SEC. 3002. PREMIUM ASSISTANCE FOR COBRA BENEFITS 
AND EXTENSION OF COBRA BENEFITS FOR 
OLDER OR LONG-TERM EMPLOYEES. 
(a) PREMIUM ASSISTANCE
FOR COBRA CONTINU-
ATION COVERAGE
FOR INDIVIDUALS
AND THEIR FAMI-
LIES.— 
(1) PROVISION OF PREMIUM ASSISTANCE.— 
(A) REDUCTION OF PREMIUMS PAYABLE.— 
In the case of any premium for a period of cov-
erage beginning on or after the date of the enact-
ment of this Act for COBRA continuation cov-
erage with respect to any assistance eligible indi-
vidual, such individual shall be treated for pur-
poses of any COBRA continuation provision as 
having paid the amount of such premium if such 
individual pays 35 percent of the amount of such 
premium (as determined without regard to this 
subsection). 
(B) PREMIUM REIMBURSEMENT.—For pro-
visions providing the balance of such premium, 
see section 6431 of the Internal Revenue Code of 
1986, as added by paragraph (12). 
(2) LIMITATION OF PERIOD OF PREMIUM ASSIST-
ANCE.— 
(A) IN GENERAL.—Paragraph (1)(A) shall 
not apply with respect to any assistance eligible 
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individual for months of coverage beginning on 
or after the earlier of— 
(i) the first date that such individual 
is eligible for coverage under any other 
group health plan (other than coverage con-
sisting of only dental, vision, counseling, or 
referral services (or a combination thereof), 
coverage under a health reimbursement ar-
rangement or a health flexible spending ar-
rangement, or coverage of treatment that is 
furnished in an on-site medical facility 
maintained by the employer and that con-
sists primarily of first-aid services, preven-
tion and wellness care, or similar care (or 
a combination thereof)) or is eligible for 
benefits under title XVIII of the Social Se-
curity Act, or 
(ii) the earliest of— 
(I) the date which is 12 months 
after the first day of the first month 
that paragraph (1)(A) applies with re-
spect to such individual, 
(II) the date following the expira-
tion of the maximum period of con-
tinuation coverage required under the 
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applicable COBRA continuation cov-
erage provision, or 
(III) the date following the expi-
ration of the period of continuation 
coverage 
allowed 
under 
paragraph 
(4)(B)(ii). 
(B) TIMING
OF
ELIGIBILITY
FOR
ADDI-
TIONAL
COVERAGE.—For purposes of subpara-
graph (A)(i), an individual shall not be treated 
as eligible for coverage under a group health 
plan before the first date on which such indi-
vidual could be covered under such plan. 
(C) NOTIFICATION REQUIREMENT.—An as-
sistance eligible individual shall notify in writ-
ing the group health plan with respect to which 
paragraph (1)(A) applies if such paragraph 
ceases to apply by reason of subparagraph 
(A)(i). Such notice shall be provided to the group 
health plan in such time and manner as may be 
specified by the Secretary of Labor. 
(3) ASSISTANCE
ELIGIBLE
INDIVIDUAL.—For 
purposes of this section, the term ‘‘assistance eligible 
individual’’ means any qualified beneficiary if— 
(A) at any time during the period that be-
gins with September 1, 2008, and ends with De-
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cember 31, 2009, such qualified beneficiary is el-
igible for COBRA continuation coverage, 
(B) such qualified beneficiary elects such 
coverage, 
(C) the qualifying event with respect to the 
COBRA continuation coverage consists of the in-
voluntary termination of the covered employee’s 
employment and occurred during such period, 
and 
(D) at the time of the election such qualified 
beneficiary’s 
annual 
income 
is 
less 
than 
$1,000,000. 
(4) EXTENSION OF ELECTION PERIOD AND EF-
FECT ON COVERAGE.— 
(A) IN GENERAL.—Notwithstanding section 
605(a) of the Employee Retirement Income Secu-
rity Act of 1974, section 4980B(f)(5)(A) of the 
Internal Revenue Code of 1986, section 2205(a) 
of the Public Health Service Act, and section 
8905a(c)(2) of title 5, United States Code, in the 
case of an individual who is a qualified bene-
ficiary described in paragraph (3)(A) as of the 
date of the enactment of this Act and has not 
made the election referred to in paragraph 
(3)(B) as of such date, such individual may elect 
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the COBRA continuation coverage under the 
COBRA continuation coverage provisions con-
taining such sections during the 60-day period 
commencing with the date on which the notifica-
tion required under paragraph (7)(C) is pro-
vided to such individual. 
(B) COMMENCEMENT
OF
COVERAGE; NO 
REACH-BACK.—Any COBRA continuation cov-
erage elected by a qualified beneficiary during 
an extended election period under subparagraph 
(A)— 
(i) shall commence on the date of the 
enactment of this Act, and 
(ii) shall not extend beyond the period 
of COBRA continuation coverage that 
would have been required under the applica-
ble COBRA continuation coverage provision 
if the coverage had been elected as required 
under such provision. 
(C) PREEXISTING
CONDITIONS.—With re-
spect to a qualified beneficiary who elects 
COBRA continuation coverage pursuant to sub-
paragraph (A), the period— 
(i) beginning on the date of the quali-
fying event, and 
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(ii) ending with the day before the date 
of the enactment of this Act, 
shall be disregarded for purposes of determining 
the 63-day periods referred to in section 701)(2) 
of the Employee Retirement Income Security Act 
of 1974, section 9801(c)(2) of the Internal Rev-
enue Code of 1986, and section 2701(c)(2) of the 
Public Health Service Act. 
(5) EXPEDITED REVIEW OF DENIALS OF PRE-
MIUM ASSISTANCE.—In any case in which an indi-
vidual requests treatment as an assistance eligible in-
dividual and is denied such treatment by the group 
health plan by reason of such individual’s ineligi-
bility for COBRA continuation coverage, the Sec-
retary of Labor (or the Secretary of Health and 
Human services in connection with COBRA continu-
ation coverage which is provided other than pursuant 
to part 6 of subtitle B of title I of the Employee Re-
tirement Income Security Act of 1974), in consulta-
tion with the Secretary of the Treasury, shall provide 
for expedited review of such denial. An individual 
shall be entitled to such review upon application to 
such Secretary in such form and manner as shall be 
provided by such Secretary. Such Secretary shall 
make a determination regarding such individual’s eli-
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gibility within 10 business days after receipt of such 
individual’s application for review under this para-
graph. 
(6) DISREGARD OF SUBSIDIES FOR PURPOSES OF 
FEDERAL
AND
STATE
PROGRAMS.—Notwithstanding 
any other provision of law, any premium reduction 
with respect to an assistance eligible individual under 
this subsection shall not be considered income or re-
sources in determining eligibility for, or the amount 
of assistance or benefits provided under, any other 
public benefit provided under Federal law or the law 
of any State or political subdivision thereof. 
(7) NOTICES TO INDIVIDUALS.— 
(A) GENERAL NOTICE.— 
(i) IN GENERAL.—In the case of notices 
provided under section 606(4) of the Em-
ployee Retirement Income Security Act of 
1974 
(29 
U.S.C. 
1166(4)), 
section 
4980B(f)(6)(D) of the Internal Revenue 
Code of 1986, section 2206(4) of the Public 
Health Service Act (42 U.S.C. 300bb–6(4)), 
or section 8905a(f)(2)(A) of title 5, United 
States Code, with respect to individuals 
who, during the period described in para-
graph (3)(A), become entitled to elect 
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COBRA continuation coverage, such notices 
shall include an additional notification to 
the recipient of the availability of premium 
reduction with respect to such coverage 
under this subsection. 
(ii) ALTERNATIVE
NOTICE.—In the 
case of COBRA continuation coverage to 
which the notice provision under such sec-
tions does not apply, the Secretary of 
Labor, in consultation with the Secretary of 
the Treasury and the Secretary of Health 
and Human Services, shall, in coordination 
with administrators of the group health 
plans (or other entities) that provide or ad-
minister the COBRA continuation coverage 
involved, provide rules requiring the provi-
sion of such notice. 
(iii) FORM.—The requirement of the 
additional notification under this subpara-
graph may be met by amendment of exist-
ing notice forms or by inclusion of a sepa-
rate document with the notice otherwise re-
quired. 
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(B) SPECIFIC REQUIREMENTS.—Each addi-
tional notification under subparagraph (A) shall 
include— 
(i) the forms necessary for establishing 
eligibility for premium reduction under this 
subsection, 
(ii) the name, address, and telephone 
number necessary to contact the plan ad-
ministrator and any other person main-
taining relevant information in connection 
with such premium reduction, 
(iii) a description of the extended elec-
tion period provided for in paragraph 
(4)(A), 
(iv) a description of the obligation of 
the qualified beneficiary under paragraph 
(2)(C) to notify the plan providing continu-
ation coverage of eligibility for subsequent 
coverage under another group health plan 
or eligibility for benefits under title XVIII 
of the Social Security Act and the penalty 
provided for failure to so notify the plan, 
and 
(v) a description, displayed in a 
prominent manner, of the qualified bene-
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ficiary’s right to a reduced premium and 
any conditions on entitlement to the re-
duced premium. 
(C) NOTICE
RELATING
TO
RETROACTIVE 
COVERAGE.—In the case of an individual de-
scribed in paragraph (3)(A) who has elected 
COBRA continuation coverage as of the date of 
enactment of this Act or an individual described 
in paragraph (4)(A), the administrator of the 
group health plan (or other entity) involved shall 
provide (within 60 days after the date of enact-
ment of this Act) for the additional notification 
required to be provided under subparagraph (A). 
(D) MODEL NOTICES.—Not later than 30 
days after the date of enactment of this Act, the 
Secretary of the Labor, in consultation with the 
Secretary of the Treasury and the Secretary of 
Health and Human Services, shall prescribe 
models for the additional notification required 
under this paragraph. 
(8) SAFEGUARDS.—The Secretary of the Treas-
ury shall provide such rules, procedures, regulations, 
and other guidance as may be necessary and appro-
priate to prevent fraud and abuse under this sub-
section. 
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(9) OUTREACH.—The Secretary of Labor, in con-
sultation with the Secretary of the Treasury and the 
Secretary of Health and Human Services, shall pro-
vide outreach consisting of public education and en-
rollment assistance relating to premium reduction 
provided under this subsection. Such outreach shall 
target employers, group health plan administrators, 
public assistance programs, States, insurers, and 
other entities as determined appropriate by such Sec-
retaries. Such outreach shall include an initial focus 
on those individuals electing continuation coverage 
who are referred to in paragraph (7)(C). Information 
on such premium reduction, including enrollment, 
shall also be made available on website of the Depart-
ments of Labor, Treasury, and Health and Human 
Services. 
(10) DEFINITIONS.—For purposes of this sub-
section— 
(A) ADMINISTRATOR.—The term ‘‘adminis-
trator’’ has the meaning given such term in sec-
tion 3(16) of the Employee Retirement Income 
Security Act of 1974. 
(B) COBRA CONTINUATION
COVERAGE.— 
The term ‘‘COBRA continuation coverage’’ 
means continuation coverage provided pursuant 
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to part 6 of subtitle B of title I of the Employee 
Retirement Income Security Act of 1974 (other 
than under section 609), title XXII of the Public 
Health Service Act, section 4980B of the Internal 
Revenue Code of 1986 (other than subsection 
(f)(1) of such section insofar as it relates to pedi-
atric vaccines), or section 8905a of title 5, 
United States Code, or under a State program 
that provides continuation coverage comparable 
to such continuation coverage. Such term does 
not include coverage under a health flexible 
spending arrangement. 
(C) COBRA CONTINUATION
PROVISION.— 
The term ‘‘COBRA continuation provision’’ 
means the provisions of law described in sub-
paragraph (B). 
(D) COVERED EMPLOYEE.—The term ‘‘cov-
ered employee’’ has the meaning given such term 
in section 607(2) of the Employee Retirement In-
come Security Act of 1974. 
(E) QUALIFIED
BENEFICIARY.—The term 
‘‘qualified beneficiary’’ has the meaning given 
such term in section 607(3) of the Employee Re-
tirement Income Security Act of 1974. 
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(F) GROUP
HEALTH
PLAN.—The term 
‘‘group health plan’’ has the meaning given such 
term in section 607(1) of the Employee Retire-
ment Income Security Act of 1974. 
(G) STATE.—The term ‘‘State’’ includes the 
District of Columbia, the Commonwealth of 
Puerto Rico, the Virgin Islands, Guam, Amer-
ican Samoa, and the Commonwealth of the 
Northern Mariana Islands. 
(11) REPORTS.— 
(A) INTERIM REPORT.—The Secretary of the 
Treasury shall submit an interim report to the 
Committee on Education and Labor, the Com-
mittee on Ways and Means, and the Committee 
on Energy and Commerce of the House of Rep-
resentatives and the Committee on Health, Edu-
cation, Labor, and Pensions and the Committee 
on Finance of the Senate regarding the premium 
reduction provided under this subsection that in-
cludes— 
(i) the number of individuals provided 
such assistance as of the date of the report; 
and 
(ii) the total amount of expenditures 
incurred (with administrative expenditures 
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noted separately) in connection with such 
assistance as of the date of the report. 
(B) FINAL REPORT.—As soon as practicable 
after the last period of COBRA continuation cov-
erage for which premium reduction is provided 
under this section, the Secretary of the Treasury 
shall submit a final report to each Committee re-
ferred to in subparagraph (A) that includes— 
(i) the number of individuals provided 
premium reduction under this section; 
(ii) the average dollar amount (month-
ly and annually) of premium reductions 
provided to such individuals; and 
(iii) the total amount of expenditures 
incurred (with administrative expenditures 
noted separately) in connection with pre-
mium reduction under this section. 
(12) COBRA PREMIUM ASSISTANCE.— 
(A) IN GENERAL.—Subchapter B of chapter 
65 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new 
section: 
‘‘SEC. 6431. COBRA PREMIUM ASSISTANCE. 
‘‘(a) IN GENERAL.—The entity to whom premiums are 
payable under COBRA continuation coverage shall be reim-
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bursed for the amount of premiums not paid by plan bene-
ficiaries by reason of section 3002(a) of the Health Insur-
ance Assistance for the Unemployed Act of 2009. Such 
amount shall be treated as a credit against the requirement 
of such entity to make deposits of payroll taxes. To the ex-
tent that such amount exceeds the amount of such taxes, 
the Secretary shall pay to such entity the amount of such 
excess. No payment may be made under this subsection to 
an entity with respect to any assistance eligible individual 
until after such entity has received the reduced premium 
from such individual required under section 3002(a)(1)(A) 
of such Act. 
‘‘(b) PAYROLL TAXES.—For purposes of this section, 
the term ‘payroll taxes’ means— 
‘‘(1) amounts required to be deducted and with-
held for the payroll period under section 3401 (relat-
ing to wage withholding), 
‘‘(2) amounts required to be deducted for the 
payroll period under section 3102 (relating to FICA 
employee taxes), and 
‘‘(3) amounts of the taxes imposed for the payroll 
period under section 3111 (relating to FICA employer 
taxes). 
‘‘(c) TREATMENT OF CREDIT.—Except as otherwise 
provided by the Secretary, the credit described in subsection 
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(a) shall be applied as though the employer had paid to 
the Secretary, on the day that the qualified beneficiary’s 
premium payment is received, an amount equal to such 
credit. 
‘‘(d) TREATMENT OF PAYMENT.—For purposes of sec-
tion 1324(b)(2) of title 31, United States Code, any pay-
ment under this section shall be treated in the same manner 
as a refund of the credit under section 35. 
‘‘(e) REPORTING.— 
‘‘(1) IN GENERAL.—Each entity entitled to reim-
bursement under subsection (a) for any period shall 
submit such reports as the Secretary may require, in-
cluding— 
‘‘(A) an attestation of involuntary termi-
nation of employment for each covered employee 
on the basis of whose termination entitlement to 
reimbursement is claimed under subsection (a), 
and 
‘‘(B) a report of the amount of payroll taxes 
offset under subsection (a) for the reporting pe-
riod and the estimated offsets of such taxes for 
the subsequent reporting period in connection 
with reimbursements under subsection (a). 
‘‘(2) TIMING OF REPORTS RELATING TO AMOUNT 
OF PAYROLL TAXES.—Reports required under para-
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graph (1)(B) shall be submitted at the same time as 
deposits of taxes imposed by chapters 21, 22, and 24 
or at such time as is specified by the Secretary. 
‘‘(f) REGULATIONS.—The Secretary may issue such 
regulations or other guidance as may be necessary or appro-
priate to carry out this section, including the requirement 
to report information or the establishment of other methods 
for verifying the correct amounts of payments and credits 
under this section.’’. 
(B) SOCIAL SECURITY TRUST FUNDS HELD 
HARMLESS.—In determining any amount trans-
ferred or appropriated to any fund under the So-
cial Security Act, section 6431 of the Internal 
Revenue Code of 1986 shall not be taken into ac-
count. 
(C) CLERICAL AMENDMENT.—The table of 
sections for subchapter B of chapter 65 of the In-
ternal Revenue Code of 1986 is amended by add-
ing at the end the following new item: 
‘‘Sec. 6431. COBRA premium assistance.’’. 
(D) EFFECTIVE
DATE.—The amendments 
made by this paragraph shall apply to pre-
miums to which subsection (a)(1)(A) applies. 
(13) PENALTY FOR FAILURE TO NOTIFY HEALTH 
PLAN OF CESSATION OF ELIGIBILITY FOR PREMIUM 
ASSISTANCE.— 
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(A) IN GENERAL.—Part I of subchapter B 
of chapter 68 of the Internal Revenue Code of 
1986 is amended by adding at the end the fol-
lowing new section: 
‘‘SEC. 6720C. PENALTY FOR FAILURE TO NOTIFY HEALTH 
PLAN OF CESSATION OF ELIGIBILITY FOR 
COBRA PREMIUM ASSISTANCE. 
‘‘(a) IN GENERAL.—Any person required to notify a 
group health plan under section 3002(a)(2)(C)) of the 
Health Insurance Assistance for the Unemployed Act of 
2009 who fails to make such a notification at such time 
and in such manner as the Secretary of Labor may require 
shall pay a penalty of 110 percent of the premium reduction 
provided under such section after termination of eligibility 
under such subsection. 
‘‘(b) REASONABLE CAUSE EXCEPTION.—No penalty 
shall be imposed under subsection (a) with respect to any 
failure if it is shown that such failure is due to reasonable 
cause and not to willful neglect.’’. 
(B) CLERICAL AMENDMENT.—The table of 
sections of part I of subchapter B of chapter 68 
of such Code is amended by adding at the end 
the following new item: 
‘‘Sec. 6720C. Penalty for failure to notify health plan of cessation of eligibility 
for COBRA premium assistance.’’. 
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(C) EFFECTIVE
DATE.—The amendments 
made by this paragraph shall apply to failures 
occurring after the date of the enactment of this 
Act. 
(14) COORDINATION WITH HCTC.— 
(A) IN GENERAL.—Subsection (g) of section 
35 of the Internal Revenue Code of 1986 is 
amended by redesignating paragraph (9) as 
paragraph (10) and inserting after paragraph 
(8) the following new paragraph: 
‘‘(9) COBRA PREMIUM
ASSISTANCE.—In the 
case of an assistance eligible individual who receives 
premium reduction for COBRA continuation coverage 
under section 3002(a) of the Health Insurance Assist-
ance for the Unemployed Act of 2009 for any month 
during the taxable year, such individual shall not be 
treated as an eligible individual, a certified indi-
vidual, or a qualifying family member for purposes 
of this section or section 7527 with respect to such 
month.’’. 
(B) EFFECTIVE
DATE.—The amendment 
made by subparagraph (A) shall apply to tax-
able years ending after the date of the enactment 
of this Act. 
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(15) EXCLUSION
OF
COBRA
PREMIUM
ASSIST-
ANCE FROM GROSS INCOME.— 
(A) IN GENERAL.—Part III of subchapter B 
of chapter 1 of the Internal Revenue Code of 
1986 is amended by inserting after section 139B 
the following new section: 
‘‘SEC. 139C. COBRA PREMIUM ASSISTANCE. 
‘‘In the case of an assistance eligible individual (as 
defined in section 3002 of the Health Insurance Assistance 
for the Unemployed Act of 2009), gross income does not in-
clude any premium reduction provided under subsection (a) 
of such section.’’. 
(B) CLERICAL AMENDMENT.—The table of 
sections for part III of subchapter B of chapter 
1 of such Code is amended by inserting after the 
item relating to section 139B the following new 
item: 
‘‘Sec. 139C. COBRA premium assistance.’’. 
(C) EFFECTIVE
DATE.—The amendments 
made by this paragraph shall apply to taxable 
years ending after the date of the enactment of 
this Act. 
(b) EXTENSION OF COBRA BENEFITS FOR OLDER OR 
LONG-TERM EMPLOYEES.— 
(1) ERISA AMENDMENT.—Section 602(2)(A) of 
the Employee Retirement Income Security Act of 
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1974 is amended by adding at the end the following 
new clauses: 
‘‘(x) SPECIAL
RULE
FOR
OLDER
OR 
LONG-TERM
EMPLOYEES
GENERALLY.—In 
the case of a qualifying event described in 
section 603(2) with respect to a covered em-
ployee who (as of such qualifying event) has 
attained age 55 or has completed 10 or 
more years of service with the entity that is 
the employer at the time of the qualifying 
event, clauses (i) and (ii) shall not apply. 
‘‘(xi) YEAR OF SERVICE.— For pur-
poses of this subparagraph, the term ‘year 
of service’ shall have the meaning provided 
in section 202(a)(3).’’. 
(2) IRC AMENDMENT.—Clause (i) of section 
4980B(f)(2)(B) of the Internal Revenue Code of 1986 
is amended by adding at the end the following new 
subclauses: 
‘‘(X) SPECIAL RULE FOR OLDER 
OR
LONG-TERM
EMPLOYEES
GEN-
ERALLY.—In the case of a qualifying 
event described in paragraph (3)(B) 
with respect to a covered employee who 
(as of such qualifying event) has at-
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tained age 55 or has completed 10 or 
more years of service with the entity 
that is the employer at the time of the 
qualifying event, subclauses (I) and 
(II) shall not apply. 
‘‘(XI) YEAR
OF
SERVICE.— For 
purposes of this clause, the term ‘year 
of service’ shall have the meaning pro-
vided in section 202(a)(3) of the Em-
ployee Retirement Income Security Act 
of 1974.’’. 
(3) PHSA AMENDMENT.—Section 2202(2)(A) of 
the Public Health Service Act is amended by adding 
at the end the following new clauses: 
‘‘(viii) SPECIAL RULE FOR OLDER OR 
LONG-TERM
EMPLOYEES
GENERALLY.—In 
the case of a qualifying event described in 
section 2203(2) with respect to a covered 
employee who (as of such qualifying event) 
has attained age 55 or has completed 10 or 
more years of service with the entity that is 
the employer at the time of the qualifying 
event, clauses (i) and (ii) shall not apply. 
‘‘(ix) YEAR OF SERVICE.— For pur-
poses of this subparagraph, the term ‘year 
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of service’ shall have the meaning provided 
in section 202(a)(3) of the Employee Retire-
ment Income Security Act of 1974.’’. 
(4) EFFECTIVE
DATE
OF
AMENDMENTS.—The 
amendments made by this subsection shall apply to 
periods of coverage which would (without regard to 
the amendments made by this section) end on or after 
the date of the enactment of this Act. 
SEC. 3003. TEMPORARY OPTIONAL MEDICAID COVERAGE 
FOR THE UNEMPLOYED. 
(a) IN GENERAL.—Section 1902 of the Social Security 
Act (42 U.S.C. 1396b) is amended— 
(1) in subsection (a)(10)(A)(ii)— 
(A) by striking ‘‘or’’ at the end of subclause 
(XVIII); 
(B) by adding ‘‘or’’ at the end of subclause 
(XIX); and 
(C) by adding at the end the following new 
subclause: 
‘‘(XX) who are described in sub-
section (dd)(1) (relating to certain un-
employed individuals and their fami-
lies);’’; and 
(2) by adding at the end the following new sub-
section: 
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ceed 200 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 
1981) applicable to a family of the size involved, and 
who, but for subsection (a)(10)(A)(ii)(XX), are not el-
igible for medical assistance under this title or health 
assistance under title XXI. 
‘‘(D) Individuals who are involuntarily unem-
ployed and were involuntarily separated from em-
ployment on or after September 1, 2008, and before 
January 1, 2011, who are members of households par-
ticipating in the supplemental nutrition assistance 
program established under the Food and Nutrition 
Act of 2008 (7 U.S.C. 2011 et seq), and who, but for 
subsection (a)(10)(A)(ii)(XX), are not eligible for 
medical assistance under this title or health assistance 
under title XXI. 
A State plan may elect one or more of the categories de-
scribed in this paragraph but may not elect the category 
described in subparagraph (B) unless the State plan also 
elects the category described in subparagraph (A). 
‘‘(3) The requirements of this paragraph with respect 
to an individual are the following: 
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‘‘(A) In the case of individuals within a category 
described in subparagraph (A) or (B) of paragraph 
(2), the individual was involuntarily separated from 
employment on or after September 1, 2008, and before 
January 1, 2011, or meets such comparable require-
ment as the Secretary specifies through rule, guid-
ance, or otherwise in the case of an individual who 
was an independent contractor. 
‘‘(B) The individual is not otherwise covered 
under creditable coverage, as defined in section 
2701(c) of the Public Health Service Act (42 U.S.C. 
300gg(c)), but applied without regard to paragraph 
(1)(F) of such section and without regard to coverage 
provided by reason of the application of subsection 
(a)(10)(A)(ii)(XX). 
‘‘(4)(A) No income or resources test shall be applied 
with respect to any category of individuals described in sub-
paragraph (A), (B), or (D) of paragraph (2) who are eligi-
ble for medical assistance only by reason of the application 
of subsection (a)(10)(A)(ii)(XX). 
‘‘(B) Nothing in this subsection shall be construed to 
prevent a State from imposing a resource test for the cat-
egory of individuals described in paragraph (2)(C)). 
‘‘(C) In the case of individuals provided medical as-
sistance by reason of the application of subsection 
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(a)(10)(A)(ii)(XX), the requirements of subsections (i)(22) 
and (x) shall not apply.’’. 
(b) 100 PERCENT FEDERAL MATCHING RATE.— 
(1) FMAP FOR
TIME-LIMITED
PERIOD.—The 
third sentence of section 1905(b) of such Act (42 
U.S.C. 1396d(b)) is amended by inserting before the 
period at the end the following: ‘‘and for items and 
services furnished on or after the date of enactment of 
this Act and before January 1, 2011, to individuals 
who are eligible for medical assistance only by reason 
of the application of section 1902(a)(10)(A)(ii)(XX)’’. 
(2) CERTAIN
ENROLLMENT-RELATED
ADMINIS-
TRATIVE COSTS.—Notwithstanding any other provi-
sion of law, for purposes of applying section 1903(a) 
of the Social Security Act (42 U.S.C. 1396b(a)), with 
respect to expenditures incurred on or after the date 
of the enactment of this Act and before January 1, 
2011, for costs of administration (including outreach 
and the modification and operation of eligibility in-
formation systems) attributable to eligibility deter-
mination and enrollment of individuals who are eligi-
ble for medical assistance only by reason of the appli-
cation of section 1902(a)(10)(A)(ii)(XX) of such Act, 
as added by subsection (a)(1), the Federal matching 
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percentage shall be 100 percent instead of the match-
ing percentage otherwise applicable. 
(c) 
CONFORMING
AMENDMENTS.—(1) 
Section 
1903(f)(4) of such Act (42 U.S.C. 1396c(f)(4)) is amended 
by 
inserting 
‘‘1902(a)(10)(A)(ii)(XX), 
or’’ 
after 
‘‘1902(a)(10)(A)(ii)(XIX),’’. 
(2) Section 1905(a) of such Act (42 U.S.C. 1396d(a)) 
is amended, in the matter preceding paragraph (1)— 
(A) by striking ‘‘or’’ at the end of clause (xii); 
(B) by adding ‘‘or’’ at the end of clause (xiii); 
and 
(C) by inserting after clause (xiii) the following 
new clause: 
‘‘(xiv) individuals described in section 
1902(dd)(1),’’. 
TITLE IV—HEALTH 
INFORMATION TECHNOLOGY 
SEC. 4001. SHORT TITLE; TABLE OF CONTENTS OF TITLE. 
(a) SHORT TITLE.—This title may be cited as the 
‘‘Health Information Technology for Economic and Clinical 
Health Act’’ or the ‘‘HITECH Act’’. 
(b) TABLE OF CONTENTS OF TITLE.—The table of con-
tents of this title is as follows: 
Sec. 4001. Short title; table of contents of title. 
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Subtitle A—Promotion of Health Information Technology 
PART I—IMPROVING HEALTH CARE QUALITY, SAFETY, AND EFFICIENCY 
Sec. 4101. ONCHIT; standards development and adoption. 
‘‘TITLE XXX—HEALTH INFORMATION TECHNOLOGY AND QUALITY 
‘‘Sec. 3000. Definitions. 
‘‘Subtitle A—Promotion of Health Information Technology 
‘‘Sec. 3001. Office of the National Coordinator for Health Information Tech-
nology. 
‘‘Sec. 3002. HIT Policy Committee. 
‘‘Sec. 3003. HIT Standards Committee. 
‘‘Sec. 3004. Process for adoption of endorsed recommendations; adoption of 
initial set of standards, implementation specifications, and 
certification criteria. 
‘‘Sec. 3005. Application and use of adopted standards and implementation 
specifications by Federal agencies. 
‘‘Sec. 3006. Voluntary application and use of adopted standards and imple-
mentation specifications by private entities. 
‘‘Sec. 3007. Federal health information technology. 
‘‘Sec. 3008. Transitions. 
‘‘Sec. 3009. Relation to HIPAA privacy and security law. 
‘‘Sec. 3010. Authorization for appropriations. 
Sec. 4102. Technical amendment. 
Sec. 4103. American technology required. 
PART II—APPLICATION AND USE OF ADOPTED HEALTH INFORMATION 
TECHNOLOGY STANDARDS; REPORTS 
Sec. 4111. Coordination of Federal activities with adopted standards and imple-
mentation specifications. 
Sec. 4112. Application to private entities. 
Sec. 4113. Study and reports. 
Subtitle B—Testing of Health Information Technology 
Sec. 4201. National Institute for Standards and Technology testing. 
Sec. 4202. Research and development programs. 
Subtitle C—Incentives for the Use of Health Information Technology 
PART I—GRANTS AND LOANS FUNDING 
Sec. 4301. Grant, loan, and demonstration programs. 
‘‘Subtitle B—Incentives for the Use of Health Information Technology 
‘‘Sec. 3011. Immediate funding to strengthen the health information tech-
nology infrastructure. 
‘‘Sec. 3012. Health information technology implementation assistance. 
‘‘Sec. 3013. State grants to promote health information technology. 
‘‘Sec. 3014. Competitive grants to States and Indian tribes for the develop-
ment of loan programs to facilitate the widespread adoption 
of certified EHR technology. 
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‘‘Sec. 3015. Demonstration program to integrate information technology into 
clinical education. 
‘‘Sec. 3016. Information technology professionals on health care. 
‘‘Sec. 3017. General grant and loan provisions. 
‘‘Sec. 3018. Authorization for appropriations. 
PART II—MEDICARE PROGRAM 
Sec. 4311. Incentives for eligible professionals. 
Sec. 4312. Incentives for hospitals. 
Sec. 4313. Treatment of payments and savings; implementation funding. 
Sec. 4314. Study on application of EHR payment incentives for providers not re-
ceiving other incentive payments. 
PART III—MEDICAID FUNDING 
Sec. 4321. Medicaid provider HIT adoption and operation payments; implemen-
tation funding. 
Subtitle D—Privacy 
Sec. 4400. Definitions. 
PART I—IMPROVED PRIVACY PROVISIONS AND SECURITY PROVISIONS 
Sec. 4401. Application of security provisions and penalties to business associates 
of covered entities; annual guidance on security provisions. 
Sec. 4402. Notification in the case of breach. 
Sec. 4403. Education on Health Information Privacy. 
Sec. 4404. Application of privacy provisions and penalties to business associates 
of covered entities. 
Sec. 4405. Restrictions on certain disclosures and sales of health information; ac-
counting of certain protected health information disclosures; ac-
cess to certain information in electronic format. 
Sec. 4406. Conditions on certain contacts as part of health care operations. 
Sec. 4407. Temporary breach notification requirement for vendors of personal 
health records and other non-HIPAA covered entities. 
Sec. 4408. Business associate contracts required for certain entities. 
Sec. 4409. Clarification of application of wrongful disclosures criminal penalties. 
Sec. 4410. Improved enforcement. 
Sec. 4411. Audits. 
Sec. 4412. Securing individually identifiable health information. 
Sec. 4413. Special rule for information to reduce medication errors and improve 
patient safety. 
PART II—RELATIONSHIP TO OTHER LAWS; REGULATORY REFERENCES; 
EFFECTIVE DATE; REPORTS 
Sec. 4421. Relationship to other laws. 
Sec. 4422. Regulatory references. 
Sec. 4423. Effective date. 
Sec. 4424. Studies, reports, guidance. 
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Subtitle A—Promotion of Health 
Information Technology 
PART 1—IMPROVING HEALTH CARE QUALITY, 
SAFETY, AND EFFICIENCY 
SEC. 4101. ONCHIT; STANDARDS DEVELOPMENT AND ADOP-
TION. 
The Public Health Service Act (42 U.S.C. 201 et seq.) 
is amended by adding at the end the following: 
‘‘TITLE XXX—HEALTH INFORMA-
TION 
TECHNOLOGY 
AND 
QUALITY 
‘‘SEC. 3000. DEFINITIONS. 
‘‘In this title: 
‘‘(1) CERTIFIED EHR TECHNOLOGY.—The term 
‘certified EHR technology’ means a qualified elec-
tronic health record that is certified pursuant to sec-
tion 3001(c)(5) as meeting standards adopted under 
section 3004 that are applicable to the type of record 
involved (as determined by the Secretary, such as an 
ambulatory electronic health record for office-based 
physicians or an inpatient hospital electronic health 
record for hospitals). 
‘‘(2) ENTERPRISE INTEGRATION.—The term ‘en-
terprise integration’ means the electronic linkage of 
health care providers, health plans, the government, 
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and other interested parties, to enable the electronic 
exchange and use of health information among all the 
components in the health care infrastructure in ac-
cordance with applicable law, and such term includes 
related application protocols and other related stand-
ards. 
‘‘(3) 
HEALTH
CARE
PROVIDER.—The 
term 
‘health care provider’ means a hospital, skilled nurs-
ing facility, nursing facility, home health entity or 
other long term care facility, health care clinic, Feder-
ally qualified health center, group practice (as defined 
in section 1877(h)(4) of the Social Security Act), a 
pharmacist, a pharmacy, a laboratory, a physician 
(as defined in section 1861(r) of the Social Security 
Act), 
a 
practitioner 
(as 
described 
in 
section 
1842(b)(18)(C) of the Social Security Act), a provider 
operated by, or under contract with, the Indian 
Health Service or by an Indian tribe (as defined in 
the Indian Self-Determination and Education Assist-
ance Act), tribal organization, or urban Indian orga-
nization (as defined in section 4 of the Indian Health 
Care Improvement Act), a rural health clinic, a cov-
ered entity under section 340B, an ambulatory sur-
gical center described in section 1833(i) of the Social 
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Security Act, and any other category of facility or 
clinician determined appropriate by the Secretary. 
‘‘(4) HEALTH INFORMATION.—The term ‘health 
information’ has the meaning given such term in sec-
tion 1171(4) of the Social Security Act. 
‘‘(5) HEALTH INFORMATION TECHNOLOGY.—The 
term ‘health information technology’ means hardware, 
software, integrated technologies and related licenses, 
intellectual property, upgrades, and packaged solu-
tions sold as services that are specifically designed for 
use by health care entities for the electronic creation, 
maintenance, or exchange of health information. 
‘‘(6) HEALTH PLAN.—The term ‘health plan’ has 
the meaning given such term in section 1171(5) of the 
Social Security Act. 
‘‘(7) HIT POLICY COMMITTEE.—The term ‘HIT 
Policy Committee’ means such Committee established 
under section 3002(a). 
‘‘(8) HIT STANDARDS
COMMITTEE.—The term 
‘HIT Standards Committee’ means such Committee 
established under section 3003(a). 
‘‘(9) INDIVIDUALLY IDENTIFIABLE HEALTH IN-
FORMATION.—The term ‘individually identifiable 
health information’ has the meaning given such term 
in section 1171(6) of the Social Security Act. 
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‘‘(10) LABORATORY.—The term ‘laboratory’ has 
the meaning given such term in section 353(a). 
‘‘(11) NATIONAL COORDINATOR.—The term ‘Na-
tional Coordinator’ means the head of the Office of the 
National Coordinator for Health Information Tech-
nology established under section 3001(a). 
‘‘(12) PHARMACIST.—The term ‘pharmacist’ has 
the meaning given such term in section 804(2) of the 
Federal Food, Drug, and Cosmetic Act. 
‘‘(13) 
QUALIFIED
ELECTRONIC
HEALTH 
RECORD.—The 
term 
‘qualified 
electronic 
health 
record’ means an electronic record of health-related 
information on an individual that— 
‘‘(A) includes patient demographic and 
clinical health information, such as medical his-
tory and problem lists; and 
‘‘(B) has the capacity— 
‘‘(i) to provide clinical decision sup-
port; 
‘‘(ii) to support physician order entry; 
‘‘(iii) to capture and query informa-
tion relevant to health care quality; and 
‘‘(iv) to exchange electronic health in-
formation with, and integrate such infor-
mation from other sources. 
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‘‘(14) STATE.—The term ‘State’ means each of 
the several States, the District of Columbia, Puerto 
Rico, the Virgin Islands, Guam, American Samoa, 
and the Northern Mariana Islands. 
‘‘Subtitle A—Promotion of Health 
Information Technology 
‘‘SEC. 3001. OFFICE OF THE NATIONAL COORDINATOR FOR 
HEALTH INFORMATION TECHNOLOGY. 
‘‘(a) ESTABLISHMENT.—There is established within 
the Department of Health and Human Services an Office 
of the National Coordinator for Health Information Tech-
nology (referred to in this section as the ‘Office’). The Office 
shall be headed by a National Coordinator who shall be ap-
pointed by the Secretary and shall report directly to the 
Secretary. 
‘‘(b) PURPOSE.—The National Coordinator shall per-
form the duties under subsection (c) in a manner consistent 
with the development of a nationwide health information 
technology infrastructure that allows for the electronic use 
and exchange of information and that— 
‘‘(1) ensures that each patient’s health informa-
tion is secure and protected, in accordance with ap-
plicable law; 
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‘‘(2) improves health care quality, reduces med-
ical errors, reduces health disparities, and advances 
the delivery of patient-centered medical care; 
‘‘(3) reduces health care costs resulting from inef-
ficiency, medical errors, inappropriate care, duplica-
tive care, and incomplete information; 
‘‘(4) provides appropriate information to help 
guide medical decisions at the time and place of care; 
‘‘(5) ensures the inclusion of meaningful public 
input in such development of such infrastructure; 
‘‘(6) improves the coordination of care and infor-
mation among hospitals, laboratories, physician of-
fices, and other entities through an effective infra-
structure for the secure and authorized exchange of 
health care information; 
‘‘(7) improves public health activities and facili-
tates the early identification and rapid response to 
public health threats and emergencies, including bio-
terror events and infectious disease outbreaks; 
‘‘(8) facilitates health and clinical research and 
health care quality; 
‘‘(9) promotes prevention of chronic diseases; 
‘‘(10) promotes a more effective marketplace, 
greater competition, greater systems analysis, in-
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creased consumer choice, and improved outcomes in 
health care services; and 
‘‘(11) improves efforts to reduce health dispari-
ties. 
‘‘(c) DUTIES OF THE NATIONAL COORDINATOR.— 
‘‘(1) STANDARDS.—The National Coordinator 
shall review and determine whether to endorse each 
standard, implementation specification, and certifi-
cation criterion for the electronic exchange and use of 
health information that is recommended by the HIT 
Standards Committee under section 3003 for purposes 
of adoption under section 3004. The Coordinator shall 
make such determination, and report to the Secretary 
such determination, not later than 45 days after the 
date the recommendation is received by the Coordi-
nator. 
‘‘(2) HIT POLICY COORDINATION.— 
‘‘(A) IN GENERAL.—The National Coordi-
nator shall coordinate health information tech-
nology policy and programs of the Department 
with those of other relevant executive branch 
agencies with a goal of avoiding duplication of 
efforts and of helping to ensure that each agency 
undertakes health information technology activi-
ties primarily within the areas of its greatest ex-
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pertise and technical capability and in a man-
ner towards a coordinated national goal. 
‘‘(B) HIT POLICY AND STANDARDS COMMIT-
TEES.—The National Coordinator shall be a 
leading member in the establishment and oper-
ations of the HIT Policy Committee and the 
HIT Standards Committee and shall serve as a 
liaison among those two Committees and the 
Federal Government. 
‘‘(3) STRATEGIC PLAN.— 
‘‘(A) IN GENERAL.—The National Coordi-
nator shall, in consultation with other appro-
priate Federal agencies (including the National 
Institute of Standards and Technology), update 
the Federal Health IT Strategic Plan (developed 
as of June 3, 2008) to include specific objectives, 
milestones, and metrics with respect to the fol-
lowing: 
‘‘(i) The electronic exchange and use of 
health information and the enterprise inte-
gration of such information. 
‘‘(ii) The utilization of an electronic 
health record for each person in the United 
States by 2014. 
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‘‘(iii) The incorporation of privacy 
and security protections for the electronic 
exchange of an individual’s individually 
identifiable health information. 
‘‘(iv) Ensuring security methods to en-
sure appropriate authorization and elec-
tronic authentication of health information 
and specifying technologies or methodologies 
for rendering health information unusable, 
unreadable, or indecipherable. 
‘‘(v) Specifying a framework for co-
ordination and flow of recommendations 
and policies under this subtitle among the 
Secretary, the National Coordinator, the 
HIT Policy Committee, the HIT Standards 
Committee, and other health information 
exchanges and other relevant entities. 
‘‘(vi) Methods to foster the public un-
derstanding of health information tech-
nology. 
‘‘(vii) Strategies to enhance the use of 
health information technology in improving 
the quality of health care, reducing medical 
errors, reducing health disparities, improv-
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ing public health, and improving the con-
tinuity of care among health care settings. 
‘‘(B) COLLABORATION.—The strategic plan 
shall be updated through collaboration of public 
and private entities. 
‘‘(C) MEASURABLE OUTCOME GOALS.—The 
strategic plan update shall include measurable 
outcome goals. 
‘‘(D) PUBLICATION.—The National Coordi-
nator shall republish the strategic plan, includ-
ing all updates. 
‘‘(4) WEBSITE.—The National Coordinator shall 
maintain and frequently update an Internet website 
on which there is posted information on the work, 
schedules, reports, recommendations, and other infor-
mation to ensure transparency in promotion of a na-
tionwide health information technology infrastruc-
ture. 
‘‘(5) CERTIFICATION.— 
‘‘(A) IN GENERAL.—The National Coordi-
nator, in consultation with the Director of the 
National Institute of Standards and Technology, 
shall develop a program (either directly or by 
contract) for the voluntary certification of health 
information technology as being in compliance 
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with applicable certification criteria adopted 
under this subtitle. Such program shall include 
testing of the technology in accordance with sec-
tion 4201(b) of the HITECH Act. 
‘‘(B) 
CERTIFICATION
CRITERIA
DE-
SCRIBED.—In this title, the term ‘certification 
criteria’ means, with respect to standards and 
implementation specifications for health infor-
mation technology, criteria to establish that the 
technology meets such standards and implemen-
tation specifications. 
‘‘(6) REPORTS AND PUBLICATIONS.— 
‘‘(A) REPORT ON ADDITIONAL FUNDING OR 
AUTHORITY NEEDED.—Not later than 12 months 
after the date of the enactment of this title, the 
National Coordinator shall submit to the appro-
priate committees of jurisdiction of the House of 
Representatives and the Senate a report on any 
additional funding or authority the Coordinator 
or the HIT Policy Committee or HIT Standards 
Committee requires to evaluate and develop 
standards, implementation specifications, and 
certification criteria, or to achieve full participa-
tion of stakeholders in the adoption of a nation-
wide health information technology infrastruc-
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ture that allows for the electronic use and ex-
change of health information. 
‘‘(B) IMPLEMENTATION REPORT.—The Na-
tional Coordinator shall prepare a report that 
identifies lessons learned from major public and 
private health care systems in their implementa-
tion of health information technology, including 
information on whether the technologies and 
practices developed by such systems may be ap-
plicable to and usable in whole or in part by 
other health care providers. 
‘‘(C) ASSESSMENT OF IMPACT OF HIT ON 
COMMUNITIES WITH HEALTH DISPARITIES AND 
UNINSURED, UNDERINSURED, AND
MEDICALLY 
UNDERSERVED
AREAS.—The National Coordi-
nator shall assess and publish the impact of 
health information technology in communities 
with health disparities and in areas with a high 
proportion of individuals who are uninsured, 
underinsured, and medically underserved indi-
viduals (including urban and rural areas) and 
identify practices to increase the adoption of 
such technology by health care providers in such 
communities. 
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‘‘(D) EVALUATION OF BENEFITS AND COSTS 
OF THE ELECTRONIC USE AND EXCHANGE OF 
HEALTH
INFORMATION.—The National Coordi-
nator shall evaluate and publish evidence on the 
benefits and costs of the electronic use and ex-
change of health information and assess to whom 
these benefits and costs accrue. 
‘‘(E) RESOURCE REQUIREMENTS.—The Na-
tional Coordinator shall estimate and publish re-
sources required annually to reach the goal of 
utilization of an electronic health record for each 
person in the United States by 2014, including 
the required level of Federal funding, expecta-
tions for regional, State, and private investment, 
and the expected contributions by volunteers to 
activities for the utilization of such records. 
‘‘(7) ASSISTANCE.—The National Coordinator 
may provide financial assistance to consumer advo-
cacy groups and not-for-profit entities that work in 
the public interest for purposes of defraying the cost 
to such groups and entities to participate under, 
whether in whole or in part, the National Technology 
Transfer Act of 1995 (15 U.S.C. 272 note). 
‘‘(8) GOVERNANCE FOR NATIONWIDE HEALTH IN-
FORMATION
NETWORK.—The National Coordinator 
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shall establish a governance mechanism for the na-
tionwide health information network. 
‘‘(d) DETAIL OF FEDERAL EMPLOYEES.— 
‘‘(1) IN GENERAL.—Upon the request of the Na-
tional Coordinator, the head of any Federal agency is 
authorized to detail, with or without reimbursement 
from the Office, any of the personnel of such agency 
to the Office to assist it in carrying out its duties 
under this section. 
‘‘(2) EFFECT OF DETAIL.—Any detail of per-
sonnel under paragraph (1) shall— 
‘‘(A) not interrupt or otherwise affect the 
civil service status or privileges of the Federal 
employee; and 
‘‘(B) be in addition to any other staff of the 
Department employed by the National Coordi-
nator. 
‘‘(3) ACCEPTANCE
OF
DETAILEES.—Notwith-
standing any other provision of law, the Office may 
accept detailed personnel from other Federal agencies 
without regard to whether the agency described under 
paragraph (1) is reimbursed. 
‘‘(e) CHIEF PRIVACY OFFICER OF THE OFFICE OF THE 
NATIONAL COORDINATOR.—Not later than 12 months after 
the date of the enactment of this title, the Secretary shall 
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appoint a Chief Privacy Officer of the Office of the National 
Coordinator, whose duty it shall be to advise the National 
Coordinator on privacy, security, and data stewardship of 
electronic health information and to coordinate with other 
Federal agencies (and similar privacy officers in such agen-
cies), with State and regional efforts, and with foreign 
countries with regard to the privacy, security, and data 
stewardship of electronic individually identifiable health 
information. 
‘‘SEC. 3002. HIT POLICY COMMITTEE. 
‘‘(a) ESTABLISHMENT.—There is established a HIT 
Policy Committee to make policy recommendations to the 
National Coordinator relating to the implementation of a 
nationwide health information technology infrastructure, 
including implementation of the strategic plan described in 
section 3001(c)(3). 
‘‘(b) DUTIES.— 
‘‘(1) RECOMMENDATIONS ON HEALTH INFORMA-
TION TECHNOLOGY INFRASTRUCTURE.—The HIT Pol-
icy Committee shall recommend a policy framework 
for the development and adoption of a nationwide 
health information technology infrastructure that per-
mits the electronic exchange and use of health infor-
mation as is consistent with the strategic plan under 
section 3001(c)(3) and that includes the recommenda-
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tions under paragraph (2). The Committee shall up-
date such recommendations and make new rec-
ommendations as appropriate. 
‘‘(2) SPECIFIC AREAS OF STANDARD DEVELOP-
MENT.— 
‘‘(A) IN GENERAL.—The HIT Policy Com-
mittee shall recommend the areas in which 
standards, implementation specifications, and 
certification criteria are needed for the electronic 
exchange and use of health information for pur-
poses of adoption under section 3004 and shall 
recommend an order of priority for the develop-
ment, harmonization, and recognition of such 
standards, specifications, and certification cri-
teria among the areas so recommended. Such 
standards and implementation specifications 
shall include named standards, architectures, 
and software schemes for the authentication and 
security of individually identifiable health infor-
mation and other information as needed to en-
sure the reproducible development of common so-
lutions across disparate entities. 
‘‘(B) AREAS
REQUIRED
FOR
CONSIDER-
ATION.—For purposes of subparagraph (A), the 
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HIT Policy Committee shall make recommenda-
tions for at least the following areas: 
‘‘(i) Technologies that protect the pri-
vacy of health information and promote se-
curity in a qualified electronic health 
record, including for the segmentation and 
protection from disclosure of specific and 
sensitive individually identifiable health in-
formation with the goal of minimizing the 
reluctance of patients to seek care (or dis-
close information about a condition) be-
cause of privacy concerns, in accordance 
with applicable law, and for the use and 
disclosure of limited data sets of such infor-
mation. 
‘‘(ii) A nationwide health information 
technology infrastructure that allows for the 
electronic use and accurate exchange of 
health information. 
‘‘(iii) The utilization of a certified elec-
tronic health record for each person in the 
United States by 2014. 
‘‘(iv) Technologies that as a part of a 
qualified electronic health record allow for 
an accounting of disclosures made by a cov-
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ered entity (as defined for purposes of regu-
lations promulgated under section 264(c) of 
the Health Insurance Portability and Ac-
countability Act of 1996) for purposes of 
treatment, payment, and health care oper-
ations (as such terms are defined for pur-
poses of such regulations). 
‘‘(v) The use of certified electronic 
health records to improve the quality of 
health care, such as by promoting the co-
ordination of health care and improving 
continuity of health care among health care 
providers, by reducing medical errors, by 
improving population health, by reducing 
health disparities, and by advancing re-
search and education. 
‘‘(C) OTHER AREAS FOR CONSIDERATION.— 
In making recommendations under subpara-
graph (A), the HIT Policy Committee may con-
sider the following additional areas: 
‘‘(i) The appropriate uses of a nation-
wide health information infrastructure, in-
cluding for purposes of— 
‘‘(I) the collection of quality data 
and public reporting; 
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‘‘(II) biosurveillance and public 
health; 
‘‘(III) medical and clinical re-
search; and 
‘‘(IV) drug safety. 
‘‘(ii) Self-service technologies that fa-
cilitate the use and exchange of patient in-
formation and reduce wait times. 
‘‘(iii) Telemedicine technologies, in 
order to reduce travel requirements for pa-
tients in remote areas. 
‘‘(iv) Technologies that facilitate home 
health care and the monitoring of patients 
recuperating at home. 
‘‘(v) Technologies that help reduce med-
ical errors. 
‘‘(vi) Technologies that facilitate the 
continuity of care among health settings. 
‘‘(vii) Technologies that meet the needs 
of diverse populations. 
‘‘(viii) Any other technology that the 
HIT Policy Committee finds to be among 
the technologies with the greatest potential 
to improve the quality and efficiency of 
health care. 
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‘‘(3) FORUM.—The HIT Policy Committee shall 
serve as a forum for broad stakeholder input with spe-
cific expertise in policies relating to the matters de-
scribed in paragraphs (1) and (2). 
‘‘(c) MEMBERSHIP AND OPERATIONS.— 
‘‘(1) IN
GENERAL.—The National Coordinator 
shall provide leadership in the establishment and op-
erations of the HIT Policy Committee. 
‘‘(2) MEMBERSHIP.—The membership of the HIT 
Policy Committee shall at least reflect providers, an-
cillary healthcare workers, consumers, purchasers, 
health plans, technology vendors, researchers, relevant 
Federal agencies, and individuals with technical ex-
pertise on health care quality, privacy and security, 
and on the electronic exchange and use of health in-
formation. 
‘‘(3) CONSIDERATION.—The National Coordi-
nator shall ensure that the relevant recommendations 
and comments from the National Committee on Vital 
and Health Statistics are considered in the develop-
ment of policies. 
‘‘(d) APPLICATION OF FACA.—The Federal Advisory 
Committee Act (5 U.S.C. App.), other than section 14 of 
such Act, shall apply to the HIT Policy Committee. 
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‘‘(e) PUBLICATION.—The Secretary shall provide for 
publication in the Federal Register and the posting on the 
Internet website of the Office of the National Coordinator 
for Health Information Technology of all policy rec-
ommendations made by the HIT Policy Committee under 
this section. 
‘‘SEC. 3003. HIT STANDARDS COMMITTEE. 
‘‘(a) ESTABLISHMENT.—There is established a com-
mittee to be known as the HIT Standards Committee to 
recommend to the National Coordinator standards, imple-
mentation specifications, and certification criteria for the 
electronic exchange and use of health information for pur-
poses of adoption under section 3004, consistent with the 
implementation of the strategic plan described in section 
3001(c)(3) and beginning with the areas listed in section 
3002(b)(2)(B) in accordance with policies developed by the 
HIT Policy Committee. 
‘‘(b) DUTIES.— 
‘‘(1) STANDARDS DEVELOPMENT.— 
‘‘(A) IN
GENERAL.—The HIT Standards 
Committee shall recommend to the National Co-
ordinator standards, implementation specifica-
tions, and certification criteria described in sub-
section (a) that have been developed, harmonized, 
or recognized by the HIT Standards Committee. 
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The HIT Standards Committee shall update 
such recommendations and make new rec-
ommendations as appropriate, including in re-
sponse to a notification sent under section 
3004(b)(2). Such recommendations shall be con-
sistent with the latest recommendations made by 
the HIT Policy Committee. 
‘‘(B) PILOT TESTING OF STANDARDS AND 
IMPLEMENTATION
SPECIFICATIONS.—In the de-
velopment, harmonization, or recognition of 
standards and implementation specifications, the 
HIT Standards Committee shall, as appropriate, 
provide for the testing of such standards and 
specifications by the National Institute for 
Standards and Technology under section 4201 of 
the HITECH Act. 
‘‘(C) CONSISTENCY.—The standards, imple-
mentation specifications, and certification cri-
teria recommended under this subsection shall be 
consistent with the standards for information 
transactions and data elements adopted pursu-
ant to section 1173 of the Social Security Act. 
‘‘(2) FORUM.—The HIT Standards Committee 
shall serve as a forum for the participation of a broad 
range of stakeholders to provide input on the develop-
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ment, harmonization, and recognition of standards, 
implementation specifications, and certification cri-
teria necessary for the development and adoption of 
a nationwide health information technology infra-
structure that allows for the electronic use and ex-
change of health information. 
‘‘(3) SCHEDULE.—Not later than 90 days after 
the date of the enactment of this title, the HIT Stand-
ards Committee shall develop a schedule for the assess-
ment of policy recommendations developed by the 
HIT Policy Committee under section 3002. The HIT 
Standards Committee shall update such schedule an-
nually. The Secretary shall publish such schedule in 
the Federal Register. 
‘‘(4) PUBLIC INPUT.—The HIT Standards Com-
mittee shall conduct open public meetings and develop 
a process to allow for public comment on the schedule 
described in paragraph (3) and recommendations de-
scribed in this subsection. Under such process com-
ments shall be submitted in a timely manner after the 
date of publication of a recommendation under this 
subsection. 
‘‘(c) MEMBERSHIP AND OPERATIONS.— 
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‘‘(1) IN
GENERAL.—The National Coordinator 
shall provide leadership in the establishment and op-
erations of the HIT Standards Committee. 
‘‘(2) MEMBERSHIP.—The membership of the HIT 
Standards Committee shall at least reflect providers, 
ancillary healthcare workers, consumers, purchasers, 
health plans, technology vendors, researchers, relevant 
Federal agencies, and individuals with technical ex-
pertise on health care quality, privacy and security, 
and on the electronic exchange and use of health in-
formation. 
‘‘(3) CONSIDERATION.—The National Coordi-
nator shall ensure that the relevant recommendations 
and comments from the National Committee on Vital 
and Health Statistics are considered in the develop-
ment of standards. 
‘‘(4) ASSISTANCE.—For the purposes of carrying 
out this section, the Secretary may provide or ensure 
that financial assistance is provided by the HIT 
Standards Committee to defray in whole or in part 
any membership fees or dues charged by such Com-
mittee to those consumer advocacy groups and not for 
profit entities that work in the public interest as a 
part of their mission. 
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‘‘(d) APPLICATION OF FACA.—The Federal Advisory 
Committee Act (5 U.S.C. App.), other than section 14, shall 
apply to the HIT Standards Committee. 
‘‘(e) PUBLICATION.—The Secretary shall provide for 
publication in the Federal Register and the posting on the 
Internet website of the Office of the National Coordinator 
for Health Information Technology of all recommendations 
made by the HIT Standards Committee under this section. 
‘‘SEC. 3004. PROCESS FOR ADOPTION OF ENDORSED REC-
OMMENDATIONS; ADOPTION OF INITIAL SET 
OF STANDARDS, IMPLEMENTATION SPECI-
FICATIONS, AND CERTIFICATION CRITERIA. 
‘‘(a) PROCESS FOR ADOPTION OF ENDORSED REC-
OMMENDATIONS.— 
‘‘(1) REVIEW OF ENDORSED STANDARDS, IMPLE-
MENTATION SPECIFICATIONS, AND CERTIFICATION CRI-
TERIA.—Not later than 90 days after the date of re-
ceipt of standards, implementation specifications, or 
certification criteria endorsed under section 3001(c), 
the Secretary, in consultation with representatives of 
other relevant Federal agencies, shall jointly review 
such standards, implementation specifications, or cer-
tification criteria and shall determine whether or not 
to propose adoption of such standards, implementa-
tion specifications, or certification criteria. 
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‘‘(2) DETERMINATION TO ADOPT STANDARDS, IM-
PLEMENTATION SPECIFICATIONS, AND CERTIFICATION 
CRITERIA.—If the Secretary determines— 
‘‘(A) to propose adoption of any grouping of 
such standards, implementation specifications, 
or certification criteria, the Secretary shall, by 
regulation, determine whether or not to adopt 
such grouping of standards, implementation 
specifications, or certification criteria; or 
‘‘(B) not to propose adoption of any group-
ing of standards, implementation specifications, 
or certification criteria, the Secretary shall no-
tify the National Coordinator and the HIT 
Standards Committee in writing of such deter-
mination and the reasons for not proposing the 
adoption of such recommendation. 
‘‘(3) PUBLICATION.—The Secretary shall provide 
for publication in the Federal Register of all deter-
minations made by the Secretary under paragraph 
(1). 
‘‘(b) ADOPTION OF INITIAL SET OF STANDARDS, IM-
PLEMENTATION SPECIFICATIONS, AND CERTIFICATION CRI-
TERIA.— 
‘‘(1) IN GENERAL.—Not later than December 31, 
2009, the Secretary shall, through the rulemaking 
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process described in section 3003, adopt an initial set 
of standards, implementation specifications, and cer-
tification criteria for the areas required for consider-
ation under section 3002(b)(2)(B). 
‘‘(2) APPLICATION OF CURRENT STANDARDS, IM-
PLEMENTATION SPECIFICATIONS, AND CERTIFICATION 
CRITERIA.—The standards, implementation specifica-
tions, and certification criteria adopted before the 
date of the enactment of this title through the process 
existing through the Office of the National Coordi-
nator for Health Information Technology may be ap-
plied towards meeting the requirement of paragraph 
(1). 
‘‘SEC. 3005. APPLICATION AND USE OF ADOPTED STAND-
ARDS 
AND 
IMPLEMENTATION 
SPECIFICA-
TIONS BY FEDERAL AGENCIES. 
‘‘For requirements relating to the application and use 
by Federal agencies of the standards and implementation 
specifications adopted under section 3004, see section 4111 
of the HITECH Act. 
‘‘SEC. 3006. VOLUNTARY APPLICATION AND USE OF ADOPT-
ED STANDARDS AND IMPLEMENTATION SPEC-
IFICATIONS BY PRIVATE ENTITIES. 
‘‘(a) IN GENERAL.—Except as provided under section 
4112 of the HITECH Act, any standard or implementation 
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specification adopted under section 3004 shall be voluntary 
with respect to private entities. 
‘‘(b) RULE OF CONSTRUCTION.—Nothing in this sub-
title shall be construed to require that a private entity that 
enters into a contract with the Federal Government apply 
or use the standards and implementation specifications 
adopted under section 3004 with respect to activities not 
related to the contract. 
‘‘SEC. 3007. FEDERAL HEALTH INFORMATION TECHNOLOGY. 
‘‘(a) IN GENERAL.—The National Coordinator shall 
support the development, routine updating, and provision 
of qualified EHR technology (as defined in section 3000) 
consistent with subsections (b) and (c) unless the Secretary 
determines that the needs and demands of providers are 
being substantially and adequately met through the market-
place. 
‘‘(b) CERTIFICATION.—In making such EHR tech-
nology publicly available, the National Coordinator shall 
ensure that the qualified EHR technology described in sub-
section (a) is certified under the program developed under 
section 3001(c)(3) to be in compliance with applicable 
standards adopted under section 3003(a). 
‘‘(c) AUTHORIZATION TO CHARGE A NOMINAL FEE.— 
The National Coordinator may impose a nominal fee for 
the adoption by a health care provider of the health infor-
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mation technology system developed or approved under sub-
section (a) and (b). Such fee shall take into account the 
financial circumstances of smaller providers, low income 
providers, and providers located in rural or other medically 
underserved areas. 
‘‘(d) RULE OF CONSTRUCTION.—Nothing in this sec-
tion shall be construed to require that a private or govern-
ment entity adopt or use the technology provided under this 
section. 
‘‘SEC. 3008. TRANSITIONS. 
‘‘(a) ONCHIT.—To the extent consistent with section 
3001, all functions, personnel, assets, liabilities, and ad-
ministrative actions applicable to the National Coordinator 
for Health Information Technology appointed under Execu-
tive Order 13335 or the Office of such National Coordinator 
on the date before the date of the enactment of this title 
shall be transferred to the National Coordinator appointed 
under section 3001(a) and the Office of such National Coor-
dinator as of the date of the enactment of this title. 
‘‘(b) AHIC.— 
‘‘(1) To the extent consistent with sections 3002 
and 3003, all functions, personnel, assets, and liabil-
ities applicable to the AHIC Successor, Inc. doing 
business as the National eHealth Collaborative as of 
the day before the date of the enactment of this title 
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shall be transferred to the HIT Policy Committee or 
the HIT Standards Committee, established under sec-
tion 3002(a) or 3003(a), as appropriate, as of the 
date of the enactment of this title. 
‘‘(2) In carrying out section 3003(b)(1)(A), until 
recommendations are made by the HIT Policy Com-
mittee, recommendations of the HIT Standards Com-
mittee shall be consistent with the most recent rec-
ommendations made by such AHIC Successor, Inc. 
‘‘(c) RULES OF CONSTRUCTION.— 
‘‘(1) ONCHIT.—Nothing in section 3001 or sub-
section (a) shall be construed as requiring the cre-
ation of a new entity to the extent that the Office of 
the National Coordinator for Health Information 
Technology established pursuant to Executive Order 
13335 is consistent with the provisions of section 
3001. 
‘‘(2) AHIC.—Nothing in sections 3002 or 3003 
or subsection (b) shall be construed as prohibiting the 
AHIC Successor, Inc. doing business as the National 
eHealth Collaborative from modifying its charter, du-
ties, membership, and any other structure or function 
required to be consistent with section 3002 and 3003 
in a manner that would permit the Secretary to 
choose to recognize such AHIC Successor, Inc. as the 
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HIT Policy Committee or the HIT Standards Com-
mittee. 
‘‘SEC. 3009. RELATION TO HIPAA PRIVACY AND SECURITY 
LAW. 
‘‘(a) IN GENERAL.—With respect to the relation of this 
title to HIPAA privacy and security law: 
‘‘(1) This title may not be construed as having 
any effect on the authorities of the Secretary under 
HIPAA privacy and security law. 
‘‘(2) The purposes of this title include ensuring 
that the health information technology standards and 
implementation specifications adopted under section 
3004 take into account the requirements of HIPAA 
privacy and security law. 
‘‘(b) DEFINITION.—For purposes of this section, the 
term ‘HIPAA privacy and security law’ means— 
‘‘(1) the provisions of part C of title XI of the 
Social Security Act, section 264 of the Health Insur-
ance Portability and Accountability Act of 1996, and 
subtitle D of title IV of the HITECH Act; and 
‘‘(2) regulations under such provisions. 
‘‘SEC. 3010. AUTHORIZATION FOR APPROPRIATIONS. 
‘‘There is authorized to be appropriated to the Office 
of the National Coordinator for Health Information Tech-
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nology to carry out this subtitle $250,000,000 for fiscal year 
2009.’’. 
SEC. 4102. TECHNICAL AMENDMENT. 
Section 1171(5) of the Social Security Act (42 U.S.C. 
1320d) is amended by striking ‘‘or C’’ and inserting ‘‘C, 
or D’’. 
SEC. 4103. AMERICAN TECHNOLOGY REQUIRED. 
(a) REQUIREMENT.—Any funds made available to 
carry out this title and the amendments made by this title 
(including through grants, contracts, loans, payments 
under title XVIII or XIX of the Social Security Act, or other 
assistance) may be used to purchase health information 
technology only if such technology is manufactured, includ-
ing the engineering and programming of any software, in 
the United States substantially all from articles, materials, 
or supplies mined, produced, or manufactured, as the case 
may be, in the United States. 
(b) DEFINITION.—In this section, the term ‘‘health in-
formation technology’’ has the meaning given to that term 
in section 3000 of the Public Health Service Act, as added 
by section 4101. 
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PART 2—APPLICATION AND USE OF ADOPTED 
HEALTH 
INFORMATION 
TECHNOLOGY 
STANDARDS; REPORTS 
SEC. 4111. COORDINATION OF FEDERAL ACTIVITIES WITH 
ADOPTED 
STANDARDS 
AND 
IMPLEMENTA-
TION SPECIFICATIONS. 
(a) SPENDING
ON
HEALTH
INFORMATION
TECH-
NOLOGY SYSTEMS.—As each agency (as defined in the Exec-
utive Order issued on August 22, 2006, relating to pro-
moting quality and efficient health care in Federal govern-
ment administered or sponsored health care programs) im-
plements, acquires, or upgrades health information tech-
nology systems used for the direct exchange of individually 
identifiable health information between agencies and with 
non-Federal entities, it shall utilize, where available, health 
information technology systems and products that meet 
standards and implementation specifications adopted under 
section 3004 of the Public Health Service Act, as added by 
section 4101. 
(b) FEDERAL
INFORMATION
COLLECTION
ACTIVI-
TIES.—With respect to a standard or implementation speci-
fication adopted under section 3004 of the Public Health 
Service Act, as added by section 4101, the President shall 
take measures to ensure that Federal activities involving 
the broad collection and submission of health information 
are consistent with such standard or implementation speci-
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fication, respectively, within three years after the date of 
such adoption. 
(c) APPLICATION OF DEFINITIONS.—The definitions 
contained in section 3000 of the Public Health Service Act, 
as added by section 4101, shall apply for purposes of this 
part. 
SEC. 4112. APPLICATION TO PRIVATE ENTITIES. 
Each agency (as defined in such Executive Order 
issued on August 22, 2006, relating to promoting quality 
and efficient health care in Federal government adminis-
tered or sponsored health care programs) shall require in 
contracts or agreements with health care providers, health 
plans, or health insurance issuers that as each provider, 
plan, or issuer implements, acquires, or upgrades health in-
formation technology systems, it shall utilize, where avail-
able, health information technology systems and products 
that meet standards and implementation specifications 
adopted under section 3004 of the Public Health Service 
Act, as added by section 4101. 
SEC. 4113. STUDY AND REPORTS. 
(a) REPORT ON ADOPTION OF NATIONWIDE SYSTEM.— 
Not later than 2 years after the date of the enactment of 
this Act and annually thereafter, the Secretary of Health 
and Human Services shall submit to the appropriate com-
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mittees of jurisdiction of the House of Representatives and 
the Senate a report that— 
(1) describes the specific actions that have been 
taken by the Federal Government and private entities 
to facilitate the adoption of a nationwide system for 
the electronic use and exchange of health information; 
(2) describes barriers to the adoption of such a 
nationwide system; and 
(3) contains recommendations to achieve full im-
plementation of such a nationwide system. 
(b) REIMBURSEMENT INCENTIVE STUDY
AND RE-
PORT.— 
(1) STUDY.—The Secretary of Health and 
Human Services shall carry out, or contract with a 
private entity to carry out, a study that examines 
methods to create efficient reimbursement incentives 
for improving health care quality in Federally quali-
fied health centers, rural health clinics, and free clin-
ics. 
(2) REPORT.—Not later than 2 years after the 
date of the enactment of this Act, the Secretary of 
Health and Human Services shall submit to the ap-
propriate committees of jurisdiction of the House of 
Representatives and the Senate a report on the study 
carried out under paragraph (1). 
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(c) AGING SERVICES TECHNOLOGY STUDY AND RE-
PORT.— 
(1) IN GENERAL.—The Secretary of Health and 
Human Services shall carry out, or contract with a 
private entity to carry out, a study of matters relat-
ing to the potential use of new aging services tech-
nology to assist seniors, individuals with disabilities, 
and their caregivers throughout the aging process. 
(2) MATTERS TO BE STUDIED.—The study under 
paragraph (1) shall include— 
(A) an evaluation of— 
(i) methods for identifying current, 
emerging, and future health technology that 
can be used to meet the needs of seniors and 
individuals with disabilities and their care-
givers across all aging services settings, as 
specified by the Secretary; 
(ii) methods for fostering scientific in-
novation with respect to aging services tech-
nology within the business and academic 
communities; and 
(iii) developments in aging services 
technology in other countries that may be 
applied in the United States; and 
(B) identification of— 
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(i) barriers to innovation in aging 
services technology and devising strategies 
for removing such barriers; and 
(ii) barriers to the adoption of aging 
services technology by health care providers 
and consumers and devising strategies to re-
moving such barriers. 
(3) REPORT.—Not later than 24 months after the 
date of the enactment of this Act, the Secretary shall 
submit to the appropriate committees of jurisdiction 
of the House of Representatives and of the Senate a 
report on the study carried out under paragraph (1). 
(4) DEFINITIONS.—For purposes of this sub-
section: 
(A) AGING
SERVICES
TECHNOLOGY.—The 
term ‘‘aging services technology’’ means health 
technology that meets the health care needs of 
seniors, individuals with disabilities, and the 
caregivers of such seniors and individuals. 
(B) SENIOR.—The term ‘‘senior’’ has such 
meaning as specified by the Secretary. 
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Subtitle B—Testing of Health 
Information Technology 
SEC. 4201. NATIONAL INSTITUTE FOR STANDARDS AND 
TECHNOLOGY TESTING. 
(a) PILOT TESTING OF STANDARDS AND IMPLEMENTA-
TION SPECIFICATIONS.—In coordination with the HIT 
Standards Committee established under section 3003 of the 
Public Health Service Act, as added by section 4101, with 
respect to the development of standards and implementation 
specifications under such section, the Director of the Na-
tional Institute for Standards and Technology shall test 
such standards and implementation specifications, as ap-
propriate, in order to assure the efficient implementation 
and use of such standards and implementation specifica-
tions. 
(b) VOLUNTARY TESTING PROGRAM.—In coordination 
with the HIT Standards Committee established under sec-
tion 3003 of the Public Health Service Act, as added by 
section 4101, with respect to the development of standards 
and implementation specifications under such section, the 
Director of the National Institute of Standards and Tech-
nology shall support the establishment of a conformance 
testing infrastructure, including the development of tech-
nical test beds. The development of this conformance testing 
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infrastructure may include a program to accredit inde-
pendent, non-Federal laboratories to perform testing. 
SEC. 4202. RESEARCH AND DEVELOPMENT PROGRAMS. 
(a) HEALTH CARE INFORMATION ENTERPRISE INTE-
GRATION RESEARCH CENTERS.— 
(1) IN GENERAL.—The Director of the National 
Institute of Standards and Technology, in consulta-
tion with the Director of the National Science Foun-
dation and other appropriate Federal agencies, shall 
establish a program of assistance to institutions of 
higher education (or consortia thereof which may in-
clude nonprofit entities and Federal Government lab-
oratories) to establish multidisciplinary Centers for 
Health Care Information Enterprise Integration. 
(2) REVIEW; COMPETITION.—Grants shall be 
awarded under this subsection on a merit-reviewed, 
competitive basis. 
(3) PURPOSE.—The purposes of the Centers de-
scribed in paragraph (1) shall be— 
(A) to generate innovative approaches to 
health care information enterprise integration by 
conducting cutting-edge, multidisciplinary re-
search on the systems challenges to health care 
delivery; and 
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(B) the development and use of health infor-
mation technologies and other complementary 
fields. 
(4) RESEARCH AREAS.—Research areas may in-
clude— 
(A) interfaces between human information 
and communications technology systems; 
(B) voice-recognition systems; 
(C) software that improves interoperability 
and connectivity among health information sys-
tems; 
(D) software dependability in systems crit-
ical to health care delivery; 
(E) measurement of the impact of informa-
tion technologies on the quality and productivity 
of health care; 
(F) health information enterprise manage-
ment; 
(G) health information technology security 
and integrity; and 
(H) relevant health information technology 
to reduce medical errors. 
(5) APPLICATIONS.—An institution of higher 
education (or a consortium thereof) seeking funding 
under this subsection shall submit an application to 
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100 
the Director of the National Institute of Standards 
and Technology at such time, in such manner, and 
containing such information as the Director may re-
quire. The application shall include, at a minimum, 
a description of— 
(A) the research projects that will be under-
taken by the Center established pursuant to as-
sistance under paragraph (1) and the respective 
contributions of the participating entities; 
(B) how the Center will promote active col-
laboration among scientists and engineers from 
different disciplines, such as information tech-
nology, biologic sciences, management, social 
sciences, and other appropriate disciplines; 
(C) technology transfer activities to dem-
onstrate and diffuse the research results, tech-
nologies, and knowledge; and 
(D) how the Center will contribute to the 
education and training of researchers and other 
professionals in fields relevant to health informa-
tion enterprise integration. 
(b) NATIONAL INFORMATION TECHNOLOGY RESEARCH 
AND DEVELOPMENT PROGRAM.—The National High-Per-
formance Computing Program established by section 101 of 
the High-Performance Computing Act of 1991 (15 U.S.C. 
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101 
5511) shall coordinate Federal research and development 
programs related to the development and deployment of 
health information technology, including activities related 
to— 
(1) computer infrastructure; 
(2) data security; 
(3) development of large-scale, distributed, reli-
able computing systems; 
(4) wired, wireless, and hybrid high-speed net-
working; 
(5) development of software and software-inten-
sive systems; 
(6) human-computer interaction and informa-
tion management technologies; and 
(7) the social and economic implications of in-
formation technology. 
Subtitle C—Incentives for the Use of 
Health Information Technology 
PART I—GRANTS AND LOANS FUNDING 
SEC. 4301. GRANT, LOAN, AND DEMONSTRATION PRO-
GRAMS. 
Title XXX of the Public Health Service Act, as added 
by section 4101, is amended by adding at the end the fol-
lowing new subtitle: 
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102 
‘‘Subtitle B—Incentives for the Use 
of Health Information Technology 
‘‘SEC. 3011. IMMEDIATE FUNDING TO STRENGTHEN THE 
HEALTH INFORMATION TECHNOLOGY INFRA-
STRUCTURE. 
‘‘(a) IN
GENERAL.—The Secretary shall, using 
amounts appropriated under section 3018, invest in the in-
frastructure necessary to allow for and promote the elec-
tronic exchange and use of health information for each indi-
vidual in the United States consistent with the goals out-
lined in the strategic plan developed by the National Coor-
dinator (and as available) under section 3001. To the great-
est extent practicable, the Secretary shall ensure that any 
funds so appropriated shall be used for the acquisition of 
health information technology that meets standards and 
certification criteria adopted before the date of the enact-
ment of this title until such date as the standards are adopt-
ed under section 3004. The Secretary shall invest funds 
through the different agencies with expertise in such goals, 
such as the Office of the National Coordinator for Health 
Information Technology, the Health Resources and Services 
Administration, the Agency for Healthcare Research and 
Quality, the Centers of Medicare & Medicaid Services, the 
Centers for Disease Control and Prevention, and the Indian 
Health Service to support the following: 
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103 
‘‘(1) Health information technology architecture 
that will support the nationwide electronic exchange 
and use of health information in a secure, private, 
and accurate manner, including connecting health in-
formation exchanges, and which may include updat-
ing and implementing the infrastructure necessary 
within different agencies of the Department of Health 
and Human Services to support the electronic use 
and exchange of health information. 
‘‘(2) Development and adoption of appropriate 
certified electronic health records for categories of pro-
viders, as defined in section 3000, not eligible for sup-
port under title XVIII or XIX of the Social Security 
Act for the adoption of such records. 
‘‘(3) Training on and dissemination of informa-
tion on best practices to integrate health information 
technology, including electronic health records, into a 
provider’s delivery of care, consistent with best prac-
tices learned from the Health Information Technology 
Research Center developed under section 3012(b), in-
cluding community health centers receiving assistance 
under section 330, covered entities under section 
340B, and providers participating in one or more of 
the programs under titles XVIII, XIX, and XXI of the 
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104 
Social Security Act (relating to Medicare, Medicaid, 
and the State Children’s Health Insurance Program). 
‘‘(4) Infrastructure and tools for the promotion 
of telemedicine, including coordination among Fed-
eral agencies in the promotion of telemedicine. 
‘‘(5) Promotion of the interoperability of clinical 
data repositories or registries. 
‘‘(6) Promotion of technologies and best practices 
that enhance the protection of health information by 
all holders of individually identifiable health informa-
tion. 
‘‘(7) Improvement and expansion of the use of 
health information technology by public health de-
partments. 
‘‘(8) Provision of $300 million to support re-
gional or sub-national efforts towards health informa-
tion exchange. 
‘‘(b) COORDINATION.—The Secretary shall ensure 
funds under this section are used in a coordinated manner 
with other health information promotion activities. 
‘‘(c) ADDITIONAL USE OF FUNDS.—In addition to 
using funds as provided in subsection (a), the Secretary 
may use amounts appropriated under section 3018 to carry 
out health information technology activities that are pro-
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vided for under laws in effect on the date of the enactment 
of this title. 
‘‘SEC. 3012. HEALTH INFORMATION TECHNOLOGY IMPLE-
MENTATION ASSISTANCE. 
‘‘(a) HEALTH INFORMATION TECHNOLOGY EXTENSION 
PROGRAM.—To assist health care providers to adopt, imple-
ment, and effectively use certified EHR technology that al-
lows for the electronic exchange and use of health informa-
tion, the Secretary, acting through the Office of the National 
Coordinator, shall establish a health information technology 
extension program to provide health information technology 
assistance services to be carried out through the Department 
of Health and Human Services. The National Coordinator 
shall consult with other Federal agencies with demonstrated 
experience and expertise in information technology services, 
such as the National Institute of Standards and Tech-
nology, in developing and implementing this program. 
‘‘(b) HEALTH INFORMATION TECHNOLOGY RESEARCH 
CENTER.— 
‘‘(1) IN GENERAL.—The Secretary shall create a 
Health Information Technology Research Center (in 
this section referred to as the ‘Center’) to provide tech-
nical assistance and develop or recognize best prac-
tices to support and accelerate efforts to adopt, imple-
ment, and effectively utilize health information tech-
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106 
nology that allows for the electronic exchange and use 
of information in compliance with standards, imple-
mentation specifications, and certification criteria 
adopted under section 3004. 
‘‘(2) INPUT.—The Center shall incorporate input 
from— 
‘‘(A) other Federal agencies with dem-
onstrated experience and expertise in informa-
tion technology services such as the National In-
stitute of Standards and Technology; 
‘‘(B) users of health information technology, 
such as providers and their support and clerical 
staff and others involved in the care and care co-
ordination of patients, from the health care and 
health information technology industry; and 
‘‘(C) others as appropriate. 
‘‘(3) PURPOSES.—The purposes of the Center are 
to— 
‘‘(A) provide a forum for the exchange of 
knowledge and experience; 
‘‘(B) accelerate the transfer of lessons 
learned from existing public and private sector 
initiatives, including those currently receiving 
Federal financial support; 
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107 
‘‘(C) assemble, analyze, and widely dissemi-
nate evidence and experience related to the adop-
tion, implementation, and effective use of health 
information technology that allows for the elec-
tronic exchange and use of information includ-
ing through the regional centers described in sub-
section (c); 
‘‘(D) provide technical assistance for the es-
tablishment and evaluation of regional and local 
health information networks to facilitate the elec-
tronic exchange of information across health care 
settings and improve the quality of health care; 
‘‘(E) provide technical assistance for the de-
velopment and dissemination of solutions to bar-
riers to the exchange of electronic health informa-
tion; and 
‘‘(F) learn about effective strategies to adopt 
and utilize health information technology in 
medically underserved communities. 
‘‘(c) HEALTH INFORMATION TECHNOLOGY REGIONAL 
EXTENSION CENTERS.— 
‘‘(1) IN GENERAL.—The Secretary shall provide 
assistance for the creation and support of regional 
centers (in this subsection referred to as ‘regional cen-
ters’) to provide technical assistance and disseminate 
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best practices and other information learned from the 
Center to support and accelerate efforts to adopt, im-
plement, and effectively utilize health information 
technology that allows for the electronic exchange and 
use of information in compliance with standards, im-
plementation specifications, and certification criteria 
adopted under section 3004. Activities conducted 
under this subsection shall be consistent with the stra-
tegic plan developed by the National Coordinator, 
(and, as available) under section 3001. 
‘‘(2) AFFILIATION.—Regional centers shall be af-
filiated with any United States-based nonprofit insti-
tution or organization, or group thereof, that applies 
and is awarded financial assistance under this sec-
tion. Individual awards shall be decided on the basis 
of merit. 
‘‘(3) OBJECTIVE.—The objective of the regional 
centers is to enhance and promote the adoption of 
health information technology through— 
‘‘(A) assistance with the implementation, ef-
fective use, upgrading, and ongoing maintenance 
of health information technology, including elec-
tronic health records, to healthcare providers na-
tionwide; 
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109 
‘‘(B) broad participation of individuals 
from industry, universities, and State govern-
ments; 
‘‘(C) active dissemination of best practices 
and research on the implementation, effective 
use, upgrading, and ongoing maintenance of 
health information technology, including elec-
tronic health records, to health care providers in 
order to improve the quality of healthcare and 
protect the privacy and security of health infor-
mation; 
‘‘(D) participation, to the extent prac-
ticable, in health information exchanges; and 
‘‘(E) utilization, when appropriate, of the 
expertise and capability that exists in Federal 
agencies other than the Department; and 
‘‘(F) integration of health information tech-
nology, including electronic health records, into 
the initial and ongoing training of health profes-
sionals and others in the healthcare industry 
that would be instrumental to improving the 
quality of healthcare through the smooth and ac-
curate electronic use and exchange of health in-
formation. 
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110 
‘‘(4) REGIONAL
ASSISTANCE.—Each regional 
center shall aim to provide assistance and education 
to all providers in a region, but shall prioritize any 
direct assistance first to the following: 
‘‘(A) Public or not-for-profit hospitals or 
critical access hospitals. 
‘‘(B) Federally qualified health centers (as 
defined in section 1861(aa)(4) of the Social Se-
curity Act). 
‘‘(C) Entities that are located in rural and 
other areas that serve uninsured, underinsured, 
and medically underserved individuals (regard-
less of whether such area is urban or rural). 
‘‘(D) Individual or small group practices 
(or a consortium thereof) that are primarily fo-
cused on primary care. 
‘‘(5) FINANCIAL SUPPORT.—The Secretary may 
provide financial support to any regional center cre-
ated under this subsection for a period not to exceed 
four years. The Secretary may not provide more than 
50 percent of the capital and annual operating and 
maintenance funds required to create and maintain 
such a center, except in an instance of national eco-
nomic conditions which would render this cost-share 
requirement detrimental to the program and upon no-
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111 
tification to Congress as to the justification to waive 
the cost-share requirement. 
‘‘(6) NOTICE
OF
PROGRAM
DESCRIPTION
AND 
AVAILABILITY OF FUNDS.—The Secretary shall pub-
lish in the Federal Register, not later than 90 days 
after the date of the enactment of this title, a draft 
description of the program for establishing regional 
centers under this subsection. Such description shall 
include the following: 
‘‘(A) A detailed explanation of the program 
and the programs goals. 
‘‘(B) Procedures to be followed by the appli-
cants. 
‘‘(C) Criteria for determining qualified ap-
plicants. 
‘‘(D) Maximum support levels expected to be 
available to centers under the program. 
‘‘(7) APPLICATION REVIEW.—The Secretary shall 
subject each application under this subsection to 
merit review. In making a decision whether to ap-
prove such application and provide financial support, 
the Secretary shall consider at a minimum the merits 
of the application, including those portions of the ap-
plication regarding— 
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‘‘(A) the ability of the applicant to provide 
assistance under this subsection and utilization 
of health information technology appropriate to 
the needs of particular categories of health care 
providers; 
‘‘(B) the types of service to be provided to 
health care providers; 
‘‘(C) geographical diversity and extent of 
service area; and 
‘‘(D) the percentage of funding and amount 
of in-kind commitment from other sources. 
‘‘(8) BIENNIAL EVALUATION.—Each regional cen-
ter which receives financial assistance under this sub-
section shall be evaluated biennially by an evaluation 
panel appointed by the Secretary. Each evaluation 
panel shall be composed of private experts, none of 
whom shall be connected with the center involved, and 
of Federal officials. Each evaluation panel shall meas-
ure the involved center’s performance against the ob-
jective specified in paragraph (3). The Secretary shall 
not continue to provide funding to a regional center 
unless its evaluation is overall positive. 
‘‘(9) CONTINUING
SUPPORT.—After the second 
year of assistance under this subsection, a regional 
center may receive additional support under this sub-
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section if it has received positive evaluations and a 
finding by the Secretary that continuation of Federal 
funding to the center was in the best interest of provi-
sion of health information technology extension serv-
ices. 
‘‘SEC. 3013. STATE GRANTS TO PROMOTE HEALTH INFORMA-
TION TECHNOLOGY. 
‘‘(a) IN GENERAL.—The Secretary, acting through the 
National Coordinator, shall establish a program in accord-
ance with this section to facilitate and expand the electronic 
movement and use of health information among organiza-
tions according to nationally recognized standards. 
‘‘(b) PLANNING GRANTS.—The Secretary may award 
a grant to a State or qualified State-designated entity (as 
described in subsection (f)) that submits an application to 
the Secretary at such time, in such manner, and containing 
such information as the Secretary may specify, for the pur-
pose of planning activities described in subsection (d). 
‘‘(c) IMPLEMENTATION GRANTS.—The Secretary may 
award a grant to a State or qualified State designated enti-
ty that— 
‘‘(1) has submitted, and the Secretary has ap-
proved, a plan described in subsection (e) (regardless 
of whether such plan was prepared using amounts 
awarded under subsection (b); and 
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‘‘(2) submits an application at such time, in 
such manner, and containing such information as the 
Secretary may specify. 
‘‘(d) USE
OF FUNDS.—Amounts received under a 
grant under subsection (c) shall be used to conduct activities 
to facilitate and expand the electronic movement and use 
of health information among organizations according to na-
tionally recognized standards through activities that in-
clude— 
‘‘(1) enhancing broad and varied participation 
in the authorized and secure nationwide electronic use 
and exchange of health information; 
‘‘(2) identifying State or local resources available 
towards a nationwide effort to promote health infor-
mation technology; 
‘‘(3) complementing other Federal grants, pro-
grams, and efforts towards the promotion of health 
information technology; 
‘‘(4) providing technical assistance for the devel-
opment and dissemination of solutions to barriers to 
the exchange of electronic health information; 
‘‘(5) promoting effective strategies to adopt and 
utilize health information technology in medically un-
derserved communities; 
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‘‘(6) assisting patients in utilizing health infor-
mation technology; 
‘‘(7) encouraging clinicians to work with Health 
Information Technology Regional Extension Centers 
as described in section 3012, to the extent they are 
available and valuable; 
‘‘(8) supporting public health agencies’ author-
ized use of and access to electronic health information; 
‘‘(9) promoting the use of electronic health 
records for quality improvement including through 
quality measures reporting; and 
‘‘(10) such other activities as the Secretary may 
specify. 
‘‘(e) PLAN.— 
‘‘(1) IN GENERAL.—A plan described in this sub-
section is a plan that describes the activities to be 
carried out by a State or by the qualified State-des-
ignated entity within such State to facilitate and ex-
pand the electronic movement and use of health infor-
mation among organizations according to nationally 
recognized standards and implementation specifica-
tions. 
‘‘(2) REQUIRED ELEMENTS.—A plan described 
in paragraph (1) shall— 
‘‘(A) be pursued in the public interest; 
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‘‘(B) be consistent with the strategic plan 
developed by the National Coordinator, (and, as 
available) under section 3001; 
‘‘(C) include a description of the ways the 
State or qualified State-designated entity will 
carry out the activities described in subsection 
(b); and 
‘‘(D) contain such elements as the Secretary 
may require. 
‘‘(f) QUALIFIED STATE-DESIGNATED ENTITY.—For 
purposes of this section, to be a qualified State-designated 
entity, with respect to a State, an entity shall— 
‘‘(1) be designated by the State as eligible to re-
ceive awards under this section; 
‘‘(2) be a not-for-profit entity with broad stake-
holder representation on its governing board; 
‘‘(3) demonstrate that one of its principal goals 
is to use information technology to improve health 
care quality and efficiency through the authorized 
and secure electronic exchange and use of health in-
formation; 
‘‘(4) adopt nondiscrimination and conflict of in-
terest policies that demonstrate a commitment to 
open, fair, and nondiscriminatory participation by 
stakeholders; and 
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‘‘(5) conform to such other requirements as the 
Secretary may establish. 
‘‘(g) REQUIRED CONSULTATION.—In carrying out ac-
tivities described in subsections (b) and (c), a State or 
qualified State-designated entity shall consult with and 
consider the recommendations of— 
‘‘(1) health care providers (including providers 
that provide services to low income and underserved 
populations); 
‘‘(2) health plans; 
‘‘(3) patient or consumer organizations that rep-
resent the population to be served; 
‘‘(4) health information technology vendors; 
‘‘(5) health care purchasers and employers; 
‘‘(6) public health agencies; 
‘‘(7) health professions schools, universities and 
colleges; 
‘‘(8) clinical researchers; 
‘‘(9) other users of health information technology 
such as the support and clerical staff of providers and 
others involved in the care and care coordination of 
patients; and 
‘‘(10) such other entities, as may be determined 
appropriate by the Secretary. 
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‘‘(1) To award loans that comply with the fol-
lowing: 
‘‘(A) The interest rate for each loan shall 
not exceed the market interest rate. 
‘‘(B) The principal and interest payments 
on each loan shall commence not later than 1 
year after the date the loan was awarded, and 
each loan shall be fully amortized not later than 
10 years after the date of the loan. 
‘‘(C) The Loan Fund shall be credited with 
all payments of principal and interest on each 
loan awarded from the Loan Fund. 
‘‘(2) To guarantee, or purchase insurance for, a 
local obligation (all of the proceeds of which finance 
a project eligible for assistance under this subsection) 
if the guarantee or purchase would improve credit 
market access or reduce the interest rate applicable to 
the obligation involved. 
‘‘(3) As a source of revenue or security for the 
payment of principal and interest on revenue or gen-
eral obligation bonds issued by the eligible entity if 
the proceeds of the sale of the bonds will be deposited 
into the Loan Fund. 
‘‘(4) To earn interest on the amounts deposited 
into the Loan Fund. 
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