its estimates for purposes 
of this division any costs of a provision to the extent that 
those costs, when combined with all other excluded costs 
of any other previously designated provisions of enacted 
legislation under the same subsection of section 107, do 
not exceed the maximum applicable current policy adjust-
ment defined under the applicable subsection of section 
107 for the applicable 10-year period, using the most re-
cent baseline estimates supplied by the Congressional 
Budget Office consistent with section 257 of the Balanced 
Budget and Emergency Deficit Control Act of 1985 used 
in considering a concurrent resolution on the budget; or, 
after the beginning of a new calendar year and before con-
sideration of a concurrent resolution on the budget, using 
the most recent baseline estimates supplied by the Con-
gressional Budget Office consistent with section 257 of the 
Balanced Budget and Emergency Deficit Control Act of 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00020
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
1985. CBO estimates of legislation containing a current 
policy designation under this subsection shall include a 
separate presentation of costs excluded from the calcula-
tion of budgetary effects for the legislation, as well as an 
updated total of all excluded costs of provisions within the 
same subsection of section 107. 
(d) OMB PAYGO SCORECARDS.— 
(1) IN
GENERAL.—OMB shall maintain and 
make publicly available a continuously updated docu-
ment containing two PAYGO scorecards displaying 
the budgetary effects of PAYGO legislation as deter-
mined under section 308 of the Congressional Budg-
et Act of 1974, applying the look-back requirement 
in subsection (e) and the averaging requirement in 
subsection (f), and a separate addendum displaying 
the estimates of the costs of provisions designated in 
statute as emergency requirements. 
(2) ESTIMATES
IN
LEGISLATION.—Except as 
provided in paragraph (3), in making the calcula-
tions for the PAYGO scorecards, OMB shall use the 
budgetary effects included by reference in the appli-
cable legislation. 
(3) OMB ESTIMATES.—If legislation does not 
contain the estimate of budgetary effects under 
paragraph (2), then OMB shall score the budgetary 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00021
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
effects of that legislation upon its enactment, based 
on the approaches to scorekeeping set forth in this 
division. 
(4) 5-YEAR
SCORECARD.—The first scorecard 
shall display the budgetary effects of PAYGO legis-
lation in each year over the 5-year period beginning 
in the budget year. 
(5) 10-YEAR SCORECARD.—The second score-
card shall display the budgetary effects of PAYGO 
legislation in each year over the 10-year period be-
ginning in the budget year. 
(e) LOOK-BACK TO CAPTURE CURRENT-YEAR EF-
FECTS.—For purposes of this section, OMB shall treat the 
budgetary effects of PAYGO legislation enacted during a 
session of Congress that occur during the current year as 
though they occurred in the budget year. 
(f) AVERAGING USED
TO MEASURE COMPLIANCE 
OVER 5-YEAR AND 10-YEAR PERIODS.—OMB shall cumu-
late the budgetary effects of a PAYGO Act over the budg-
et year (which includes any look-back effects under sub-
section (e)) and— 
(1) for purposes of the 5-year scorecard re-
ferred to in subsection (d)(4), the four subsequent 
outyears, divide that cumulative total by five, and 
enter the quotient in the budget-year column and in 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00022
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
each subsequent column of the 5-year PAYGO score-
card; and 
(2) for purposes of the 10-year scorecard re-
ferred to in subsection (d)(5), the nine subsequent 
outyears, divide that cumulative total by ten, and 
enter the quotient in the budget-year column and in 
each subsequent column of the 10-year PAYGO 
scorecard. 
SEC. 105. ANNUAL REPORT AND SEQUESTRATION ORDER. 
(a) ANNUAL REPORT.—Not later than 14 days (ex-
cluding weekends and holidays) after Congress adjourns 
to end a session, OMB shall make publicly available and 
cause to be printed in the Federal Register an annual 
PAYGO report. The report shall include an up-to-date 
document containing the PAYGO scorecards, a description 
of any current policy adjustments made under section 
104(c), information about emergency legislation (if any) 
designated under section 103(4)(D), information about 
any sequestration if required by subsection (b), and other 
data and explanations that enhance public understanding 
of this division and actions taken under it. 
(b) SEQUESTRATION ORDER.—If the annual report 
issued at the end of a session of Congress under sub-
section (a) shows a debit on either PAYGO scorecard for 
the budget year, OMB shall prepare and the President 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00023
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
shall issue and include in that report a sequestration order 
that, upon issuance, shall reduce budgetary resources of 
direct spending programs by enough to offset that debit 
as prescribed in section 106. If there is a debit on both 
scorecards, the order shall fully offset the larger of the 
two debits. OMB shall include that order in the annual 
report and transmit it to the House of Representatives 
and the Senate. If the President issues a sequestration 
order, the annual report shall contain, for each budget ac-
count to be sequestered, estimates of the baseline level of 
budgetary resources subject to sequestration, the amount 
of budgetary resources to be sequestered, and the outlay 
reductions that will occur in the budget year and the sub-
sequent fiscal year because of that sequestration. 
SEC. 106. CALCULATING A SEQUESTRATION. 
(a) 
REDUCING
NONEXEMPT
BUDGETARY
RE-
SOURCES BY A UNIFORM PERCENTAGE.—OMB shall cal-
culate the uniform percentage by which the budgetary re-
sources of nonexempt direct spending programs are to be 
sequestered such that the outlay savings resulting from 
that sequestration, as calculated under subsection (b), 
shall offset the budget-year debit, if any on the applicable 
PAYGO scorecard. If the uniform percentage calculated 
under the prior sentence exceeds 4 percent, the Medicare 
programs described in section 256(d) of BBEDCA shall 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00024
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
be reduced by 4 percent and the uniform percentage by 
which the budgetary resources of all other nonexempt di-
rect spending programs are to be sequestered shall be in-
creased, as necessary, so that the sequestration of Medi-
care and of all other nonexempt direct spending programs 
together produce the required outlay savings. 
(b) OUTLAY SAVINGS.—In determining the amount 
by which a sequestration offsets a budget-year debit, OMB 
shall count— 
(1) the amount by which the sequestration in a 
crop year of crop support payments, pursuant to 
section 256(j) of BBEDCA, reduces outlays in the 
budget year and the subsequent fiscal year; 
(2) the amount by which the sequestration of 
Medicare payments in the 12-month period following 
the sequestration order, pursuant to section 256(d) 
of BBEDCA, reduces outlays in the budget year and 
the subsequent fiscal year; and 
(3) the amount by which the sequestration in 
the budget year of the budgetary resources of other 
nonexempt mandatory programs reduces outlays in 
the budget year and in the subsequent fiscal year. 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00025
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
SEC. 107. CURRENT POLICY ADJUSTMENT TO THE CBO ES-
TIMATES. 
(a) PURPOSE.—The purpose of this section is to pro-
vide for adjustments of estimates of budgetary effects of 
PAYGO legislation for legislation affecting four areas of 
the budget— 
(1) payments made under section 1848 of the 
Social Security Act (titled Payment for Physicians’ 
Services); 
(2) the Estate and Gift Tax under subtitle B of 
the Internal Revenue Code of 1986; 
(3) the AMT; and 
(4) provisions of EGTRRA or JGTRRA that 
amended the Internal Revenue Code of 1986 (or 
provisions in later statutes further amending the 
amendments made by EGTRRA or JGTRRA), other 
than— 
(A) the provisions of those two Acts that 
were made permanent by the Pension Protec-
tion Act of 2006 (Public Law 109–280); 
(B) amendments to the estate and gift tax 
referred to in paragraph (2); 
(C) the AMT referred to in paragraph (3); 
(D) the 35 percent bracket and that por-
tion of the 33 percent bracket that applies to 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00026
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
taxable income greater than $200,000 for an 
individual and $250,000 for a couple; and 
(E) provisions in those two Acts relating to 
taxes rates on capital gains and dividends. 
(b) MEDICARE PAYMENTS TO PHYSICIANS.— 
(1) CRITERIA.—Legislation that includes provi-
sions amending or superseding the system of pay-
ments under section 1848 of the Social Security Act 
shall trigger the current policy adjustment required 
by this division. 
(2) ADJUSTMENT.—The amount of the max-
imum current policy adjustment shall be the dif-
ference between— 
(A) estimated net outlays attributable to 
the payments made to physicians under that 
section of the Social Security Act (as scheduled 
on July 15, 2009, to be in effect); and 
(B) what those net outlays would have 
been if the nominal payment rates and related 
parameters in effect for 2009 had been in effect 
thereafter without change. 
(c) ESTATE AND GIFT TAX.— 
(1) CRITERIA.—Legislation that includes provi-
sions amending the Estate and Gift Tax under sub-
title B of the Internal Revenue Code of 1986 shall 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00027
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
trigger the current policy adjustment required by 
this division. 
(2) ADJUSTMENT.—The amount of the max-
imum current policy adjustment shall be the dif-
ference between— 
(A) total revenues projected to be collected 
under the Internal Revenue Code of 1986 (as 
scheduled on July 15, 2009, to be in effect); 
and 
(B) what those revenue collections would 
have been if, on the date of enactment of the 
legislation meeting the criteria in paragraph 
(1), estate and gift tax law had instead been 
amended so that the tax rates, nominal exemp-
tion amounts, and related parameters in effect 
for tax year 2009 had remained in effect there-
after without change. 
(d) PERMANENT EXTENSION OF MIDDLE-CLASS TAX 
CUTS AND AMT RELIEF.— 
(1) CRITERIA.—Legislation that includes provi-
sions extending middle-class tax cuts or AMT relief 
shall trigger the current policy adjustment required 
by this division if those provisions extend one or 
more of the following provisions— 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00028
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
(A) AMT relief for calendar year 2010 and 
subsequent years in such a manner that the 
number of AMT taxpayers is not estimated to 
exceed the number of AMT taxpayers in tax 
year 2008 in any year through the tenth year 
after enactment; 
(B) the 10 percent bracket as in effect for 
tax year 2010, as provided for under section 
101(a) of the Economic Growth and Tax Relief 
Reconciliation Act of 2001 and any later 
amendments through July 15, 2009; 
(C) the child tax credit as in effect for tax 
year 2010, as provided for under section 201 of 
the Economic Growth and Tax Relief Reconcili-
ation Act and any later amendments through 
July 15, 2009; 
(D) tax benefits for married couples as in 
effect for tax year 2010, as provided for under 
title III of the Economic Growth and Tax Relief 
Reconciliation Act and any later amendments 
through July 15, 2009; 
(E) the adoption credit as in effect in tax 
year 2010, as provided for under section 202 of 
the Economic Growth and Tax Relief Reconcili-
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00029
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
ation Act of 2001 and any later amendments 
through July 15, 2009; 
(F) the dependent care credit as in effect 
in tax year 2010, as provided for under section 
204 of the Economic Growth and Tax Relief 
Reconciliation Act of 2001 and any later 
amendments through July 15, 2009; 
(G) the employer-provided child care credit 
as in effect in tax year 2010, as provided for 
under section 205 of the Economic Growth and 
Tax Relief Reconciliation Act of 2001 and any 
later amendments through July 15, 2009; 
(H) the education tax benefits as in effect 
in tax year 2010, as provided for under title IV 
of the Economic Growth and Tax Relief Rec-
onciliation Act of 2001 and any later amend-
ments through July 15, 2009; 
(I) the 25 and 28 percent brackets as in 
effect for tax year 2010, as provided for under 
section 101(a) of the Economic Growth and 
Tax Relief Reconciliation Act of 2001 and any 
later amendments through July 15, 2009; and 
(J) the 33 percent brackets as in effect for 
tax year 2010, as provided for under section 
101(a) of the Economic Growth and Tax Relief 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00030
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
Reconciliation Act of 2001 and any later 
amendment affecting taxpayers with taxable in-
come of $200,000 or less for individuals and 
$250,000 or less for couples in calendar year 
2010 and increased in each subsequent year by 
an amount equal to the cost of living adjust-
ment determined under section 1(f)(3) of the 
Internal Revenue Code of 1986 for the calendar 
year in which the taxable year begins, deter-
mined by substituting ‘‘calendar year 2008’’ for 
‘‘calendar year 1992’’ in subparagraph (B) 
thereof. 
(2) ADJUSTMENT.—The amount of the max-
imum current policy adjustment shall be the dif-
ference between what total revenues would have been 
under the Internal Revenue Code of 1986 (as sched-
uled on July 15, 2009, to be in effect) and what rev-
enues would be if legislation— 
(A) permanently extending the AMT ex-
emption and brackets in effect in tax year 2009 
but increased in tax year 2010 and each subse-
quent tax year as indicated under subsection 
(d)(2)(B), along with any additional amount 
necessary to prevent the number of taxpayers 
who must pay AMT from increasing; and 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00031
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
(B) permanently extending the provisions 
identified in paragraph (1), 
were enacted on the same day as the legislation re-
ferred to in paragraph (1). 
SEC. 108. APPLICATION OF BBEDCA. 
For purposes of this division— 
(1) notwithstanding section 275 of BBEDCA, 
the provisions of sections 255, 256, 257, and 274 of 
BBEDCA, as amended by this division, shall apply 
to the provisions of this division; 
(2) references in sections 255, 256, 257, and 
274 to ‘‘this part’’ or ‘‘this title’’ shall be interpreted 
as applying to this division; 
(3) references in sections 255, 256, 257, and 
274 of BBEDCA to ‘‘section 254’’ shall be inter-
preted as referencing section 105 of this division; 
(4) the reference in section 256(b) of BBEDCA 
to ‘‘section 252 or 253’’ shall be interpreted as ref-
erencing section 105 of this division; 
(5) the reference in section 256(d)(1) of 
BBEDCA to ‘‘section 252 or 253’’ shall be inter-
preted as referencing section 106 of this division; 
(6) the reference in section 256(d)(4) of 
BBEDCA to ‘‘section 252 or 253’’ shall be inter-
preted as referencing section 105 of this division; 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00032
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
(7) section 256(k) of BBEDCA shall apply to 
a sequestration, if any, under this division; and 
(8) references in section 257(e) of BBEDCA to 
‘‘section 251, 252, or 253’’ shall be interpreted as 
referencing section 104 of this division. 
SEC. 109. TECHNICAL CORRECTIONS. 
(a) Section 250(c)(18) of BBEDCA is amended by 
striking ‘‘the expenses the Federal deposit insurance agen-
cies’’ and inserting ‘‘the expenses of the Federal deposit 
insurance agencies’’. 
(b) Section 256(k)(1) of BBEDCA is amended by 
striking ‘‘in paragraph (5)’’ and inserting ‘‘in paragraph 
(6)’’. 
SEC. 110. CONFORMING AMENDMENTS. 
(a) Section 256(a) of BBEDCA is repealed. 
(b) Section 256(b) of BBEDCA is amended by strik-
ing ‘‘origination fees under sections 438(c)(2) and 455(c) 
of that Act shall each be increased by 0.50 percentage 
point.’’ and inserting in lieu thereof ‘‘origination fees 
under sections 438(c)(2) and (6) and 455(c) and loan 
processing 
and 
issuance 
fees 
under 
section 
428(f)(1)(A)(ii) of that Act shall each be increased by the 
uniform percentage specified in that sequestration order, 
and, for student loans originated during the period of the 
sequestration, special allowance payments under section 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00033
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
438(b) of that Act accruing during the period of the se-
questration shall be reduced by the uniform percentage 
specified in that sequestration order.’’. 
(c) Section 256(c) of BBEDCA is repealed. 
(d) Section 256(d) of BBEDCA is amended— 
(1) by redesignating paragraphs (2), (3), and 
(4) as paragraphs (3), (5), and (6); 
(2) by amending paragraph (1) to read as fol-
lows: 
‘‘(1) CALCULATION OF REDUCTION IN PAYMENT 
AMOUNTS.—To achieve the total percentage reduc-
tion in those programs required by section 252 or 
253, subject to paragraph (2), and notwithstanding 
section 710 of the Social Security Act, OMB shall 
determine, and the applicable Presidential order 
under section 254 shall implement, the percentage 
reduction that shall apply, with respect to the health 
insurance programs under title XVIII of the Social 
Security Act— 
‘‘(A) in the case of parts A and B of such 
title, to individual payments for services fur-
nished during the one-year period beginning on 
the first day of the first month beginning after 
the date the order is issued (or, if later, the 
date specified in paragraph (4)); and 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00034
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘(B) in the case of parts C and D, to 
monthly payments under contracts under such 
parts for the same one-year period; 
such that the reduction made in payments under 
that order shall achieve the required total percentage 
reduction in those payments for that period.’’; 
(3) by inserting after paragraph (1) the fol-
lowing: 
‘‘(2) UNIFORM
REDUCTION
RATE; MAXIMUM 
PERMISSIBLE REDUCTION.—Reductions in payments 
for programs and activities under such title XVIII 
pursuant to a sequestration order under section 254 
shall be at a uniform rate, which shall not exceed 4 
percent, across all such programs and activities sub-
ject to such order.’’; 
(4) by inserting after paragraph (3), as redesig-
nated, the following: 
‘‘(4) TIMING OF SUBSEQUENT SEQUESTRATION 
ORDER.—A sequestration order required by section 
252 or 253 with respect to programs under such 
title XVIII shall not take effect until the first month 
beginning after the end of the effective period of any 
prior sequestration order with respect to such pro-
grams, as determined in accordance with paragraph 
(1).’’; 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00035
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
(5) in paragraph (6), as redesignated, to read 
as follows: 
‘‘(6) SEQUESTRATION
DISREGARDED
IN
COM-
PUTING
PAYMENT
AMOUNTS.—The Secretary of 
Health and Human Services shall not take into ac-
count any reductions in payment amounts which 
have been or may be effected under this part, for 
purposes of computing any adjustments to payment 
rates under such title XVIII, specifically including— 
‘‘(A) the part C growth percentage under 
section 1853(c)(6); 
‘‘(B) the part D annual growth rate under 
section 1860D–2(b)(6); and 
‘‘(C) application of risk corridors to part D 
payment rates under section 1860D–15(e).’’; 
and 
(6) by adding after paragraph (6), as redesig-
nated, the following: 
‘‘(7) EXEMPTIONS FROM SEQUESTRATION.—In 
addition to the programs and activities specified in 
section 255, the following shall be exempt from se-
questration under this part: 
‘‘(A) PART D LOW-INCOME SUBSIDIES.— 
Premium and cost-sharing subsidies under sec-
tion 1860D–14 of the Social Security Act. 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00036
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘(B) PART D CATASTROPHIC SUBSIDY.— 
Payments under section 1860D–15(b) and 
(e)(2)(B) of the Social Security Act. 
‘‘(C) QUALIFIED
INDIVIDUAL
(QI)
PRE-
MIUMS.—Payments to States for coverage of 
Medicare cost-sharing for certain low-income 
Medicare beneficiaries under section 1933 of 
the Social Security Act.’’. 
SEC. 111. EXEMPT PROGRAMS AND ACTIVITIES. 
(a) DESIGNATIONS.—Section 255 of BBEDCA is 
amended by redesignating subsection (i) as (j) and strik-
ing ‘‘1998’’ and inserting in lieu thereof ‘‘2010’’. 
(b) SOCIAL SECURITY, VETERANS PROGRAMS, NET 
INTEREST, AND TAX CREDITS.—Subsections (a) through 
(d) of section 255 of BBEDCA are amended to read as 
follows: 
‘‘(a) SOCIAL SECURITY BENEFITS AND TIER I RAIL-
ROAD RETIREMENT BENEFITS.—Benefits payable under 
the old-age, survivors, and disability insurance program 
established under title II of the Social Security Act (42 
U.S.C. 401 et seq.), and benefits payable under section 
231b(a), 231b(f)(2), 231c(a), and 231c(f) of title 45, 
United States Code, shall be exempt from reduction under 
any order issued under this part. 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00037
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘(b) VETERANS PROGRAMS.—The following program 
shall be exempt from reduction under any order issued 
under this part— 
‘‘All programs administered by the Department 
of Veterans Affairs. 
‘‘Special Benefits for Certain World War II 
Veterans (28–0401–0–1–701). 
‘‘(c) NET INTEREST.—No reduction of payments for 
net interest (all of major functional category 900) shall 
be made under any order issued under this part. 
‘‘(d) REFUNDABLE INCOME TAX CREDITS.—Pay-
ments to individuals made pursuant to provisions of the 
Internal Revenue Code of 1986 establishing refundable 
tax credits shall be exempt from reduction under any order 
issued under this part.’’. 
(c) OTHER PROGRAMS
AND ACTIVITIES, LOW-IN-
COME
PROGRAMS, AND
ECONOMIC
RECOVERY
PRO-
GRAMS.—Subsections (g) and (h) of section 255 of 
BBEDCA are amended to read as follows: 
‘‘(g) OTHER PROGRAMS AND ACTIVITIES.— 
‘‘(1)(A) The following budget accounts and ac-
tivities shall be exempt from reduction under any 
order issued under this part: 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00038
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘Activities resulting from private dona-
tions, bequests, or voluntary contributions to 
the Government. 
‘‘Activities financed by voluntary payments 
to the Government for goods or services to be 
provided for such payments. 
‘‘Administration of Territories, Northern 
Mariana Islands Covenant grants (14–0412–0– 
1–808). 
‘‘Advances to the Unemployment Trust 
Fund and Other Funds (16–0327–0–1–600). 
‘‘Black Lung Disability Trust Fund Refi-
nancing (16–0329–0–1–601). 
‘‘Bonneville Power Administration Fund 
and borrowing authority established pursuant 
to section 13 of Public Law 93–454 (1974), as 
amended (89–4045–0–3–271). 
‘‘Claims, Judgments, and Relief Acts (20– 
1895–0–1–808). 
‘‘Compact of Free Association (14–0415– 
0–1–808). 
‘‘Compensation of the President (11– 
0209–01–1–802). 
‘‘Comptroller of the Currency, Assessment 
Funds (20–8413–0–8–373). 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00039
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘Continuing Fund, Southeastern Power 
Administration (89–5653–0–2–271). 
‘‘Continuing Fund, Southwestern Power 
Administration (89–5649–0–2–271). 
‘‘Dual Benefits Payments Account (60– 
0111–0–1–601). 
‘‘Emergency Fund, Western Area Power 
Administration (89–5069–0–2–271). 
‘‘Exchange Stabilization Fund (20–4444– 
0–3–155). 
‘‘Federal Deposit Insurance Corporation, 
Deposit Insurance Fund (51–4596–4–4–373). 
‘‘Federal Deposit Insurance Corporation, 
FSLIC Resolution Fund (51–4065–0–3–373). 
‘‘Federal Deposit Insurance Corporation, 
Noninterest 
Bearing 
Transaction 
Account 
Guarantee (51–4458–0–3–373). 
‘‘Federal Deposit Insurance Corporation, 
Senior Unsecured Debt Guarantee (51–4457– 
0–3–373). 
‘‘Federal Housing Finance Agency, Admin-
istrative Expenses (95–5532–0–2–371). 
‘‘Federal Payment to the District of Co-
lumbia Judicial Retirement and Survivors An-
nuity Fund (20–1713–0–1–752). 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00040
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘Federal Payment to the District of Co-
lumbia Pension Fund (20–1714–0–1–601). 
‘‘Federal Payments to the Railroad Retire-
ment Accounts (60–0113–0–1–601). 
‘‘Federal Reserve Bank Reimbursement 
Fund (20–1884–0–1–803). 
‘‘Financial Agent Services (20–1802–0–1– 
803). 
‘‘Foreign Military Sales Trust Fund (11– 
8242–0–7–155). 
‘‘Hazardous Waste Management, Con-
servation Reserve Program (12–4336–0–3– 
999). 
‘‘Host Nation Support Fund for Relocation 
(97–8337–0–7–051). 
‘‘Internal Revenue Collections for Puerto 
Rico (20–5737–0–2–806). 
‘‘Intragovernmental funds, including those 
from which the outlays are derived primarily 
from resources paid in from other government 
accounts, except to the extent such funds are 
augmented by direct appropriations for the fis-
cal year during which an order is in effect. 
‘‘Medical Facilities Guarantee and Loan 
Fund (75–9931–0–3–551). 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00041
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘Payments to the United States Terri-
tories, Fiscal Assistance (14–0418–0–1–806). 
‘‘Payments to trust funds from excise 
taxes or other receipts properly creditable to 
such trust funds. 
‘‘Payments to widows and heirs of de-
ceased Members of Congress (00–0215–0–1– 
801). 
‘‘Postal Service Fund (18–4020–0–3–372). 
‘‘Radiation Exposure Compensation Trust 
Fund (15–8116–0–1–054). 
‘‘Reimbursement to Federal Reserve Banks 
(20–0562–0–1–803). 
‘‘Salaries of Article III judges. 
‘‘Soldiers and Airmen’s Home, payment of 
claims (84–8930–0–7–705). 
‘‘Tennessee Valley Authority Fund, except 
nonpower programs and activities (64–4110–0– 
3–999). 
‘‘Tribal and Indian trust accounts within 
the Department of the Interior which fund 
prior legal obligations of the Government or 
which are established pursuant to Acts of Con-
gress regarding Federal management of tribal 
real property or other fiduciary responsibilities, 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00044
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
including but not limited to Tribal Special 
Fund (14–5265–0–2–452), Tribal Trust Fund 
(14–8030–0–7–452), White Earth Settlement 
(14–2204–0–1–452), and Indian Water Rights 
and Habitat Acquisition (14–5505–0–2–303). 
‘‘United Mine Workers of America 1992 
Benefit Plan (95–8260–0–7–551). 
‘‘United Mine Workers of America 1993 
Benefit Plan (95–8535–0–7–551). 
‘‘United Mine Workers of America Com-
bined Benefit Fund (95–8295–0–7–551). 
‘‘United States Enrichment Corporation 
Fund (95–4054–0–3–271). 
‘‘Universal Service Fund (27–5183–0–2– 
376). 
‘‘Vaccine Injury Compensation (75–0320– 
0–1–551). 
‘‘Vaccine Injury Compensation Program 
Trust Fund (20–8175–0–7–551). 
‘‘(B) The following Federal retirement and dis-
ability accounts and activities shall be exempt from 
reduction under any order issued under this part: 
‘‘Black Lung Disability Trust Fund (20– 
8144–0–7–601). 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00045
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘Central Intelligence Agency Retirement 
and Disability System Fund (56–3400–0–1– 
054). 
‘‘Civil Service Retirement and Disability 
Fund (24–8135–0–7–602). 
‘‘Comptrollers general retirement system 
(05–0107–0–1–801). 
‘‘Contributions to U.S. Park Police annu-
ity benefits, Other Permanent Appropriations 
(14–9924–0–2–303). 
‘‘Court of Appeals for Veterans Claims Re-
tirement Fund (95–8290–0–7–705). 
‘‘Department of Defense Medicare-Eligible 
Retiree Health Care Fund (97–5472–0–2–551). 
‘‘District of Columbia Federal Pension 
Fund (20–5511–0–2–601). 
‘‘District of Columbia Judicial Retirement 
and Survivors Annuity Fund (20–8212–0–7– 
602). 
‘‘Energy Employees Occupational Illness 
Compensation Fund (16–1523–0–1–053). 
‘‘Foreign National Employees Separation 
Pay (97–8165–0–7–051). 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00046
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘Foreign Service National Defined Con-
tributions Retirement Fund (19–5497–0–2– 
602). 
‘‘Foreign Service National Separation Li-
ability Trust Fund (19–8340–0–7–602). 
‘‘Foreign Service Retirement and Dis-
ability Fund(19–8186–0–7–602). 
‘‘Government Payment for Annuitants, 
Employees Health Benefits (24–0206–0–1– 
551). 
‘‘Government Payment for Annuitants, 
Employee Life Insurance (24–0500–0–1–602). 
‘‘Judicial Officers’ Retirement Fund (10– 
8122–0–7–602). 
‘‘Judicial Survivors’ Annuities Fund (10– 
8110–0–7–602). 
‘‘Military Retirement Fund (97–8097–0– 
7–602). 
‘‘National Railroad Retirement Investment 
Trust (60–8118–0–7–601). 
‘‘National Oceanic and Atmospheric Ad-
ministration retirement (13–1450–0–1–306). 
‘‘Pensions for former Presidents (47– 
0105–0–1–802). 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00047
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘Postal Service Retiree Health Benefits 
Fund (24–5391–0–2–551). 
‘‘Public Safety Officer Benefits (15–0403– 
0–1–754). 
‘‘Rail Industry Pension Fund (60–8011– 
0–7–601). 
‘‘Retired Pay, Coast Guard (70–0602–0– 
1–403). 
‘‘Retirement Pay and Medical Benefits for 
Commissioned Officers, Public Health Service 
(75–0379–0–1–551). 
‘‘Special Benefits for Disabled Coal Miners 
(16–0169–0–1–601). 
‘‘Special Benefits, Federal Employees’ 
Compensation Act (16–1521–0–1–600). 
‘‘Special Workers Compensation Expenses 
(16–9971–0–7–601). 
‘‘Tax Court Judges Survivors Annuity 
Fund (23–8115–0–7–602). 
‘‘United States Court of Federal Claims 
Judges’ Retirement Fund (10–8124–0–7–602). 
‘‘United States Secret Service, DC Annuity 
(70–0400–0–1–751). 
‘‘Voluntary Separation Incentive Fund 
(97–8335–0–7–051). 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00048
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘(2) Prior legal obligations of the Government 
in the following budget accounts and activities shall 
be exempt from any order issued under this part: 
‘‘Biomass Energy Development (20–0114– 
0–1–271). 
‘‘Check Forgery Insurance Fund (20– 
4109–0–3–803). 
‘‘Credit liquidating accounts. 
‘‘Credit reestimates. 
‘‘Employees Life Insurance Fund (24– 
8424–0–8–602). 
‘‘Federal Aviation Insurance Revolving 
Fund (69–4120–0–3–402). 
‘‘Federal 
Crop 
Insurance 
Corporation 
Fund (12–4085–0–3–351). 
‘‘Federal Emergency Management Agency, 
National Flood Insurance Fund (58–4236–0– 
3–453). 
‘‘Federal Home Loan Mortgage Corpora-
tion (Freddie Mac). 
‘‘Federal National Mortgage Corporation 
(Fannie Mae). 
‘‘Geothermal resources development fund 
(89–0206–0–1–271). 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00049
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘Low-Rent Public Housing—Loans and 
Other Expenses (86–4098–0–3–604). 
‘‘Maritime Administration, War Risk In-
surance Revolving Fund (69–4302–0–3–403). 
‘‘Natural Resource Damage Assessment 
Fund (14–1618–0–1–302). 
‘‘Overseas Private Investment Corporation, 
Noncredit Account (71–4184–0–3–151). 
‘‘Pension Benefit Guaranty Corporation 
Fund (16–4204–0–3–601). 
‘‘San Joaquin Restoration Fund (14– 
5537–0–2–301). 
‘‘Servicemembers’ Group Life Insurance 
Fund (36–4009–0–3–701). 
‘‘Terrorism Insurance Program (20–0123– 
0–1–376). 
‘‘(h) LOW-INCOME PROGRAMS.—The following pro-
grams shall be exempt from reduction under any order 
issued under this part: 
‘‘Academic Competitiveness/Smart Grant Pro-
gram (91–0205–0–1–502). 
‘‘Child Care Entitlement to States (75–1550– 
0–1–609). 
‘‘Child Enrollment Contingency Fund (75– 
5551–0–2–551). 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00050
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘(i) ECONOMIC RECOVERY PROGRAMS.—The fol-
lowing programs shall be exempt from reduction under 
any order issued under this part: 
‘‘All programs enacted in, or increases in pro-
grams provided by, the American Recovery and Re-
investment Act of 2009. 
‘‘Exchange Stabilization Fund-Money Market 
Mutual Fund Guaranty Facility (20–4274–0–3– 
376). 
‘‘Financial Stabilization Reserve (20–0131–4– 
1–376). 
‘‘GSE Mortgage-Backed Securities Purchase 
Program Account (20–0126–0–1–371). 
‘‘GSE Preferred Stock Purchase Agreements 
(20–0125–0–1–371). 
‘‘Office of Financial Stability (20–0128–0–1– 
376). 
‘‘Special Inspector General for the Troubled 
Asset Relief Program (20–0133–0–1–376). 
‘‘Troubled Asset Relief Program Account (20– 
0132–0–1–376). 
‘‘Troubled Asset Relief Program Equity Pur-
chase Program (20–0134–0–1–376). 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00052
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS
HR 3961 RDS
‘‘Troubled Asset Relief Program, Home Afford-
able Modification Program (20–0136–0–1–604).’’. 
Passed the House of Representatives November 19, 
2009. 
Attest: 
LORRAINE C. MILLER, 
Clerk. 
VerDate Nov 24 2008 
21:58 Jan 05, 2010
Jkt 089200
PO 00000
Frm 00053
Fmt 6652
Sfmt 6201
E:\BILLS\H3961.RDS
H3961
hsrobinson on DSK69SOYB1PROD with BILLS