618 
SEC. 1422. NATIONAL INDEPENDENT MONITOR PILOT PRO-
GRAM. 
(a) ESTABLISHMENT.— 
(1) IN GENERAL.—The Secretary, in consulta-
tion with the Inspector General of the Department 
of Health and Human Services, shall establish a 
pilot program (in this section referred to as the 
‘‘pilot program’’) to develop, test, and implement use 
of an independent monitor to oversee interstate and 
large intrastate chains of skilled nursing facilities 
and nursing facilities. 
(2) SELECTION.—The Secretary shall select 
chains of skilled nursing facilities and nursing facili-
ties described in paragraph (1) to participate in the 
pilot program from among those chains that submit 
an application to the Secretary at such time, in such 
manner, and containing such information as the Sec-
retary may require. 
(3) DURATION.—The Secretary shall conduct 
the pilot program for a two-year period. 
(4) IMPLEMENTATION.—The Secretary shall 
implement the pilot program not later than one year 
after the date of the enactment of this Act. 
(b) REQUIREMENTS.—The Secretary shall evaluate 
chains selected to participate in the pilot program based 
on criteria selected by the Secretary, including where evi-
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dence suggests that one or more facilities of the chain are 
experiencing serious safety and quality of care problems. 
Such criteria may include the evaluation of a chain that 
includes one or more facilities participating in the ‘‘Special 
Focus Facility’’ program (or a successor program) or one 
or more facilities with a record of repeated serious safety 
and quality of care deficiencies. 
(c) RESPONSIBILITIES OF THE INDEPENDENT MON-
ITOR.—An independent monitor that enters into a con-
tract with the Secretary to participate in the conduct of 
such program shall— 
(1) conduct periodic reviews and prepare root- 
cause quality and deficiency analyses of a chain to 
assess if facilities of the chain are in compliance 
with State and Federal laws and regulations applica-
ble to the facilities; 
(2) undertake sustained oversight of the chain, 
whether publicly or privately held, to involve the 
owners of the chain and the principal business part-
ners of such owners in facilitating compliance by fa-
cilities of the chain with State and Federal laws and 
regulations applicable to the facilities; 
(3) analyze the management structure, distribu-
tion of expenditures, and nurse staffing levels of fa-
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cilities of the chain in relation to resident census, 
staff turnover rates, and tenure; 
(4) report findings and recommendations with 
respect to such reviews, analyses, and oversight to 
the chain and facilities of the chain, to the Secretary 
and to relevant States; and 
(5) publish the results of such reviews, anal-
yses, and oversight. 
(d) IMPLEMENTATION OF RECOMMENDATIONS.— 
(1) RECEIPT OF FINDING BY CHAIN.—Not later 
than 10 days after receipt of a finding of an inde-
pendent monitor under subsection (c)(4), a chain 
participating in the pilot program shall submit to 
the independent monitor a report— 
(A) outlining corrective actions the chain 
will take to implement the recommendations in 
such report; or 
(B) indicating that the chain will not im-
plement such recommendations and why it will 
not do so. 
(2) RECEIPT
OF
REPORT
BY
INDEPENDENT 
MONITOR.—Not later than 10 days after the date of 
receipt of a report submitted by a chain under para-
graph (1), an independent monitor shall finalize its 
recommendations and submit a report to the chain 
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and facilities of the chain, the Secretary, and the 
State (or States) involved, as appropriate, containing 
such final recommendations. 
(e) COST OF APPOINTMENT.—A chain shall be re-
sponsible for a portion of the costs associated with the 
appointment of independent monitors under the pilot pro-
gram. The chain shall pay such portion to the Secretary 
(in an amount and in accordance with procedures estab-
lished by the Secretary). 
(f) WAIVER AUTHORITY.—The Secretary may waive 
such requirements of titles XVIII and XIX of the Social 
Security Act (42 U.S.C. 1395 et seq.; 1396 et seq.) as 
may be necessary for the purpose of carrying out the pilot 
program. 
(g) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated such sums as may be 
necessary to carry out this section. 
(h) DEFINITIONS.—In this section: 
(1) FACILITY.—The term ‘‘facility’’ means a 
skilled nursing facility or a nursing facility. 
(2) NURSING
FACILITY.—The term ‘‘nursing 
facility’’ has the meaning given such term in section 
1919(a) of the Social Security Act (42 U.S.C. 
1396r(a)). 
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(3) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of Health and Human Services, acting 
through the Assistant Secretary for Planning and 
Evaluation. 
(4) SKILLED
NURSING
FACILITY.—The term 
‘‘skilled nursing facility’’ has the meaning given such 
term in section 1819(a) of the Social Security Act 
(42 U.S.C. 1395(a)). 
(i) EVALUATION AND REPORT.— 
(1) EVALUATION.—The Inspector General of 
the Department of Health and Human Services shall 
evaluate the pilot program. Such evaluation shall— 
(A) determine whether the independent 
monitor program should be established on a 
permanent basis; and 
(B) if the Inspector General determines 
that the independent monitor program should 
be established on a permanent basis, rec-
ommend appropriate procedures and mecha-
nisms for such establishment. 
(2) REPORT.—Not later than 180 days after 
the completion of the pilot program, the Inspector 
General shall submit to Congress and the Secretary 
a report containing the results of the evaluation con-
ducted under paragraph (1), together with rec-
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not later than the date that the Sec-
retary determines appropriate; 
‘‘(ii) ensure that the facility does not 
admit any new residents on or after the 
date on which such written notification is 
submitted; and 
‘‘(iii) include in the notice a plan for 
the transfer and adequate relocation of the 
residents of the facility by a specified date 
prior to closure that has been approved by 
the State, including assurances that the 
residents will be transferred to the most 
appropriate facility or other setting in 
terms of quality, services, and location, 
taking into consideration the needs and 
best interests of each resident. 
‘‘(B) RELOCATION.— 
‘‘(i) IN
GENERAL.—The State shall 
ensure that, before a facility closes, all 
residents of the facility have been success-
fully relocated to another facility or an al-
ternative home and community-based set-
ting. 
‘‘(ii) CONTINUATION
OF
PAYMENTS 
UNTIL RESIDENTS RELOCATED.—The Sec-
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retary may, as the Secretary determines 
appropriate, continue to make payments 
under this title with respect to residents of 
a facility that has submitted a notification 
under subparagraph (A) during the period 
beginning on the date such notification is 
submitted and ending on the date on which 
the resident is successfully relocated.’’. 
(2) 
CONFORMING
AMENDMENTS.—Section 
1819(h)(4) of the Social Security Act (42 U.S.C. 
1395i–3(h)(4)) is amended— 
(A) in the first sentence, by striking ‘‘the 
Secretary shall terminate’’ and inserting ‘‘the 
Secretary, subject to subsection (c)(7), shall 
terminate’’; and 
(B) in the second sentence, by striking 
‘‘subsection (c)(2)’’ and inserting ‘‘paragraphs 
(2) and (7) of subsection (c)’’. 
(b) NURSING FACILITIES.— 
(1) IN GENERAL.—Section 1919(c) of the So-
cial Security Act (42 U.S.C. 1396r(c)) is amended 
by adding at the end the following new paragraph: 
‘‘(9) NOTIFICATION OF FACILITY CLOSURE.— 
‘‘(A) IN GENERAL.—Any individual who is 
an administrator of a nursing facility must— 
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‘‘(i) submit to the Secretary, the State 
long-term care ombudsman, residents of 
the facility, and the legal representatives of 
such residents or other responsible parties, 
written notification of an impending clo-
sure— 
‘‘(I) subject to subclause (II), not 
later than the date that is 60 days 
prior to the date of such closure; and 
‘‘(II) in the case of a facility 
where the Secretary terminates the fa-
cility’s participation under this title, 
not later than the date that the Sec-
retary determines appropriate; 
‘‘(ii) ensure that the facility does not 
admit any new residents on or after the 
date on which such written notification is 
submitted; and 
‘‘(iii) include in the notice a plan for 
the transfer and adequate relocation of the 
residents of the facility by a specified date 
prior to closure that has been approved by 
the State, including assurances that the 
residents will be transferred to the most 
appropriate facility or other setting in 
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terms of quality, services, and location, 
taking into consideration the needs and 
best interests of each resident. 
‘‘(B) RELOCATION.— 
‘‘(i) IN
GENERAL.—The State shall 
ensure that, before a facility closes, all 
residents of the facility have been success-
fully relocated to another facility or an al-
ternative home and community-based set-
ting. 
‘‘(ii) CONTINUATION
OF
PAYMENTS 
UNTIL RESIDENTS RELOCATED.—The Sec-
retary may, as the Secretary determines 
appropriate, continue to make payments 
under this title with respect to residents of 
a facility that has submitted a notification 
under subparagraph (A) during the period 
beginning on the date such notification is 
submitted and ending on the date on which 
the resident is successfully relocated.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect 1 year after the date of the 
enactment of this Act. 
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PART 3—IMPROVING STAFF TRAINING 
SEC. 1431. DEMENTIA AND ABUSE PREVENTION TRAINING. 
(a) 
SKILLED
NURSING
FACILITIES.—Section 
1819(f)(2)(A)(i)(I) of the Social Security Act (42 U.S.C. 
1395i–3(f)(2)(A)(i)(I)) is amended by inserting ‘‘(includ-
ing, in the case of initial training and, if the Secretary 
determines appropriate, in the case of ongoing training, 
dementia management training and resident abuse preven-
tion training)’’ after ‘‘curriculum’’. 
(b) 
NURSING
FACILITIES.—Section 
1919(f)(2)(A)(i)(I) of the Social Security Act (42 U.S.C. 
1396r(f)(2)(A)(i)(I)) is amended by inserting ‘‘(including, 
in the case of initial training and, if the Secretary deter-
mines appropriate, in the case of ongoing training, demen-
tia management training and resident abuse prevention 
training)’’ after ‘‘curriculum’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall take effect 1 year after the date of the 
enactment of this Act. 
SEC. 1432. STUDY AND REPORT ON TRAINING REQUIRED 
FOR CERTIFIED NURSE AIDES AND SUPER-
VISORY STAFF. 
(a) STUDY.— 
(1) IN GENERAL.—The Secretary shall conduct 
a study on the content of training for certified nurse 
aides and supervisory staff of skilled nursing facili-
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ties and nursing facilities. The study shall include an 
analysis of the following: 
(A) Whether the number of initial training 
hours for certified nurse aides required under 
sections 
1819(f)(2)(A)(i)(II) 
and 
1919(f)(2)(A)(i)(II) of the Social Security Act 
(42 
U.S.C. 
1395i–3(f)(2)(A)(i)(II); 
1396r(f)(2)(A)(i)(II)) should be increased from 
75 and, if so, what the required number of ini-
tial training hours should be, including any rec-
ommendations for the content of such training 
(including training related to dementia). 
(B) Whether requirements for ongoing 
training 
under 
such 
sections 
1819(f)(2)(A)(i)(II) and 1919(f)(2)(A)(i)(II) 
should be increased from 12 hours per year, in-
cluding any recommendations for the content of 
such training. 
(2) CONSULTATION.—In conducting the anal-
ysis under paragraph (1)(A), the Secretary shall 
consult with States that, as of the date of the enact-
ment of this Act, require more than 75 hours of 
training for certified nurse aides. 
(3) DEFINITIONS.—In this section: 
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(A) NURSING FACILITY.—The term ‘‘nurs-
ing facility’’ has the meaning given such term 
in section 1919(a) of the Social Security Act 
(42 U.S.C. 1396r(a)). 
(B) SECRETARY.—The term ‘‘Secretary’’ 
means the Secretary of Health and Human 
Services, acting through the Assistant Secretary 
for Planning and Evaluation. 
(C) SKILLED
NURSING
FACILITY.—The 
term ‘‘skilled nursing facility’’ has the meaning 
given such term in section 1819(a) of the Social 
Security Act (42 U.S.C. 1395(a)). 
(b) REPORT.—Not later than 2 years after the date 
of the enactment of this Act, the Secretary shall submit 
to Congress a report containing the results of the study 
conducted under subsection (a), together with rec-
ommendations for such legislation and administrative ac-
tion as the Secretary determines appropriate. 
Subtitle C—Quality Measurements 
SEC. 1441. ESTABLISHMENT OF NATIONAL PRIORITIES FOR 
QUALITY IMPROVEMENT. 
Title XI of the Social Security Act, as amended by 
section 1401(a), is further amended by adding at the end 
the following new part: 
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‘‘PART E—QUALITY IMPROVEMENT 
‘‘ESTABLISHMENT OF NATIONAL PRIORITIES FOR 
PERFORMANCE IMPROVEMENT 
‘‘SEC. 1191. (a) ESTABLISHMENT OF NATIONAL PRI-
ORITIES BY THE SECRETARY.—The Secretary shall estab-
lish and periodically update, not less frequently than tri-
ennially, national priorities for performance improvement. 
‘‘(b) RECOMMENDATIONS
FOR NATIONAL PRIOR-
ITIES.—In establishing and updating national priorities 
under subsection (a), the Secretary shall solicit and con-
sider recommendations from multiple outside stake-
holders. 
‘‘(c) CONSIDERATIONS IN SETTING NATIONAL PRI-
ORITIES.—With respect to such priorities, the Secretary 
shall ensure that priority is given to areas in the delivery 
of health care services in the United States that— 
‘‘(1) contribute to a large burden of disease, in-
cluding those that address the health care provided 
to patients with prevalent, high-cost chronic dis-
eases; 
‘‘(2) have the greatest potential to decrease 
morbidity and mortality in this country, including 
those that are designed to eliminate harm to pa-
tients; 
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‘‘(3) have the greatest potential for improving 
the 
performance, 
affordability, 
and 
patient- 
centeredness of health care, including those due to 
variations in care; 
‘‘(4) address health disparities across groups 
and areas; and 
‘‘(5) have the potential for rapid improvement 
due to existing evidence, standards of care or other 
reasons. 
‘‘(d) DEFINITIONS.—In this part: 
‘‘(1) CONSENSUS-BASED
ENTITY.—The term 
‘consensus-based entity’ means an entity with a con-
tract with the Secretary under section 1890. 
‘‘(2) QUALITY
MEASURE.—The term ‘quality 
measure’ means a national consensus standard for 
measuring the performance and improvement of pop-
ulation health, or of institutional providers of serv-
ices, physicians, and other health care practitioners 
in the delivery of health care services. 
‘‘(e) FUNDING.— 
‘‘(1) IN GENERAL.—The Secretary shall provide 
for the transfer, from the Federal Hospital Insur-
ance Trust Fund under section 1817 and the Fed-
eral Supplementary Medical Insurance Trust Fund 
under section 1841 (in such proportion as the Sec-
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retary determines appropriate), of $2,000,000, for 
the activities under this section for each of the fiscal 
years 2010 through 2014. 
‘‘(2) AUTHORIZATION
OF
APPROPRIATIONS.— 
For purposes of carrying out the provisions of this 
section, in addition to funds otherwise available, out 
of any funds in the Treasury not otherwise appro-
priated, there are appropriated to the Secretary of 
Health and Human Services $2,000,000 for each of 
the fiscal years 2010 through 2014.’’. 
SEC. 1442. DEVELOPMENT OF NEW QUALITY MEASURES; 
GAO EVALUATION OF DATA COLLECTION 
PROCESS FOR QUALITY MEASUREMENT. 
Part E of title XI of the Social Security Act, as added 
by section 1441, is amended by adding at the end the fol-
lowing new sections: 
‘‘SEC. 1192. DEVELOPMENT OF NEW QUALITY MEASURES. 
‘‘(a) AGREEMENTS WITH QUALIFIED ENTITIES.— 
‘‘(1) IN GENERAL.—The Secretary shall enter 
into agreements with qualified entities to develop 
quality measures for the delivery of health care serv-
ices in the United States. 
‘‘(2) FORM OF AGREEMENTS.—The Secretary 
may carry out paragraph (1) by contract, grant, or 
otherwise. 
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‘‘(3) 
RECOMMENDATIONS
OF
CONSENSUS- 
BASED ENTITY.—In carrying out this section, the 
Secretary shall— 
‘‘(A) seek public input; and 
‘‘(B) take into consideration recommenda-
tions of the consensus-based entity with a con-
tract with the Secretary under section 1890(a). 
‘‘(b) DETERMINATION OF AREAS WHERE QUALITY 
MEASURES ARE REQUIRED.—Consistent with the na-
tional priorities established under this part and with the 
programs administered by the Centers for Medicare & 
Medicaid Services and in consultation with other relevant 
Federal agencies, the Secretary shall determine areas in 
which quality measures for assessing health care services 
in the United States are needed. 
‘‘(c) DEVELOPMENT OF QUALITY MEASURES.— 
‘‘(1) PATIENT-CENTERED
AND
POPULATION- 
BASED
MEASURES.—Quality measures developed 
under agreements under subsection (a) shall be de-
signed— 
‘‘(A) to assess outcomes and functional 
status of patients; 
‘‘(B) to assess the continuity and coordina-
tion of care and care transitions for patients 
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across providers and health care settings, in-
cluding end of life care; 
‘‘(C) to assess patient experience and pa-
tient engagement; 
‘‘(D) to assess the safety, effectiveness, 
and timeliness of care; 
‘‘(E) to assess health disparities including 
those associated with individual race, ethnicity, 
age, gender, place of residence or language; 
‘‘(F) to assess the efficiency and resource 
use in the provision of care; 
‘‘(G) to the extent feasible, to be collected 
as part of health information technologies sup-
porting better delivery of health care services; 
‘‘(H) to be available free of charge to users 
for the use of such measures; and 
‘‘(I) to assess delivery of health care serv-
ices to individuals regardless of age. 
‘‘(2) AVAILABILITY OF MEASURES.—The Sec-
retary shall make quality measures developed under 
this section available to the public. 
‘‘(3) TESTING OF PROPOSED MEASURES.—The 
Secretary may use amounts made available under 
subsection (f) to fund the testing of proposed quality 
measures by qualified entities. Testing funded under 
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this paragraph shall include testing of the feasibility 
and usability of proposed measures. 
‘‘(4) UPDATING
OF
ENDORSED
MEASURES.— 
The Secretary may use amounts made available 
under subsection (f) to fund the updating (and test-
ing, if applicable) by consensus-based entities of 
quality measures that have been previously endorsed 
by such an entity as new evidence is developed, in 
a manner consistent with section 1890(b)(3). 
‘‘(d) QUALIFIED ENTITIES.—Before entering into 
agreements with a qualified entity, the Secretary shall en-
sure that the entity is a public, nonprofit or academic in-
stitution with technical expertise in the area of health 
quality measurement. 
‘‘(e) APPLICATION FOR GRANT.—A grant may be 
made under this section only if an application for the 
grant is submitted to the Secretary and the application 
is in such form, is made in such manner, and contains 
such agreements, assurances, and information as the Sec-
retary determines to be necessary to carry out this section. 
‘‘(f) FUNDING.— 
‘‘(1) IN GENERAL.—The Secretary shall provide 
for the transfer, from the Federal Hospital Insur-
ance Trust Fund under section 1817 and the Fed-
eral Supplementary Medical Insurance Trust Fund 
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637 
under section 1841 (in such proportion as the Sec-
retary determines appropriate), of $25,000,000, to 
the Secretary for purposes of carrying out this sec-
tion for each of the fiscal years 2010 through 2014. 
‘‘(2) AUTHORIZATION
OF
APPROPRIATIONS.— 
For purposes of carrying out the provisions of this 
section, in addition to funds otherwise available, out 
of any funds in the Treasury not otherwise appro-
priated, there are appropriated to the Secretary of 
Health and Human Services $25,000,000 for each 
of the fiscal years 2010 through 2014. 
‘‘SEC. 1193. GAO EVALUATION OF DATA COLLECTION PROC-
ESS FOR QUALITY MEASUREMENT. 
‘‘(a) GAO EVALUATIONS.—The Comptroller General 
of the United States shall conduct periodic evaluations of 
the implementation of the data collection processes for 
quality measures used by the Secretary. 
‘‘(b) CONSIDERATIONS.—In carrying out the evalua-
tion under subsection (a), the Comptroller General shall 
determine— 
‘‘(1) whether the system for the collection of 
data for quality measures provides for validation of 
data as relevant and scientifically credible; 
‘‘(2) whether data collection efforts under the 
system use the most efficient and cost-effective 
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638 
means in a manner that minimizes administrative 
burden on persons required to collect data and that 
adequately protects the privacy of patients’ personal 
health information and provides data security; 
‘‘(3) whether standards under the system pro-
vide for an appropriate opportunity for physicians 
and other clinicians and institutional providers of 
services to review and correct findings; and 
‘‘(4) the extent to which quality measures are 
consistent with section 1192(c)(1) or result in direct 
or indirect costs to users of such measures. 
‘‘(c) REPORT.—The Comptroller General shall sub-
mit reports to Congress and to the Secretary containing 
a description of the findings and conclusions of the results 
of each such evaluation.’’. 
SEC. 1443. MULTI-STAKEHOLDER PRE-RULEMAKING INPUT 
INTO SELECTION OF QUALITY MEASURES. 
Section 1808 of the Social Security Act (42 U.S.C. 
1395b–9) is amended by adding at the end the following 
new subsection: 
‘‘(d) MULTI-STAKEHOLDER PRE-RULEMAKING INPUT 
INTO SELECTION OF QUALITY MEASURES.— 
‘‘(1) LIST OF MEASURES.—Not later than De-
cember 1 before each year (beginning with 2011), 
the Secretary shall make public a list of measures 
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being considered for selection for quality measure-
ment by the Secretary in rulemaking with respect to 
payment systems under this title beginning in the 
payment year beginning in such year and for pay-
ment systems beginning in the calendar year fol-
lowing such year, as the case may be. 
‘‘(2) CONSULTATION
ON
SELECTION
OF
EN-
DORSED
QUALITY
MEASURES.—A consensus-based 
entity that has entered into a contract under section 
1890 shall, as part of such contract, convene multi- 
stakeholder groups to provide recommendations on 
the selection of individual or composite quality meas-
ures, for use in reporting performance information 
to the public or for use in public health care pro-
grams. 
‘‘(3) MULTI-STAKEHOLDER INPUT.—Not later 
than February 1 of each year (beginning with 
2011), the consensus-based entity described in para-
graph (2) shall transmit to the Secretary the rec-
ommendations of multi-stakeholder groups provided 
under paragraph (2). Such recommendations shall 
be included in the transmissions the consensus-based 
entity makes to the Secretary under the contract 
provided for under section 1890. 
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‘‘(4) REQUIREMENT
FOR
TRANSPARENCY
IN 
PROCESS.— 
‘‘(A) IN
GENERAL.—In convening multi- 
stakeholder groups under paragraph (2) with 
respect to the selection of quality measures, the 
consensus-based entity described in such para-
graph shall provide for an open and transparent 
process for the activities conducted pursuant to 
such convening. 
‘‘(B) SELECTION OF ORGANIZATIONS PAR-
TICIPATING
IN
MULTI-STAKEHOLDER 
GROUPS.—The process under paragraph (2) 
shall ensure that the selection of representatives 
of multi-stakeholder groups includes provision 
for public nominations for, and the opportunity 
for public comment on, such selection. 
‘‘(5) USE OF INPUT.—The respective proposed 
rule shall contain a summary of the recommenda-
tions made by the multi-stakeholder groups under 
paragraph (2), as well as other comments received 
regarding the proposed measures, and the extent to 
which such proposed rule follows such recommenda-
tions and the rationale for not following such rec-
ommendations. 
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‘‘(6) MULTI-STAKEHOLDER GROUPS.—For pur-
poses of this subsection, the term ‘multi-stakeholder 
groups’ means, with respect to a quality measure, a 
voluntary collaborative of organizations representing 
persons interested in or affected by the use of such 
quality measure, such as the following: 
‘‘(A) Hospitals and other institutional pro-
viders. 
‘‘(B) Physicians. 
‘‘(C) Health care quality alliances. 
‘‘(D) Nurses and other health care practi-
tioners. 
‘‘(E) Health plans. 
‘‘(F) Patient advocates and consumer 
groups. 
‘‘(G) Employers. 
‘‘(H) Public and private purchasers of 
health care items and services. 
‘‘(I) Labor organizations. 
‘‘(J) Relevant departments or agencies of 
the United States. 
‘‘(K) Biopharmaceutical companies and 
manufacturers of medical devices. 
‘‘(L) Licensing, credentialing, and accred-
iting bodies. 
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‘‘(7) FUNDING.— 
‘‘(A) IN
GENERAL.—The Secretary shall 
provide for the transfer, from the Federal Hos-
pital Insurance Trust Fund under section 1817 
and the Federal Supplementary Medical Insur-
ance Trust Fund under section 1841 (in such 
proportion as the Secretary determines appro-
priate), of $1,000,000, to the Secretary for pur-
poses of carrying out this subsection for each of 
the fiscal years 2010 through 2014. 
‘‘(B) 
AUTHORIZATION
OF
APPROPRIA-
TIONS.—For purposes of carrying out the provi-
sions of this subsection, in addition to funds 
otherwise available, out of any funds in the 
Treasury not otherwise appropriated, there are 
appropriated to the Secretary of Health and 
Human Services $1,000,000 for each of the fis-
cal years 2010 through 2014.’’. 
SEC. 1444. APPLICATION OF QUALITY MEASURES. 
(a) 
INPATIENT
HOSPITAL
SERVICES.—Section 
1886(b)(3)(B) of such Act (42 U.S.C. 1395ww(b)(3)(B)) 
is amended by adding at the end the following new clause: 
‘‘(x)(I) Subject to subclause (II), for purposes of re-
porting data on quality measures for inpatient hospital 
services furnished during fiscal year 2012 and each subse-
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quent fiscal year, the quality measures specified under 
clause (viii) shall be measures selected by the Secretary 
from measures that have been endorsed by the entity with 
a contract with the Secretary under section 1890(a). 
‘‘(II) In the case of a specified area or medical topic 
determined appropriate by the Secretary for which a fea-
sible and practical quality measure has not been endorsed 
by the entity with a contract under section 1890(a), the 
Secretary may specify a measure that is not so endorsed 
as long as due consideration is given to measures that 
have been endorsed or adopted by a consensus organiza-
tion identified by the Secretary. The Secretary shall sub-
mit such a non-endorsed measure to the entity for consid-
eration for endorsement. If the entity considers but does 
not endorse such a measure and if the Secretary does not 
phase-out use of such measure, the Secretary shall include 
the rationale for continued use of such a measure in rule-
making.’’. 
(b) OUTPATIENT
HOSPITAL
SERVICES.—Section 
1833(t)(17) of such Act (42 U.S.C. 1395l(t)(17)) is 
amended by adding at the end the following new subpara-
graph: 
‘‘(F) USE OF ENDORSED QUALITY MEAS-
URES.—The provisions of clause (x) of section 
1886(b)(3)(C) shall apply to quality measures 
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for covered OPD services under this paragraph 
in the same manner as such provisions apply to 
quality measures for inpatient hospital serv-
ices.’’. 
(c) 
PHYSICIANS’ 
SERVICES.—Section 
1848(k)(2)(C)(ii) of such Act (42 U.S.C. 1395w- 
4(k)(2)(C)(ii)) is amended by adding at the end the fol-
lowing: ‘‘The Secretary shall submit such a non-endorsed 
measure to the entity for consideration for endorsement. 
If the entity considers but does not endorse such a meas-
ure and if the Secretary does not phase-out use of such 
measure, the Secretary shall include the rationale for con-
tinued use of such a measure in rulemaking.’’. 
(d) 
RENAL
DIALYSIS
SERVICES.—Section 
1881(h)(2)(B)(ii) 
of 
such 
Act 
(42 
U.S.C. 
1395rr(h)(2)(B)(ii)) is amended by adding at the end the 
following: ‘‘The Secretary shall submit such a non-en-
dorsed measure to the entity for consideration for endorse-
ment. If the entity considers but does not endorse such 
a measure and if the Secretary does not phase-out use 
of such measure, the Secretary shall include the rationale 
for continued use of such a measure in rulemaking.’’. 
(e) 
ENDORSEMENT
OF
STANDARDS.—Section 
1890(b)(2) of the Social Security Act (42 U.S.C. 
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1395aaa(b)(2)) is amended by adding after and below sub-
paragraph (B) the following: 
‘‘If the entity does not endorse a measure, such enti-
ty shall explain the reasons and provide suggestions 
about changes to such measure that might make it 
a potentially endorsable measure.’’. 
(f) EFFECTIVE DATE.—Except as otherwise pro-
vided, the amendments made by this section shall apply 
to quality measures applied for payment years beginning 
with 2012 or fiscal year 2012, as the case may be. 
SEC. 1445. CONSENSUS-BASED ENTITY FUNDING. 
Section 1890(d) of the Social Security Act (42 U.S.C. 
1395aaa(d)) is amended by striking ‘‘for each of fiscal 
years 2009 through 2012’’ and inserting ‘‘for fiscal year 
2009, and $12,000,000 for each of the fiscal years 2010 
through 2012’’ 
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Subtitle D—Physician Payments 
Sunshine Provision 
SEC. 1451. REPORTS ON FINANCIAL RELATIONSHIPS BE-
TWEEN 
MANUFACTURERS 
AND 
DISTRIBU-
TORS 
OF 
COVERED 
DRUGS, 
DEVICES, 
BIOLOGICALS, 
OR 
MEDICAL 
SUPPLIES 
UNDER MEDICARE, MEDICAID, OR CHIP AND 
PHYSICIANS AND OTHER HEALTH CARE ENTI-
TIES AND BETWEEN PHYSICIANS AND OTHER 
HEALTH CARE ENTITIES. 
(a) IN GENERAL.—Part A of title XI of the Social 
Security Act (42 U.S.C. 1301 et seq.), as amended by sec-
tion 1631(a), is further amended by inserting after section 
1128G the following new section: 
‘‘SEC. 1128H. FINANCIAL REPORTS ON PHYSICIANS’ FINAN-
CIAL RELATIONSHIPS WITH MANUFACTUR-
ERS 
AND 
DISTRIBUTORS 
OF 
COVERED 
DRUGS, DEVICES, BIOLOGICALS, OR MEDICAL 
SUPPLIES UNDER MEDICARE, MEDICAID, OR 
CHIP AND WITH ENTITIES THAT BILL FOR 
SERVICES UNDER MEDICARE. 
‘‘(a) REPORTING OF PAYMENTS OR OTHER TRANS-
FERS OF VALUE.— 
‘‘(1) IN GENERAL.—Except as provided in this 
subsection, not later than March 31, 2011 and an-
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nually thereafter, each applicable manufacturer or 
distributor that provides a payment or other transfer 
of value to a covered recipient, or to an entity or in-
dividual at the request of or designated on behalf of 
a covered recipient, shall submit to the Secretary, in 
such electronic form as the Secretary shall require, 
the following information with respect to the pre-
ceding calendar year: 
‘‘(A) With respect to the covered recipient, 
the recipient’s name, business address, physi-
cian specialty, and national provider identifier. 
‘‘(B) With respect to the payment or other 
transfer of value, other than a drug sample— 
‘‘(i) its value and date; 
‘‘(ii) the name of the related drug, de-
vice, or supply, if available; and 
‘‘(iii) a description of its form, indi-
cated (as appropriate for all that apply) 
as— 
‘‘(I) cash or a cash equivalent; 
‘‘(II) in-kind items or services; 
‘‘(III) stock, a stock option, or 
any other ownership interest, divi-
dend, profit, or other return on invest-
ment; or 
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‘‘(IV) any other form (as defined 
by the Secretary). 
‘‘(C) With respect to a drug sample, the 
name, number, date, and dosage units of the 
sample. 
‘‘(2) 
AGGREGATE
REPORTING.—Information 
submitted by an applicable manufacturer or dis-
tributor under paragraph (1) shall include the ag-
gregate amount of all payments or other transfers of 
value provided by the manufacturer or distributor to 
covered recipients (and to entities or individuals at 
the request of or designated on behalf of a covered 
recipient) during the year involved, including all pay-
ments and transfers of value regardless of whether 
such payments or transfer of value were individually 
disclosed. 
‘‘(3) SPECIAL RULE FOR CERTAIN PAYMENTS 
OR
OTHER
TRANSFERS
OF
VALUE.—In the case 
where an applicable manufacturer or distributor pro-
vides a payment or other transfer of value to an en-
tity or individual at the request of or designated on 
behalf of a covered recipient, the manufacturer or 
distributor shall disclose that payment or other 
transfer of value under the name of the covered re-
cipient. 
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‘‘(4) DELAYED
REPORTING
FOR
PAYMENTS 
MADE
PURSUANT
TO
PRODUCT
DEVELOPMENT 
AGREEMENTS.—In the case of a payment or other 
transfer of value made to a covered recipient by an 
applicable manufacturer or distributor pursuant to a 
product development agreement for services fur-
nished in connection with the development of a new 
drug, device, biological, or medical supply, the appli-
cable manufacturer or distributor may report the 
value and recipient of such payment or other trans-
fer of value in the first reporting period under this 
subsection in the next reporting deadline after the 
earlier of the following: 
‘‘(A) The date of the approval or clearance 
of the covered drug, device, biological, or med-
ical supply by the Food and Drug Administra-
tion. 
‘‘(B) Two calendar years after the date 
such payment or other transfer of value was 
made. 
‘‘(5) DELAYED
REPORTING
FOR
PAYMENTS 
MADE PURSUANT TO CLINICAL INVESTIGATIONS.—In 
the case of a payment or other transfer of value 
made to a covered recipient by an applicable manu-
facturer or distributor in connection with a clinical 
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investigation regarding a new drug, device, biologi-
cal, or medical supply, the applicable manufacturer 
or distributor may report as required under this sec-
tion in the next reporting period under this sub-
section after the earlier of the following: 
‘‘(A) The date that the clinical investiga-
tion is registered on the website maintained by 
the National Institutes of Health pursuant to 
section 671 of the Food and Drug Administra-
tion Amendments Act of 2007. 
‘‘(B) Two calendar years after the date 
such payment or other transfer of value was 
made. 
‘‘(6) 
CONFIDENTIALITY.—Information 
de-
scribed in paragraph (4) or (5) shall be considered 
confidential and shall not be subject to disclosure 
under section 552 of title 5, United States Code, or 
any other similar Federal, State, or local law, until 
or after the date on which the information is made 
available to the public under such paragraph. 
‘‘(b) REPORTING OF OWNERSHIP INTEREST BY PHY-
SICIANS IN HOSPITALS AND OTHER ENTITIES THAT BILL 
MEDICARE.—Not later than March 31 of each year (be-
ginning with 2011), each hospital or other health care en-
tity (not including a Medicare Advantage organization) 
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that bills the Secretary under part A or part B of title 
XVIII for services shall report on the ownership shares 
(other than ownership shares described in section 1877(c)) 
of each physician who, directly or indirectly, owns an in-
terest in the entity. In this subsection, the term ‘physician’ 
includes a physician’s immediate family members (as de-
fined for purposes of section 1877(a)). 
‘‘(c) PUBLIC AVAILABILITY.— 
‘‘(1) IN GENERAL.—The Secretary shall estab-
lish procedures to ensure that, not later than Sep-
tember 30, 2011, and on June 30 of each year be-
ginning thereafter, the information submitted under 
subsections (a) and (b), other than information re-
gard drug samples, with respect to the preceding 
calendar year is made available through an Internet 
website that— 
‘‘(A) is searchable and is in a format that 
is clear and understandable; 
‘‘(B) contains information that is pre-
sented by the name of the applicable manufac-
turer or distributor, the name of the covered re-
cipient, the business address of the covered re-
cipient, the specialty (if applicable) of the cov-
ered recipient, the value of the payment or 
other transfer of value, the date on which the 
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payment or other transfer of value was provided 
to the covered recipient, the form of the pay-
ment or other transfer of value, indicated (as 
appropriate) under subsection (a)(1)(B)(ii), the 
nature of the payment or other transfer of 
value, indicated (as appropriate) under sub-
section (a)(1)(B)(iii), and the name of the cov-
ered drug, device, biological, or medical supply, 
as applicable; 
‘‘(C) contains information that is able to 
be easily aggregated and downloaded; 
‘‘(D) contains a description of any enforce-
ment actions taken to carry out this section, in-
cluding any penalties imposed under subsection 
(d), during the preceding year; 
‘‘(E) contains background information on 
industry-physician relationships; 
‘‘(F) in the case of information submitted 
with respect to a payment or other transfer of 
value described in subsection (a)(5), lists such 
information separately from the other informa-
tion submitted under subsection (a) and des-
ignates such separately listed information as 
funding for clinical research; 
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‘‘(G) contains any other information the 
Secretary determines would be helpful to the 
average consumer; and 
‘‘(H) provides the covered recipient an op-
portunity to submit corrections to the informa-
tion made available to the public with respect to 
the covered recipient. 
‘‘(2) ACCURACY OF REPORTING.—The accuracy 
of the information that is submitted under sub-
sections (a) and (b) and made available under para-
graph (1) shall be the responsibility of the applicable 
manufacturer or distributor of a covered drug, de-
vice, biological, or medical supply reporting under 
subsection (a) or hospital or other health care entity 
reporting physician ownership under subsection (b). 
The Secretary shall establish procedures to ensure 
that the covered recipient is provided with an oppor-
tunity to submit corrections to the manufacturer, 
distributor, hospital, or other entity reporting under 
subsection (a) or (b) with regard to information 
made public with respect to the covered recipient 
and, under such procedures, the corrections shall be 
transmitted to the Secretary. 
‘‘(3) SPECIAL RULE FOR DRUG SAMPLES.—In-
formation relating to drug samples provided under 
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mulgated to carry out such subsection, shall be 
subject to a civil money penalty of not less than 
$10,000, but not more than $100,000, for each 
payment or other transfer of value or ownership 
or investment interest not reported as required 
under such subsection. Such penalty shall be 
imposed and collected in the same manner as 
civil money penalties under subsection (a) of 
section 1128A are imposed and collected under 
that section. 
‘‘(B) LIMITATION.—The total amount of 
civil money penalties imposed under subpara-
graph (A) with respect to each annual submis-
sion of information under subsection (a) or (b) 
by an applicable manufacturer, distributor, or 
entity shall not exceed $1,000,000, or, if great-
er, 0.1 percentage of the total annual revenues 
of the manufacturer, distributor, or entity. 
‘‘(3) USE OF FUNDS.—Funds collected by the 
Secretary as a result of the imposition of a civil 
money penalty under this subsection shall be used to 
carry out this section. 
‘‘(4) ENFORCEMENT THROUGH STATE ATTOR-
NEYS GENERAL.—The attorney general of a State, 
after providing notice to the Secretary of an intent 
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to proceed under this paragraph in a specific case 
and providing the Secretary with an opportunity to 
bring an action under this subsection and the Sec-
retary declining such opportunity, may proceed 
under this subsection against a manufacturer or dis-
tributor in the State. 
‘‘(e) ANNUAL REPORT
TO CONGRESS.—Not later 
than April 1 of each year beginning with 2011, the Sec-
retary shall submit to Congress a report that includes the 
following: 
‘‘(1) The information submitted under this sec-
tion during the preceding year, aggregated for each 
applicable manufacturer or distributor of a covered 
drug, device, biological, or medical supply that sub-
mitted such information during such year. 
‘‘(2) A description of any enforcement actions 
taken to carry out this section, including any pen-
alties imposed under subsection (d), during the pre-
ceding year. 
‘‘(f) DEFINITIONS.—In this section: 
‘‘(1) APPLICABLE
MANUFACTURER; APPLICA-
BLE DISTRIBUTOR.—The term ‘applicable manufac-
turer’ means a manufacturer of a covered drug, de-
vice, biological, or medical supply, and the term ‘ap-
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plicable distributor’ means a distributor of a covered 
drug, device, or medical supply. 
‘‘(2) CLINICAL
INVESTIGATION.—The term 
‘clinical investigation’ means any experiment involv-
ing one or more human subjects, or materials de-
rived from human subjects, in which a drug or de-
vice is administered, dispensed, or used. 
‘‘(3) COVERED DRUG, DEVICE, BIOLOGICAL, OR 
MEDICAL SUPPLY.—The term ‘covered’ means, with 
respect to a drug, device, biological, or medical sup-
ply, such a drug, device, biological, or medical supply 
for which payment is available under title XVIII or 
a State plan under title XIX or XXI (or a waiver 
of such a plan). 
‘‘(4) COVERED RECIPIENT.—The term ‘covered 
recipient’ means the following: 
‘‘(A) A physician. 
‘‘(B) A physician group practice. 
‘‘(C) Any other prescriber of a covered 
drug, device, biological, or medical supply. 
‘‘(D) A pharmacy or pharmacist. 
‘‘(E) A health insurance issuer, group 
health plan, or other entity offering a health 
benefits plan, including any employee of such 
an issuer, plan, or entity. 
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‘‘(F) A pharmacy benefit manager, includ-
ing any employee of such a manager. 
‘‘(G) A hospital. 
‘‘(H) A medical school. 
‘‘(I) A sponsor of a continuing medical 
education program. 
‘‘(J) A patient advocacy or disease specific 
group. 
‘‘(K) A organization of health care profes-
sionals. 
‘‘(L) A biomedical researcher. 
‘‘(M) A group purchasing organization. 
‘‘(5) DISTRIBUTOR OF A COVERED DRUG, DE-
VICE, OR MEDICAL SUPPLY.—The term ‘distributor 
of a covered drug, device, or medical supply’ means 
any entity which is engaged in the marketing or dis-
tribution of a covered drug, device, or medical sup-
ply (or any subsidiary of or entity affiliated with 
such entity), but does not include a wholesale phar-
maceutical distributor. 
‘‘(6) EMPLOYEE.—The term ‘employee’ has the 
meaning given such term in section 1877(h)(2). 
‘‘(7) KNOWINGLY.—The term ‘knowingly’ has 
the meaning given such term in section 3729(b) of 
title 31, United States Code. 
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‘‘(8) MANUFACTURER
OF
A
COVERED
DRUG, 
DEVICE, BIOLOGICAL, OR
MEDICAL
SUPPLY.—The 
term ‘manufacturer of a covered drug, device, bio-
logical, or medical supply’ means any entity which is 
engaged in the production, preparation, propagation, 
compounding, conversion, processing, marketing, or 
distribution of a covered drug, device, biological, or 
medical supply (or any subsidiary of or entity affili-
ated with such entity). 
‘‘(9) PAYMENT
OR
OTHER
TRANSFER
OF 
VALUE.— 
‘‘(A) IN GENERAL.—The term ‘payment or 
other transfer of value’ means a transfer of 
anything of value for or of any of the following: 
‘‘(i) Gift, food, or entertainment. 
‘‘(ii) Travel or trip. 
‘‘(iii) Honoraria. 
‘‘(iv) Research funding or grant. 
‘‘(v) Education or conference funding. 
‘‘(vi) Consulting fees. 
‘‘(vii) Ownership or investment inter-
est and royalties or license fee. 
‘‘(B) INCLUSIONS.—Subject to subpara-
graph (C), the term ‘payment or other transfer 
of value’ includes any compensation, gift, hono-
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rarium, speaking fee, consulting fee, travel, 
services, dividend, profit distribution, stock or 
stock option grant, or any ownership or invest-
ment interest held by a physician in a manufac-
turer (excluding a dividend or other profit dis-
tribution from, or ownership or investment in-
terest in, a publicly traded security or mutual 
fund (as described in section 1877(c))). 
‘‘(C) EXCLUSIONS.—The term ‘payment or 
other transfer of value’ does not include the fol-
lowing: 
‘‘(i) Any payment or other transfer of 
value provided by an applicable manufac-
turer or distributor to a covered recipient 
where the amount transferred to, requested 
by, or designated on behalf of the covered 
recipient does not exceed $5. 
‘‘(ii) The loan of a covered device for 
a short-term trial period, not to exceed 90 
days, to permit evaluation of the covered 
device by the covered recipient. 
‘‘(iii) Items or services provided under 
a contractual warranty, including the re-
placement of a covered device, where the 
terms of the warranty are set forth in the 
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purchase or lease agreement for the cov-
ered device. 
‘‘(iv) A transfer of anything of value 
to a covered recipient when the covered re-
cipient is a patient and not acting in the 
professional capacity of a covered recipient. 
‘‘(v) In-kind items used for the provi-
sion of charity care. 
‘‘(vi) A dividend or other profit dis-
tribution from, or ownership or investment 
interest in, a publicly traded security and 
mutual fund (as described in section 
1877(c)). 
‘‘(vii) Compensation paid by a manu-
facturer or distributor of a covered drug, 
device, biological, or medical supply to a 
covered recipient who is directly employed 
by and works solely for such manufacturer 
or distributor. 
‘‘(viii) Any discount or cash rebate. 
‘‘(10) PHYSICIAN.—The term ‘physician’ has 
the meaning given that term in section 1861(r). For 
purposes of this section, such term does not include 
a physician who is an employee of the applicable 
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manufacturer that is required to submit information 
under subsection (a). 
‘‘(g) ANNUAL REPORTS TO STATES.—Not later than 
April 1 of each year beginning with 2011, the Secretary 
shall submit to States a report that includes a summary 
of the information submitted under subsections (a) and 
(d) during the preceding year with respect to covered re-
cipients or other hospitals and entities in the State. 
‘‘(h) RELATION TO STATE LAWS.— 
‘‘(1) IN
GENERAL.—Effective on January 1, 
2011, subject to paragraph (2), the provisions of 
this section shall preempt any law or regulation of 
a State or of a political subdivision of a State that 
requires an applicable manufacturer and applicable 
distributor (as such terms are defined in subsection 
(f)) to disclose or report, in any format, the type of 
information (described in subsection (a)) regarding a 
payment or other transfer of value provided by the 
manufacturer to a covered recipient (as so defined). 
‘‘(2) NO
PREEMPTION
OF
ADDITIONAL
RE-
QUIREMENTS.—Paragraph (1) shall not preempt any 
law or regulation of a State or of a political subdivi-
sion of a State that requires any of the following: 
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‘‘(A) The disclosure or reporting of infor-
mation not of the type required to be disclosed 
or reported under this section. 
‘‘(B) The disclosure or reporting, in any 
format, of the type of information required to 
be disclosed or reported under this section to a 
Federal, State, or local governmental agency for 
public health surveillance, investigation, or 
other public health purposes or health oversight 
purposes. 
‘‘(C) The discovery or admissibility of in-
formation described in this section in a crimi-
nal, civil, or administrative proceeding.’’. 
(b) AVAILABILITY OF INFORMATION FROM THE DIS-
CLOSURE
OF
FINANCIAL
RELATIONSHIP
REPORT 
(DFRR).—The Secretary of Health and Human Services 
shall submit to Congress a report on the full results of 
the Disclosure of Physician Financial Relationships sur-
veys required pursuant to section 5006 of the Deficit Re-
duction Act of 2005. Such report shall be submitted to 
Congress not later than the date that is 6 months after 
the date such surveys are collected and shall be made pub-
licly available on an Internet website of the Department 
of Health and Human Services. 
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Subtitle E—Public Reporting on 
Health Care-Associated Infections 
SEC. 1461. REQUIREMENT FOR PUBLIC REPORTING BY 
HOSPITALS 
AND 
AMBULATORY 
SURGICAL 
CENTERS ON HEALTH CARE-ASSOCIATED IN-
FECTIONS. 
(a) IN GENERAL.—Title XI of the Social Security Act 
is amended by inserting after section 1138 the following 
section: 
‘‘SEC. 1138A. REQUIREMENT FOR PUBLIC REPORTING BY 
HOSPITALS 
AND 
AMBULATORY 
SURGICAL 
CENTERS ON HEALTH CARE-ASSOCIATED IN-
FECTIONS. 
‘‘(a) REPORTING REQUIREMENT.— 
‘‘(1) IN GENERAL.—The Secretary shall provide 
that a hospital (as defined in subsection (g)) or am-
bulatory surgical center meeting the requirements of 
titles XVIII or XIX may participate in the programs 
established under such titles (pursuant to the appli-
cable 
provisions 
of 
law, 
including 
sections 
1866(a)(1) and 1832(a)(1)(F)(i)) only if, in accord-
ance with this section, the hospital or center reports 
such information on health care-associated infections 
that develop in the hospital or center (and such de-
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mographic information associated with such infec-
tions) as the Secretary specifies. 
‘‘(2) REPORTING PROTOCOLS.— Such informa-
tion shall be reported in accordance with reporting 
protocols established by the Secretary through the 
Director of the Centers for Disease Control and Pre-
vention (in this section referred to as the ‘CDC’) 
and to the National Healthcare Safety Network of 
the CDC or under such another reporting system of 
such Centers as determined appropriate by the Sec-
retary in consultation with such Director. 
‘‘(3) COORDINATION
WITH
HIT.—The Sec-
retary, through the Director of the CDC and the Of-
fice of the National Coordinator for Health Informa-
tion Technology, shall ensure that the transmission 
of information under this subsection is coordinated 
with systems established under the HITECH Act, 
where appropriate. 
‘‘(4) PROCEDURES TO ENSURE THE VALIDITY 
OF
INFORMATION.—The Secretary shall establish 
procedures regarding the validity of the information 
submitted under this subsection in order to ensure 
that such information is appropriately compared 
across hospitals and centers. Such procedures shall 
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address failures to report as well as errors in report-
ing. 
‘‘(5) IMPLEMENTATION.—Not later than 1 year 
after the date of enactment of this section, the Sec-
retary, through the Director of CDC, shall promul-
gate regulations to carry out this section. 
‘‘(b) PUBLIC POSTING OF INFORMATION.—The Sec-
retary shall promptly post, on the official public Internet 
site of the Department of Health and Human Services, 
the information reported under subsection (a). Such infor-
mation shall be set forth in a manner that allows for the 
comparison of information on health care-associated infec-
tions— 
‘‘(1) among hospitals and ambulatory surgical 
centers; and 
‘‘(2) by demographic information. 
‘‘(c) ANNUAL REPORT TO CONGRESS.—On an annual 
basis the Secretary shall submit to the Congress a report 
that summarizes each of the following: 
‘‘(1) The number and types of health care-asso-
ciated infections reported under subsection (a) in 
hospitals and ambulatory surgical centers during 
such year. 
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‘‘(2) Factors that contribute to the occurrence 
of such infections, including health care worker im-
munization rates. 
‘‘(3) Based on the most recent information 
available to the Secretary on the composition of the 
professional staff of hospitals and ambulatory sur-
gical centers, the number of certified infection con-
trol professionals on the staff of hospitals and ambu-
latory surgical centers. 
‘‘(4) The total increases or decreases in health 
care costs that resulted from increases or decreases 
in the rates of occurrence of each such type of infec-
tion during such year. 
‘‘(5) Recommendations, in coordination with the 
Center for Quality Improvement established under 
section 931 of the Public Health Service Act, for 
best practices to eliminate the rates of occurrence of 
each such type of infection in hospitals and ambula-
tory surgical centers. 
‘‘(d) NON-PREEMPTION OF STATE LAWS.—Nothing 
in this section shall be construed as preempting or other-
wise affecting any provision of State law relating to the 
disclosure of information on health care-associated infec-
tions or patient safety procedures for a hospital or ambu-
latory surgical center. 
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‘‘(e) HEALTH CARE-ASSOCIATED INFECTION.—For 
purposes of this section: 
‘‘(1) IN GENERAL.—The term ‘health care-asso-
ciated infection’ means an infection that develops in 
a patient who has received care in any institutional 
setting where health care is delivered and is related 
to receiving health care. 
‘‘(2) RELATED TO RECEIVING HEALTH CARE.— 
The term ‘related to receiving health care’, with re-
spect to an infection, means that the infection was 
not incubating or present at the time health care 
was provided. 
‘‘(f) APPLICATION
TO
CRITICAL
ACCESS
HOS-
PITALS.—For purposes of this section, the term ‘hospital’ 
includes a critical access hospital, as defined in section 
1861(mm)(1).’’. 
(b) EFFECTIVE DATE.—With respect to section 
1138A of the Social Security Act (as inserted by sub-
section (a) of this section), the requirement under such 
section that hospitals and ambulatory surgical centers 
submit reports takes effect on such date (not later than 
2 years after the date of the enactment of this Act) as 
the Secretary of Health and Human Services shall specify. 
In order to meet such deadline, the Secretary may imple-
ment such section through guidance or other instructions. 
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(c) GAO REPORT.—Not later than 18 months after 
the date of the enactment of this Act, the Comptroller 
General of the United States shall submit to Congress a 
report on the program established under section 1138A 
of the Social Security Act, as inserted by subsection (a). 
Such report shall include an analysis of the appropriate-
ness of the types of information required for submission, 
compliance with reporting requirements, the success of the 
validity procedures established, and any conflict or overlap 
between the reporting required under such section and any 
other reporting systems mandated by either the States or 
the Federal Government. 
(d) REPORT ON ADDITIONAL DATA.—Not later than 
18 months after the date of the enactment of this Act, 
the Secretary of Health and Human Services shall submit 
to the Congress a report on the appropriateness of expand-
ing the requirements under such section to include addi-
tional information (such as health care worker immuniza-
tion rates), in order to improve health care quality and 
patient safety. 
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TITLE V—MEDICARE GRADUATE 
MEDICAL EDUCATION 
SEC. 1501. DISTRIBUTION OF UNUSED RESIDENCY POSI-
TIONS. 
(a) IN GENERAL.—Section 1886(h) of the Social Se-
curity Act (42 U.S.C. 1395ww(h)) is amended— 
(1) in paragraph (4)(F)(i), by striking ‘‘para-
graph (7)’’ and inserting ‘‘paragraphs (7) and (8)’’; 
(2) in paragraph (4)(H)(i), by striking ‘‘para-
graph (7)’’ and inserting ‘‘paragraphs (7) and (8)’’; 
(3) in paragraph (7)(E), by inserting ‘‘and 
paragraph (8)’’ after ‘‘this paragraph’’; and 
(4) by adding at the end the following new 
paragraph: 
‘‘(8) ADDITIONAL REDISTRIBUTION OF UNUSED 
RESIDENCY POSITIONS.— 
‘‘(A) REDUCTIONS IN LIMIT BASED ON UN-
USED POSITIONS.— 
‘‘(i) PROGRAMS SUBJECT TO REDUC-
TION.—If a hospital’s reference resident 
level (specified in clause (ii)) is less than 
the otherwise applicable resident limit (as 
defined in subparagraph (C)(ii)), effective 
for portions of cost reporting periods oc-
curring on or after July 1, 2011, the oth-
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erwise applicable resident limit shall be re-
duced by 90 percent of the difference be-
tween such otherwise applicable resident 
limit and such reference resident level. 
‘‘(ii) REFERENCE RESIDENT LEVEL.— 
‘‘(I) IN
GENERAL.—Except as 
otherwise provided in a subsequent 
subclause, the reference resident level 
specified in this clause for a hospital 
is the highest resident level for any of 
the 3 most recent cost reporting peri-
ods (ending before the date of the en-
actment of this paragraph) of the hos-
pital for which a cost report has been 
settled (or, if not, submitted (subject 
to audit)), as determined by the Sec-
retary. 
‘‘(II) USE OF MOST RECENT AC-
COUNTING PERIOD TO RECOGNIZE EX-
PANSION OF EXISTING PROGRAMS.—If 
a hospital submits a timely request to 
increase its resident level due to an 
expansion, or planned expansion, of 
an existing residency training pro-
gram that is not reflected on the most 
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recent settled or submitted cost re-
port, after audit and subject to the 
discretion of the Secretary, subject to 
subclause (IV), the reference resident 
level for such hospital is the resident 
level that includes the additional resi-
dents attributable to such expansion 
or establishment, as determined by 
the Secretary. The Secretary is au-
thorized to determine an alternative 
reference resident level for a hospital 
that submitted to the Secretary a 
timely request, before the start of the 
2009–2010 academic year, for an in-
crease in its reference resident level 
due to a planned expansion. 
‘‘(III) 
SPECIAL
PROVIDER 
AGREEMENT.—In the case of a hos-
pital 
described 
in 
paragraph 
(4)(H)(v), the reference resident level 
specified in this clause is the limita-
tion applicable under subclause (I) of 
such paragraph. 
‘‘(IV) 
PREVIOUS
REDISTRIBU-
TION.—The reference resident level 
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specified in this clause for a hospital 
shall be increased to the extent re-
quired to take into account an in-
crease in resident positions made 
available to the hospital under para-
graph (7)(B) that are not otherwise 
taken into account under a previous 
subclause. 
‘‘(iii) AFFILIATION.—The provisions 
of clause (i) shall be applied to hospitals 
which are members of the same affiliated 
group (as defined by the Secretary under 
paragraph (4)(H)(ii)) and to the extent the 
hospitals can demonstrate that they are 
filling any additional
resident slots allo-
cated to other hospitals through an affili-
ation agreement, the Secretary shall adjust 
the determination of available slots accord-
ingly, or which the Secretary otherwise has 
permitted the resident positions (under 
section 402 of the Social Security Amend-
ments of 1967) to be aggregated for pur-
poses of applying the resident position lim-
itations under this subsection. 
‘‘(B) REDISTRIBUTION.— 
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675 
‘‘(i) IN
GENERAL.—The Secretary 
shall increase the otherwise applicable resi-
dent limit for each qualifying hospital that 
submits an application under this subpara-
graph by such number as the Secretary 
may approve for portions of cost reporting 
periods occurring on or after July 1, 2011. 
The estimated aggregate number of in-
creases in the otherwise applicable resident 
limit under this subparagraph may not ex-
ceed the Secretary’s estimate of the aggre-
gate reduction in such limits attributable 
to subparagraph (A). 
‘‘(ii) REQUIREMENTS
FOR
QUALI-
FYING
HOSPITALS.—A hospital is not a 
qualifying hospital for purposes of this 
paragraph unless the following require-
ments are met: 
‘‘(I) MAINTENANCE OF PRIMARY 
CARE
RESIDENT
LEVEL.—The hos-
pital maintains the number of primary 
care residents at a level that is not 
less than the base level of primary 
care residents increased by the num-
ber of additional primary care resi-
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676 
dent positions provided to the hospital 
under this subparagraph. For pur-
poses of this subparagraph, the ‘base 
level of primary care residents’ for a 
hospital is the level of such residents 
as of a base period (specified by the 
Secretary), determined without regard 
to whether such positions were in ex-
cess of the otherwise applicable resi-
dent limit for such period but taking 
into account the application of sub-
clauses (II) and (III) of subparagraph 
(A)(ii). 
‘‘(II) DEDICATED
ASSIGNMENT 
OF ADDITIONAL RESIDENT POSITIONS 
TO PRIMARY CARE.—The hospital as-
signs all such additional resident posi-
tions for primary care residents. 
‘‘(III) 
ACCREDITATION.—The 
hospital’s residency programs in pri-
mary care are fully accredited or, in 
the case of a residency training pro-
gram not in operation as of the base 
year, the hospital is actively applying 
for such accreditation for the program 
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for such additional resident positions 
(as determined by the Secretary). 
‘‘(iii) CONSIDERATIONS
IN
REDIS-
TRIBUTION.—In determining for which 
qualifying hospitals the increase in the oth-
erwise applicable resident limit is provided 
under this subparagraph, the Secretary 
shall take into account the demonstrated 
likelihood of the hospital filling the posi-
tions within the first 3 cost reporting peri-
ods beginning on or after July 1, 2011, 
made available under this subparagraph, 
as determined by the Secretary. 
‘‘(iv) PRIORITY
FOR
CERTAIN
HOS-
PITALS.—In determining for which quali-
fying hospitals the increase in the other-
wise applicable resident limit is provided 
under this subparagraph, the Secretary 
shall distribute the increase to qualifying 
hospitals based on the following criteria: 
‘‘(I) The Secretary shall give 
preference to hospitals that had a re-
duction in resident training positions 
under subparagraph (A). 
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‘‘(II) The Secretary shall give 
preference to hospitals with 3-year 
primary care residency training pro-
grams, such as family practice and 
general internal medicine. 
‘‘(III) The Secretary shall give 
preference to hospitals insofar as they 
have in effect formal arrangements 
(as determined by the Secretary) that 
place greater emphasis upon training 
in Federally qualified health centers, 
rural health clinics, and other nonpro-
vider settings, and to hospitals that 
receive additional payments under 
subsection (d)(5)(F) and emphasize 
training in an outpatient department. 
‘‘(IV) The Secretary shall give 
preference to hospitals with a number 
of positions (as of July 1, 2009) in 
excess of the otherwise applicable resi-
dent limit for such period. 
‘‘(V) The Secretary shall give 
preference to hospitals that place 
greater emphasis upon training in a 
health professional shortage area (des-
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679 
ignated under section 332 of the Pub-
lic Health Service Act) or a health 
professional needs area (designated 
under section 2211 of such Act). 
‘‘(VI) The Secretary shall give 
preference to hospitals in States that 
have low resident-to-population ratios 
(including a greater preference for 
those States with lower resident-to- 
population ratios). 
‘‘(v) LIMITATION.—In no case shall 
more than 20 full-time equivalent addi-
tional residency positions be made available 
under this subparagraph with respect to 
any hospital. 
‘‘(vi) APPLICATION OF PER RESIDENT 
AMOUNTS FOR PRIMARY CARE.—With re-
spect to additional residency positions in a 
hospital attributable to the increase pro-
vided under this subparagraph, the ap-
proved FTE resident amounts are deemed 
to be equal to the hospital per resident 
amounts for primary care and nonprimary 
care computed under paragraph (2)(D) for 
that hospital. 
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‘‘(vii) DISTRIBUTION.—The Secretary 
shall distribute the increase in resident 
training positions to qualifying hospitals 
under this subparagraph not later than 
July 1, 2011. 
‘‘(C) RESIDENT
LEVEL
AND
LIMIT
DE-
FINED.—In this paragraph: 
‘‘(i) The term ‘resident level’ has the 
meaning given such term in paragraph 
(7)(C)(i). 
‘‘(ii) The term ‘otherwise applicable 
resident limit’ means, with respect to a 
hospital, the limit otherwise applicable 
under subparagraphs (F)(i) and (H) of 
paragraph (4) on the resident level for the 
hospital determined without regard to this 
paragraph but taking into account para-
graph (7)(A). 
‘‘(D) MAINTENANCE
OF
PRIMARY
CARE 
RESIDENT LEVEL.—In carrying out this para-
graph, the Secretary shall require hospitals that 
receive additional resident positions under sub-
paragraph (B)— 
‘‘(i) to maintain records, and periodi-
cally report to the Secretary, on the num-
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681 
ber of primary care residents in its resi-
dency training programs; and 
‘‘(ii) as a condition of payment for a 
cost reporting period under this subsection 
for such positions, to maintain the level of 
such positions at not less than the sum 
of— 
‘‘(I) the base level of primary 
care resident positions (as determined 
under subparagraph (B)(ii)(I)) before 
receiving such additional positions; 
and 
‘‘(II) the number of such addi-
tional positions.’’. 
(b) IME.— 
(1) IN GENERAL.—Section 1886(d)(5)(B)(v) of 
the 
Social 
Security 
Act 
(42 
U.S.C. 
1395ww(d)(5)(B)(v)), in the third sentence, is 
amended— 
(A) by striking ‘‘subsection (h)(7)’’ and in-
serting ‘‘subsections (h)(7) and (h)(8)’’; and 
(B) by striking ‘‘it applies’’ and inserting 
‘‘they apply’’. 
(2) 
CONFORMING
PROVISION.—Section 
1886(d)(5)(B) of the Social Security Act (42 U.S.C. 
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682 
1395ww(d)(5)(B)) is amended by adding at the end 
the following clause: 
‘‘(x) For discharges occurring on or after July 1, 
2011, insofar as an additional payment amount under this 
subparagraph is attributable to resident positions distrib-
uted to a hospital under subsection (h)(8)(B), the indirect 
teaching adjustment factor shall be computed in the same 
manner as provided under clause (ii) with respect to such 
resident positions.’’. 
(c) CONFORMING AMENDMENT.—Section 422(b)(2) 
of the Medicare Prescription Drug, Improvement, and 
Modernization Act of 2003 (Public Law 108–173) is 
amended by striking ‘‘section 1886(h)(7)’’ and all that fol-
lows and inserting ‘‘paragraphs (7) and (8) of subsection 
(h) of section 1886 of the Social Security Act.’’. 
SEC. 1502. INCREASING TRAINING IN NONPROVIDER SET-
TINGS. 
(a) DIRECT GME.—Section 1886(h)(4)(E) of the So-
cial Security Act (42 U.S.C. 1395ww(h)) is amended— 
(1) by designating the first sentence as a clause 
(i) with the heading ‘‘IN GENERAL.—’’ and appro-
priate indentation; 
(2) by striking ‘‘shall be counted and that all 
the time’’ and inserting ‘‘shall be counted and 
that— 
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‘‘(I) effective for cost reporting 
periods beginning before July 1, 2009, 
all the time’’; 
(3) in subclause (I), as inserted by paragraph 
(1), by striking the period at the end and inserting 
‘‘; and’’; and 
(A) by inserting after subclause (I), as so 
inserted, the following: 
‘‘(II) effective for cost reporting 
periods beginning on or after July 1, 
2009, all the time so spent by a resi-
dent shall be counted towards the de-
termination of full-time equivalency, 
without regard to the setting in which 
the activities are performed, if the 
hospital incurs the costs of the sti-
pends and fringe benefits of the resi-
dent during the time the resident 
spends in that setting. 
Any hospital claiming under this subpara-
graph for time spent in a nonprovider set-
ting shall maintain and make available to 
the 
Secretary 
records 
regarding 
the 
amount of such time and such amount in 
comparison with amounts of such time in 
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such base year as the Secretary shall speci-
fy.’’. 
(b) IME.—Section 1886(d)(5)(B)(iv) of the Social 
Security Act (42 U.S.C. 1395ww(d)(5)(B)(iv)) is amend-
ed— 
(1) by striking ‘‘(iv) Effective for discharges oc-
curring on or after October 1, 1997’’ and inserting 
‘‘(iv)(I) Effective for discharges occurring on or 
after October 1, 1997, and before July 1, 2009’’; 
and 
(2) by inserting after subclause (I), as inserted 
by paragraph (1), the following new subclause: 
‘‘(II) Effective for discharges occurring on or 
after July 1, 2009, all the time spent by an intern 
or resident in patient care activities at an entity in 
a nonprovider setting shall be counted towards the 
determination of full-time equivalency if the hospital 
incurs the costs of the stipends and fringe benefits 
of the intern or resident during the time the intern 
or resident spends in that setting.’’. 
(c) OIG STUDY ON IMPACT ON TRAINING.—The In-
spector General of the Department of Health and Human 
Services shall analyze the data collected by the Secretary 
of Health and Human Services from the records made 
available to the Secretary under section 1886(h)(4)(E) of 
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the Social Security Act, as amended by subsection (a), in 
order to assess the extent to which there is an increase 
in time spent by medical residents in training in nonpro-
vider settings as a result of the amendments made by this 
section. Not later than 4 years after the date of the enact-
ment of this Act, the Inspector General shall submit a re-
port to Congress on such analysis and assessment. 
(d) DEMONSTRATION
PROJECT
FOR
APPROVED 
TEACHING HEALTH CENTERS.— 
(1) IN GENERAL.—The Secretary of Health and 
Human Services shall conduct a demonstration 
project under which an approved teaching health 
center (as defined in paragraph (3)) would be eligi-
ble for payment under subsections (h) and (k) of 
section 1886 of the Social Security Act (42 U.S.C. 
1395ww) of amounts for its own direct costs of 
graduate medical education activities for primary 
care residents, as well as for the direct costs of grad-
uate medical education activities of its contracting 
hospital for such residents, in a manner similar to 
the manner in which such payments would be made 
to a hospital if the hospital were to operate such a 
program. 
(2) CONDITIONS.—Under the demonstration 
project— 
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(A) an approved teaching health center 
shall contract with an accredited teaching hos-
pital to carry out the inpatient responsibilities 
of the primary care residency program of the 
hospital involved and is responsible for payment 
to the hospital for the hospital’s costs of the 
salary and fringe benefits for residents in the 
program; 
(B) the number of primary care residents 
of the center shall not count against the con-
tracting hospital’s resident limit; and 
(C) the contracting hospital shall agree not 
to diminish the number of residents in its pri-
mary care residency training program. 
(3) APPROVED TEACHING HEALTH CENTER DE-
FINED.—In this subsection, the term ‘‘approved 
teaching health center’’ means a nonprovider setting, 
such as a Federally qualified health center or rural 
health clinic (as defined in section 1861(aa) of the 
Social Security Act), that develops and operates an 
accredited primary care residency program for which 
funding would be available if it were operated by a 
hospital. 
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SEC. 1503. RULES FOR COUNTING RESIDENT TIME FOR DI-
DACTIC AND SCHOLARLY ACTIVITIES AND 
OTHER ACTIVITIES. 
(a) DIRECT GME.—Section 1886(h) of the Social Se-
curity Act (42 U.S.C. 1395ww(h)) is amended— 
(1) in paragraph (4)(E), as amended by section 
1502(a)— 
(A) in clause (i), by striking ‘‘Such rules’’ 
and inserting ‘‘Subject to clause (ii), such 
rules’’; and 
(B) by adding at the end the following new 
clause: 
‘‘(ii) TREATMENT OF CERTAIN NON-
PROVIDER
AND
DIDACTIC
ACTIVITIES.— 
Such rules shall provide that all time spent 
by an intern or resident in an approved 
medical residency training program in a 
nonprovider setting that is primarily en-
gaged in furnishing patient care (as de-
fined in paragraph (5)(K)) in nonpatient 
care activities, such as didactic conferences 
and seminars, but not including research 
not associated with the treatment or diag-
nosis of a particular patient, as such time 
and activities are defined by the Secretary, 
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688 
shall be counted toward the determination 
of full-time equivalency.’’; 
(2) in paragraph (4), by adding at the end the 
following new subparagraph: 
‘‘(I) TREATMENT OF CERTAIN TIME IN AP-
PROVED MEDICAL RESIDENCY TRAINING PRO-
GRAMING.—In determining the hospital’s num-
ber of full-time equivalent residents for pur-
poses of this subsection, all the time that is 
spent by an intern or resident in an approved 
medical residency training program on vacation, 
sick leave, or other approved leave, as such time 
is defined by the Secretary, and that does not 
prolong the total time the resident is partici-
pating in the approved program beyond the nor-
mal duration of the program shall be counted 
toward the determination of full-time equiva-
lency.’’; and 
(3) in paragraph (5), by adding at the end the 
following new subparagraph: 
‘‘(K) NONPROVIDER SETTING THAT IS PRI-
MARILY
ENGAGED
IN
FURNISHING
PATIENT 
CARE.—The term ‘nonprovider setting that is 
primarily engaged in furnishing patient care’ 
means a nonprovider setting in which the pri-
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689 
mary activity is the care and treatment of pa-
tients, as defined by the Secretary.’’. 
(b) IME DETERMINATIONS.—Section 1886(d)(5)(B) 
of such Act (42 U.S.C. 1395ww(d)(5)(B)), as amended by 
section 1501(b), is amended by adding at the end the fol-
lowing new clause: 
‘‘(xi)(I) The provisions of subparagraph (I) of sub-
section (h)(4) shall apply under this subparagraph in the 
same manner as they apply under such subsection. 
‘‘(II) In determining the hospital’s number of full- 
time equivalent residents for purposes of this subpara-
graph, all the time spent by an intern or resident in an 
approved medical residency training program in non-
patient care activities, such as didactic conferences and 
seminars, as such time and activities are defined by the 
Secretary, that occurs in the hospital shall be counted to-
ward the determination of full-time equivalency if the hos-
pital— 
‘‘(aa) is recognized as a subsection (d) hospital; 
‘‘(bb) is recognized as a subsection (d) Puerto 
Rico hospital; 
‘‘(cc) is reimbursed under a reimbursement sys-
tem authorized under section 1814(b)(3); or 
‘‘(dd) is a provider-based hospital outpatient de-
partment. 
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‘‘(III) In determining the hospital’s number of full- 
time equivalent residents for purposes of this subpara-
graph, all the time spent by an intern or resident in an 
approved medical residency training program in research 
activities that are not associated with the treatment or di-
agnosis of a particular patient, as such time and activities 
are defined by the Secretary, shall not be counted toward 
the determination of full-time equivalency.’’. 
(c) EFFECTIVE DATES; APPLICATION.— 
(1) IN
GENERAL.—Except as otherwise pro-
vided, the Secretary of Health and Human Services 
shall implement the amendments made by this sec-
tion in a manner so as to apply to cost reporting pe-
riods beginning on or after January 1, 1983. 
(2) DIRECT GME.—Section 1886(h)(4)(E)(ii) of 
the Social Security Act, as added by subsection 
(a)(1)(B), shall apply to cost reporting periods be-
ginning on or after July 1, 2008. 
(3) IME.—Section 1886(d)(5)(B)(x)(III) of the 
Social Security Act, as added by subsection (b), shall 
apply to cost reporting periods beginning on or after 
October 1, 2001. Such section, as so added, shall 
not give rise to any inference on how the law in ef-
fect prior to such date should be interpreted. 
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691 
(4) APPLICATION.—The amendments made by 
this section shall not be applied in a manner that re-
quires reopening of any settled hospital cost reports 
as to which there is not a jurisdictionally proper ap-
peal pending as of the date of the enactment of this 
Act on the issue of payment for indirect costs of 
medical education under section 1886(d)(5)(B) of 
the Social Security Act or for direct graduate med-
ical education costs under section 1886(h) of such 
Act. 
SEC. 1504. PRESERVATION OF RESIDENT CAP POSITIONS 
FROM CLOSED HOSPITALS. 
(a) DIRECT GME.—Section 1886(h)(4)(H) of the So-
cial Security Act (42 U.S.C. Section 1395ww(h)(4)(H)) 
is amended by adding at the end the following new clause: 
‘‘(vi) REDISTRIBUTION OF RESIDENCY 
SLOTS AFTER A HOSPITAL CLOSES.— 
‘‘(I) IN
GENERAL.—The Sec-
retary shall, by regulation, establish a 
process consistent with subclauses (II) 
and (III) under which, in the case 
where a hospital (other than a hos-
pital described in clause (v)) with an 
approved medical residency program 
in a State closes on or after the date 
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692 
that is 2 years before the date of the 
enactment of this clause, the Sec-
retary shall increase the otherwise ap-
plicable resident limit under this para-
graph for other hospitals in the State 
in accordance with this clause. 
‘‘(II) PROCESS
FOR
HOSPITALS 
IN CERTAIN AREAS.—In determining 
for which hospitals the increase in the 
otherwise applicable resident limit de-
scribed in subclause (I) is provided, 
the Secretary shall establish a process 
to provide for such increase to one or 
more hospitals located in the State. 
Such process shall take into consider-
ation the recommendations submitted 
to the Secretary by the senior health 
official (as designated by the chief ex-
ecutive officer of such State) if such 
recommendations are submitted not 
later than 180 days after the date of 
the hospital closure involved (or, in 
the case of a hospital that closed after 
the date that is 2 years before the 
date of the enactment of this clause, 
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693 
180 days after such date of enact-
ment). 
‘‘(III) LIMITATION.—The esti-
mated aggregate number of increases 
in the otherwise applicable resident 
limits for hospitals under this clause 
shall be equal to the estimated num-
ber of resident positions in the ap-
proved medical residency programs 
that closed on or after the date de-
scribed in subclause (I).’’. 
(b) NO EFFECT ON TEMPORARY FTE CAP ADJUST-
MENTS.—The amendments made by this section shall not 
effect any temporary adjustment to a hospital’s FTE cap 
under section 413.79(h) of title 42, Code of Federal Regu-
lations (as in effect on the date of enactment of this Act) 
and 
shall 
not 
affect 
the 
application 
of 
section 
1886(h)(4)(H)(v) of the Social Security Act. 
(c) CONFORMING AMENDMENTS.— 
(1) Section 422(b)(2) of the Medicare Prescrip-
tion Drug, Improvement, and Modernization Act of 
2003 (Public Law 108–173), as amended by section 
1501(c), is amended by striking ‘‘(7) and’’ and in-
serting ‘‘(4)(H)(vi), (7), and’’. 
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(2) Section 1886(h)(7)(E) of the Social Secu-
rity Act (42 U.S.C. 1395ww(h)(7)(E)) is amended 
by inserting ‘‘or under paragraph (4)(H)(vi)’’ after 
‘‘under this paragraph’’. 
SEC. 1505. IMPROVING ACCOUNTABILITY FOR APPROVED 
MEDICAL RESIDENCY TRAINING. 
(a) SPECIFICATION OF GOALS FOR APPROVED MED-
ICAL
RESIDENCY
TRAINING
PROGRAMS.—Section 
1886(h)(1) of the Social Security Act (42 U.S.C. 
1395ww(h)(1)) is amended— 
(1) by designating the matter beginning with 
‘‘Notwithstanding’’ as a subparagraph (A) with the 
heading ‘‘IN GENERAL.—’’ and with appropriate in-
dentation; and 
(2) by adding at the end the following new sub-
paragraph: 
‘‘(B) GOALS
AND
ACCOUNTABILITY
FOR 
APPROVED MEDICAL RESIDENCY TRAINING PRO-
GRAMS.—The goals of medical residency train-
ing programs are to foster a physician work-
force so that physicians are trained to be able 
to do the following: 
‘‘(i) Work effectively in various health 
care delivery settings, such as nonprovider 
settings. 
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‘‘(ii) Coordinate patient care within 
and across settings relevant to their spe-
cialties. 
‘‘(iii) Understand the relevant cost 
and value of various diagnostic and treat-
ment options. 
‘‘(iv) Work in inter-professional teams 
and multi-disciplinary team-based models 
in provider and nonprovider settings to en-
hance safety and improve quality of patient 
care. 
‘‘(v) Be knowledgeable in methods of 
identifying systematic errors in health care 
delivery and in implementing systematic 
solutions in case of such errors, including 
experience and participation in continuous 
quality improvement projects to improve 
health outcomes of the population the phy-
sicians serve. 
‘‘(vi) Be meaningful EHR users (as 
determined under section 1848(o)(2)) in 
the delivery of care and in improving the 
quality of the health of the community and 
the individuals that the hospital serves.’’ 
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696 
(b) GAO STUDY ON EVALUATION OF TRAINING PRO-
GRAMS.— 
(1) IN GENERAL.—The Comptroller General of 
the United States shall conduct a study to evaluate 
the extent to which medical residency training pro-
grams— 
(A) are meeting the goals described in sec-
tion 1886(h)(1)(B) of the Social Security Act, 
as added by subsection (a), in a range of resi-
dency programs, including primary care and 
other specialties; and 
(B) have the appropriate faculty expertise 
to teach the topics required to achieve such 
goals. 
(2) REPORT.—Not later than 18 months after 
the date of the enactment of this Act, the Comp-
troller General shall submit to Congress a report on 
such study and shall include in such report rec-
ommendations as to how medical residency training 
programs could be further encouraged to meet such 
goals through means such as— 
(A) development of curriculum require-
ments; and 
(B) assessment of the accreditation proc-
esses of the Accreditation Council for Graduate 
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Medical Education and the American Osteo-
pathic Association and effectiveness of those 
processes in accrediting medical residency pro-
grams that meet the goals referred to in para-
graph (1)(A). 
TITLE VI—PROGRAM INTEGRITY 
Subtitle A—Increased Funding to 
Fight Waste, Fraud, and Abuse 
SEC. 1601. INCREASED FUNDING AND FLEXIBILITY TO 
FIGHT FRAUD AND ABUSE. 
(a) IN GENERAL.—Section 1817(k) of the Social Se-
curity Act (42 U.S.C. 1395i(k)) is amended— 
(1) by adding at the end the following new 
paragraph: 
‘‘(7) ADDITIONAL FUNDING.—In addition to the 
funds otherwise appropriated to the Account from 
the Trust Fund under paragraphs (3) and (4) and 
for purposes described in paragraphs (3)(C) and 
(4)(A), there are hereby appropriated an additional 
$100,000,000 to such Account from such Trust 
Fund for each fiscal year beginning with 2011. The 
funds appropriated under this paragraph shall be al-
located in the same proportion as the total funding 
appropriated with respect to paragraphs (3)(A) and 
(4)(A) was allocated with respect to fiscal year 
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698 
2010, and shall be available without further appro-
priation until expended.’’. 
(2) in paragraph (4)(A)— 
(A) by inserting ‘‘for activities described in 
paragraph (3)(C) and’’ after ‘‘necessary’’; and 
(B) by inserting ‘‘until expended’’ after 
‘‘appropriation’’. 
(b) 
FLEXIBILITY
IN
PURSUING
FRAUD
AND 
ABUSE.—Section 1893(a) of the Social Security Act (42 
U.S.C. 1395ddd(a)) is amended by inserting ‘‘, or other-
wise,’’ after ‘‘entities’’. 
Subtitle B—Enhanced Penalties for 
Fraud and Abuse 
SEC. 1611. ENHANCED PENALTIES FOR FALSE STATEMENTS 
ON PROVIDER OR SUPPLIER ENROLLMENT 
APPLICATIONS. 
(a) IN GENERAL.—Section 1128A(a) of the Social 
Security Act (42 U.S.C. 1320a–7a(a)) is amended— 
(1) in paragraph (1)(D), by striking all that fol-
lows ‘‘in which the person was excluded’’ and insert-
ing ‘‘under Federal law from the Federal health care 
program under which the claim was made, or’’; 
(2) by striking ‘‘or’’ at the end of paragraph 
(6); 
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699 
(3) in paragraph (7), by inserting at the end 
‘‘or’’; 
(4) by inserting after paragraph (7) the fol-
lowing new paragraph: 
‘‘(8) knowingly makes or causes to be made any 
false statement, omission, or misrepresentation of a 
material fact in any application, agreement, bid, or 
contract to participate or enroll as a provider of 
services or supplier under a Federal health care pro-
gram, including managed care organizations under 
title XIX, Medicare Advantage organizations under 
part C of title XVIII, prescription drug plan spon-
sors under part D of title XVIII, and entities that 
apply to participate as providers of services or sup-
pliers in such managed care organizations and such 
plans;’’; 
(5) in the matter following paragraph (8), as 
inserted by paragraph (4), by striking ‘‘or in cases 
under paragraph (7), $50,000 for each such act)’’ 
and inserting ‘‘in cases under paragraph (7), 
$50,000 for each such act, or in cases under para-
graph (8), $50,000 for each false statement, omis-
sion, or misrepresentation of a material fact)’’; and 
(6) in the second sentence, by striking ‘‘for a 
lawful purpose)’’ and inserting ‘‘for a lawful pur-
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pose, or in cases under paragraph (8), an assess-
ment of not more than 3 times the amount claimed 
as the result of the false statement, omission, or 
misrepresentation of material fact claimed by a pro-
vider of services or supplier whose application to 
participate contained such false statement, omission, 
or misrepresentation)’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to acts committed on or after 
January 1, 2010. 
SEC. 1612. ENHANCED PENALTIES FOR SUBMISSION OF 
FALSE STATEMENTS MATERIAL TO A FALSE 
CLAIM. 
(a) IN GENERAL.—Section 1128A(a) of the Social 
Security Act (42 U.S.C. 1320a–7a(a)), as amended by sec-
tion 1611, is further amended— 
(1) in paragraph (7), by striking ‘‘or’’ at the 
end; 
(2) in paragraph (8), by inserting ‘‘or’’ at the 
end; and 
(3) by inserting after paragraph (8), the fol-
lowing new paragraph: 
‘‘(9) knowingly makes, uses, or causes to be 
made or used, a false record or statement material 
to a false or fraudulent claim for payment for items 
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701 
and services furnished under a Federal health care 
program;’’; and 
(4) in the matter following paragraph (9), as 
inserted by paragraph (3)— 
(A) by striking ‘‘or in cases under para-
graph (8)’’ and inserting ‘‘in cases under para-
graph (8)’’; and 
(B) by striking ‘‘a material fact)’’ and in-
serting ‘‘a material fact, in cases under para-
graph (9), $50,000 for each false record or 
statement)’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to acts committed on or after 
January 1, 2010. 
SEC. 1613. ENHANCED PENALTIES FOR DELAYING INSPEC-
TIONS. 
(a) IN GENERAL.—Section 1128A(a) of the Social 
Security Act (42 U.S.C. 1320a–7a(a)), as amended by sec-
tions 1611 and 1612, is further amended— 
(1) in paragraph (8), by striking ‘‘or’’ at the 
end; 
(2) in paragraph (9), by inserting ‘‘or’’ at the 
end; 
(3) by inserting after paragraph (9) the fol-
lowing new paragraph: 
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702 
‘‘(10) fails to grant timely access, upon reason-
able request (as defined by the Secretary in regula-
tions), to the Inspector General of the Department 
of Health and Human Services, for the purpose of 
audits, investigations, evaluations, or other statutory 
functions of the Inspector General of the Depart-
ment of Health and Human Services;’’; and 
(4) in the matter following paragraph (10), as 
inserted by paragraph (3), by inserting ‘‘, or in cases 
under paragraph (10), $15,000 for each day of the 
failure described in such paragraph’’ after ‘‘false 
record or statement’’. 
(b) ENSURING TIMELY INSPECTIONS RELATING TO 
CONTRACTS
WITH
MA 
ORGANIZATIONS.—Section 
1857(d)(2) of such Act (42 U.S.C. 1395w–27(d)(2)) is 
amended— 
(1) in subparagraph (A), by inserting ‘‘timely’’ 
before ‘‘inspect’’; and 
(2) in subparagraph (B), by inserting ‘‘timely’’ 
before ‘‘audit and inspect’’. 
(c) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to violations committed on or 
after January 1, 2010. 
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703 
SEC. 1614. ENHANCED HOSPICE PROGRAM SAFEGUARDS. 
(a) MEDICARE.—Part A of title XVIII of the Social 
Security Act is amended by inserting after section 1819 
the following new section: 
‘‘SEC. 1819A. ASSURING QUALITY OF CARE IN HOSPICE 
CARE. 
‘‘(a) IN GENERAL.—If the Secretary determines on 
the basis of a survey or otherwise, that a hospice program 
that is certified for participation under this title has dem-
onstrated a substandard quality of care and failed to meet 
such other requirements as the Secretary may find nec-
essary in the interest of the health and safety of the indi-
viduals who are provided care and services by the agency 
or organization involved and determines— 
‘‘(1) that the deficiencies involved immediately 
jeopardize the health and safety of the individuals to 
whom the program furnishes items and services, the 
Secretary shall take immediate action to remove the 
jeopardy and correct the deficiencies through the 
remedy specified in subsection (b)(2)(A)(iii) or ter-
minate the certification of the program, and may 
provide, in addition, for 1 or more of the other rem-
edies described in subsection (b)(2)(A); or 
‘‘(2) that the deficiencies involved do not imme-
diately jeopardize the health and safety of the indi-
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704 
viduals to whom the program furnishes items and 
services, the Secretary may— 
‘‘(A) impose intermediate sanctions devel-
oped pursuant to subsection (b), in lieu of ter-
minating the certification of the program; and 
‘‘(B) if, after such a period of intermediate 
sanctions, the program is still not in compliance 
with such requirements, the Secretary shall ter-
minate the certification of the program. 
If the Secretary determines that a hospice program 
that is certified for participation under this title is 
in compliance with such requirements but, as of a 
previous period, was not in compliance with such re-
quirements, the Secretary may provide for a civil 
money penalty under subsection (b)(2)(A)(i) for the 
days in which it finds that the program was not in 
compliance with such requirements. 
‘‘(b) INTERMEDIATE SANCTIONS.— 
‘‘(1) DEVELOPMENT AND IMPLEMENTATION.— 
The Secretary shall develop and implement, by not 
later than July 1, 2012— 
‘‘(A) a range of intermediate sanctions to 
apply to hospice programs under the conditions 
described in subsection (a), and 
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‘‘(B) appropriate procedures for appealing 
determinations relating to the imposition of 
such sanctions. 
‘‘(2) SPECIFIED SANCTIONS.— 
‘‘(A) 
IN
GENERAL.—The 
intermediate 
sanctions developed under paragraph (1) may 
include— 
‘‘(i) civil money penalties in an 
amount not to exceed $10,000 for each day 
of noncompliance or, in the case of a per 
instance penalty applied by the Secretary, 
not to exceed $25,000, 
‘‘(ii) denial of all or part of the pay-
ments to which a hospice program would 
otherwise be entitled under this title with 
respect to items and services furnished by 
a hospice program on or after the date on 
which the Secretary determines that inter-
mediate sanctions should be imposed pur-
suant to subsection (a)(2), 
‘‘(iii) the appointment of temporary 
management to oversee the operation of 
the hospice program and to protect and as-
sure the health and safety of the individ-
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uals under the care of the program while 
improvements are made, 
‘‘(iv) corrective action plans, and 
‘‘(v) in-service training for staff. 
The provisions of section 1128A (other than 
subsections (a) and (b)) shall apply to a civil 
money penalty under clause (i) in the same 
manner as such provisions apply to a penalty or 
proceeding under section 1128A(a). The tem-
porary management under clause (iii) shall not 
be terminated until the Secretary has deter-
mined that the program has the management 
capability to ensure continued compliance with 
all requirements referred to in that clause. 
‘‘(B) 
CLARIFICATION.—The 
sanctions 
specified in subparagraph (A) are in addition to 
sanctions otherwise available under State or 
Federal law and shall not be construed as lim-
iting other remedies, including any remedy 
available to an individual at common law. 
‘‘(C) COMMENCEMENT
OF
PAYMENT.—A 
denial of payment under subparagraph (A)(ii) 
shall terminate when the Secretary determines 
that the hospice program no longer dem-
onstrates a substandard quality of care and 
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meets such other requirements as the Secretary 
may find necessary in the interest of the health 
and safety of the individuals who are provided 
care and services by the agency or organization 
involved. 
‘‘(3) SECRETARIAL AUTHORITY.—The Secretary 
shall develop and implement, by not later than July 
1, 2011, specific procedures with respect to the con-
ditions under which each of the intermediate sanc-
tions developed under paragraph (1) is to be applied, 
including the amount of any fines and the severity 
of each of these sanctions. Such procedures shall be 
designed so as to minimize the time between identi-
fication of deficiencies and imposition of these sanc-
tions and shall provide for the imposition of incre-
mentally more severe fines for repeated or uncor-
rected deficiencies.’’. 
(b) APPLICATION TO MEDICAID.—Section 1905(o) of 
the Social Security Act (42 U.S.C. 1396d(o)) is amended 
by adding at the end the following new paragraph: 
‘‘(4) The provisions of section 1819A shall apply to 
a hospice program providing hospice care under this title 
in the same manner as such provisions apply to a hospice 
program providing hospice care under title XVIII.’’. 
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(c) APPLICATION TO CHIP.—Title XXI of the Social 
Security Act is amended by adding at the end the fol-
lowing new section: 
‘‘SEC. 2114. ASSURING QUALITY OF CARE IN HOSPICE CARE. 
‘‘The provisions of section 1819A shall apply to a 
hospice program providing hospice care under this title in 
the same manner such provisions apply to a hospice pro-
gram providing hospice care under title XVIII.’’. 
SEC. 1615. ENHANCED PENALTIES FOR INDIVIDUALS EX-
CLUDED FROM PROGRAM PARTICIPATION. 
(a) IN GENERAL.—Section 1128A(a) of the Social 
Security Act (42 U.S.C. 1320a–7a(a)), as amended by the 
previous sections, is further amended— 
(1) by striking ‘‘or’’ at the end of paragraph 
(9); 
(2) by inserting ‘‘or’’ at the end of paragraph 
(10); 
(3) by inserting after paragraph (10) the fol-
lowing new paragraph: 
‘‘(11) orders or prescribes an item or service, 
including without limitation home health care, diag-
nostic and clinical lab tests, prescription drugs, du-
rable medical equipment, ambulance services, phys-
ical or occupational therapy, or any other item or 
service, during a period when the person has been 
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excluded from participation in a Federal health care 
program, and the person knows or should know that 
a claim for such item or service will be presented to 
such a program;’’; and 
(4) in the matter following paragraph (11), as 
inserted by paragraph (2), by striking ‘‘$15,000 for 
each day of the failure described in such paragraph’’ 
and inserting ‘‘$15,000 for each day of the failure 
described in such paragraph, or in cases under para-
graph (11), $50,000 for each order or prescription 
for an item or service by an excluded individual’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to violations committed on or 
after January 1, 2010. 
SEC. 1616. ENHANCED PENALTIES FOR PROVISION OF 
FALSE INFORMATION BY MEDICARE ADVAN-
TAGE AND PART D PLANS. 
(a) IN GENERAL.—Section 1857(g)(2)(A) of the So-
cial Security Act (42 U.S.C. 1395w—27(g)(2)(A)) is 
amended by inserting ‘‘except with respect to a determina-
tion under subparagraph (E), an assessment of not more 
than 3 times the amount claimed by such plan or plan 
sponsor based upon the misrepresentation or falsified in-
formation involved,’’ after ‘‘for each such determination,’’. 
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(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to violations committed on or 
after January 1, 2010. 
SEC. 1617. ENHANCED PENALTIES FOR MEDICARE ADVAN-
TAGE AND PART D MARKETING VIOLATIONS. 
(a) IN GENERAL.—Section 1857(g)(1) of the Social 
Security Act (42 U.S.C. 1395w—27(g)(1)), as amended 
by section 1221(b), is amended— 
(1) in subparagraph (G), by striking ‘‘or’’ at 
the end; 
(2) by inserting after subparagraph (H) the fol-
lowing new subparagraphs: 
‘‘(I) except as provided under subpara-
graph (C) or (D) of section 1860D–1(b)(1), en-
rolls an individual in any plan under this part 
without the prior consent of the individual or 
the designee of the individual; 
‘‘(J) transfers an individual enrolled under 
this part from one plan to another without the 
prior consent of the individual or the designee 
of the individual or solely for the purpose of 
earning a commission; 
‘‘(K) fails to comply with marketing re-
strictions described in subsections (h) and (j) of 
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section 1851 or applicable implementing regula-
tions or guidance; or 
‘‘(L) employs or contracts with any indi-
vidual or entity who engages in the conduct de-
scribed in subparagraphs (A) through (K) of 
this paragraph;’’; and 
(3) by adding at the end the following new sen-
tence: ‘‘The Secretary may provide, in addition to 
any other remedies authorized by law, for any of the 
remedies described in paragraph (2), if the Secretary 
determines that any employee or agent of such orga-
nization, or any provider or supplier who contracts 
with such organization, has engaged in any conduct 
described in subparagraphs (A) through (L) of this 
paragraph.’’ 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to violations committed on or 
after January 1, 2010. 
SEC. 1618. ENHANCED PENALTIES FOR OBSTRUCTION OF 
PROGRAM AUDITS. 
(a) IN GENERAL.—Section 1128(b)(2) of the Social 
Security Act (42 U.S.C. 1320a–7(b)(2)) is amended— 
(1) in the heading, by inserting ‘‘OR AUDIT’’ 
after ‘‘INVESTIGATION’’; and 
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(2) by striking ‘‘investigation into’’ and all that 
follows through the period and inserting ‘‘investiga-
tion or audit related to—’’ 
‘‘(i) any offense described in para-
graph (1) or in subsection (a); or 
‘‘(ii) the use of funds received, directly 
or indirectly, from any Federal health care 
program 
(as 
defined 
in 
section 
1128B(f)).’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to violations committed on or 
after January 1, 2010. 
SEC. 1619. EXCLUSION OF CERTAIN INDIVIDUALS AND EN-
TITIES FROM PARTICIPATION IN MEDICARE 
AND STATE HEALTH CARE PROGRAMS. 
(a) IN GENERAL.—Section 1128(c) of the Social Se-
curity Act, as previously amended by this subdivision, is 
further amended— 
(1) in the heading, by striking ‘‘AND PERIOD’’ 
and inserting ‘‘PERIOD, AND EFFECT’’; and 
(2) by adding at the end the following new 
paragraph: 
‘‘(4)(A) For purposes of this Act, subject to subpara-
graph (C), the effect of exclusion is that no payment may 
be made by any Federal health care program (as defined 
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in section 1128B(f)) with respect to any item or service 
furnished— 
‘‘(i) by an excluded individual or entity; or 
‘‘(ii) at the medical direction or on the prescrip-
tion of a physician or other authorized individual 
when the person submitting a claim for such item or 
service knew or had reason to know of the exclusion 
of such individual. 
‘‘(B) For purposes of this section and sections 1128A 
and 1128B, subject to subparagraph (C), an item or serv-
ice has been furnished by an individual or entity if the 
individual or entity directly or indirectly provided, ordered, 
manufactured, distributed, prescribed, or otherwise sup-
plied the item or service regardless of how the item or 
service was paid for by a Federal health care program or 
to whom such payment was made. 
‘‘(C)(i) Payment may be made under a Federal 
health care program for emergency items or services (not 
including items or services furnished in an emergency 
room of a hospital) furnished by an excluded individual 
or entity, or at the medical direction or on the prescription 
of an excluded physician or other authorized individual 
during the period of such individual’s exclusion. 
‘‘(ii) In the case that an individual eligible for bene-
fits under title XVIII or XIX submits a claim for payment 
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for items or services furnished by an excluded individual 
or entity, and such individual eligible for such benefits did 
not know or have reason to know that such excluded indi-
vidual or entity was so excluded, then, notwithstanding 
such exclusion, payment shall be made for such items or 
services. In such case the Secretary shall notify such indi-
vidual eligible for such benefits of the exclusion of the indi-
vidual or entity furnishing the items or services. Payment 
shall not be made for items or services furnished by an 
excluded individual or entity to an individual eligible for 
such benefits after a reasonable time (as determined by 
the Secretary in regulations) after the Secretary has noti-
fied the individual eligible for such benefits of the exclu-
sion of the individual or entity furnishing the items or 
services. 
‘‘(iii) In the case that a claim for payment for items 
or services furnished by an excluded individual or entity 
is submitted by an individual or entity other than an indi-
vidual eligible for benefits under title XVIII or XIX or 
the excluded individual or entity, and the Secretary deter-
mines that the individual or entity that submitted the 
claim took reasonable steps to learn of the exclusion and 
reasonably relied upon inaccurate or misleading informa-
tion from the relevant Federal health care program or its 
contractor, the Secretary may waive repayment of the 
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amount paid in violation of the exclusion to the individual 
or entity that submitted the claim for the items or services 
furnished by the excluded individual or entity. If a Federal 
health care program contractor provided inaccurate or 
misleading information that resulted in the waiver of an 
overpayment under this clause, the Secretary shall take 
appropriate action to recover the improperly paid amount 
from the contractor.’’. 
Subtitle C—Enhanced Program 
and Provider Protections 
SEC. 1631. ENHANCED CMS PROGRAM PROTECTION AU-
THORITY. 
(a) IN GENERAL.—Title XI of the Social Security Act 
(42 U.S.C. 1301 et seq.) is amended by inserting after 
section 1128F the following new section: 
‘‘SEC. 1128G. ENHANCED PROGRAM AND PROVIDER PRO-
TECTIONS IN THE MEDICARE, MEDICAID, AND 
CHIP PROGRAMS. 
‘‘(a) CERTAIN AUTHORIZED SCREENING, ENHANCED 
OVERSIGHT PERIODS, AND ENROLLMENT MORATORIA.— 
‘‘(1) IN GENERAL.—For periods beginning after 
January 1, 2011, in the case that the Secretary de-
termines there is a significant risk of fraudulent ac-
tivity (as determined by the Secretary based on rel-
evant complaints, reports, referrals by law enforce-
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ment or other sources, data analysis, trending infor-
mation, or claims submissions by providers of serv-
ices and suppliers) with respect to a category of pro-
vider of services or supplier of items or services, in-
cluding a category within a geographic area, under 
title XVIII, XIX, or XXI, the Secretary may impose 
any of the following requirements with respect to a 
provider of services or a supplier (whether such pro-
vider or supplier is initially enrolling in the program 
or is renewing such enrollment): 
‘‘(A) Screening under paragraph (2). 
‘‘(B) Enhanced oversight periods under 
paragraph (3). 
‘‘(C) Enrollment moratoria under para-
graph (4). 
In applying this subsection for purposes of title XIX 
and XXI the Secretary may require a State to carry 
out the provisions of this subsection as a require-
ment of the State plan under title XIX or the child 
health plan under title XXI. Actions taken and de-
terminations made under this subsection shall not be 
subject to review by a judicial tribunal. 
‘‘(2) SCREENING.—For purposes of paragraph 
(1), the Secretary shall establish procedures under 
which screening is conducted with respect to pro-
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viders of services and suppliers described in such 
paragraph. Such screening may include— 
‘‘(A) licensing board checks; 
‘‘(B) screening against the list of individ-
uals and entities excluded from the program 
under title XVIII, XIX, or XXI; 
‘‘(C) the excluded provider list system; 
‘‘(D) background checks; and 
‘‘(E) unannounced pre-enrollment or other 
site visits. 
‘‘(3) ENHANCED
OVERSIGHT
PERIOD.—For 
purposes of paragraph (1), the Secretary shall estab-
lish procedures to provide for a period of not less 
than 30 days and not more than 365 days during 
which providers of services and suppliers described 
in such paragraph, as the Secretary determines ap-
propriate, would be subject to enhanced oversight, 
such as required or unannounced (or required and 
unannounced) site visits or inspections, prepayment 
review, enhanced review of claims, and such other 
actions as specified by the Secretary, under the pro-
grams under titles XVIII, XIX, and XXI. Under 
such procedures, the Secretary may extend such pe-
riod for more than 365 days if the Secretary deter-
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mines that after the initial period such additional 
period of oversight is necessary. 
‘‘(4) MORATORIUM ON ENROLLMENT OF PRO-
VIDERS
AND
SUPPLIERS.—For purposes of para-
graph (1), the Secretary, based upon a finding of a 
risk of serious ongoing fraud within a program 
under title XVIII, XIX, or XXI, may impose a mor-
atorium on the enrollment of providers of services 
and suppliers within a category of providers of serv-
ices and suppliers (including a category within a spe-
cific geographic area) under such title. Such a mora-
torium may only be imposed if the Secretary makes 
a determination that the moratorium would not ad-
versely impact access of individuals to care under 
such program. 
‘‘(5) CLARIFICATION.—Nothing in this sub-
section shall be interpreted to preclude or limit the 
ability of a State to engage in provider screening or 
enhanced provider oversight activities beyond those 
required by the Secretary.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) MEDICAID.—Section 1902(a) of the Social 
Security Act (42 U.S.C. 42 U.S.C. 1396a(a)) is 
amended— 
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(A) in paragraph (23), by inserting before 
the semicolon at the end the following: ‘‘or by 
a person to whom or entity to which a morato-
rium under section 1128G(a)(4) is applied dur-
ing the period of such moratorium’’; 
(B) in paragraph (72); by striking at the 
end ‘‘and’’; 
(C) in paragraph (73), by striking the pe-
riod at the end and inserting ‘‘; and’’; and 
(D) by adding after paragraph (73) the 
following new paragraph: 
‘‘(74) provide that the State will enforce any 
determination made by the Secretary under sub-
section (a) of section 1128G (relating to a signifi-
cant risk of fraudulent activity with respect to a cat-
egory of provider or supplier described in such sub-
section (a) through use of the appropriate proce-
dures described in such subsection (a)), and that the 
State will carry out any activities as required by the 
Secretary for purposes of such subsection (a).’’. 
(2) CHIP.—Section 2102 of such Act (42 
U.S.C. 1397bb) is amended by adding at the end the 
following new subsection: 
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‘‘(d) PROGRAM INTEGRITY.—A State child health 
plan shall include a description of the procedures to be 
used by the State— 
‘‘(1) to enforce any determination made by the 
Secretary under subsection (a) of section 1128G (re-
lating to a significant risk of fraudulent activity with 
respect to a category of provider or supplier de-
scribed in such subsection through use of the appro-
priate procedures described in such subsection); and 
‘‘(2) to carry out any activities as required by 
the Secretary for purposes of such subsection.’’. 
(3) MEDICARE.—Section 1866(j) of such Act 
(42 U.S.C. 1395cc(j)) is amended by adding at the 
end the following new paragraph: 
‘‘(3) PROGRAM INTEGRITY.—The provisions of 
section 1128G(a) apply to enrollments and renewals 
of enrollments of providers of services and suppliers 
under this title.’’. 
SEC. 1632. ENHANCED MEDICARE, MEDICAID, AND CHIP 
PROGRAM DISCLOSURE REQUIREMENTS RE-
LATING TO PREVIOUS AFFILIATIONS. 
(a) IN GENERAL.—Section 1128G of the Social Secu-
rity Act, as inserted by section 1631, is amended by add-
ing at the end the following new subsection: 
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‘‘(b) ENHANCED PROGRAM DISCLOSURE REQUIRE-
MENTS.— 
‘‘(1) DISCLOSURE.—A provider of services or 
supplier who submits on or after July 1, 2011, an 
application for enrollment and renewing enrollment 
in a program under title XVIII, XIX, or XXI shall 
disclose (in a form and manner determined by the 
Secretary) any current affiliation or affiliation with-
in the previous 10-year period with a provider of 
services or supplier that has uncollected debt or with 
a person or entity that has been suspended or ex-
cluded under such program, subject to a payment 
suspension, or has had its billing privileges revoked. 
‘‘(2) ENHANCED
SAFEGUARDS.—If the Sec-
retary determines that such previous affiliation of 
such provider or supplier poses a risk of fraud, 
waste, or abuse, the Secretary may apply such en-
hanced safeguards as the Secretary determines nec-
essary to reduce such risk associated with such pro-
vider or supplier enrolling or participating in the 
program under title XVIII, XIX, or XXI. Such safe-
guards may include enhanced oversight, such as en-
hanced screening of claims, required or unannounced 
(or required and unannounced) site visits or inspec-
tions, additional information reporting requirements, 
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and conditioning such enrollment on the provision of 
a surety bond. 
‘‘(3) AUTHORITY TO DENY PARTICIPATION.—If 
the Secretary determines that there has been at 
least one such affiliation and that such affiliation or 
affiliations, as applicable, of such provider or sup-
plier poses a serious risk of fraud, waste, or abuse, 
the Secretary may deny the application of such pro-
vider or supplier.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) MEDICAID.—Paragraph (74) of section 
1902(a) of such Act (42 U.S.C. 1396a(a)), as added 
by section 1631(b)(1), is amended— 
(A) by inserting ‘‘or subsection (b) of such 
section (relating to disclosure requirements)’’ 
before ‘‘, and that the State’’; and 
(B) by inserting before the period the fol-
lowing: ‘‘and apply any enhanced safeguards, 
with respect to a provider or supplier described 
in such subsection (b), as the Secretary deter-
mines necessary under such subsection (b)’’. 
(2) CHIP.—Subsection (d) of section 2102 of 
such Act (42 U.S.C. 1397bb), as added by section 
1631(b)(2), is amended— 
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(A) in paragraph (1), by striking at the 
end ‘‘and’’; 
(B) in paragraph (2) by striking the period 
at the end and inserting ‘‘; and’ ’’ and 
(C) by adding at the end the following new 
paragraph: 
‘‘(3) to enforce any determination made by the 
Secretary under subsection (b) of section 1128G (re-
lating to disclosure requirements) and to apply any 
enhanced safeguards, with respect to a provider or 
supplier described in such subsection, as the Sec-
retary determines necessary under such subsection.’’. 
SEC. 1633. REQUIRED INCLUSION OF PAYMENT MODIFIER 
FOR CERTAIN EVALUATION AND MANAGE-
MENT SERVICES. 
Section 1848 of the Social Security Act (42 U.S.C. 
1395w–4), as amended by section 4101 of the HITECH 
Act (Public Law 111–5), is amended by adding at the end 
the following new subsection: 
‘‘(p) PAYMENT MODIFIER FOR CERTAIN EVALUA-
TION AND MANAGEMENT SERVICES.—The Secretary shall 
establish a payment modifier under the fee schedule under 
this section for evaluation and management services (as 
specified in section 1842(b)(16)(B)(ii)) that result in the 
ordering of additional services (such as lab tests), the pre-
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scription of drugs, the furnishing or ordering of durable 
medical equipment in order to enable better monitoring 
of claims for payment for such additional services under 
this title, or the ordering, furnishing, or prescribing of 
other items and services determined by the Secretary to 
pose a high risk of waste, fraud, and abuse. The Secretary 
may require providers of services or suppliers to report 
such modifier in claims submitted for payment.’’. 
SEC. 1634. EVALUATIONS AND REPORTS REQUIRED UNDER 
MEDICARE INTEGRITY PROGRAM. 
(a) IN GENERAL.—Section 1893(c) of the Social Se-
curity Act (42 U.S.C. 1395ddd(c)) is amended— 
(1) in paragraph (3), by striking at the end 
‘‘and’’; 
(2) by redesignating paragraph (4) as para-
graph (5); and 
(3) by inserting after paragraph (3) the fol-
lowing new paragraph: 
‘‘(4) for the contract year beginning in 2011 
and each subsequent contract year, the entity pro-
vides assurances to the satisfaction of the Secretary 
that the entity will conduct periodic evaluations of 
the effectiveness of the activities carried out by such 
entity under the Program and will submit to the 
Secretary an annual report on such activities; and’’. 
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(b) REFERENCE
TO MEDICAID INTEGRITY PRO-
GRAM.—For a similar provision with respect to the Med-
icaid Integrity Program, see section 1752. 
SEC. 1635. REQUIRE PROVIDERS AND SUPPLIERS TO 
ADOPT 
PROGRAMS 
TO 
REDUCE 
WASTE, 
FRAUD, AND ABUSE. 
(a) IN GENERAL.—Section 1874 of the Social Secu-
rity Act (42 U.S.C. 42 U.S.C. 1395kk) is amended by 
adding at the end the following new subsection: 
‘‘(e) COMPLIANCE PROGRAMS FOR PROVIDERS OF 
SERVICES AND SUPPLIERS.— 
‘‘(1) 
IN
GENERAL.—The 
Secretary 
may 
disenroll a provider of services or a supplier (other 
than a physician or a skilled nursing facility) under 
this title (or may impose any civil monetary penalty 
or other intermediate sanction under paragraph (4)) 
if such provider of services or supplier fails to, sub-
ject to paragraph (5), establish a compliance pro-
gram that contains the core elements established 
under paragraph (2). 
‘‘(2) ESTABLISHMENT OF CORE ELEMENTS.— 
The Secretary, in consultation with the Inspector 
General of the Department of Health and Human 
Services, shall establish core elements for a compli-
ance program under paragraph (1). Such elements 
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may include written policies, procedures, and stand-
ards of conduct, a designated compliance officer and 
a compliance committee; effective training and edu-
cation pertaining to fraud, waste, and abuse for the 
organization’s employees and contractors; a con-
fidential or anonymous mechanism, such as a hot-
line, to receive compliance questions and reports of 
fraud, waste, or abuse; disciplinary guidelines for en-
forcement of standards; internal monitoring and au-
diting procedures, including monitoring and auditing 
of contractors; procedures for ensuring prompt re-
sponses to detected offenses and development of cor-
rective action initiatives, including responses to po-
tential offenses; and procedures to return all identi-
fied overpayments to the programs under this title, 
title XIX, and title XXI. 
‘‘(3) TIMELINE
FOR
IMPLEMENTATION.—The 
Secretary shall determine a timeline for the estab-
lishment of the core elements under paragraph (2) 
and the date on which a provider of services and 
suppliers (other than physicians) shall be required to 
have established such a program for purposes of this 
subsection. 
‘‘(4) CMS ENFORCEMENT
AUTHORITY.—The 
Administrator for the Centers of Medicare & Med-
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icaid Services shall have the authority to determine 
whether a provider of services or supplier described 
in subparagraph (3) has met the requirement of this 
subsection and to impose a civil monetary penalty 
not to exceed $50,000 for each violation. The Sec-
retary may also impose other intermediate sanctions, 
including corrective action plans and additional mon-
itoring in the case of a violation of this subsection. 
‘‘(5) PILOT
PROGRAM.—The Secretary may 
conduct a pilot program on the application of this 
subsection with respect to a category of providers of 
services or suppliers (other than physicians) that the 
Secretary determines to be a category which is at 
high risk for waste, fraud, and abuse before imple-
menting the requirements of this subsection to all 
providers of services and suppliers described in para-
graph (3).’’. 
(b) REFERENCE
TO
SIMILAR
MEDICAID
PROVI-
SION.—For a similar provision with respect to the Med-
icaid program under title XIX of the Social Security Act, 
see section 1753. 
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SEC. 1636. MAXIMUM PERIOD FOR SUBMISSION OF MEDI-
CARE CLAIMS REDUCED TO NOT MORE THAN 
12 MONTHS. 
(a) PURPOSE.—In general, the 36-month period cur-
rently allowed for claims filing under parts A, B, C, and, 
D of title XVIII of the Social Security Act presents oppor-
tunities for fraud schemes in which processing patterns 
of the Centers for Medicare & Medicaid Services can be 
observed and exploited. Narrowing the window for claims 
processing will not overburden providers and will reduce 
fraud and abuse. 
(b) REDUCING MAXIMUM PERIOD
FOR SUBMIS-
SION.— 
(1) PART A.—Section 1814(a) of the Social Se-
curity Act (42 U.S.C. 1395f(a)) is amended— 
(A) in paragraph (1), by striking ‘‘period 
of 3 calendar years’’ and all that follows and in-
serting ‘‘period of 1 calendar year from which 
such services are furnished; and’’; and 
(B) by adding at the end the following new 
sentence: ‘‘In applying paragraph (1), the Sec-
retary may specify exceptions to the 1 calendar 
year period specified in such paragraph.’’. 
(2) PART B.—Section 1835(a) of such Act (42 
U.S.C. 1395n(a)) is amended— 
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(A) in paragraph (1), by striking ‘‘period 
of 3 calendar years’’ and all that follows and in-
serting ‘‘period of 1 calendar year from which 
such services are furnished; and’’; and 
(B) by adding at the end the following new 
sentence: ‘‘In applying paragraph (1), the Sec-
retary may specify exceptions to the 1 calendar 
year period specified in such paragraph.’’. 
(3) PARTS C AND D.—Section 1857(d) of such 
Act is amended by adding at the end the following 
new paragraph: 
‘‘(7) PERIOD FOR SUBMISSION OF CLAIMS.— 
The contract shall require an MA organization or 
PDP sponsor to require any provider of services 
under contract with, in partnership with, or affili-
ated with such organization or sponsor to ensure 
that, with respect to items and services furnished by 
such provider to an enrollee of such organization, 
written request, signed by such enrollee, except in 
cases in which the Secretary finds it impracticable 
for the enrollee to do so, is filed for payment for 
such items and services in such form, in such man-
ner, and by such person or persons as the Secretary 
may by regulation prescribe, no later than the close 
of the 1 calendar year period after such items and 
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services are furnished. In applying the previous sen-
tence, the Secretary may specify exceptions to the 1 
calendar year period specified.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
subsection (b) shall be effective for items and services fur-
nished on or after January 1, 2011. 
SEC. 1637. PHYSICIANS WHO ORDER DURABLE MEDICAL 
EQUIPMENT OR HOME HEALTH SERVICES RE-
QUIRED TO BE MEDICARE ENROLLED PHYSI-
CIANS OR ELIGIBLE PROFESSIONALS. 
(a) DME.—Section 1834(a)(11)(B) of the Social Se-
curity Act (42 U.S.C. 1395m(a)(11)(B)) is amended by 
striking ‘‘physician’’ and inserting ‘‘physician enrolled 
under section 1866(j) or an eligible professional under sec-
tion 1848(k)(3)(B)’’. 
(b) HOME HEALTH SERVICES.— 
(1) PART A.—Section 1814(a)(2) of such Act 
(42 U.S.C. 1395(a)(2)) is amended in the matter 
preceding subparagraph (A) by inserting ‘‘in the 
case of services described in subparagraph (C), a 
physician enrolled under section 1866(j) or an eligi-
ble professional under section 1848(k)(3)(B),’’ be-
fore ‘‘or, in the case of services’’. 
(2) PART B.—Section 1835(a)(2) of such Act 
(42 U.S.C. 1395n(a)(2)) is amended in the matter 
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preceding subparagraph (A) by inserting ‘‘, or in the 
case of services described in subparagraph (A), a 
physician enrolled under section 1866(j) or an eligi-
ble professional under section 1848(k)(3)(B),’’ after 
‘‘a physician’’. 
(c) DISCRETION
TO EXPAND APPLICATION.—The 
Secretary may extend the requirement applied by the 
amendments made by subsections (a) and (b) to durable 
medical equipment and home health services (relating to 
requiring certifications and written orders to be made by 
enrolled physicians and health professions) to other cat-
egories of items or services under this title, including cov-
ered part D drugs as defined in section 1860D–2(e), if 
the Secretary determines that such application would help 
to reduce the risk of waste, fraud, and abuse with respect 
to such other categories under title XVIII of the Social 
Security Act. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to written orders and certifications 
made on or after July 1, 2010. 
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SEC. 1638. REQUIREMENT FOR PHYSICIANS TO PROVIDE 
DOCUMENTATION ON REFERRALS TO PRO-
GRAMS AT HIGH RISK OF WASTE AND ABUSE. 
(a) PHYSICIANS AND OTHER SUPPLIERS.—Section 
1842(h) of the Social Security Act, is amended by adding 
at the end the following new paragraph 
‘‘(10) The Secretary may disenroll, for a period of 
not more than one year for each act, a physician or sup-
plier under section 1866(j) if such physician or supplier 
fails to maintain and, upon request of the Secretary, pro-
vide access to documentation relating to written orders or 
requests for payment for durable medical equipment, cer-
tifications for home health services, or referrals for other 
items or services written or ordered by such physician or 
supplier under this title, as specified by the Secretary.’’. 
(b) PROVIDERS OF SERVICES.—Section 1866(a)(1) 
of such Act (42 U.S.C. 1395cc), is amended— 
(1) in subparagraph (U), by striking at the end 
‘‘and’’; 
(2) in subparagraph (V), by striking the period 
at the end and adding ‘‘; and’’; and 
(3) by adding at the end the following new sub-
paragraph: 
‘‘(W) maintain and, upon request of the 
Secretary, provide access to documentation re-
lating to written orders or requests for payment 
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for durable medical equipment, certifications for 
home health services, or referrals for other 
items or services written or ordered by the pro-
vider under this title, as specified by the Sec-
retary.’’. 
(c) OIG PERMISSIVE EXCLUSION AUTHORITY.—Sec-
tion 1128(b)(11) of the Social Security Act (42 U.S.C. 
1320a–7(b)(11)) is amended by inserting ‘‘, ordering, re-
ferring for furnishing, or certifying the need for’’ after 
‘‘furnishing’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to orders, certifications, and refer-
rals made on or after January 1, 2010. 
SEC. 1639. FACE TO FACE ENCOUNTER WITH PATIENT RE-
QUIRED BEFORE PHYSICIANS MAY CERTIFY 
ELIGIBILITY FOR HOME HEALTH SERVICES 
OR DURABLE MEDICAL EQUIPMENT UNDER 
MEDICARE. 
(a) CONDITION OF PAYMENT FOR HOME HEALTH 
SERVICES.— 
(1) PART
A.—Section 1814(a)(2)(C) of such 
Act is amended— 
(A) by striking ‘‘and such services’’ and in-
serting ‘‘such services’’; and 
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(B) by inserting after ‘‘care of a physi-
cian’’ the following: ‘‘, and, in the case of a cer-
tification or recertification made by a physician 
after January 1, 2010, prior to making such 
certification the physician must document that 
the physician has had a face-to-face encounter 
(including through use of telehealth and other 
than with respect to encounters that are inci-
dent to services involved) with the individual 
during the 6-month period preceding such cer-
tification, or other reasonable timeframe as de-
termined by the Secretary’’. 
(2) PART B.—Section 1835(a)(2)(A) of the So-
cial Security Act is amended— 
(A) by striking ‘‘and’’ before ‘‘(iii)’’; and 
(B) by inserting after ‘‘care of a physi-
cian’’ the following: ‘‘, and (iv) in the case of 
a certification or recertification after January 
1, 2010, prior to making such certification the 
physician must document that the physician has 
had a face-to-face encounter (including through 
use of telehealth and other than with respect to 
encounters that are incident to services in-
volved) with the individual during the 6-month 
period preceding such certification or recertifi-
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cation, or other reasonable timeframe as deter-
mined by the Secretary’’. 
(b) CONDITION OF PAYMENT FOR DURABLE MED-
ICAL EQUIPMENT.—Section 1834(a)(11)(B) of the Social 
Security Act (42 U.S.C. 1395m(a)(11)(B)) is amended by 
adding before the period at the end the following: ‘‘and 
shall require that such an order be written pursuant to 
the physician documenting that the physician has had a 
face-to-face encounter (including through use of telehealth 
and other than with respect to encounters that are inci-
dent to services involved) with the individual involved dur-
ing the 6-month period preceding such written order, or 
other reasonable timeframe as determined by the Sec-
retary’’. 
(c) APPLICATION TO OTHER AREAS UNDER MEDI-
CARE.—The Secretary may apply the face-to-face encoun-
ter requirement described in the amendments made by 
subsections (a) and (b) to other items and services for 
which payment is provided under title XVIII of the Social 
Security Act based upon a finding that such an decision 
would reduce the risk of waste, fraud, or abuse. 
(d) APPLICATION TO MEDICAID AND CHIP.—The re-
quirements pursuant to the amendments made by sub-
sections (a) and (b) shall apply in the case of physicians 
making certifications for home health services under title 
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XIX or XXI of the Social Security Act, in the same man-
ner and to the same extent as such requirements apply 
in the case of physicians making such certifications under 
title XVIII of such Act. 
SEC. 1640. EXTENSION OF TESTIMONIAL SUBPOENA AU-
THORITY TO PROGRAM EXCLUSION INVES-
TIGATIONS. 
(a) IN GENERAL.—Section 1128(f) of the Social Se-
curity Act (42 U.S.C. 1320a-7(f)) is amended by adding 
at the end the following new paragraph: 
‘‘(4) The provisions of subsections (d) and (e) of sec-
tion 205 shall apply with respect to this section to the 
same extent as they are applicable with respect to title 
II. The Secretary may delegate the authority granted by 
section 205(d) (as made applicable to this section) to the 
Inspector General of the Department of Health and 
Human Services or the Administrator of the Centers for 
Medicare & Medicaid Services for purposes of any inves-
tigation under this section.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to investigations beginning on 
or after January 1, 2010. 
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737 
SEC. 1641. REQUIRED REPAYMENTS OF MEDICARE AND 
MEDICAID OVERPAYMENTS. 
Section 1128G of the Social Security Act, as inserted 
by section 1631 and amended by section 1632, is further 
amended by adding at the end the following new sub-
section: 
‘‘(c) REPORTS ON AND REPAYMENT OF OVERPAY-
MENTS IDENTIFIED THROUGH INTERNAL AUDITS AND 
REVIEWS.— 
‘‘(1) REPORTING
AND
RETURNING
OVERPAY-
MENTS.—If a person knows of an overpayment, the 
person must— 
‘‘(A) report and return the overpayment to 
the Secretary, the State, an intermediary, a 
carrier, or a contractor, as appropriate, at the 
correct address, and 
‘‘(B) notify the Secretary, the State, inter-
mediary, carrier, or contractor to whom the 
overpayment was returned in writing of the rea-
son for the overpayment. 
‘‘(2) TIMING.—An overpayment must be re-
ported and returned under paragraph (1)(A) by not 
later than the date that is 60 days after the date the 
person knows of the overpayment. 
Any known overpayment retained later than the ap-
plicable date specified in this paragraph creates an 
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obligation as defined in section 3729(b)(3) of title 
31 of the United States Code. 
‘‘(3) CLARIFICATION.—Repayment of any over-
payments (or refunding by withholding of future 
payments) by a provider of services or supplier does 
not otherwise limit the provider or supplier’s poten-
tial liability for administrative obligations such as 
applicable interests, fines, and specialties or civil or 
criminal sanctions involving the same claim if it is 
determined later that the reason for the overpay-
ment was related to fraud by the provider or sup-
plier or the employees or agents of such provider or 
supplier. 
‘‘(4) DEFINITIONS.—In this subsection: 
‘‘(A) KNOWS.—The term ‘knows’ has the 
meaning given the terms ‘knowing’ and ‘know-
ingly’ in section 3729(b) of title 31 of the 
United States Code. 
‘‘(B) OVERPAYMENT.—The term ‘‘overpay-
ment’’ means any finally determined funds that 
a person receives or retains under title XVIII, 
XIX, or XXI to which the person, after applica-
ble reconciliation, is not entitled under such 
title. 
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‘‘(C) PERSON.—The term ‘person’ means a 
provider of services, supplier, Medicaid man-
aged care organization (as defined in section 
1903(m)(1)(A)), Medicare Advantage organiza-
tion (as defined in section 1859(a)(1)), or PDP 
sponsor 
(as 
defined 
in 
section 
1860D– 
41(a)(13)), but excluding a beneficiary.’’. 
SEC. 1642. EXPANDED APPLICATION OF HARDSHIP WAIV-
ERS 
FOR 
OIG 
EXCLUSIONS 
TO 
BENE-
FICIARIES OF ANY FEDERAL HEALTH CARE 
PROGRAM. 
Section 1128(c)(3)(B) of the Social Security Act (42 
U.S.C. 1320a–7(c)(3)(B)) is amended by striking ‘‘indi-
viduals entitled to benefits under part A of title XVIII 
or enrolled under part B of such title, or both’’ and insert-
ing ‘‘beneficiaries (as defined in section 1128A(i)(5)) of 
that program’’. 
SEC. 1643. ACCESS TO CERTAIN INFORMATION ON RENAL 
DIALYSIS FACILITIES. 
Section 1881(b) of the Social Security Act (42 U.S.C. 
1395rr(b)) is amended by adding at the end the following 
new paragraph: 
‘‘(15) For purposes of evaluating or auditing pay-
ments made to renal dialysis facilities for items and serv-
ices under this section under paragraph (1), each such 
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renal dialysis facility, upon the request of the Secretary, 
shall provide to the Secretary access to information relat-
ing to any ownership or compensation arrangement be-
tween such facility and the medical director of such facility 
or between such facility and any physician.’’. 
SEC. 1644. BILLING AGENTS, CLEARINGHOUSES, OR OTHER 
ALTERNATE PAYEES REQUIRED TO REG-
ISTER UNDER MEDICARE. 
(a) MEDICARE.—Section 1866(j)(1) of the Social Se-
curity Act (42 U.S.C. 1395cc(j)(1)) is amended by adding 
at the end the following new subparagraph: 
‘‘(D) BILLING
AGENTS
AND
CLEARING-
HOUSES REQUIRED TO BE REGISTERED UNDER 
MEDICARE.—Any agent, clearinghouse, or other 
alternate payee that submits claims on behalf of 
a health care provider must be registered with 
the Secretary in a form and manner specified 
by the Secretary.’’. 
(b) MEDICAID.—For a similar provision with respect 
to the Medicaid program under title XIX of the Social Se-
curity Act, see section 1759. 
(c) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to claims submitted on or after 
January 1, 2012. 
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SEC. 1645. CONFORMING CIVIL MONETARY PENALTIES TO 
FALSE CLAIMS ACT AMENDMENTS. 
Section 1128A of the Social Security Act, as amended 
by sections 1611, 1612, 1613, and 1615, is further 
amended— 
(1) in subsection (a)— 
(A) in paragraph (1), by striking ‘‘to an 
officer, employee, or agent of the United States, 
or of any department or agency thereof, or of 
any State agency (as defined in subsection 
(i)(1))’’; 
(B) in paragraph (4)— 
(i) in the matter preceding subpara-
graph (A), by striking ‘‘participating in a 
program under title XVIII or a State 
health care program’’ and inserting ‘‘par-
ticipating in a Federal health care program 
(as defined in section 1128B(f))’’; and 
(ii) in subparagraph (A), by striking 
‘‘title XVIII or a State health care pro-
gram’’ and inserting ‘‘a Federal health 
care program (as defined in section 
1128B(f))’’; 
(C) by striking ‘‘or’’ at the end of para-
graph (10); 
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(D) by inserting after paragraph (11) the 
following new paragraphs: 
‘‘(12) conspires to commit a violation of this 
section; or 
‘‘(13) knowingly makes, uses, or causes to be 
made or used, a false record or statement material 
to an obligation to pay or transmit money or prop-
erty to a Federal health care program, or knowingly 
conceals or knowingly and improperly avoids or de-
creases an obligation to pay or transmit money or 
property to a Federal health care program;’’; and 
(E) in the matter following paragraph 
(13), as inserted by subparagraph (D)— 
(i) by striking ‘‘or’’ before ‘‘in cases 
under paragraph (11)’’; and 
(ii) by inserting ‘‘, in cases under 
paragraph (12), $50,000 for any violation 
described in this section committed in fur-
therance of the conspiracy involved; or in 
cases under paragraph (13), $50,000 for 
each false record or statement, or conceal-
ment, avoidance, or decrease’’ after ‘‘by an 
excluded individual’’; and 
(F) in the second sentence, by striking 
‘‘such false statement, omission, or misrepre-
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sentation)’’ and inserting ‘‘such false statement 
or misrepresentation, in cases under paragraph 
(12), an assessment of not more than 3 times 
the total amount that would otherwise apply for 
any violation described in this section com-
mitted in furtherance of the conspiracy in-
volved, or in cases under paragraph (13), an as-
sessment of not more than 3 times the total 
amount of the obligation to which the false 
record or statement was material or that was 
avoided or decreased)’’. 
(2) in subsection (c)(1), by striking ‘‘six years’’ 
and inserting ‘‘10 years’’; and 
(3) in subsection (i)— 
(A) by amending paragraph (2) to read as 
follows: 
‘‘(2) The term ‘claim’ means any application, 
request, or demand, whether under contract, or oth-
erwise, for money or property for items and services 
under a Federal health care program (as defined in 
section 1128B(f)), whether or not the United States 
or a State agency has title to the money or property, 
that— 
‘‘(A) is presented or caused to be pre-
sented to an officer, employee, or agent of the 
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United States, or of any department or agency 
thereof, or of any State agency (as defined in 
subsection (i)(1)); or 
‘‘(B) is made to a contractor, grantee, or 
other recipient if the money or property is to be 
spent or used on the Federal health care pro-
gram’s behalf or to advance a Federal health 
care program interest, and if the Federal health 
care program— 
‘‘(i) provides or has provided any por-
tion of the money or property requested or 
demanded; or 
‘‘(ii) will reimburse such contractor, 
grantee, or other recipient for any portion 
of the money or property which is re-
quested or demanded.’’; 
(B) by amending paragraph (3) to read as 
follows: 
‘‘(3) The term ‘item or service’ means, without 
limitation, any medical, social, management, admin-
istrative, or other item or service used in connection 
with or directly or indirectly related to a Federal 
health care program.’’; 
(C) in paragraph (6)— 
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745 
(i) in subparagraph (C), by striking at 
the end ‘‘or’’; 
(ii) in the first subparagraph (D), by 
striking at the end the period and inserting 
‘‘; or’’; and 
(iii) by redesignating the second sub-
paragraph (D) as a subparagraph (E); 
(D) by amending paragraph (7) to read as 
follows: 
‘‘(7) The terms ‘knowing’, ‘knowingly’, and 
‘should know’ mean that a person, with respect to 
information— 
‘‘(A) has actual knowledge of the informa-
tion; 
‘‘(B) acts in deliberate ignorance of the 
truth or falsity of the information; or 
‘‘(C) acts in reckless disregard of the truth 
or falsity of the information; 
and require no proof of specific intent to defraud.’’; 
and 
(E) by adding at the end the following new 
paragraphs: 
‘‘(8) The term ‘obligation’ means an established 
duty, whether or not fixed, arising from an express 
or implied contractual, grantor-grantee, or licensor- 
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licensee relationship, from a fee-based or similar re-
lationship, from statute or regulation, or from the 
retention of any overpayment. 
‘‘(9) The term ‘material’ means having a nat-
ural tendency to influence, or be capable of influ-
encing, the payment or receipt of money or prop-
erty.’’. 
Subtitle D—Access to Information 
Needed 
to 
Prevent 
Fraud, 
Waste, and Abuse 
SEC. 1651. ACCESS TO INFORMATION NECESSARY TO IDEN-
TIFY FRAUD, WASTE, AND ABUSE. 
Section 1128G of the Social Security Act, as added 
by section 1631 and amended by sections 1632 and 1641, 
is further amended by adding at the end the following new 
subsection; 
‘‘(d) ACCESS TO INFORMATION NECESSARY TO IDEN-
TIFY FRAUD, WASTE, AND ABUSE.—For purposes of law 
enforcement activity, and to the extent consistent with ap-
plicable disclosure, privacy, and security laws, including 
the Health Insurance Portability and Accountability Act 
of 1996 and the Privacy Act of 1974, and subject to any 
information systems security requirements enacted by law 
or otherwise required by the Secretary, the Attorney Gen-
eral shall have access, facilitation by the Inspector General 
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of the Department of Health and Human Services, to 
claims and payment data relating to titles XVIII and XIX, 
in consultation with the Centers for Medicare & Medicaid 
Services or the owner of such data.’’. 
SEC. 1652. ELIMINATION OF DUPLICATION BETWEEN THE 
HEALTHCARE INTEGRITY AND PROTECTION 
DATA BANK AND THE NATIONAL PRACTI-
TIONER DATA BANK. 
(a) IN GENERAL.—To eliminate duplication between 
the Healthcare Integrity and Protection Data Bank 
(HIPDB) established under section 1128E of the Social 
Security Act and the National Practitioner Data Bank 
(NPBD) established under the Health Care Quality Im-
provement Act of 1986, section 1128E of the Social Secu-
rity Act (42 U.S.C. 1320a-7e) is amended— 
(1) in subsection (a), by striking ‘‘Not later 
than’’ and inserting ‘‘Subject to subsection (h), not 
later than’’; 
(2) in the first sentence of subsection (d)(2), by 
striking ‘‘(other than with respect to requests by 
Federal agencies)’’; and 
(3) by adding at the end the following new sub-
section: 
‘‘(h) SUNSET OF THE HEALTHCARE INTEGRITY AND 
PROTECTION DATA BANK; TRANSITION PROCESS.—Ef-
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748 
fective upon the enactment of this subsection, the Sec-
retary shall implement a process to eliminate duplication 
between the Healthcare Integrity and Protection Data 
Bank (in this subsection referred to as the ‘HIPDB’ es-
tablished pursuant to subsection (a) and the National 
Practitioner Data Bank (in this subsection referred to as 
the ‘NPDB’) as implemented under the Health Care Qual-
ity Improvement Act of 1986 and section 1921 of this Act, 
including systems testing necessary to ensure that infor-
mation formerly collected in the HIPDB will be accessible 
through the NPDB, and other activities necessary to 
eliminate duplication between the two data banks. Upon 
the completion of such process, notwithstanding any other 
provision of law, the Secretary shall cease the operation 
of the HIPDB and shall collect information required to 
be reported under the preceding provisions of this section 
in the NPDB. Except as otherwise provided in this sub-
section, the provisions of subsections (a) through (g) shall 
continue to apply with respect to the reporting of (or fail-
ure to report), access to, and other treatment of the infor-
mation specified in this section.’’. 
(b) ELIMINATION OF THE RESPONSIBILITY OF THE 
HHS OFFICE OF THE INSPECTOR GENERAL.—Section 
1128C(a)(1) of the Social Security Act (42 U.S.C. 1320a- 
7c(a)(1)) is amended— 
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(1) in subparagraph (C), by adding at the end 
‘‘and’’; 
(2) in subparagraph (D), by striking at the end 
‘‘, and’’ and inserting a period; and 
(3) by striking subparagraph (E). 
(c) SPECIAL PROVISION FOR ACCESS TO THE NA-
TIONAL PRACTITIONER DATA BANK BY THE DEPART-
MENT OF VETERANS AFFAIRS.— 
(1) IN GENERAL.—Notwithstanding any other 
provision of law, during the one year period that be-
gins on the effective date specified in subsection 
(e)(1), the information described in paragraph (2) 
shall be available from the National Practitioner 
Data Bank (described in section 1921 of the Social 
Security Act) to the Secretary of Veterans Affairs 
without charge. 
(2) INFORMATION DESCRIBED.—For purposes 
of paragraph (1), the information described in this 
paragraph is the information that would, but for the 
amendments made by this section, have been avail-
able to the Secretary of Veterans Affairs from the 
Healthcare Integrity and Protection Data Bank. 
(d) FUNDING.—Notwithstanding any provisions of 
this division, sections 1128E(d)(2) and 1817(k)(3) of the 
Social Security Act, or any other provision of law, there 
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shall be available for carrying out the transition process 
under section 1128E(h) of the Social Security Act over 
the period required to complete such process, and for oper-
ation of the National Practitioner Data Bank until such 
process is completed, without fiscal year limitation— 
(1) any fees collected pursuant to section 
1128E(d)(2) of such Act; and 
(2) such additional amounts as necessary, from 
appropriations available to the Secretary and to the 
Office of the Inspector General of the Department of 
Health and Human Services under clauses (i) and 
(ii), respectively, of section 1817(k)(3)(A) of such 
Act, for costs of such activities during the first 12 
months following the date of the enactment of this 
Act. 
(e) EFFECTIVE DATE.—The amendments made— 
(1) by subsection (a)(2) shall take effect on the 
first day after the Secretary of Health and Human 
Services certifies that the process implemented pur-
suant to section 1128E(h) of the Social Security Act 
(as added by subsection (a)(3)) is complete; and 
(2) by subsection (b) shall take effect on the 
earlier of the date specified in paragraph (1) or the 
first day of the second succeeding fiscal year after 
the fiscal year during which this Act is enacted. 
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751 
SEC. 1653. COMPLIANCE WITH HIPAA PRIVACY AND SECU-
RITY STANDARDS. 
The provisions of sections 262(a) and 264 of the 
Health Insurance Portability and Accountability Act of 
1996 (and standards promulgated pursuant to such sec-
tions) and the Privacy Act of 1974 shall apply with respect 
to the provisions of this subtitle and amendments made 
by this subtitle. 
TITLE VII—MEDICAID AND CHIP 
Subtitle A—Medicaid and Health 
Reform 
SEC. 1701. ELIGIBILITY FOR INDIVIDUALS WITH INCOME 
BELOW 1331⁄3
PERCENT OF THE FEDERAL 
POVERTY LEVEL. 
(a) ELIGIBILITY
FOR NON-TRADITIONAL INDIVID-
UALS WITH INCOME BELOW 133 PERCENT OF THE FED-
ERAL POVERTY LEVEL.— 
(1) IN GENERAL.—Section 1902(a)(10)(A)(i) of 
the 
Social 
Security 
Act 
(42 
U.S.C. 
1396b(a)(10)(A)(i) is amended— 
(A) by striking ‘‘or’’ at the end of sub-
clause (VI); 
(B) by adding ‘‘or’’ at the end of subclause 
(VII); and 
(C) by adding at the end the following new 
subclause: 
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‘‘(VIII) who are under 65 years 
of age, who are not described in a pre-
vious subclause of this clause, and 
who are in families whose income (de-
termined using methodologies and 
procedures specified by the Secretary 
in 
consultation 
with 
the 
Health 
Choices Commissioner) does not ex-
ceed 1331⁄3 percent of the income offi-
cial poverty line (as defined by the Of-
fice of Management and Budget, and 
revised annually in accordance with 
section 673(2) of the Omnibus Budget 
Reconciliation Act of 1981) applicable 
to a family of the size involved;’’. 
(2) 100% FMAP FOR NON-TRADITIONAL MED-
ICAID
ELIGIBLE
INDIVIDUALS.—Section 1905 of 
such Act (42 U.S.C. 1396d) is amended— 
(A) in the third sentence of subsection (b) 
by inserting before the period at the end the 
following: ‘‘and with respect to amounts de-
scribed in subsection (y)’’; and 
(B) by adding at the end the following new 
subsection: 
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753 
‘‘(y) ADDITIONAL
EXPENDITURES
SUBJECT
TO 
100% FMAP.—For purposes of section 1905(b), the 
amounts described in this subsection are the following: 
‘‘(1) Amounts expended for medical assistance 
for individuals described in subclause (VIII) of sec-
tion 1902(a)(10)(A)(i).’’. 
(3) CONSTRUCTION.—Nothing in this sub-
section shall be construed as not providing for cov-
erage 
under 
subclause 
(VIII) 
of 
section 
1902(a)(10)(A)(i) of the Social Security Act, as 
added by paragraph (1) of, and an increased FMAP 
under the amendment made by paragraph (2) for, 
an individual who has been provided medical assist-
ance under title XIX of the Act under a demonstra-
tion waiver approved under section 1115 of such Act 
or with State funds. 
(4) 
CONFORMING
AMENDMENT.—Section 
1903(f)(4) of the Social Security Act (42 U.S.C. 
1396b(f)(4)) 
is 
amended 
by 
inserting 
‘‘1902(a)(10)(A)(i)(VIII),’’ 
after 
‘‘1902(a)(10)(A)(i)(VII),’’. 
(b) ELIGIBILITY FOR TRADITIONAL MEDICAID ELI-
GIBLE INDIVIDUALS WITH INCOME NOT EXCEEDING 
1331⁄3 PERCENT OF THE FEDERAL POVERTY LEVEL.— 
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754 
(1) IN GENERAL.—Section 1902(a)(10)(A)(i) of 
the 
Social 
Security 
Act 
(42 
U.S.C. 
1396b(a)(10)(A)(i)), as amended by subsection (a), 
is amended— 
(A) by striking ‘‘or’’ at the end of sub-
clause (VII); 
(B) by adding ‘‘or’’ at the end of subclause 
(VIII); and 
(C) by adding at the end the following new 
subclause: 
‘‘(IX) who are under 65 years of 
age, who would be eligible for medical 
assistance under the State plan under 
one of subclauses (I) through (VII) 
(based on the income standards, 
methodologies, and procedures in ef-
fect as of June 16, 2009) but for in-
come and who are in families whose 
income does not exceed 1331⁄3 percent 
of the income official poverty line (as 
defined by the Office of Management 
and Budget, and revised annually in 
accordance with section 673(2) of the 
Omnibus Budget Reconciliation Act of 
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755 
1981) applicable to a family of the 
size involved;’’. 
(2) 100% FMAP
FOR
CERTAIN
TRADITIONAL 
MEDICAID ELIGIBLE INDIVIDUALS.—Section 1905(y) 
of such Act (42 U.S.C. 1396d(b)), as added by sub-
section (a)(2)(B), is amended by inserting ‘‘or (IX)’’ 
after ‘‘(VIII)’’. 
(3) CONSTRUCTION.—Nothing in this sub-
section shall be construed as not providing for cov-
erage 
under 
subclause 
(IX) 
of 
section 
1902(a)(10)(A)(i) of the Social Security Act, as 
added by paragraph (1) of, and an increased FMAP 
under the amendment made by paragraph (2) for, 
an individual who has been provided medical assist-
ance under title XIX of the Act under a demonstra-
tion waiver approved under section 1115 of such Act 
or with State funds. 
(4) 
CONFORMING
AMENDMENT.—Section 
1903(f)(4) of the Social Security Act (42 U.S.C. 
1396b(f)(4)), as amended by subsection (a)(4), is 
amended by inserting ‘‘1902(a)(10)(A)(i)(IX),’’ after 
‘‘1902(a)(10)(A)(i)(VIII),’’. 
(c) 100% MATCHING RATE FOR TEMPORARY COV-
ERAGE
OF CERTAIN NEWBORNS.—Section 1905(y) of 
such Act, as added by subsection (a)(2)(B), is amended— 
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756 
(1) in paragraph (1), by inserting before the pe-
riod at the end the following: ‘‘, and who is not pro-
vided medical assistance under section 1943(b)(2) of 
this title or section 205(d)(1)(B) of the America’s 
Affordable Health Choices Act of 2009’’; and 
(2) by adding at the end the following: 
‘‘(2) Amounts expended for medical assistance 
for children described in section 203(d)(1)(A) of the 
America’s Affordable Health Choices Act of 2009 
during the time period specified in such section.’’. 
(d) NETWORK ADEQUACY.—Section 1932(a)(2) of 
the Social Security Act (42 U.S.C. 1396u–2(a)(2)) is 
amended by adding at the end the following new subpara-
graph: 
‘‘(D) ENROLLMENT OF NON-TRADITIONAL 
MEDICAID
ELIGIBLES.—A State may not re-
quire under paragraph (1) the enrollment in a 
managed care entity of an individual described 
in section 1902(a)(10)(A)(i)(VIII) unless the 
State demonstrates, to the satisfaction of the 
Secretary, that the entity, through its provider 
network and other arrangements, has the ca-
pacity to meet the health, mental health, and 
substance abuse needs of such individuals.’’. 
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757 
(e) EFFECTIVE DATE.—The amendments made by 
this section shall take effect on the first day of Y1, and 
shall apply with respect to items and services furnished 
on or after such date. 
SEC. 1702. REQUIREMENTS AND SPECIAL RULES FOR CER-
TAIN MEDICAID ELIGIBLE INDIVIDUALS. 
(a) IN GENERAL.—Title XIX of the Social Security 
Act is amended by adding at the end the following new 
section: 
‘‘REQUIREMENTS AND SPECIAL RULES FOR CERTAIN 
MEDICAID ELIGIBLE INDIVIDUALS 
‘‘SEC. 1943. (a) COORDINATION WITH NHI EX-
CHANGE
THROUGH
MEMORANDUM
OF
UNDER-
STANDING.— 
‘‘(1) IN GENERAL.—The State shall enter into 
a Medicaid memorandum of understanding described 
in section 204(e)(4) of the America’s Affordable 
Health Choices Act of 2009 with the Health Choices 
Commissioner, acting in consultation with the Sec-
retary, with respect to coordinating the implementa-
tion of the provisions of subdivision A of such Act 
with the State plan under this title in order to en-
sure the enrollment of Medicaid eligible individuals 
in acceptable coverage. Nothing in this section shall 
be construed as permitting such memorandum to 
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758 
modify or vitiate any requirement of a State plan 
under this title. 
‘‘(2) ENROLLMENT
OF
EXCHANGE-REFERRED 
INDIVIDUALS.— 
‘‘(A) NON-TRADITIONAL
INDIVIDUALS.— 
Pursuant to such memorandum the State shall 
accept without further determination the enroll-
ment under this title of an individual deter-
mined by the Commissioner to be a non-tradi-
tional Medicaid eligible individual. The State 
shall not do any redeterminations of eligibility 
for such individuals unless the periodicity of 
such redeterminations is consistent with the pe-
riodicity for redeterminations by the Commis-
sioner of eligibility for affordability credits 
under subtitle C of title II of subdivision A of 
the America’s Affordable Health Choices Act of 
2009, as specified under such memorandum. 
‘‘(B) TRADITIONAL INDIVIDUALS.— 
‘‘(i) 
REGULAR
ENROLLMENT
OP-
TION.—Pursuant to such memorandum, 
insofar as the memorandum has selected 
the 
option 
described 
in 
section 
205(e)(3)(A) of the America’s Affordable 
Health Choices Act of 2009, the State 
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759 
shall accept without further determination 
the enrollment under this title of an indi-
vidual determined by the Commissioner to 
be a traditional Medicaid eligible indi-
vidual. The State may do redeterminations 
of eligibility of such individual consistent 
with such section and the memorandum. 
‘‘(ii) PRESUMPTIVE
ELIGIBILITY
OP-
TION.—Pursuant to such memorandum, 
insofar as the memorandum has selected 
the 
option 
described 
in 
section 
205(e)(3)(B) of the America’s Affordable 
Health Choices Act of 2009, the State 
shall provide for making medical assistance 
available during the presumptive eligibility 
period and shall, upon application of the 
individual for medical assistance under this 
title, promptly make a determination (and 
subsequent redeterminations) of eligibility 
in the same manner as if the individual 
had applied directly to the State for such 
assistance except that the State shall use 
the income-related information used by the 
Commissioner and provided to the State 
under the memorandum in making the pre-
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760 
sumptive eligibility determination to the 
maximum extent feasible. 
‘‘(3) DETERMINATIONS
OF
ELIGIBILITY
FOR 
AFFORDABILITY CREDITS.—If the Commissioner de-
termines that a State Medicaid agency has the ca-
pacity to make determinations of eligibility for af-
fordability credits under subtitle C of title II of sub-
division A of the America’s Affordable Health 
Choices Act of 2009, under such memorandum— 
‘‘(A) the State Medicaid agency shall con-
duct such determinations for any Exchange-eli-
gible individual who requests such a determina-
tion; 
‘‘(B) in the case that a State Medicaid 
agency determines that an Exchange-eligible in-
dividual is not eligible for affordability credits, 
the agency shall forward the information on the 
basis of which such determination was made to 
the Commissioner; and 
‘‘(C) the Commissioner shall reimburse the 
State Medicaid agency for the costs of con-
ducting such determinations. 
‘‘(b) TREATMENT OF CERTAIN NEWBORNS.— 
‘‘(1) IN GENERAL.—In the case of a child who 
is deemed under section 205(d)(1) of the America’s 
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761 
Affordable Health Choices Act of 2009 to be a non- 
traditional Medicaid eligible individual and enrolled 
under this title pursuant to such section, the State 
shall provide for a determination, by not later than 
the end of the period referred to in subparagraph 
(A) of such section, of the child’s eligibility for med-
ical assistance under this title. 
‘‘(2) EXTENDED TREATMENT AS TRADITIONAL 
MEDICAID
ELIGIBLE
INDIVIDUAL.—In accordance 
with subparagraph (B) of section 205(d)(1) of the 
America’s Affordable Health Choices Act of 2009, in 
the case of a child described in subparagraph (A) of 
such section who at the end of the period referred 
to in such subparagraph is not otherwise covered 
under acceptable coverage, the child shall be deemed 
(until such time as the child obtains such coverage 
or the State otherwise makes a determination of the 
child’s eligibility for medical assistance under its 
plan under this title pursuant to paragraph (1)) to 
be a traditional Medicaid eligible individual de-
scribed in section 1902(l)(1)(B). 
‘‘(c) DEFINITIONS .—In this section: 
‘‘(1) MEDICAID
ELIGIBLE
INDIVIDUALS.—In 
this section, the terms ‘Medicaid eligible individual’, 
‘traditional Medicaid eligible individual’, and ‘non- 
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762 
traditional Medicaid eligible individual’ have the 
meanings given such terms in section 205(e)(5) of 
the America’s Affordable Health Choices Act of 
2009. 
‘‘(2) MEMORANDUM.—The term ‘memorandum’ 
means a Medicaid memorandum of understanding 
under section 205(e)(4) of the America’s Affordable 
Health Choices Act of 2009. 
‘‘(3) Y1.—The term ‘Y1’ has the meaning given 
such term in section 100(c) of the America’s Afford-
able Health Choices Act of 2009.’’. 
(b) CONFORMING AMENDMENTS TO ERROR RATE.— 
(1) Section 1903(u)(1)(D) of the Social Secu-
rity Act (42 U.S.C. 1396b(u)(1)(D)) is amended by 
adding at the end the following new clause: 
‘‘(vi) In determining the amount of erroneous excess 
payments, there shall not be included any erroneous pay-
ments made that are attributable to an error in an eligi-
bility determination under subtitle C of title II of subdivi-
sion A of the America’s Affordable Health Choices Act of 
2009.’’. 
(2) Section 2105(c)(11) of such Act (42 U.S.C. 
1397ee(c)(11)) is amended by adding at the end the 
following new sentence: ‘‘Clause (vi) of section 
1903(u)(1)(D) shall apply with respect to the appli-
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763 
cation of such requirements under this title and title 
XIX.’’. 
SEC. 1703. CHIP AND MEDICAID MAINTENANCE OF EFFORT. 
(a) CHIP MAINTENANCE
OF
EFFORT.—Section 
1902 of the Social Security Act (42 U.S.C. 1396a) is 
amended— 
(1) in subsection (a), as amended by section 
1631(b)(1)(D)— 
(A) by striking ‘‘and’’ at the end of para-
graph (72); 
(B) by striking the period at the end of 
paragraph (73) and inserting ‘‘; and’’; and 
(C) by inserting after paragraph (74) the 
following new paragraph: 
‘‘(75) provide for maintenance of effort under 
the State child health plan under title XXI in ac-
cordance with subsection (gg).’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(gg) CHIP MAINTENANCE OF EFFORT REQUIRE-
MENT.— 
‘‘(1) IN GENERAL.—Subject to paragraph (2), 
as a condition of its State plan under this title under 
subsection (a)(75) and receipt of any Federal finan-
cial assistance under section 1903(a) for calendar 
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quarters beginning after the date of the enactment 
of this subsection and before CHIP MOE termi-
nation date specified in paragraph (3), a State shall 
not have in effect eligibility standards, methodolo-
gies, or procedures under its State child health plan 
under title XXI (including any waiver under such 
title or under section 1115 that is permitted to con-
tinue effect) that are more restrictive than the eligi-
bility standards, methodologies, or procedures, re-
spectively, under such plan (or waiver) as in effect 
on June 16, 2009. 
‘‘(2) LIMITATION.—Paragraph (1) shall not be 
construed as preventing a State from imposing a 
limitation described in section 2110(b)(5)(C)(i)(II) 
for a fiscal year in order to limit expenditures under 
its State child health plan under title XXI to those 
for which Federal financial participation is available 
under section 2105 for the fiscal year. 
‘‘(3) CHIP MOE TERMINATION DATE.—In para-
graph (1), the ‘CHIP MOE termination date’ for a 
State is the date that is the first day of Y1 (as de-
fined in section 100(c) of the America’s Affordable 
Health Choices Act of 2009) or, if later, the first 
day after such date that both of the following deter-
minations have been made: 
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‘‘(A) The Health Choices Commissioner 
has determined that the Health Insurance Ex-
change has the capacity to support the partici-
pation of CHIP enrollees who are Exchange-eli-
gible individuals (as defined in section 202(b) of 
the America’s Affordable Health Choices Act of 
2009), 
‘‘(B) The Secretary has determined that 
such Exchange, the State, and employers have 
procedures in effect to ensure the timely transi-
tion without interruption of coverage of CHIP 
enrollees from assistance under title XXI to ac-
ceptable coverage (as defined for purposes of 
such Act). 
In this paragraph, the term ‘CHIP enrollee’ means 
a targeted low-income child or (if the State has 
elected the option under section 2112, a targeted 
low-income pregnant woman) who is or otherwise 
would be (but for acceptable coverage) eligible for 
child health assistance or pregnancy-related assist-
ance, respectively, under the State child health plan 
referred to in paragraph (1).’’. 
(b) MEDICAID MAINTENANCE OF EFFORT; SIMPLI-
FYING
AND COORDINATING ELIGIBILITY RULES BE-
TWEEN EXCHANGE AND MEDICAID.— 
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766 
(1) IN GENERAL.—Section 1903 of such Act 
(42 U.S.C. 1396b) is amended by adding at the end 
the following new subsection: 
‘‘(aa) MAINTENANCE OF MEDICAID EFFORT; SIMPLI-
FYING
AND COORDINATING ELIGIBILITY RULES BE-
TWEEN
HEALTH
INSURANCE
EXCHANGE
AND
MED-
ICAID.— 
‘‘(1) MAINTENANCE OF EFFORT.—A State is 
not eligible for payment under subsection (a) for a 
calendar quarter beginning after the date of the en-
actment of this subsection if eligibility standards, 
methodologies, or procedures under its plan under 
this title (including any waiver under this title or 
under section 1115 that is permitted to continue ef-
fect) that are more restrictive than the eligibility 
standards, methodologies, or procedures, respec-
tively, under such plan (or waiver) as in effect on 
June 16, 2009. The Secretary shall extend such a 
waiver (including the availability of Federal financial 
participation under such waiver) for such period as 
may be required for a State to meet the requirement 
of the previous sentence. 
‘‘(2) REMOVAL OF ASSET TEST FOR CERTAIN 
ELIGIBILITY CATEGORIES.— 
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767 
‘‘(A) IN GENERAL.—A State is not eligible 
for payment under subsection (a) for a calendar 
quarter beginning on or after the first day of 
Y1 (as defined in section 100(c) of the Amer-
ica’s Affordable Health Choices Act of 2009), if 
the State applies any asset or resource test in 
determining (or redetermining) eligibility of any 
individual on or after such first day under any 
of the following: 
‘‘(i) Subclause (I), (III), (IV), or (VI) 
of section 1902(a)(10)(A)(i). 
‘‘(ii) Subclause (II), (IX), (XIV) or 
(XVII) of section 1902(a)(10)(A)(ii). 
‘‘(iii) Section 1931(b). 
‘‘(B) OVERRIDING CONTRARY PROVISIONS; 
REFERENCES.—The provisions of this title that 
prevent the waiver of an asset or resource test 
described in subparagraph (A) are hereby 
waived. 
‘‘(C) REFERENCES.—Any reference to a 
provision described in a provision in subpara-
graph (A) shall be deemed to be a reference to 
such provision as modified through the applica-
tion of subparagraphs (A) and (B).’’. 
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(2) CONFORMING AMENDMENTS.—(A) Section 
1902(a)(10)(A) 
of 
such 
Act 
(42 
U.S.C. 
1396a(a)(10)(A)) is amended, in the matter before 
clause 
(i), 
by 
inserting 
‘‘subject 
to 
section 
1903(aa)(2),’’ after ‘‘(A)’’. 
(B) Section 1931(b)(2) of such Act (42 U.S.C. 
1396u–1(b)(1)) is amended by inserting ‘‘subject to 
section 1903(aa)(2)’’ after ‘‘and (3)’’. 
(c) STANDARDS FOR BENCHMARK PACKAGES.—Sec-
tion 1937(b) of such Act (42 U.S.C. 1396u–7(b)) is 
amended— 
(1) in paragraph (1), by inserting ‘‘subject to 
paragraph (5)’’; and 
(2) by adding at the end the following new 
paragraph: 
‘‘(5) MINIMUM STANDARDS.—Effective January 
1, 2013, any benchmark benefit package (or bench-
mark equivalent coverage under paragraph (2)) 
must meet the minimum benefits and cost-sharing 
standards of a basic plan offered through the Health 
Insurance Exchange.’’. 
SEC. 1704. REDUCTION IN MEDICAID DSH. 
(a) REPORT.— 
(1) IN GENERAL.—Not later than January 1, 
2016, the Secretary of Health and Human Services 
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(in this title referred to as the ‘‘Secretary’’) shall 
submit to Congress a report concerning the extent to 
which, based upon the impact of the health care re-
forms carried out under subdivision A in reducing 
the number of uninsured individuals, there is a con-
tinued role for Medicaid DSH. In preparing the re-
port, the Secretary shall consult with community- 
based health care networks serving low-income bene-
ficiaries. 
(2) MATTERS TO BE INCLUDED.—The report 
shall include the following: 
(A) 
RECOMMENDATIONS.—Recommenda-
tions regarding— 
(i) the appropriate targeting of Med-
icaid DSH within States; and 
(ii) the distribution of Medicaid DSH 
among the States. 
(B) SPECIFICATION OF DSH HEALTH RE-
FORM METHODOLOGY.—The DSH Health Re-
form methodology described in paragraph (2) of 
subsection (b) for purposes of implementing the 
requirements of such subsection. 
(3) COORDINATION WITH MEDICARE DSH RE-
PORT.—The Secretary shall coordinate the report 
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770 
under this subsection with the report on Medicare 
DSH under section 1112. 
(4) MEDICAID DSH.—In this section, the term 
‘‘Medicaid DSH’’ means adjustments in payments 
under section 1923 of the Social Security Act for in-
patient hospital services furnished by dispropor-
tionate share hospitals. 
(b) MEDICAID DSH REDUCTIONS.— 
(1) IN GENERAL.—The Secretary shall reduce 
Medicaid DSH so as to reduce total Federal pay-
ments 
to 
all 
States 
for 
such 
purpose 
by 
$1,500,000,000 in fiscal year 2017, $2,500,000,000 
in fiscal year 2018, and $6,000,000,000 in fiscal 
year 2019. 
(2) DSH HEALTH REFORM METHODOLOGY.— 
The Secretary shall carry out paragraph (1) through 
use of a DSH Health Reform methodology issued by 
the Secretary that imposes the largest percentage re-
ductions on the States that— 
(A) have the lowest percentages of unin-
sured individuals (determined on the basis of 
audited hospital cost reports) during the most 
recent year for which such data are available; 
or 
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771 
(B) do not target their DSH payments 
on— 
(i) hospitals with high volumes of 
Medicaid inpatients (as defined in section 
1923(b)(1)(A) of the Social Security Act 
(42 U.S.C. 1396r–4(b)(1)(A)); and 
(ii) hospitals that have high levels of 
uncompensated care (excluding bad debt). 
(3) DSH ALLOTMENT PUBLICATIONS.— 
(A) IN GENERAL.—Not later than the pub-
lication deadline specified in subparagraph (B), 
the Secretary shall publish in the Federal Reg-
ister a notice specifying the DSH allotment to 
each State under 1923(f) of the Social Security 
Act for the respective fiscal year specified in 
such subparagraph, consistent with the applica-
tion of the DSH Health Reform methodology 
described in paragraph (2). 
(B) PUBLICATION DEADLINE.—The publi-
cation deadline specified in this subparagraph 
is— 
(i) January 1, 2016, with respect to 
DSH allotments described in subparagraph 
(A) for fiscal year 2017; 
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772 
(ii) January 1, 2017, with respect to 
DSH allotments described in subparagraph 
(A) for fiscal year 2018; and 
(iii) January 1, 2018, with respect to 
DSH allotments described in subparagraph 
(A) for fiscal year 2019. 
(c) CONFORMING AMENDMENTS.— 
(1) Section 1923(f) of the Social Security Act 
(42 U.S.C. 1396r–4(f)) is amended— 
(A) by redesignating paragraph (7) as 
paragraph (8); and 
(B) by inserting after paragraph (6) the 
following new paragraph: 
‘‘(7) SPECIAL RULE FOR FISCAL YEARS 2017, 
2018, AND 2019.— 
‘‘(A) FISCAL YEAR 2017.—Notwithstanding 
paragraph (2), the total DSH allotments for all 
States for— 
‘‘(i) fiscal year 2017, shall be the total 
DSH allotments that would otherwise be 
determined under this subsection for such 
fiscal year decreased by $1,500,000,000; 
‘‘(ii) fiscal year 2018, shall be the 
total DSH allotments that would otherwise 
be determined under this subsection for 
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773 
such 
fiscal 
year 
decreased 
by 
$2,500,000,000; and 
‘‘(iii) fiscal year 2019, shall be the 
total DSH allotments that would otherwise 
be determined under this subsection for 
such 
fiscal 
year 
decreased 
by 
$6,000,000,000.’’. 
(2) Section 1923(b)(4) of such Act (42 U.S.C. 
1396r–4(b)(4)) is amended by adding before the pe-
riod the following: ‘‘or to affect the authority of the 
Secretary to issue and implement the DSH Health 
Reform methodology under section 1704(b)(2) of the 
America’s Health Choices Act of 2009’’. 
(d) DISPROPORTIONATE SHARE HOSPITALS (DSH) 
AND ESSENTIAL ACCESS HOSPITAL (EAH) NON-DIS-
CRIMINATION.— 
(1) IN GENERAL.—Section 1923(d) of the So-
cial Security Act (42 U.S.C. 1396r-4) is amended by 
adding at the end the following new paragraph: 
‘‘(4) No hospital may be defined or deemed as 
a disproportionate share hospital, or as an essential 
access 
hospital 
(for 
purposes 
of 
subsection 
(f)(6)(A)(iv), under a State plan under this title or 
subsection (b) of this section (including any waiver 
under section 1115) unless the hospital— 
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774 
‘‘(A) provides services to beneficiaries 
under this title without discrimination on the 
ground of race, color, national origin, creed, 
source of payment, status as a beneficiary 
under this title, or any other ground unrelated 
to such beneficiary’s need for the services or the 
availability of the needed services in the hos-
pital; and 
‘‘(B) makes arrangements for, and accepts, 
reimbursement under this title for services pro-
vided to eligible beneficiaries under this title.’’. 
(2) EFFECTIVE DATE.—The amendment made 
by subsection (a) shall be apply to expenditures 
made on or after July 1, 2010. 
SEC. 1705. EXPANDED OUTSTATIONING. 
(a) IN GENERAL.—Section 1902(a)(55) of the Social 
Security Act (42 U.S.C. 1396a(a)(55)) is amended by 
striking 
‘‘under 
subsection 
(a)(10)(A)(i)(IV), 
(a)(10)(A)(i)(VI), 
(a)(10)(A)(i)(VII), 
or 
(a)(10)(A)(ii)(IX)’’ and inserting ‘‘(including receipt and 
processing of applications of individuals for affordability 
credits under subtitle C of title II of subdivision A of the 
America’s Affordable Health Choices Act of 2009 pursu-
ant to a Medicaid memorandum of understanding under 
section 1943(a)(1))’’. 
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775 
(b) EFFECTIVE DATE.— 
(1) Except as provided in paragraph (2), the 
amendment made by subsection (a) shall apply to 
services furnished on or after July 1, 2010, without 
regard to whether or not final regulations to carry 
out such amendment have been promulgated by such 
date. 
(2) In the case of a State plan for medical as-
sistance under title XIX of the Social Security Act 
which the Secretary of Health and Human Services 
determines requires State legislation (other than leg-
islation appropriating funds) in order for the plan to 
meet the additional requirement imposed by the 
amendment made by this section, the State plan 
shall not be regarded as failing to comply with the 
requirements of such title solely on the basis of its 
failure to meet this additional requirement before 
the first day of the first calendar quarter beginning 
after the close of the first regular session of the 
State legislature that begins after the date of the en-
actment of this Act. For purposes of the previous 
sentence, in the case of a State that has a 2-year 
legislative session, each year of such session shall be 
deemed to be a separate regular session of the State 
legislature. 
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776 
Subtitle B—Prevention 
SEC. 1711. REQUIRED COVERAGE OF PREVENTIVE SERV-
ICES. 
(a) COVERAGE.—Section 1905 of the Social Security 
Act (42 U.S.C. 1396d), as amended by section 
1701(a)(2)(B), is amended— 
(1) in subsection (a)(4)— 
(A) by striking ‘‘and’’ before ‘‘(C)’’; and 
(B) by inserting before the semicolon at 
the end the following: ‘‘and (D) preventive serv-
ices described in subsection (z)’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(z) PREVENTIVE SERVICES.—The preventive serv-
ices described in this subsection are services not otherwise 
described in subsection (a) or (r) that the Secretary deter-
mines are— 
‘‘(1)(A) recommended with a grade of A or B 
by the Task Force for Clinical Preventive Services; 
or 
‘‘(B) vaccines recommended for use as appro-
priate by the Director of the Centers for Disease 
Control and Prevention; and 
‘‘(2) appropriate for individuals entitled to med-
ical assistance under this title.’’. 
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777 
(b) CONFORMING AMENDMENT.—Section 1928 of 
such Act (42 U.S.C. 1396s) is amended— 
(1) in subsection (c)(2)(B)(i), by striking ‘‘the 
advisory committee referred to in subsection (e)’’ 
and inserting ‘‘the Director of the Centers for Dis-
ease Control and Prevention’’; 
(2) in subsection (e), by striking ‘‘Advisory 
Committee’’ and all that follows and inserting ‘‘Di-
rector of the Centers for Disease Control and Pre-
vention.’’; and 
(3) by striking subsection (g). 
(c) EFFECTIVE DATE.— 
(1) Except as provided in paragraph (2), the 
amendments made by this section shall apply to 
services furnished on or after July 1, 2010, without 
regard to whether or not final regulations to carry 
out such amendments have been promulgated by 
such date. 
(2) In the case of a State plan for medical as-
sistance under title XIX of the Social Security Act 
which the Secretary of Health and Human Services 
determines requires State legislation (other than leg-
islation appropriating funds) in order for the plan to 
meet the additional requirements imposed by the 
amendments made by this section, the State plan 
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778 
shall not be regarded as failing to comply with the 
requirements of such title solely on the basis of its 
failure to meet these additional requirements before 
the first day of the first calendar quarter beginning 
after the close of the first regular session of the 
State legislature that begins after the date of the en-
actment of this Act. For purposes of the previous 
sentence, in the case of a State that has a 2-year 
legislative session, each year of such session shall be 
deemed to be a separate regular session of the State 
legislature. 
SEC. 1712. TOBACCO CESSATION. 
(a) DROPPING TOBACCO CESSATION EXCLUSION 
FROM
COVERED
OUTPATIENT
DRUGS.—Section 
1927(d)(2) of the Social Security Act (42 U.S.C. 1396r– 
8(d)(2)) is amended— 
(1) by striking subparagraph (E); 
(2) in subparagraph (G), by inserting before the 
period at the end the following: ‘‘, except agents ap-
proved by the Food and Drug Administration for 
purposes of promoting, and when used to promote, 
tobacco cessation’’; and 
(3) 
by 
redesignating 
subparagraphs 
(F) 
through (K) as subparagraphs (E) through (J), re-
spectively. 
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779 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to drugs and services furnished 
on or after January 1, 2010. 
SEC. 1713. OPTIONAL COVERAGE OF NURSE HOME VISITA-
TION SERVICES. 
(a) IN GENERAL.—Section 1905 of the Social Secu-
rity Act (42 U.S.C. 1396d), as amended by sections 
1701(a)(2) and 1711(a), is amended— 
(1) in subsection (a)— 
(A) in paragraph (27), by striking ‘‘and’’ 
at the end; 
(B) by redesignating paragraph (28) as 
paragraph (29); and 
(C) by inserting after paragraph (27) the 
following new paragraph: 
‘‘(28) nurse home visitation services (as defined 
in subsection (aa)); and’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(aa) The term ‘nurse home visitation services’ 
means home visits by trained nurses to families with a 
first-time pregnant woman, or a child (under 2 years of 
age), who is eligible for medical assistance under this title, 
but only, to the extent determined by the Secretary based 
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upon evidence, that such services are effective in one or 
more of the following: 
‘‘(1) Improving maternal or child health and 
pregnancy outcomes or increasing birth intervals be-
tween pregnancies. 
‘‘(2) Reducing the incidence of child abuse, ne-
glect, and injury, improving family stability (includ-
ing reduction in the incidence of intimate partner vi-
olence), or reducing maternal and child involvement 
in the criminal justice system. 
‘‘(3) Increasing economic self-sufficiency, em-
ployment advancement, school-readiness, and edu-
cational achievement, or reducing dependence on 
public assistance.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to services furnished on or after 
January 1, 2010. 
(c) CONSTRUCTION.—Nothing in the amendments 
made by this section shall be construed as affecting the 
ability of a State under title XIX or XXI of the Social 
Security Act to provide nurse home visitation services as 
part of another class of items and services falling within 
the definition of medical assistance or child health assist-
ance under the respective title, or as an administrative ex-
penditure for which payment is made under section 
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781 
1903(a) or 2105(a) of such Act, respectively, on or after 
the date of the enactment of this Act. 
SEC. 1714. STATE ELIGIBILITY OPTION FOR FAMILY PLAN-
NING 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; 
(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 (hh) (re-
lating to individuals who meet certain income stand-
ards);’’. 
(2) GROUP DESCRIBED.—Section 1902 of such 
Act (42 U.S.C. 1396a), as amended by section 1703, 
is amended by adding at the end the following new 
subsection: 
‘‘(hh)(1) Individuals described in this subsection are 
individuals— 
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782 
‘‘(A) whose income does not exceed an in-
come eligibility level established by the State 
that does not exceed the highest income eligi-
bility 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, had individuals applied on or before January 1, 
2007, would have been made eligible pursuant to the 
standards and processes imposed by that State for 
benefits described in clause (XV) of the matter fol-
lowing subparagraph (G) of section subsection 
(a)(10) pursuant to a waiver granted under section 
1115. 
‘‘(3) At the option of a State, for purposes of 
subsection (a)(17)(B), in determining eligibility for 
services under this subsection, the State may con-
sider only the income of the applicant or recipient.’’. 
(3) 
LIMITATION
ON
BENEFITS.—Section 
1902(a)(10) of such Act (42 U.S.C. 1396a(a)(10)) 
is amended in the matter following subparagraph 
(G)— 
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783 
(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 (hh) shall be limited to 
family planning services and supplies described 
in section 1905(a)(4)(C) including medical di-
agnosis and treatment services that are pro-
vided pursuant to a family planning service in 
a family planning setting’’ after ‘‘cervical can-
cer’’. 
(4) 
CONFORMING
AMENDMENTS.—Section 
1905(a) of such Act (42 U.S.C. 1396d(a)), as 
amended by section 1731(c), is amended in the mat-
ter preceding paragraph (1)— 
(A) in clause (xiii), by striking ‘‘or’’ at the 
end; 
(B) in clause (xiv), by adding ‘‘or’’ at the 
end; and 
(C) by inserting after clause (xiv) the fol-
lowing: 
‘‘(xv) individuals described in section 
1902(hh),’’. 
(b) PRESUMPTIVE ELIGIBILITY.— 
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