I
103D CONGRESS
1ST SESSION
H. R. 2261
To contain the rate of growth in health care costs and enhance the quality
of health care by improving and making more efficient the provision
of medical and health insurance information, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
MAY 25, 1993
Mr. THOMAS of California (for himself, Mrs. JOHNSON of Connecticut, Mr.
GRANDY, and Mr. MCCRERY) introduced the following bill; which was re-
ferred jointly to the Committees on Energy and Commerce, Ways and
Means, Education and Labor, and Veterans’ Affairs
A BILL
To contain the rate of growth in health care costs and
enhance the quality of health care by improving and
making more efficient the provision of medical and health
insurance information, and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. TABLE OF CONTENTS.
The table of contents of this Act is as follows:
Sec. 1. Table of contents.
Sec. 2. Definitions.
TITLE I—STANDARDIZATION OF CLAIMS PROCESSING
Sec. 101. Adoption of data elements, uniform claims, and uniform electronic
transmission standards.
Sec. 102. Application of standards.
Sec. 103. Periodic review and revision of standards.
TITLE II—ELECTRONIC MEDICAL DATA STANDARDS
Sec. 201. Medical data standards for hospitals and other providers.
Sec. 202. Application of electronic data standards to certain hospitals.
Sec. 203. Electronic transmission to Federal agencies.
Sec. 204. Limitation on data requirements where standards in effect.
Sec. 205. Advisory commission.
TITLE III—DEVELOPMENT AND DISTRIBUTION OF COMPARATIVE
VALUE INFORMATION
Sec. 301. State comparative value information programs for health care pur-
chasing.
Sec. 302. Federal implementation.
Sec. 303. Comparative value information concerning Federal programs.
Sec. 304. Development of model systems.
TITLE IV—ADDITIONAL STANDARDS AND REQUIREMENTS;
RESEARCH AND DEMONSTRATIONS
Sec. 401. Standards relating to use of medicare and medicaid magnetized
health benefit cards; secondary payor data bank.
Sec. 402. Preemption of State quill pen laws.
Sec. 403. Use of standard identification numbers.
Sec. 404. Coordination of benefit standards.
Sec. 405. Research and demonstrations.
SEC. 2. DEFINITIONS.
For purposes of this Act:
(1) 
HEALTH
BENEFIT
PLAN.—The 
term
‘‘health benefit plan’’ means any hospital or medical
expense incurred policy or certificate, hospital or
medical service plan contract, or health maintenance
subscriber contract, or a multiple employer welfare
arrangement or employee benefit plan (as defined
under the Employee Retirement Income Security Act
of 1974) which provides benefits with respect to
health care services. The term includes the medicare
program (under title XVIII of the Social Security
Act), medicare supplemental health insurance, and a
State medicaid plan (approved under title XIX of
such Act). The term does not include—
(A) coverage only for accident, dental, vi-
sion, disability income, or long-term care insur-
ance, or any combination thereof,
(B) coverage issued as a supplement to li-
ability insurance,
(C) worker’s compensation or similar in-
surance, or
(D) automobile medical-payment insur-
ance,
or any combination thereof.
(2) SECRETARY.—The term ‘‘Secretary’’ means
the Secretary of Health and Human Services.
(3) STATE.—The term ‘‘State’’ means any of
the several States, the District of Columbia, the
Commonwealth of Puerto Rico, the Virgin Islands,
Guam, and American Samoa.
TITLE I—STANDARDIZATION OF
CLAIMS PROCESSING
SEC. 
101. 
ADOPTION 
OF 
DATA 
ELEMENTS, 
UNIFORM
CLAIMS, AND UNIFORM ELECTRONIC TRANS-
MISSION STANDARDS.
(a) IN GENERAL.—The Secretary of Health and
Human Services shall adopt standards relating to each of
the following:
(1) Data elements for use in paper and elec-
tronic claims processing under health benefit plans,
as well as for use in utilization review and manage-
ment of care (including data fields, formats, and
medical nomenclature, and including plan benefit
and insurance information).
(2) Uniform claims forms (including uniform
procedure and billing codes for uses with such forms
and including information on other health benefit
plans that may be liable for benefits).
(3) Uniform electronic transmission of the data
elements (for purposes of billing and utilization
review).
Standards under paragraph (3) relating to electronic
transmission of data elements for claims for services shall
supersede (to the extent specified in such standards) the
standards adopted under paragraph (2) relating to the
submission of paper claims for such services. Standards
under paragraph (3) shall include protections to assure
the confidentiality of patient-specific information and to
protect against the unauthorized use and disclosure of
information.
(b) USE OF TASK FORCES.—In adopting standards
under this section—
(1) the Secretary shall take into account the
recommendations of current task forces, including at
least the Workgroup on Electronic Data Inter-
change, National Uniform Billing Committee, the
Uniform Claim Task Force, and the Computer-based
Patient Record Institute;
(2) the Secretary shall consult with the Na-
tional Association of Insurance Commissioners (and,
with respect to standards under subsection (a)(3),
the American National Standards Institute); and
(3) the Secretary shall, to the maximum extent
practicable, seek to make the standards consistent
with any uniform clinical data sets which have been
adopted and are widely recognized.
(c) DEADLINES
FOR PROMULGATION.—The Sec-
retary shall promulgate the standards under—
(1) subsection (a)(1) relating to claims process-
ing data, by not later than 12 months after the date
of the enactment of this Act;
(2) subsection (a)(2) (relating to uniform
claims forms) by not later than 12 months after the
date of the enactment of this Act; and
(3)(A) subsection (a)(3) relating to trans-
mission of information concerning hospital and phy-
sicians services, by not later than 24 months after
the date of the enactment of this Act, and
(B) subsection (a)(3) relating to transmission
of information on other services, by such later date
as the Secretary may determine it to be feasible.
(d) REPORT TO CONGRESS.—Not later than 3 years
after the date of the enactment of this Act, the Secretary
shall report to Congress recommendations regarding re-
structuring the medicare peer review quality assurance
program given the availability of hospital data in elec-
tronic form.
SEC. 102. APPLICATION OF STANDARDS.
(a) IN GENERAL.—If the Secretary determines, at
the end of the 2-year period beginning on the date that
standards are adopted under section 101 with respect to
classes of services, that a significant number of claims for
benefits for such services under health benefit plans are
not being submitted in accordance with such standards,
the Secretary may require, after notice in the Federal
Register of not less than 6 months, that all providers of
such services must submit claims to health benefit plans
in accordance with such standards. The Secretary may
waive the application of such a requirement in such cases
as the Secretary finds that the imposition of the require-
ment would not be economically practicable.
(b) SIGNIFICANT NUMBER.—The Secretary shall
make an affirmative determination described in subsection
(a) for a class of services only if the Secretary finds that
there would be a significant, measurable additional gain
in efficiencies in the health care system that would be ob-
tained by imposing the requirement described in such
paragraph with respect to such services.
(c) APPLICATION OF REQUIREMENT.—
(1) IN GENERAL.—If the Secretary imposes the
requirement under subsection (a)—
(A) in the case of a requirement that im-
poses the standards relating to electronic trans-
mission of claims for a class of services, each
health care provider that furnishes such services
for which benefits are payable under a health
benefit plan shall transmit electronically and di-
rectly to the plan on behalf of the beneficiary
involved a claim for such services in accordance
with such standards;
(B) any health benefit plan may reject any
claim subject to the standards adopted under
section 101 but which is not submitted in ac-
cordance with such standards;
(C) it is unlawful for a health benefit plan
(i) to reject any such claim on the basis of the
form in which it is submitted if it is submitted
in accordance with such standards or (ii) to re-
quire, for the purpose of utilization review or as
a condition of providing benefits under the plan,
a provider to transmit medical data elements
that are inconsistent with the standards estab-
lished under section 101(a)(1); and
(D) the Secretary may impose a civil
money penalty on any provider that knowingly
and repeatedly submits claims in violation of
such standards or on any health benefit plan
(other than a health benefit plan described in
paragraph (2)) that knowingly and repeatedly
rejects claims in violation of subparagraph (B),
in an amount not to exceed $100 for each such
claim.
The provisions of section 1128A of the Social Secu-
rity Act (other than the first sentence of subsection
(a) and other than subsection (b)) shall apply to a
civil money penalty under subparagraph (D) in the
same manner as such provisions apply to a penalty
or proceeding under section 1128A(a) of such Act.
(2) PLANS SUBJECT TO EFFECTIVE STATE REG-
ULATION.—A plan described in this paragraph is a
health benefit plan—
(A) that is subject to regulation by a
State, and
(B) with respect to which the Secretary
finds that—
(i) the State provides for application
of the standards established under section
101, and
(ii) the State regulatory program pro-
vides for the appropriate and effective en-
forcement of such standards.
(d) TREATMENT OF REJECTIONS.—If a plan rejects
a claim pursuant to subsection (c)(1), the plan shall per-
mit the person submitting the claim a reasonable oppor-
tunity to resubmit the claim on a form or in an electronic
manner that meets the requirements for acceptance of the
claim under such subsection.
SEC. 103. PERIODIC REVIEW AND REVISION OF STAND-
ARDS.
(a) IN GENERAL.—The Secretary shall—
(1) provide for the ongoing receipt and review
of comments and suggestions for changes in the
standards adopted and promulgated under section
101;
(2) establish a schedule for the periodic review
of such standards; and
(3) based upon such comments, suggestions,
and review, revise such standards and promulgate
such revisions.
(b) APPLICATION OF REVISED STANDARDS.—If the
Secretary under subsection (a) revises the standards de-
scribed in 101, then, in the case of any claim for benefits
submitted under a health benefit plan more than the mini-
mum period (of not less than 6 months specified by the
Secretary) after the date the revision is promulgated
under subsection (a)(3), such standards shall apply under
section 102 instead of the standards previously promul-
gated.
TITLE II—ELECTRONIC MEDICAL
DATA STANDARDS
SEC. 201. MEDICAL DATA STANDARDS FOR HOSPITALS AND
OTHER PROVIDERS.
(a) PROMULGATION
OF HOSPITAL DATA STAND-
ARDS.—
(1) IN GENERAL.—Between July 1, 1994, and
January 1, 1995, the Secretary shall promulgate
standards described in subsection (b) for hospitals
concerning electronic medical data.
(2) REVISION.—The Secretary may from time
to time revise the standards promulgated under this
subsection.
(b) CONTENTS OF DATA STANDARDS.—The stand-
ards promulgated under subsection (a) shall include at
least the following:
(1) A definition of a standard set of data ele-
ments for use by utilization and quality control peer
review organizations.
(2) A definition of the set of comprehensive
data elements, which set shall include for hospitals
the standard set of data elements defined under
paragraph (1).
(3) Standards for an electronic patient care in-
formation system with data obtained at the point of
care, including standards to protect against the un-
authorized use and disclosure of information.
(4) A specification of, and manner of presen-
tation of, the individual data elements of the sets
and system under this subsection.
(5) Standards concerning the transmission of
electronic medical data.
(6) Standards relating to confidentiality of
patient-specific information.
The standards under this section shall be consistent with
standards for data elements established under section 101.
(c) OPTIONAL DATA STANDARDS FOR OTHER PRO-
VIDERS.—
(1) IN GENERAL.—The Secretary may promul-
gate standards described in paragraph (2) concern-
ing electronic medical data for providers that are not
hospitals. The Secretary may from time to time re-
vise the standards promulgated under this sub-
section.
(2) CONTENTS
OF
DATA
STANDARDS.—The
standards promulgated under paragraph (1) for non-
hospital providers may include standards comparable
to the standards described in paragraphs (2), (4),
and (5) of subsection (b) for hospitals.
(d) CONSULTATION.—In promulgating and revising
standards under this section, the Secretary shall—
(1) consult with the American National Stand-
ards Institute, hospitals, with the advisory commis-
sion established under section 205, and with other
affected providers, health benefit plans, and other
interested parties, and
(2) take into consideration, in developing stand-
ards under subsection (b)(1), the data set used by
the utilization and quality control peer review pro-
gram under part B of title XI of the Social Security
Act.
SEC. 202. APPLICATION OF ELECTRONIC DATA STANDARDS
TO CERTAIN HOSPITALS.
(a) MEDICARE REQUIREMENT
FOR SHARING
OF
HOSPITAL INFORMATION.—As of January 1, 1996, sub-
ject to paragraph (2), each hospital, as a requirement of
each participation agreement under section 1866 of the
Social Security Act, shall—
(1) maintain clinical data included in the set of
comprehensive 
data 
elements 
under 
section
201(b)(2) in electronic form on all inpatients,
(2) upon request of the Secretary or of a utili-
zation and quality control peer review organization
(with which the Secretary has entered into a con-
tract under part B of title XI of such Act), transmit
electronically the data set, and
(3) upon request of the Secretary, or of a fiscal
intermediary or carrier, transmit electronically any
data (with respect to a claim) from such data set,
in accordance with the standards promulgated under sec-
tion 201(a).
(b) WAIVER AUTHORITY.—Until January 1, 2000:
(1) The Secretary may waive the application of
the requirements of subsection (a) for a hospital
that is a small rural hospital, for such period as the
hospital demonstrates compliance with such require-
ments would constitute an undue financial hardship.
(2) The Secretary may waive the application of
the requirements of subsection (a) for a hospital
that is in the process of developing a system to pro-
vide the required data set and executes agreements
with its fiscal intermediary and its utilization and
quality control peer review organization that the hos-
pital will meet the requirements of subsection (a) by
a specified date (not later than January 1, 2000).
(3) The Secretary may waive the application of
the requirement of subsection (a)(1) for a hospital
that agrees to obtain from its records the data ele-
ments that are needed to meet the requirements of
paragraphs (2) and (3) of subsection (a) and agrees
to subject its data transfer process to a quality as-
surance program specified by the Secretary.
(c) APPLICATION TO HOSPITALS OF THE DEPART-
MENT OF VETERANS AFFAIRS.—
(1) IN GENERAL.—The Secretary of Veterans
Affairs shall provide that each hospital of the De-
partment of Veterans Affairs shall comply with the
requirements of subsection (a) in the same manner
as such requirements would apply to the hospital if
it were participating in the Medicare program.
(2) WAIVER.—Such Secretary may waive the
application of such requirements to a hospital in the
same manner as the Secretary of Health and
Human Services may waive under subsection (b) the
application of the requirements of subsection (a).
SEC. 203. ELECTRONIC TRANSMISSION TO FEDERAL AGEN-
CIES.
(a) IN GENERAL.—Effective January 1, 2000, if a
provider is required under a Federal program to transmit
a data element that is subject to a presentation or trans-
mission standard (as defined in subsection (b)), the head
of the Federal agency responsible for such program (if not
otherwise authorized) is authorized to require the provider
to present and transmit the data element electronically in
accordance with such a standard.
(b) PRESENTATION
OR TRANSMISSION STANDARD
DEFINED.—In subsection (a), the term ‘‘presentation or
transmission standard’’ means a standard, promulgated
under subsection (b) or (c) of section 201, described in
paragraph (4) or (5) of section 201(b).
SEC. 204. LIMITATION ON DATA REQUIREMENTS WHERE
STANDARDS IN EFFECT.
(a) IN GENERAL.—If standards with respect to data
elements are promulgated under section 201 with respect
to a class of provider, a health benefit plan may not re-
quire, for the purpose of utilization review or as a condi-
tion of providing benefits under the plan, that a provider
in the class—
(1) provide any data element not in the set of
comprehensive data elements specified under such
standards, or
(2) transmit or present any such data element
in a manner inconsistent with the applicable stand-
ards for such transmission or presentation.
(b) COMPLIANCE.—
(1) IN GENERAL.—The Secretary may impose a
civil money penalty on any health benefit plan (other
than a health benefit plan described in paragraph
(2)) that fails to comply with subsection (a) in an
amount not to exceed $100 for each such failure.
The provisions of section 1128A of the Social Secu-
rity Act (other than the first sentence of subsection
(a) and other than subsection (b)) shall apply to a
civil money penalty under this paragraph in the
same manner as such provisions apply to a penalty
or proceeding under section 1128A(a) of such Act.
(2) PLANS SUBJECT TO EFFECTIVE STATE REG-
ULATION.—A plan described in this paragraph is a
health benefit plan that is subject to regulation by
a State, if the Secretary finds that—
(A) the State provides for application of
the requirement of subsection (a), and
(B) the State regulatory program provides
for the appropriate and effective enforcement of
such requirement with respect to such plans.
SEC. 205. ADVISORY COMMISSION.
(a) IN GENERAL.—The Secretary shall establish an
advisory commission including hospital executives, hospital
data base managers, physicians, health services research-
ers, and technical experts in collection and use of data
and operation of data systems. Such commission shall in-
clude, as ex officio members, a representative of the Direc-
tor of the National Institutes of Health, the Administrator
for Health Care Policy and Research, the Secretary of
Veterans Affairs, and the Director of the Centers for Dis-
ease Control.
(b) FUNCTIONS.—The advisory commission shall
monitor and advise the Secretary concerning—
(1) the standards established under this title,
and
(2) operational concerns about the implementa-
tion of such standards under this part.
(c) STAFF.—From the amounts appropriated under
subsection (d), the Secretary shall provide sufficient staff
to assist the advisory commission in its activities under
this section.
(d) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated $2,000,000 for each of
fiscal years 1994 through 1999 to carry out this section.
TITLE III—DEVELOPMENT AND
DISTRIBUTION OF COMPARA-
TIVE VALUE INFORMATION
SEC. 301. STATE COMPARATIVE VALUE INFORMATION PRO-
GRAMS FOR HEALTH CARE PURCHASING.
(a) PURPOSE.—In order to assure the availability of
comparative value information to purchasers of health
care in each State, the Secretary shall determine whether
each State is developing and implementing a health care
value information program that meets the criteria and
schedule set forth in subsection (b).
(b) CRITERIA
AND SCHEDULE
FOR STATE PRO-
GRAMS.—The criteria and schedule for a State health care
value information program in this subsection shall be
specified by the Secretary as follows:
(1) The State begins promptly after enactment
of this Act to develop (directly or through contrac-
tual or other arrangements with one or more States,
coalitions of health insurance purchasers, other enti-
ties, or any combination of such arrangements)
information systems regarding comparative health
values.
(2) The information contained in such systems
covers at least the average prices of common health
care services (as defined in subsection (d)) and
health insurance plans, and, where available, meas-
ures of the variability of these prices within a State
or other market areas.
(3) The information described in paragraph (2)
is made available within the State beginning not
later than 1 year after the date of the enactment of
this Act, and is revised as frequently as reasonably
necessary, but at intervals of no greater than 1 year.
(4) Not later than 6 years after the date of the
enactment of this Act the State has developed infor-
mation systems that provide comparative costs, qual-
ity, and outcomes data with respect to health insur-
ance plans and hospitals and made the information
broadly available within the relevant market areas.
Nothing in this section shall preclude a State from provid-
ing additional information, such as information on prices
and benefits of different health benefit plans, available.
(c) GRANTS TO STATES FOR THE DEVELOPMENT OF
STATE PROGRAMS.—
(1) GRANT
AUTHORITY.—The Secretary may
make grants to each State to enable such State to
plan the development of its health care value infor-
mation program and, if necessary, to initiate the im-
plementation of such program. Each State seeking
such a grant shall submit an application therefore,
containing such information as the Secretary finds
necessary to assure that the State is likely to de-
velop and implement a program in accordance with
the criteria and schedule in subsection (b).
(2) OFFSET AUTHORITY.—If, at any time with-
in the 3-year period following the receipt by a State
of a grant under this subsection, the Secretary is re-
quired by section 302 to implement a health care in-
formation program in the State, the Secretary may
recover the amount of the grant under this sub-
section by offset against any other amount payable
to the State under the Social Security Act. The
amount of the offset shall be made available (from
the appropriation account with respect to which the
offset was taken) to the Secretary to carry out such
section.
(3) AUTHORIZATION
OF
APPROPRIATIONS.—
There are authorized to be appropriated such sums
as are necessary to make grants under this sub-
section, to remain available until expended.
(d) COMMON HEALTH CARE SERVICES DEFINED.—
In this section, the term ‘‘common health care services’’
includes such procedures as the Secretary may specify and
any additional health care services which a State may wish
to include in its comparative value information program.
SEC. 302. FEDERAL IMPLEMENTATION.
(a) IN GENERAL.—If the Secretary finds, at any
time, that a State has failed to develop or to continue to
implement a health care value information program in ac-
cordance with the criteria and schedule in section 301(b),
the Secretary shall take the actions necessary, directly or
through grants or contract, to implement a comparable
program in the State.
(b) FEES.—Fees may be charged by the Secretary
for the information materials provided pursuant to a pro-
gram under this section. Any amounts so collected shall
be deposited in the appropriation account from which the
Secretary’s costs of providing such materials were met,
and shall remain available for such purposes until
expended.
SEC. 303. COMPARATIVE VALUE INFORMATION CONCERN-
ING FEDERAL PROGRAMS.
(a) DEVELOPMENT.—The head of each Federal agen-
cy with responsibility for the provision of health insurance
or of health care services to individuals shall promptly de-
velop health care value information relating to each pro-
gram that such head administers and covering the same
types of data that a State program meeting the criteria
of section 301(b) would provide.
(b) DISSEMINATION OF INFORMATION.—Such infor-
mation shall be made generally available to States and to
providers and consumers of health care services.
SEC. 304. DEVELOPMENT OF MODEL SYSTEMS.
(a) IN GENERAL.—The Secretary shall, directly or
through grant or contract, develop model systems to facili-
tate—
(1) the gathering of data on health care cost,
quality, and outcome described in section 301(b)(4),
and
(2) analyzing such data in a manner that will
permit the valid comparison of such data among
providers and among health plans.
(b) EXPERIMENTATION.—The Secretary shall sup-
port experimentation with different approaches to achieve
the objectives of subsection (a) in the most cost effective
manner (relative to the accuracy and timeliness of the
data secured) and shall evaluate the various methods to
determine their relative success.
(c) STANDARDS.—When the Secretary considers it
appropriate, the Secretary may establish standards for the
collection and reporting of data on health care cost, qual-
ity and outcomes in order to facilitate analysis and com-
parisons among States and nationally.
(e) REPORT.—By not later than 3 years after the
date of the enactment of this Act, the Secretary shall re-
port to the Congress and the States on the models devel-
oped, and experiments conducted, under this section.
(e) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated such sums as are nec-
essary for each fiscal year beginning with fiscal year 1993
to enable the Secretary to carry out this section, including
evaluation of the different approaches tested under sub-
section (b) and their relative cost effectiveness.
TITLE IV—ADDITIONAL STAND-
ARDS AND REQUIREMENTS;
RESEARCH AND DEMONSTRA-
TIONS
SEC. 401. STANDARDS RELATING TO USE OF MEDICARE
AND MEDICAID MAGNETIZED HEALTH BENE-
FIT CARDS; SECONDARY PAYOR DATA BANK.
(a) MAGNETIZED IDENTIFICATION CARDS UNDER
MEDICARE PROGRAM.—The Secretary shall adopt stand-
ards relating to the design and use of magnetized medi-
care identification cards in order to assist health care pro-
viders providing medicare covered services to individuals—
(1) in determining whether individuals are eligi-
ble for benefits under the medicare program, and
(2) in billing the medicare program for such
services provided to eligible individuals.
Such cards shall be designed to be compatible with ma-
chines currently employed to transmit information on
credit cards. Such cards also shall be designed to be able
to be used with respect to the provision of benefits under
medicare supplemental policies.
(b) ADOPTION UNDER MEDICAID PLANS.—
(1) IN
GENERAL.—The Secretary shall take
such steps as may be necessary to encourage and as-
sist States to design and use magnetized medicaid
identification cards that meet such standards, for
use under their medicaid plans.
(2) LIMITATION ON MMIS FUNDS.—In applying
section 1903(a)(3) of the Social Security Act, the
Secretary may determine that Federal financial par-
ticipation is not available under that section to a
State which has provided for a magnetized card sys-
tem that is inconsistent with the standards adopted
under subsection (a).
(c) MEDICARE AND MEDICAID SECONDARY PAYOR
DATA BANK.—The Secretary shall establish a medicare
and medicaid information system which is designed to pro-
vide information on those group health plans and other
health benefit plans that are primary payors to the medi-
care program and medicaid program under section
1862(b) or section 1905(a)(25) of the Social Security Act.
(d) AUTHORIZATION
OF APPROPRIATIONS.—There
are authorized to be appropriated, in equal proportions
from the Federal Hospital Insurance Trust Fund and
from the Federal Supplementary Medical Insurance Trust
Fund, a total of $25,000,000 to carry out subsections (a)
and (c), including the issuance of magnetized cards to
medicare beneficiaries.
SEC. 402. PREEMPTION OF STATE QUILL PEN LAWS.
(a) IN GENERAL.—Effective January 1, 1994, no ef-
fect shall be given to any provision of State law that re-
quires medical or health insurance records (including bill-
ing information) to be maintained in written, rather than
electronic form.
(b) SECRETARIAL AUTHORITY.—The Secretary of
Health and Human Services may issue regulations to
carry out subsection (a). Such regulations may provide for
such exceptions to subsection (a) as the Secretary deter-
mines to be necessary to prevent fraud and abuse, with
respect to controlled substances, and in such other cases
as the Secretary deems appropriate.
SEC. 403. USE OF STANDARD IDENTIFICATION NUMBERS.
(a) IN GENERAL.—Effective January 1, 1994, each
health benefit plan shall—
(1) for each of its beneficiaries that has a social
security account number, use that number as the
personal identifier for claims processing and related
purposes, and
(2) for each provider that has a unique identi-
fier for purposes of title XVIII of the Social Security
Act and that furnishes health care items or services
to a beneficiary under the plan, use that identifier
as the identifier of that provider for claims process-
ing and related purposes.
(b) COMPLIANCE.—
(1) IN GENERAL.—The Secretary may impose a
civil money penalty on any health benefit plan (other
than a health benefit plan described in paragraph
(2)) that fails to comply with standards established
under subsection (a) in an amount not to exceed
$100 for each such failure. The provisions of section
1128A of the Social Security Act (other than the
first sentence of subsection (a) and other than sub-
section (b)) shall apply to a civil money penalty
under this paragraph in the same manner as such
provisions apply to a penalty or proceeding under
section 1128A(a) of such Act.
(2) PLANS SUBJECT TO EFFECTIVE STATE REG-
ULATION.—A plan described in this paragraph is a
health benefit plan that is subject to regulation by
a State, if the Secretary finds that—
(A) the State provides for application of
the requirement of subsection (a), and
(B) the State regulatory program provides
for the appropriate and effective enforcement of
such requirement with respect to such plans.
SEC. 404. COORDINATION OF BENEFIT STANDARDS.
(a) REVIEW OF COORDINATION OF BENEFIT PROB-
LEMS.—Between July 1, 1994, and January 1, 1995, the
Secretary shall determine whether problems relating to—
(1) the rules for determining the liability of
health benefit plans when benefits are payable under
2 or more such plans, or
(2) the availability of information among such
health benefit plans when benefits are so payable,
cause significant administrative costs.
(b) CONTINGENT PROMULGATION OF STANDARDS.—
(1) IN GENERAL.—If the Secretary determines
that such problems do cause significant administra-
tive costs that could be significantly reduced through
the implementation of standards, the Secretary shall
promulgate standards concerning—
(A) the liability of health benefit plans
when benefits are payable under 2 or more such
plans, and
(B) the transfer among health benefit
plans of appropriate information (which may in-
clude standards for the use of unique identifi-
ers, and for the listing of all individuals covered
under a health benefit plan) in determining li-
ability in cases when benefits are payable under
2 or more such plans.
(2) EFFECTIVE DATE.—The standards promul-
gated under paragraph (1) shall become effective on
a date specified by the Secretary, which date shall
be not earlier than 1 year after the date of promul-
gation of the standards.
(c) COMPLIANCE.—
(1) IN GENERAL.—The Secretary may impose a
civil money penalty on any health benefit plan (other
than a health benefit plan described in paragraph
(2)) that fails to comply with standards promulgated
under subsection (b) in an amount not to exceed
$100 for each such failure. The provisions of section
1128A of the Social Security Act (other than the
first sentence of subsection (a) and other than sub-
section (b)) shall apply to a civil money penalty
under this paragraph in the same manner as such
provisions apply to a penalty or proceeding under
section 1128A(a) of such Act.
(2) PLANS SUBJECT TO EFFECTIVE STATE REG-
ULATION.—A plan described in this paragraph is a
health benefit plan that is subject to regulation by
a State, if the Secretary finds that—
(A) the State provides for application of
the standards established under subsection (b),
and
(B) the State regulatory program provides
for the appropriate and effective enforcement of
such standards with respect to such plans.
(d) REVISION OF STANDARDS.—If the Secretary es-
tablishes standards under subsection (b), the Secretary
may revise such standards from time to time and such
revised standards shall be applied under subsection (c) on
or after such date (not earlier than 6 months after the
date the revision is promulgated) as the Secretary shall
specify.
SEC. 405. RESEARCH AND DEMONSTRATIONS.
(a) DEMONSTRATIONS AND RESEARCH ON MONITOR-
ING AND IMPROVING PATIENT CARE.—
(1) The Secretary shall provide grants to quali-
fied entities to demonstrate (and conduct research
concerning) the application of comprehensive infor-
mation systems—
(A) in continuously monitoring patient
care, and
(B) in improving patient care.
(2) To make grants under this subsection, there
are authorized to be appropriated from the Federal
Hospital Insurance Trust Fund $10,000,000 for
each fiscal year (beginning with fiscal year 1994 and
ending with fiscal year 1998).
(b) COMMUNICATION LINKS.—
(1) The Secretary may make grants to at least
2, but not more than 5, community organizations, or
coalitions of health care providers, health benefit
plans, and purchasers, to establish and document
the efficacy of communication links between the in-
formation systems of health benefit plans and of
health care providers.
(2) To make grants under this subsection, there
are authorized to be appropriated such sums as may
be necessary for fiscal year 1994, to remain avail-
able until expended.
(c) REGIONAL OR COMMUNITY BASED CLINICAL IN-
FORMATION SYSTEMS.—
(1) The Secretary may make grants to at least
2, but not more than 5, public or private non-profit
entities for the development of regional or commu-
nity-based clinical information systems.
(2) To make grants under this subsection, there
are authorized to be appropriated such sums as may
be necessary for fiscal year 1994, to remain avail-
able until expended.
(d) AMBULATORY CARE DATA SETS.—
(1) The Secretary may make grants to public or
private non-profit entities to develop and test, for
electronic medical data generated by physicians and
other entities (other than hospitals) that provide
health care services—
(A) the definition of a comprehensive set of
data elements, and
(B) the specification of, and manner of
presentation of, the individual data elements of
the set under subparagraph (A).
(2) To make grants under this subsection, there
are authorized to be appropriated such sums as may
be necessary for fiscal year 1994, to remain avail-
able until expended.
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