397 
(2) EFFECTIVE DATE.—The amendments made 
by this subsection shall take effect on October 1, 2007. 
(b) STATE OPTION
OF INITIAL 12-MONTH ELIGI-
BILITY.—Section 1925 of the Social Security Act (42 U.S.C. 
1396r–6) is amended— 
(1) in subsection (a)(1), by inserting ‘‘but subject 
to paragraph (5)’’ after ‘‘Notwithstanding any other 
provision of this title’’; 
(2) by adding at the end of subsection (a) the fol-
lowing: 
‘‘(5) OPTION OF 12-MONTH INITIAL ELIGIBILITY 
PERIOD.—A State may elect to treat any reference in 
this subsection to a 6-month period (or 6 months) as 
a reference to a 12-month period (or 12 months). In 
the case of such an election, subsection (b) shall not 
apply.’’; and 
(3) in subsection (b)(1), by inserting ‘‘but subject 
to subsection (a)(5)’’ after ‘‘Notwithstanding any 
other provision of this title’’. 
(c) REMOVAL OF REQUIREMENT FOR PREVIOUS RE-
CEIPT OF MEDICAL ASSISTANCE.—Section 1925(a)(1) of 
such Act (42 U.S.C. 1396r–6(a)(1)), as amended by sub-
section (b)(1), is further amended— 
(1) by inserting ‘‘subparagraph (B) and’’ before 
‘‘paragraph (5)’’; 
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398 
(2) by redesignating the matter after ‘‘REQUIRE-
MENT.—’’ as a subparagraph (A) with the heading 
‘‘IN GENERAL.—’’ and with the same indentation as 
subparagraph (B) (as added by paragraph (3)); and 
(3) by adding at the end the following: 
‘‘(B) STATE
OPTION
TO
WAIVE
REQUIRE-
MENT FOR 3 MONTHS BEFORE RECEIPT OF MED-
ICAL ASSISTANCE.—A State may, at its option, 
elect also to apply subparagraph (A) in the case 
of a family that was receiving such aid for fewer 
than three months or that had applied for and 
was eligible for such aid for fewer than 3 months 
during the 6 immediately preceding months de-
scribed in such subparagraph.’’. 
(d) CMS REPORT ON ENROLLMENT AND PARTICIPA-
TION RATES UNDER TMA.—Section 1925 of such Act (42 
U.S.C. 1396r–6), as amended by this section, is further 
amended by adding at the end the following new subsection: 
‘‘(g) COLLECTION AND REPORTING OF PARTICIPATION 
INFORMATION.— 
‘‘(1) 
COLLECTION
OF
INFORMATION
FROM 
STATES.—Each State shall collect and submit to the 
Secretary (and make publicly available), in a format 
specified by the Secretary, information on average 
monthly enrollment and average monthly participa-
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399 
tion rates for adults and children under this section 
and of the number and percentage of children who be-
come ineligible for medical assistance under this sec-
tion whose medical assistance is continued under an-
other eligibility category or who are enrolled under 
the State’s child health plan under title XXI. Such 
information shall be submitted at the same time and 
frequency in which other enrollment information 
under this title is submitted to the Secretary. 
‘‘(2) ANNUAL
REPORTS
TO
CONGRESS.—Using 
the information submitted under paragraph (1), the 
Secretary shall submit to Congress annual reports 
concerning enrollment and participation rates de-
scribed in such paragraph.’’. 
(e) EFFECTIVE DATE.—The amendments made by sub-
sections (b) through (d) shall take effect on the date of the 
enactment of this Act. 
SEC. 802. FAMILY PLANNING SERVICES. 
(a) COVERAGE AS OPTIONAL CATEGORICALLY NEEDY 
GROUP.— 
(1) IN GENERAL.—Section 1902(a)(10)(A)(ii) of 
the 
Social 
Security 
Act 
(42 
U.S.C. 
1396a(a)(10)(A)(ii)) is amended— 
(A) in subclause (XVIII), by striking ‘‘or’’ 
at the end; 
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400 
(B) in subclause (XIX), by adding ‘‘or’’ at 
the end; and 
(C) by adding at the end the following new 
subclause: 
‘‘(XX) who are described in subsection (ee) (re-
lating to individuals who meet certain income stand-
ards);’’. 
(2) GROUP DESCRIBED.—Section 1902 of the So-
cial Security Act (42 U.S.C. 1396a), as amended by 
section 112(c), is amended by adding at the end the 
following new subsection: 
‘‘(ee)(1) Individuals described in this subsection are 
individuals— 
‘‘(A) whose income does not exceed an in-
come eligibility level established by the State that 
does not exceed the highest income eligibility 
level established under the State plan under this 
title (or under its State child health plan under 
title XXI) for pregnant women; and 
‘‘(B) who are not pregnant. 
‘‘(2) At the option of a State, individuals de-
scribed in this subsection may include individuals 
who are determined to meet the eligibility require-
ments referred to in paragraph (1) under the terms, 
conditions, and procedures applicable to making eligi-
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401 
bility determinations for medical assistance under 
this title under a waiver to provide the benefits de-
scribed in clause (XV) of the matter following sub-
paragraph (G) of section 1902(a)(10) granted to the 
State under section 1115 as of January 1, 2007.’’. 
(3) 
LIMITATION
ON
BENEFITS.—Section 
1902(a)(10) of the Social Security Act (42 U.S.C. 
1396a(a)(10)) is amended in the matter following 
subparagraph (G)— 
(A) by striking ‘‘and (XIV)’’ and inserting 
‘‘(XIV)’’; and 
(B) by inserting ‘‘, and (XV) the medical 
assistance made available to an individual de-
scribed in subsection (ee) shall be limited to fam-
ily planning services and supplies described in 
section 1905(a)(4)(C) including medical diag-
nosis or treatment services that are provided 
pursuant to a family planning service in a fam-
ily planning setting provided during the period 
in which such an individual is eligible’’ after 
‘‘cervical cancer’’. 
(4) 
CONFORMING
AMENDMENTS.—Section 
1905(a) of the Social Security Act (42 U.S.C. 
1396d(a)) is amended in the matter preceding para-
graph (1)— 
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402 
(A) in clause (xii), by striking ‘‘or’’ at the 
end; 
(B) in clause (xiii), by adding ‘‘or’’ at the 
end; and 
(C) by inserting after clause (xiii) the fol-
lowing: 
‘‘(xiv) individuals described in section 
1902(ee),’’. 
(b) PRESUMPTIVE ELIGIBILITY.— 
(1) IN GENERAL.—Title XIX of the Social Secu-
rity Act (42 U.S.C. 1396 et seq.) is amended by in-
serting after section 1920B the following: 
‘‘PRESUMPTIVE ELIGIBILITY FOR FAMILY PLANNING 
SERVICES 
‘‘SEC. 1920C. (a) STATE OPTION.—State plan ap-
proved under section 1902 may provide for making medical 
assistance available to an individual described in section 
1902(ee) (relating to individuals who meet certain income 
eligibility standard) during a presumptive eligibility pe-
riod. In the case of an individual described in section 
1902(ee), such medical assistance shall be limited to family 
planning services and supplies described in 1905(a)(4)(C) 
and, at the State’s option, medical diagnosis or treatment 
services that are provided in conjunction with a family 
planning service in a family planning setting provided 
during the period in which such an individual is eligible. 
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403 
‘‘(b) DEFINITIONS.—For purposes of this section: 
‘‘(1) PRESUMPTIVE
ELIGIBILITY
PERIOD.—The 
term ‘presumptive eligibility period’ means, with re-
spect to an individual described in subsection (a), the 
period that— 
‘‘(A) begins with the date on which a quali-
fied entity determines, on the basis of prelimi-
nary information, that the individual is de-
scribed in section 1902(ee); and 
‘‘(B) ends with (and includes) the earlier 
of— 
‘‘(i) the day on which a determination 
is made with respect to the eligibility of 
such individual for services under the State 
plan; or 
‘‘(ii) in the case of such an individual 
who does not file an application by the last 
day of the month following the month dur-
ing which the entity makes the determina-
tion referred to in subparagraph (A), such 
last day. 
‘‘(2) QUALIFIED ENTITY.— 
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), the term ‘qualified entity’ means any 
entity that— 
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‘‘(i) is eligible for payments under a 
State plan approved under this title; and 
‘‘(ii) is determined by the State agency 
to be capable of making determinations of 
the type described in paragraph (1)(A). 
‘‘(B) RULE OF CONSTRUCTION.—Nothing in 
this paragraph shall be construed as preventing 
a State from limiting the classes of entities that 
may become qualified entities in order to prevent 
fraud and abuse. 
‘‘(c) ADMINISTRATION.— 
‘‘(1) IN GENERAL.—The State agency shall pro-
vide qualified entities with— 
‘‘(A) such forms as are necessary for an ap-
plication to be made by an individual described 
in subsection (a) for medical assistance under 
the State plan; and 
‘‘(B) information on how to assist such in-
dividuals in completing and filing such forms. 
‘‘(2) NOTIFICATION
REQUIREMENTS.—A quali-
fied entity that determines under subsection (b)(1)(A) 
that an individual described in subsection (a) is pre-
sumptively eligible for medical assistance under a 
State plan shall— 
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405 
‘‘(A) notify the State agency of the deter-
mination within 5 working days after the date 
on which determination is made; and 
‘‘(B) inform such individual at the time the 
determination is made that an application for 
medical assistance is required to be made by not 
later than the last day of the month following the 
month during which the determination is made. 
‘‘(3) APPLICATION FOR MEDICAL ASSISTANCE.— 
In the case of an individual described in subsection 
(a) who is determined by a qualified entity to be pre-
sumptively eligible for medical assistance under a 
State plan, the individual shall apply for medical as-
sistance by not later than the last day of the month 
following the month during which the determination 
is made. 
‘‘(d) PAYMENT.—Notwithstanding any other provision 
of this title, medical assistance that— 
‘‘(1) is furnished to an individual described in 
subsection (a)— 
‘‘(A) during a presumptive eligibility pe-
riod; 
‘‘(B) by a entity that is eligible for pay-
ments under the State plan; and 
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406 
‘‘(2) is included in the care and services covered 
by the State plan, shall be treated as medical assist-
ance provided by such plan for purposes of clause (4) 
of the first sentence of section 1905(b).’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 1902(a)(47) of the Social Secu-
rity Act (42 U.S.C. 1396a(a)(47)) is amended by 
inserting before the semicolon at the end the fol-
lowing: ‘‘and provide for making medical assist-
ance available to individuals described in sub-
section (a) of section 1920C during a presump-
tive eligibility period in accordance with such 
section’’. 
(B) Section 1903(u)(1)(D)(v) of such Act 
(42 U.S.C. 1396b(u)(1)(D)(v)) is amended— 
(i) by striking ‘‘or for’’ and inserting 
‘‘for’’; and 
(ii) by inserting before the period the 
following: ‘‘, or for medical assistance pro-
vided to an individual described in sub-
section (a) of section 1920C during a pre-
sumptive eligibility period under such sec-
tion’’. 
(e) CLARIFICATION OF COVERAGE OF FAMILY PLAN-
NING SERVICES AND SUPPLIES.—Section 1937(b) of the So-
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407 
cial Security Act (42 U.S.C. 1396u–7(b)) is amended by 
adding at the end the following: 
‘‘(5) COVERAGE OF FAMILY PLANNING SERVICES 
AND SUPPLIES.—Notwithstanding the previous provi-
sions of this section, a State may not provide for 
medical assistance through enrollment of an indi-
vidual with benchmark coverage or benchmark-equiva-
lent coverage under this section unless such coverage 
includes for any individual described in section 
1905(a)(4)(C), medical assistance for family planning 
services and supplies in accordance with such sec-
tion.’’. 
(f) EFFECTIVE DATE.—The amendments made by this 
section take effect on October 1, 2007. 
SEC. 803. AUTHORITY TO CONTINUE PROVIDING ADULT 
DAY HEALTH SERVICES APPROVED UNDER A 
STATE MEDICAID PLAN. 
(a) IN GENERAL.—During the period described in sub-
section (b), the Secretary of Health and Human Services 
shall not— 
(1) withhold, suspend, disallow, or otherwise 
deny Federal financial participation under section 
1903(a) of the Social Security Act (42 U.S.C. 
1396b(a)) for the provision of adult day health care 
services, day activity and health services, or adult 
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408 
medical day care services, as defined under a State 
Medicaid plan approved during or before 1994, dur-
ing such period if such services are provided con-
sistent with such definition and the requirements of 
such plan; or 
(2) withdraw Federal approval of any such State 
plan or part thereof regarding the provision of such 
services (by regulation or otherwise). 
(b) PERIOD DESCRIBED.—The period described in this 
subsection is the period that begins on November 3, 2005, 
and ends on March 1, 2009. 
SEC. 
804. 
STATE 
OPTION 
TO 
PROTECT 
COMMUNITY 
SPOUSES OF INDIVIDUALS WITH DISABIL-
ITIES. 
Section 1924(h)(1)(A) of the Social Security Act (42 
U.S.C. 1396r–5(h)(1)(A)) is amended by striking ‘‘is de-
scribed in section 1902(a)(10)(A)(ii)(VI)’’ and inserting ‘‘is 
being provided medical assistance for home and commu-
nity-based services under subsection (c), (d), (e), (i), or (j) 
of section 1915 or pursuant to section 1115’’. 
SEC. 805. COUNTY MEDICAID HEALTH INSURING ORGANIZA-
TIONS . 
(a) IN GENERAL.—Section 9517(c)(3) of the Consoli-
dated Omnibus Budget Reconciliation Act of 1985 (42 
U.S.C. 1396b note), as added by section 4734 of the Omni-
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409 
bus Budget Reconciliation Act of 1990 and as amended by 
section 704 of the Medicare, Medicaid, and SCHIP Benefits 
Improvement and Protection Act of 2000, is amended— 
(1) in subparagraph (A), by inserting ‘‘, in the 
case of any health insuring organization described in 
such subparagraph that is operated by a public entity 
established by Ventura County, and in the case of any 
health insuring organization described in such sub-
paragraph that is operated by a public entity estab-
lished by Merced County’’ after ‘‘described in sub-
paragraph (B)’’; and 
(2) in subparagraph (C), by striking ‘‘14 per-
cent’’ and inserting ‘‘16 percent’’. 
(b) EFFECTIVE DATE.—The amendments made by sub-
section (a) shall take effect on the date of the enactment 
of this Act. 
Subtitle B—Payments 
SEC. 811. PAYMENTS FOR PUERTO RICO AND TERRITORIES. 
(a) PAYMENT CEILING.—Section 1108(g) of the Social 
Security Act (42 U.S.C. 1308(g)) is amended— 
(1) in paragraph (2), by striking ‘‘paragraph 
(3)’’ and inserting ‘‘paragraphs (3) and (4)’’; and 
(2) by adding at the end the following new para-
graph: 
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410 
‘‘(4) FISCAL YEARS 2009 THROUGH 2012 FOR CER-
TAIN INSULAR AREAS.—The amounts otherwise deter-
mined under this subsection for Puerto Rico, the Vir-
gin Islands, Guam, the Northern Mariana Islands, 
and American Samoa for fiscal years 2009 through 
2012 shall be increased by the following amounts: 
‘‘(A) PUERTO
RICO.—For Puerto Rico, 
$250,000,000 for fiscal year 2009, $350,000,000 
for fiscal year 2010, $500,000,000 for fiscal year 
2011, and $600,000,000 for fiscal year 2012. 
‘‘(B) VIRGIN ISLANDS.—For the Virgin Is-
lands, $5,000,000 for each of fiscal years 2009 
through 2012. 
‘‘(C) GUAM.—For Guam, $5,000,000 for 
each of fiscal years 2009 through 2012. 
‘‘(D) NORTHERN
MARIANA
ISLANDS.—For 
the Northern Mariana Islands, $4,000,000 for 
each of fiscal years 2009 through 2012. 
‘‘(E) AMERICAN
SAMOA.—For American 
Samoa, $4,000,000 for each of fiscal years 2009 
through 2012. 
Such amounts shall not be taken into account in ap-
plying paragraph (2) for fiscal years 2009 through 
2012 but shall be taken into account in applying such 
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411 
paragraph for fiscal year 2013 and subsequent fiscal 
years.’’. 
(b) REMOVAL OF FEDERAL MATCHING PAYMENTS FOR 
IMPROVING DATA REPORTING SYSTEMS FROM THE OVER-
ALL LIMIT ON PAYMENTS TO TERRITORIES UNDER TITLE 
XIX.—Such section is further amended by adding at the 
end the following new paragraph: 
‘‘(5) EXCLUSION
OF
CERTAIN
EXPENDITURES 
FROM PAYMENT LIMITS.—With respect to fiscal year 
2008 and each fiscal year thereafter, if Puerto Rico, 
the Virgin Islands, Guam, the Northern Mariana Is-
lands, or American Samoa qualify for a payment 
under subparagraph (A)(i) or (B) of section 
1903(a)(3) for a calendar quarter of such fiscal year 
with respect to expenditures for improvements in data 
reporting systems described in such subparagraph, the 
limitation on expenditures under title XIX for such 
commonwealth or territory otherwise determined 
under subsection (f) and this subsection for such fiscal 
year shall be determined without regard to payment 
for such expenditures.’’. 
SEC. 812. MEDICAID DRUG REBATE. 
(a) BRAND.—Paragraph (1)(B)(i) of section 1927(c) 
of the Social Security Act (42 U.S.C. 1396r–8(c)) is amend-
ed— 
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412 
(1) by striking ‘‘and’’ at the end of subclause 
(IV); 
(2) in subclause (V)— 
(A) by inserting ‘‘and before January 1, 
2008,’’ after ‘‘December 31, 1995,’’; and 
(B) by striking the period at the end and 
inserting ‘‘; and’’; and 
(3) by adding at the end the following new sub-
clause: 
‘‘(VI) after December 31, 2007, is 
20.1 percent.’’. 
(b) PBMS TO BEST PRICE DEFINITION.— 
(1) IN GENERAL.—Section 1927(c)(1)(C)(ii)(I) of 
the 
Social 
Security 
Act 
(42 
U.S.C. 
1396r– 
8(c)(1)(C)(ii)(I)) is amended— 
(A) by striking ‘‘and’’ before ‘‘rebates’’; and 
(B) by inserting before the semicolon at the 
end the following: ‘‘, and rebates, discounts, and 
other price concessions to pharmaceutical benefit 
managers (PBMs)’’. 
(2) EFFECTIVE DATE.—The amendments made 
by paragraph (1) shall apply to calendar quarters be-
ginning on or after January 1, 2008. 
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413 
SEC. 813. ADJUSTMENT IN COMPUTATION OF MEDICAID 
FMAP TO DISREGARD AN EXTRAORDINARY 
EMPLOYER PENSION CONTRIBUTION. 
(a) IN GENERAL.—Only for purposes of computing the 
Federal medical assistance percentage under section 
1905(b) of the Social Security Act (42 U.S.C. 1396d(b)) for 
a State for a fiscal year (beginning with fiscal year 2006), 
any significantly disproportionate employer pension con-
tribution described in subsection (b) shall be disregarded in 
computing the per capita income of such State, but shall 
not be disregarded in computing the per capita income for 
the continental United States (and Alaska) and Hawaii. 
(b) SIGNIFICANTLY DISPROPORTIONATE EMPLOYER 
PENSION CONTRIBUTION.—For purposes of subsection (a), 
a significantly disproportionate employer pension contribu-
tion described in this subsection with respect to a State for 
a fiscal year is an employer contribution towards pensions 
that is allocated to such State for a period if the aggregate 
amount so allocated exceeds 25 percent of the total increase 
in personal income in that State for the period involved. 
SEC. 814. MORATORIUM ON CERTAIN PAYMENT RESTRIC-
TIONS. 
Notwithstanding any other provision of law, the Sec-
retary of Health and Human Services shall not, prior to 
the date that is 1 year after the date of enactment of this 
Act, take any action (through promulgation of regulation, 
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414 
issuance of regulatory guidance, use of federal payment 
audit procedures, or other administrative action, policy, or 
practice, including a Medical Assistance Manual trans-
mittal or letter to State Medicaid directors) to restrict cov-
erage or payment under title XIX of the Social Security 
Act for rehabilitation services, or school-based administra-
tion, transportation, or medical services if such restrictions 
are more restrictive in any aspect than those applied to 
such coverage or payment as of July 1, 2007. 
SEC. 815. TENNESSEE DSH. 
The DSH allotments for Tennessee for each fiscal year 
beginning with fiscal year 2008 under subsection (f)(3) of 
section 1923 of the Social Security Act (42 U.S.C. 
13961396r-4) are deemed to be $30,000,000. The Secretary 
of Health and Human Services may impose a limitation 
on the total amount of payments made to hospitals under 
the TennCare Section 1115 waiver only to the extent that 
such limitation is necessary to ensure that a hospital does 
not receive payment in excess of the amounts described in 
subsection (f) of such section or as necessary to ensure that 
the waiver remains budget neutral. 
SEC. 816. CLARIFICATION TREATMENT OF REGIONAL MED-
ICAL CENTER. 
(a) IN GENERAL.—Nothing in section 1903(w) of the 
Social Security Act (42 U.S.C. 1396b(w)) shall be construed 
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415 
by the Secretary of Health and Human Services as prohib-
iting a State’s use of funds as the non-Federal share of ex-
penditures under title XIX of such Act where such funds 
are transferred from or certified by a publicly-owned re-
gional medical center located in another State and de-
scribed in subsection (b), so long as the Secretary deter-
mines that such use of funds is proper and in the interest 
of the program under title XIX. 
(b) CENTER DESCRIBED.—A center described in this 
subsection is a publicly-owned regional medical center 
that— 
(1) provides level 1 trauma and burn care serv-
ices; 
(2) provides level 3 neonatal care services; 
(3) is obligated to serve all patients, regardless of 
ability to pay; 
(4) is located within a Standard Metropolitan 
Statistical Area (SMSA) that includes at least 3 
States; 
(5) provides services as a tertiary care provider 
for patients residing within a 125-mile radius; and 
(6) meets the criteria for a disproportionate 
share hospital under section 1923 of such Act (42 
U.S.C. 1396r-4) in at least one State other than the 
State in which the center is located. 
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416 
Subtitle C—Miscellaneous 
SEC. 821. DEMONSTRATION PROJECT FOR EMPLOYER BUY- 
IN. 
Title XXI of the Social Security Act, as amended by 
section 133(a)(1), is further amended by adding at the end 
the following new section: 
‘‘SEC. 2112. DEMONSTRATION PROJECT FOR EMPLOYER 
BUY-IN. 
‘‘(a) AUTHORITY.— 
‘‘(1) IN GENERAL.—The Secretary shall establish 
a demonstration project under which up to 10 States 
(each referred to in this section as a ‘participating 
State’) that meets the conditions of paragraph (2) 
may provide, under its State child health plan (not-
withstanding section 2102(b)(3)(C)) for a period of 5 
years, for child health assistance in relation to family 
coverage described in subsection (d) for children who 
would be targeted low-income children but for cov-
erage as beneficiaries under a group health plan as 
the children of participants by virtue of a qualifying 
employer’s contribution under subsection (b)(2). 
‘‘(2) CONDITIONS.—The conditions described in 
this paragraph for a State are as follows: 
‘‘(A) NO WAITING LISTS.—The State does 
not impose any waiting list, enrollment cap, or 
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similar limitation on enrollment of targeted low- 
income children under the State child health 
plan. 
‘‘(B) ELIGIBILITY OF ALL CHILDREN UNDER 
200 PERCENT OF POVERTY LINE.—The State is 
applying an income eligibility level under sec-
tion 2110(b)(1)(B)(ii)(I) that is at least 200 per-
cent of the poverty line. 
‘‘(3) QUALIFYING EMPLOYER DEFINED.—In this 
section, the term ‘qualifying employer’ means an em-
ployer that has a majority of its workforce composed 
of full-time workers with family incomes reasonably 
estimated by the employer (based on wage informa-
tion available to the employer) at or below 200 per-
cent of the poverty line. In applying the previous sen-
tence, two part-time workers shall be treated as a sin-
gle full-time worker. 
‘‘(b) FUNDING.—A demonstration project under this 
section in a participating State shall be funded, with re-
spect to assistance provided to children described in sub-
section (a)(1), consistent with the following: 
‘‘(1) LIMITED FAMILY CONTRIBUTION.—The fam-
ily involved shall be responsible for providing pay-
ment towards the premium for such assistance of such 
amount as the State may specify, except that the lim-
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itations on cost-sharing (including premiums) under 
paragraphs (2) and (3) of section 2103(e) shall apply 
to all cost-sharing of such family under this section. 
‘‘(2) MINIMUM EMPLOYER CONTRIBUTION.—The 
qualifying employer involved shall be responsible for 
providing payment to the State child health plan in 
the State of at least 50 percent of the portion of the 
cost (as determined by the State) of the family cov-
erage in which the employer is enrolling the family 
that exceeds the amount of the family contribution 
under paragraph (1) applied towards such coverage. 
‘‘(3) LIMITATION ON FEDERAL FINANCIAL PAR-
TICIPATION.—In no case shall the Federal financial 
participation under section 2105 with respect to a 
demonstration project under this section be made for 
any portion of the costs of family coverage described 
in subsection (d) (including the costs of administra-
tion of such coverage) that are not attributable to 
children described in subsection (a)(1). 
‘‘(c) UNIFORM ELIGIBILITY RULES.—In providing as-
sistance under a demonstration project under this section— 
‘‘(1) a State shall establish uniform rules of eli-
gibility for families to participate; and 
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‘‘(2) a State shall not permit a qualifying em-
ployer to select, within those families that meet such 
eligibility rules, which families may participate. 
‘‘(d) TERMS AND CONDITIONS.—The family coverage 
offered to families of qualifying employers under a dem-
onstration project under this section in a State shall be the 
same as the coverage and benefits provided under the State 
child health plan in the State for targeted low-income chil-
dren with the highest family income level permitted.’’. 
SEC. 822. DIABETES GRANTS. 
Section 2104 of the Social Security Act (42 U.C.C 
1397dd), as amended by section 101, is further amended— 
(1) in subsection (a)(11), by inserting before the 
period at the end the following: ‘‘plus for fiscal year 
2009 the total of the amount specified in subsection 
(j)’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(j) FUNDING
FOR DIABETES GRANTS.—From the 
amounts appropriated under subsection (a)(11), for fiscal 
year 2009 from the amounts— 
‘‘(1) $150,000,000 is hereby transferred and 
made available in such fiscal year for grants under 
section 330B of the Public Health Service Act; and 
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‘‘(2) $150,000,000 is hereby transferred and 
made available in such fiscal year for grants under 
section 330C of such Act.’’. 
SEC. 823. TECHNICAL CORRECTION. 
(a) CORRECTION OF REFERENCE TO CHILDREN IN 
FOSTER CARE RECEIVING CHILD WELFARE SERVICES.— 
Section 1937(a)(2)(B)(viii) of the Social Security Act (42 
U.S.C. 1396u–7(a)(2)(B) is amended by striking ‘‘aid or 
assistance is made available under part B of title IV to 
children in foster care’’ and inserting ‘‘child welfare services 
are made available under part B of title IV on the basis 
of being a child in foster care’’. 
(b) EFFECTIVE DATE.—The amendment made by sub-
section (a) shall take effect as if included in the amendment 
made by section 6044(a) of the Deficit Reduction Act of 
2005. 
TITLE IX—MISCELLANEOUS 
SEC. 901. MEDICARE PAYMENT ADVISORY COMMISSION STA-
TUS. 
Section 1805(a) of the Social Security Act (42 U.S.C. 
1395b–6(a)) is amended by inserting ‘‘as an agency of Con-
gress’’ after ‘‘established’’. 
SEC. 902. REPEAL OF TRIGGER PROVISION. 
Subtitle A of title VIII of the Medicare Prescription 
Drug, Improvement, and Modernization Act of 2003 (Public 
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Law 108–173) is repealed and the provisions of law amend-
ed by such subtitle are restored as if such subtitle had never 
been enacted. 
SEC. 903. REPEAL OF COMPARATIVE COST ADJUSTMENT 
(CCA) PROGRAM. 
Section 1860C–1 of the Social Security Act (42 U.S.C. 
1395w–29), as added by section 241(a) of the Medicare Pre-
scription Drug, Improvement, and Modernization Act of 
2003 (Public Law 108–173), is repealed. 
SEC. 904. COMPARATIVE EFFECTIVENESS RESEARCH. 
(a) IN GENERAL.—Part A of title XVIII of the Social 
Security Act is amended by adding at the end the following 
new section: 
‘‘COMPARATIVE EFFECTIVENESS RESEARCH 
‘‘SEC. 1822. (a) CENTER FOR COMPARATIVE EFFEC-
TIVENESS RESEARCH ESTABLISHED.— 
‘‘(1) IN GENERAL.—The Secretary shall establish 
within the Agency of Healthcare Research and Qual-
ity a Center for Comparative Effectiveness Research 
(in this section referred to as the ‘Center’) to conduct, 
support, and synthesize research (including research 
conducted or supported under section 1013 of the 
Medicare Prescription Drug, Improvement, and Mod-
ernization Act of 2003) with respect to the outcomes, 
effectiveness, and appropriateness of health care serv-
ices and procedures in order to identify the manner 
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in which diseases, disorders, and other health condi-
tions can most effectively and appropriately be pre-
vented, diagnosed, treated, and managed clinically. 
‘‘(2) DUTIES.—The Center shall— 
‘‘(A) conduct, support, and synthesize re-
search relevant to the comparative clinical effec-
tiveness of the full spectrum of health care treat-
ments, including pharmaceuticals, medical de-
vices, medical and surgical procedures, and other 
medical interventions; 
‘‘(B) conduct and support systematic re-
views of clinical research, including original re-
search conducted subsequent to the date of the en-
actment of this section; 
‘‘(C) use methodologies such as randomized 
controlled clinical trials as well as other various 
types of clinical research, such as observational 
studies; 
‘‘(D) submit to the Comparative Effective-
ness Research Commission, the Secretary, and 
Congress appropriate relevant reports described 
in subsection (d)(2); 
‘‘(E) encourage, as appropriate, the develop-
ment and use of clinical registries and the devel-
opment of clinical effectiveness research data net-
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works from electronic health records, post mar-
keting drug and medical device surveillance ef-
forts, and other forms of electronic health data; 
and 
‘‘(F) not later than 180 days after the date 
of the enactment of this section, develop methodo-
logical standards to be used when conducting 
studies of comparative clinical effectiveness and 
value (and procedures for use of such standards) 
in order to help ensure accurate and effective 
comparisons and update such standards at least 
biennially. 
‘‘(b) OVERSIGHT BY COMPARATIVE EFFECTIVENESS 
RESEARCH COMMISSION.— 
‘‘(1) IN GENERAL.—The Secretary shall establish 
an independent Comparative Effectiveness Research 
Commission (in this section referred to as the ‘Com-
mission’) to oversee and evaluate the activities carried 
out by the Center under subsection (a) to ensure such 
activities result in highly credible research and infor-
mation resulting from such research. 
‘‘(2) DUTIES.—The Commission shall— 
‘‘(A) determine national priorities for re-
search described in subsection (a) and in making 
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such determinations consult with patients and 
health care providers and payers; 
‘‘(B) monitor the appropriateness of use of 
the CERTF described in subsection (f) with re-
spect to the timely production of comparative ef-
fectiveness research determined to be a national 
priority under subparagraph (A); 
‘‘(C) identify highly credible research meth-
ods and standards of evidence for such research 
to be considered by the Center; 
‘‘(D) review and approve the methodological 
standards (and updates to such standards) devel-
oped by the Center under subsection (a)(2)(F); 
‘‘(E) enter into an arrangement under 
which the Institute of Medicine of the National 
Academy of Sciences shall conduct an evaluation 
and report on standards of evidence for such re-
search; 
‘‘(F) support forums to increase stakeholder 
awareness and permit stakeholder feedback on 
the efforts of the Agency of Healthcare Research 
and Quality to advance methods and standards 
that promote highly credible research; 
‘‘(G) make recommendations for public data 
access policies of the Center that would allow for 
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access of such data by the public while ensuring 
the information produced from research involved 
is timely and credible; 
‘‘(H) appoint a clinical perspective advi-
sory panel for each research priority determined 
under subparagraph (A), which shall frame the 
specific research inquiry to be examined with re-
spect to such priority to ensure that the informa-
tion produced from such research is clinically 
relevant to decisions made by clinicians and pa-
tients at the point of care; 
‘‘(I) make recommendations for the priority 
for periodic reviews of previous comparative ef-
fectiveness research and studies conducted by the 
Center under subsection (a); 
‘‘(J) routinely review processes of the Center 
with respect to such research to confirm that the 
information produced by such research is objec-
tive, credible, consistent with standards of evi-
dence established under this section, and devel-
oped through a transparent process that includes 
consultations with appropriate stakeholders; 
‘‘(K) at least annually, provide guidance or 
recommendations to health care providers and 
consumers for the use of information on the com-
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parative effectiveness of health care services by 
consumers, providers (as defined for purposes of 
regulations promulgated under section 264(c) of 
the Health Insurance Portability and Account-
ability Act of 1996) and public and private pur-
chasers; 
‘‘(L) make recommendations for a strategy 
to disseminate the findings of research conducted 
and supported under this section that enables cli-
nicians to improve performance, consumers to 
make more informed health care decisions, and 
payers to set medical policies that improve qual-
ity and value; 
‘‘(M) provide for the public disclosure of rel-
evant reports described in subsection (d)(2); and 
‘‘(N) submit to Congress an annual report 
on the progress of the Center in achieving na-
tional priorities determined under subparagraph 
(A) for the provision of credible comparative ef-
fectiveness information produced from such re-
search to all interested parties. 
‘‘(3) COMPOSITION OF COMMISSION.— 
‘‘(A) IN
GENERAL.—The members of the 
Commission shall consist of— 
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‘‘(i) the Director of the Agency for 
Healthcare Research and Quality; 
‘‘(ii) the Chief Medical Officer of the 
Centers for Medicare & Medicaid Services; 
and 
‘‘(iii) up to 15 additional members 
who shall represent broad constituencies of 
stakeholders including clinicians, patients, 
researchers, third-party payers, consumers 
of Federal and State beneficiary programs. 
‘‘(B) QUALIFICATIONS.— 
‘‘(i) DIVERSE
REPRESENTATION
OF 
PERSPECTIVES.—The members of the Com-
mission shall represent a broad range of 
perspectives and shall collectively have expe-
rience in the following areas: 
‘‘(I) Epidemiology. 
‘‘(II) Health services research. 
‘‘(III) Bioethics. 
‘‘(IV) Decision sciences. 
‘‘(V) Economics. 
‘‘(ii) DIVERSE
REPRESENTATION
OF 
HEALTH
CARE
COMMUNITY.—At least one 
member shall represent each of the following 
health care communities: 
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‘‘(I) Consumers. 
‘‘(II) Practicing physicians, in-
cluding surgeons. 
‘‘(III) Employers. 
‘‘(IV) Public payers. 
‘‘(V) Insurance plans. 
‘‘(VI) Clinical researchers who 
conduct research on behalf of pharma-
ceutical or device manufacturers. 
‘‘(4) APPOINTMENT.—The Comptroller General of 
the United States, in consultation with the chairs of 
the committees of jurisdiction of the House of Rep-
resentatives and the Senate, shall appoint the mem-
bers of the Commission. 
‘‘(5) CHAIRMAN; VICE CHAIRMAN.—The Comp-
troller General of the United States shall designate a 
member of the Commission, at the time of appoint-
ment of the member, as Chairman and a member as 
Vice Chairman for that term of appointment, except 
that in the case of vacancy of the Chairmanship or 
Vice Chairmanship, the Comptroller General may 
designate another member for the remainder of that 
member’s term. 
‘‘(6) TERMS.— 
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‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), each member of the Commis-
sion shall be appointed for a term of 4 years. 
‘‘(B) TERMS OF INITIAL APPOINTEES.—Of 
the members first appointed— 
‘‘(i) 10 shall be appointed for a term 
of 4 years; and 
‘‘(ii) 9 shall be appointed for a term of 
3 years. 
‘‘(7) COORDINATION.—To enhance effectiveness 
and coordination, the Comptroller General is encour-
aged, to the greatest extent possible, to seek coordina-
tion between the Commission and the National Advi-
sory Council of the Agency for Healthcare Research 
and Quality. 
‘‘(8) CONFLICTS OF INTEREST.—In appointing 
the members of the Commission or a clinical perspec-
tive advisory panel described in paragraph (2)(H), 
the Comptroller General of the United States or the 
Commission, respectively, shall take into consider-
ation any financial conflicts of interest. 
‘‘(9) COMPENSATION.—While serving on the busi-
ness of the Commission (including traveltime), a 
member of the Commission shall be entitled to com-
pensation at the per diem equivalent of the rate pro-
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vided for level IV of the Executive Schedule under sec-
tion 5315 of title 5, United States Code; and while so 
serving away from home and the member’s regular 
place of business, a member may be allowed travel ex-
penses, as authorized by the Director of the Commis-
sion. 
‘‘(10) AVAILABILITY OF REPORTS.—The Commis-
sion shall transmit to the Secretary a copy of each re-
port submitted under this subsection and shall make 
such reports available to the public. 
‘‘(11) DIRECTOR AND STAFF; EXPERTS AND CON-
SULTANTS.—Subject to such review as the Secretary, 
in consultation with the Comptroller General deems 
necessary to assure the efficient administration of the 
Commission, the Commission may— 
‘‘(A) employ and fix the compensation of an 
Executive Director (subject to the approval of the 
Secretary, in consultation with the Comptroller 
General) and such other personnel as may be 
necessary to carry out its duties (without regard 
to the provisions of title 5, United States Code, 
governing appointments in the competitive serv-
ice); 
‘‘(B) seek such assistance and support as 
may be required in the performance of its duties 
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from appropriate Federal departments and agen-
cies; 
‘‘(C) enter into contracts or make other ar-
rangements, as may be necessary for the conduct 
of the work of the Commission (without regard 
to section 3709 of the Revised Statutes (41 
U.S.C. 5)); 
‘‘(D) make advance, progress, and other 
payments which relate to the work of the Com-
mission; 
‘‘(E) provide transportation and subsistence 
for persons serving without compensation; and 
‘‘(F) prescribe such rules and regulations as 
it deems necessary with respect to the internal 
organization and operation of the Commission. 
‘‘(12) POWERS.— 
‘‘(A) 
OBTAINING
OFFICIAL
DATA.—The 
Commission may secure directly from any de-
partment or agency of the United States infor-
mation necessary to enable it to carry out this 
section. Upon request of the Executive Director, 
the head of that department or agency shall fur-
nish that information to the Commission on an 
agreed upon schedule. 
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‘‘(B) DATA COLLECTION.—In order to carry 
out its functions, the Commission shall— 
‘‘(i) utilize existing information, both 
published and unpublished, where possible, 
collected and assessed either by its own staff 
or under other arrangements made in ac-
cordance with this section, 
‘‘(ii) carry out, or award grants or 
contracts for, original research and experi-
mentation, where existing information is 
inadequate, and 
‘‘(iii) adopt procedures allowing any 
interested party to submit information for 
the Commission’s use in making reports 
and recommendations. 
‘‘(C) ACCESS OF GAO TO INFORMATION.— 
The Comptroller General shall have unrestricted 
access to all deliberations, records, and non-
proprietary data of the Commission, imme-
diately upon request. 
‘‘(D) PERIODIC
AUDIT.—The Commission 
shall be subject to periodic audit by the Comp-
troller General. 
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‘‘(c) RESEARCH REQUIREMENTS.—Any research con-
ducted, supported, or synthesized under this section shall 
meet the following requirements: 
‘‘(1) ENSURING
TRANSPARENCY, CREDIBILITY, 
AND ACCESS.— 
‘‘(A) The establishment of the agenda and 
conduct of the research shall be insulated from 
inappropriate political or stakeholder influence. 
‘‘(B) Methods of conducting such research 
shall be scientifically based. 
‘‘(C) All aspects of the prioritization of re-
search, conduct of the research, and development 
of conclusions based on the research shall be 
transparent to all stakeholders. 
‘‘(D) The process and methods for con-
ducting such research shall be publicly docu-
mented and available to all stakeholders. 
‘‘(E) Throughout the process of such re-
search, the Center shall provide opportunities for 
all stakeholders involved to review and provide 
comment on the methods and findings of such re-
search. 
‘‘(2) USE OF CLINICAL PERSPECTIVE ADVISORY 
PANELS.—The research shall meet a national research 
priority determined under subsection (b)(2)(A) and 
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shall examine the specific research inquiry framed by 
the clinical perspective advisory panel for the na-
tional research priority. 
‘‘(3) STAKEHOLDER
INPUT.—The priorities of 
the research, the research, and the dissemination of 
the research shall involve the consultation of patients, 
health care providers, and health care consumer rep-
resentatives through transparent mechanisms rec-
ommended by the Commission. 
‘‘(d) PUBLIC ACCESS TO COMPARATIVE EFFECTIVE-
NESS INFORMATION.— 
‘‘(1) IN GENERAL.—Not later than 90 days after 
receipt by the Center or Commission, as applicable, of 
a relevant report described in paragraph (2) made by 
the Center, Commission, or clinical perspective advi-
sory panel under this section, appropriate informa-
tion contained in such report shall be posted on the 
official public Internet site of the Center and of the 
Commission, as applicable. 
‘‘(2) RELEVANT REPORTS DESCRIBED.—For pur-
poses of this section, a relevant report is each of the 
following submitted by a grantee or contractor of the 
Center: 
‘‘(A) An interim progress report. 
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‘‘(B) A draft final comparative effectiveness 
review. 
‘‘(C) A final progress report on new re-
search submitted for publication by a peer re-
view journal. 
‘‘(D) Stakeholder comments. 
‘‘(E) A final report. 
‘‘(3) ACCESS BY CONGRESS AND THE COMMIS-
SION TO THE CENTER’S INFORMATION.—Congress and 
the Commission shall each have unrestricted access to 
all deliberations, records, and nonproprietary data of 
the Center, immediately upon request. 
‘‘(e) DISSEMINATION AND INCORPORATION OF COM-
PARATIVE EFFECTIVENESS INFORMATION.— 
‘‘(1) DISSEMINATION.—The Center shall provide 
for the dissemination of appropriate findings pro-
duced by research supported, conducted, or syn-
thesized under this section to health care providers, 
patients, vendors of health information technology fo-
cused on clinical decision support, appropriate profes-
sional associations, and Federal and private health 
plans. 
‘‘(2) INCORPORATION.—The Center shall assist 
users of health information technology focused on clin-
ical decision support to promote the timely incorpora-
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tion of the findings described in paragraph (1) into 
clinical practices and to promote the ease of use of 
such incorporation. 
‘‘(f) REPORTS TO CONGRESS.— 
‘‘(1) ANNUAL
REPORTS.—Beginning not later 
than one year after the date of the enactment of this 
section, the Director of the Agency of Healthcare Re-
search and Quality and the Commission shall submit 
to Congress an annual report on the activities of the 
Center and the Commission, as well as the research, 
conducted under this section. 
‘‘(2) RECOMMENDATION FOR FAIR SHARE PER 
CAPITA AMOUNT FOR ALL-PAYER FINANCING.—Begin-
ning not later than December 31, 2009, the Secretary 
shall submit to Congress an annual recommendation 
for a fair share per capita amount described in sub-
section (c)(1) of section 9511 of the Internal Revenue 
Code of 1986 for purposes of funding the CERTF 
under such section. 
‘‘(3) ANALYSIS AND REVIEW.—Not later than De-
cember 31, 2011, the Secretary, in consultation with 
the Commission, shall submit to Congress a report on 
all activities conducted or supported under this sec-
tion as of such date. Such report shall include an 
evaluation of the return on investment resulting from 
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such activities, the overall costs of such activities, and 
an analysis of the backlog of any research proposals 
approved by the Commission but not funded. Such re-
port shall also address whether Congress should ex-
pand the responsibilities of the Center and of the 
Commission to include studies of the effectiveness of 
various aspects of the health care delivery system, in-
cluding health plans and delivery models, such as 
health plan features, benefit designs and performance, 
and the ways in which health services are organized, 
managed, and delivered. 
‘‘(g) COORDINATING COUNCIL FOR HEALTH SERVICES 
RESEARCH.— 
‘‘(1) ESTABLISHMENT.—The Secretary shall es-
tablish a permanent council (in this section referred 
to as the ‘Council’) for the purpose of— 
‘‘(A) assisting the offices and agencies of the 
Department of Health and Human Services, the 
Department of Veterans Affairs, the Department 
of Defense, and any other Federal department or 
agency to coordinate the conduct or support of 
health services research; and 
‘‘(B) advising the President and Congress 
on— 
VerDate Aug 31 2005 
02:09 Aug 02, 2007
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E:\BILLS\H3162.RH
H3162
bajohnson on PROD1PC69 with BILLS