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‘‘(5) POSTING ON WEBSITE.—The Secretary shall 
post on the Internet website of the Centers for Medi-
care & Medicaid Services, in an easily understand-
able format— 
‘‘(A) a list of the names, business addresses, 
and business phone numbers of each qualifying 
MA organization receiving an incentive payment 
under this subsection for eligible hospitals de-
scribed in paragraph (2); and 
‘‘(B) a list of the names of the eligible hos-
pitals for which such incentive payment is 
based.’’. 
(d) CONFORMING AMENDMENTS.— 
(1) Section 1814(b) of the Social Security Act 
(42 U.S.C. 1395f(b)) is amended— 
(A) in paragraph (3), in the matter pre-
ceding subparagraph (A), by inserting ‘‘, subject 
to section 1886(d)(3)(B)(ix)(III),’’ after ‘‘then’’; 
and 
(B) by adding at the end the following: 
‘‘For purposes of applying paragraph (3), there 
shall be taken into account incentive payments, 
and payment adjustments under subsection 
(b)(3)(B)(ix) or (n) of section 1886.’’.
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(2) Section 1851(i)(1) of the Social Security Act 
(42 U.S.C. 1395w–21(i)(1)) is amended by striking 
‘‘and 1886(h)(3)(D)’’ and inserting ‘‘1886(h)(3)(D), 
and 1853(m)’’. 
(3) Section 1853 of the Social Security Act (42 
U.S.C. 1395w–23), as amended by section 4311(d)(1), 
is amended— 
(A) in subsection (c)— 
(i) in paragraph (1)(D)(i), by striking 
‘‘1848(o)’’ and inserting ‘‘, 1848(o), and 
1886(n)’’; and 
(ii) in paragraph (6)(A), by inserting 
‘‘and subsections (b)(3)(B)(ix) and (n) of 
section 1886’’ after ‘‘section 1848’’; and 
(B) in subsection (f), by inserting ‘‘and sub-
section (m)’’ after ‘‘under subsection (l)’’. 
SEC. 4203. PREMIUM HOLD HARMLESS AND IMPLEMENTA-
TION FUNDING. 
(a) PREMIUM HOLD HARMLESS.— 
(1) IN GENERAL.—Section 1839(a)(1) of the So-
cial Security Act (42 U.S.C. 1395r(a)(1)) is amended 
by adding at the end the following: ‘‘In applying this 
paragraph there shall not be taken into account addi-
tional payments under section 1848(o) and section
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1853(l)(3) and the Government contribution under 
section 1844(a)(3).’’. 
(2) PAYMENT.—Section 1844(a) of such Act (42 
U.S.C. 1395w(a)) is amended— 
(A) in paragraph (2), by striking the period 
at the end and inserting ‘‘; plus’’; and 
(B) by adding at the end the following new 
paragraph: 
‘‘(3) a Government contribution equal to the 
amount of payment incentives payable under sections 
1848(o) and 1853(l)(3).’’. 
(b) IMPLEMENTATION FUNDING.—In addition to funds 
otherwise available, out of any funds in the Treasury not 
otherwise appropriated, there are appropriated to the Sec-
retary of Health and Human Services for the Center for 
Medicare & Medicaid Services Program Management Ac-
count, $100,000,000 for each of fiscal years 2009 through 
2015 and $45,000,000 for each succeeding fiscal year 
through fiscal year 2018, which shall be available for pur-
poses of carrying out the provisions of (and amendments 
made by) this part. Amounts appropriated under this sub-
section for a fiscal year shall be available until expended.
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SEC. 4204. NON-APPLICATION OF PHASED-OUT INDIRECT 
MEDICAL 
EDUCATION 
(IME) 
ADJUSTMENT 
FACTOR FOR FISCAL YEAR 2009. 
(a) IN GENERAL.—Section 412.322 of title 42, Code 
of Federal Regulations, shall be applied without regard to 
paragraph (c) of such section, and the Secretary of Health 
and Human Services shall recompute payments for dis-
charges occurring on or after October 1, 2008, as if such 
paragraph had never been in effect. 
(b) NO EFFECT ON SUBSEQUENT YEARS.—Nothing in 
subsection (a) shall be construed as having any effect on 
the application of paragraph (d) of section 412.322 of title 
42, Code of Federal Regulations. 
SEC. 4205. STUDY ON APPLICATION OF EHR PAYMENT IN-
CENTIVES FOR PROVIDERS NOT RECEIVING 
OTHER INCENTIVE PAYMENTS. 
(a) STUDY.— 
(1) IN GENERAL.—The Secretary of Health and 
Human Services shall conduct a study to determine 
the extent to which and manner in which payment 
incentives (such as under title XVIII or XIX of the 
Social Security Act) and other funding for purposes 
of implementing and using certified EHR technology 
(as defined in section 1848(o)(4) of the Social Secu-
rity Act, as added by section 4311(a)) should be made 
available to health care providers who are receiving
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minimal or no payment incentives or other funding 
under this Act, under title XVIII or XIX of such Act, 
or otherwise, for such purposes. 
(2) DETAILS OF STUDY.—Such study shall in-
clude an examination of— 
(A) the adoption rates of certified EHR 
technology (as so defined) by such health care 
providers; 
(B) the clinical utility of such technology by 
such health care providers; 
(C) whether the services furnished by such 
health care providers are appropriate for or 
would benefit from the use of such technology; 
(D) the extent to which such health care 
providers work in settings that might otherwise 
receive an incentive payment or other funding 
under this Act, title XVIII or XIX of the Social 
Security Act, or otherwise; 
(E) the potential costs and the potential 
benefits of making payment incentives and other 
funding available to such health care providers; 
and 
(F) any other issues the Secretary deems to 
be appropriate.
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(b) REPORT.—Not later than June 30, 2010, the Sec-
retary shall submit to Congress a report on the findings 
and conclusions of the study conducted under subsection (a). 
SEC. 4206. STUDY ON AVAILABILITY OF OPEN SOURCE 
HEALTH INFORMATION TECHNOLOGY SYS-
TEMS. 
(a) IN GENERAL.— 
(1) STUDY.—The Secretary of Health and 
Human Services shall, in consultation with the 
Under Secretary for Health of the Veterans Health 
Administration, the Director of the Indian Health 
Service, the Secretary of Defense, the Director of the 
Agency for Healthcare Research and Quality, the Ad-
ministrator of the Health Resources and Services Ad-
ministration, and the Chairman of the Federal Com-
munications Commission, conduct a study on— 
(A) the current availability of open source 
health information technology systems to Federal 
safety net providers (including small, rural pro-
viders); 
(B) the total cost of ownership of such sys-
tems in comparison to the cost of proprietary 
commercial products available; 
(C) the ability of such systems to respond to 
the needs of, and be applied to, various popu-
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lations (including children and disabled individ-
uals); and 
(D) the capacity of such systems to facili-
tate interoperability. 
(2) CONSIDERATIONS.—In conducting the study 
under paragraph (1), the Secretary of Health and 
Human Services shall take into account the cir-
cumstances of smaller health care providers, health 
care providers located in rural or other medically un-
derserved areas, and safety net providers that deliver 
a significant level of health care to uninsured individ-
uals, Medicaid beneficiaries, SCHIP beneficiaries, 
and other vulnerable individuals. 
(b) REPORT.—Not later than October 1, 2010, the Sec-
retary of Health and Human Services shall submit to Con-
gress a report on the findings and the conclusions of the 
study conducted under subsection (a), together with rec-
ommendations for such legislation and administrative ac-
tion as the Secretary determines appropriate. 
Subtitle B—Medicaid Funding 
SEC. 4211. MEDICAID PROVIDER EHR ADOPTION AND OPER-
ATION PAYMENTS; IMPLEMENTATION FUND-
ING. 
(a) IN GENERAL.—Section 1903 of the Social Security 
Act (42 U.S.C. 1396b) is amended—
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(1) in subsection (a)(3)— 
(A) by striking ‘‘and’’ at the end of sub-
paragraph (D); 
(B) by striking ‘‘plus’’ at the end of sub-
paragraph (E) and inserting ‘‘and’’; and 
(C) by adding at the end the following new 
subparagraph: 
‘‘(F)(i) 100 percent of so much of the sums 
expended during such quarter as are attributable 
to payments for certified EHR technology (and 
support services including maintenance and 
training that is for, or is necessary for the adop-
tion and operation of, such technology) by Med-
icaid providers described in subsection (t)(1); 
and 
‘‘(ii) 90 percent of so much of the sums ex-
pended during such quarter as are attributable 
to payments for reasonable administrative ex-
penses related to the administration of payments 
described in clause (i) if the State meets the con-
dition described in subsection (t)(9); plus’’; and 
(2) by inserting after subsection (s) the following 
new subsection: 
‘‘(t)(1)(A) For purposes of subsection (a)(3)(F), the 
payments for certified EHR technology (and support serv-
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ices including maintenance that is for, or is necessary for 
the operation of, such technology) by Medicaid providers de-
scribed in this paragraph are payments made by the State 
in accordance with this subsection of the applicable percent 
of the net allowable costs of Medicaid providers (as defined 
in paragraph (2)) for such technology (and support serv-
ices). 
‘‘(B) For purposes of subparagraph (A), the term ‘ap-
plicable percent’ means— 
‘‘(i) in the case of a Medicaid provider described 
in paragraph (2)(A), 85 percent; 
‘‘(ii) in the case of a Medicaid provider described 
in clause (i) or (ii) of paragraph (2)(B), 100 percent; 
and 
‘‘(iii) in the case of a Medicaid provider de-
scribed in clause (iii) of paragraph (2)(B), a percent 
specified by the Secretary, but not less than 85 per-
cent. 
‘‘(2) In this subsection and subsection (a)(3)(F), the 
term ‘Medicaid provider’ means— 
‘‘(A) an eligible professional (as defined in para-
graph (3)(B)) who is not hospital-based and has at 
least 30 percent of the professional’s patient volume 
(as estimated in accordance with standards estab-
lished by the Secretary) attributable to individuals
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who are receiving medical assistance under this title; 
and 
‘‘(B)(i) a children’s hospital, (ii) an acute-care 
hospital that is not described in clause (i) and that 
has at least 10 percent of the hospital’s patient vol-
ume (as estimated in accordance with standards es-
tablished by the Secretary) attributable to individuals 
who are receiving medical assistance under this title, 
or (iii) a Federally-qualified health center or rural 
health clinic that has at least 30 percent of the cen-
ter’s or clinic’s patient volume (as estimated in ac-
cordance with standards established by the Secretary) 
attributable to individuals who are receiving medical 
assistance under this title. 
An eligible professional shall not qualify as a Medicaid pro-
vider under this subsection unless the professional has 
waived, in a manner specified by the Secretary, any right 
to payment under section 1848(o) with respect to the adop-
tion or support of certified EHR technology by the eligible 
professional. In applying clauses (ii) and (iii) of subpara-
graph (B), the standards established by the Secretary for 
patient volume shall include individuals enrolled in a Med-
icaid managed care plan (under section 1903(m) or section 
1932). 
‘‘(3) In this subsection and subsection (a)(3)(F):
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‘‘(A) The term ‘certified EHR technology’ means 
a qualified electronic health record (as defined in 
3000(13) of the Public Health Service Act) that is cer-
tified pursuant to section 3001(c)(5) of such Act as 
meeting standards adopted under section 3004 of such 
Act that are applicable to the type of record involved 
(as determined by the Secretary, such as an ambula-
tory electronic health record for office-based physi-
cians or an inpatient hospital electronic health record 
for hospitals). 
‘‘(B) The term ‘eligible professional’ means a 
physician as defined in paragraphs (1) and (2) of 
section 1861(r), and includes a nurse mid-wife and a 
nurse practitioner. 
‘‘(C) The term ‘hospital-based’ means, with re-
spect to an eligible professional, a professional (such 
as a pathologist, anesthesiologist, or emergency physi-
cian) who furnishes substantially all of the individ-
ual’s professional services in a hospital setting 
(whether inpatient or outpatient) and through the use 
of the facilities and equipment, including qualified 
electronic health records, of the hospital. 
‘‘(4)(A) The term ‘allowable costs’ means, with respect 
to certified EHR technology of a Medicaid provider, costs 
of such technology (and support services including mainte-
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‘‘(C) With respect to payments to such Medicaid 
provider for costs other than costs related to the ini-
tial adoption of certified EHR technology, the Med-
icaid provider demonstrates meaningful use of cer-
tified EHR technology through a means that is ap-
proved by the State and acceptable to the Secretary, 
and that may be based upon the methodologies ap-
plied under section 1848(o) or 1886(n). In estab-
lishing such means, which may include the reporting 
of clinical quality measures to the State, the State 
shall ensure that populations with unique needs, such 
as children, are appropriately addressed. 
‘‘(D) To the extent specified by the Secretary, the 
certified EHR technology is compatible with State or 
Federal administrative management systems. 
‘‘(6)(A) In no case shall the payments described in 
paragraph (1), with respect to a hospital, exceed in the ag-
gregate the product of— 
‘‘(i) the overall hospital EHR amount for the 
hospital computed under subparagraph (B); and 
‘‘(ii) the Medicaid share for such hospital com-
puted under subparagraph (C). 
‘‘(B) For purposes of this paragraph, the overall hos-
pital EHR amount, with respect to a hospital, is the sum 
of the applicable amounts specified in section 1886(n)(2)(A)
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for such hospital for the first 4 payment years (as estimated 
by the Secretary) determined as if the Medicare share speci-
fied in clause (ii) of such section were 1. The Secretary shall 
publish in the Federal Register the overall hospital EHR 
amount for each hospital eligible for payments under this 
subsection. In computing amounts under clause (ii) for 
payment years after the first payment year, the Secretary 
shall assume that in subsequent payment years discharges 
increase at the average annual rate of growth of the most 
recent three years for which discharge data are available. 
‘‘(C) The Medicaid share computed under this sub-
paragraph, for a hospital for a period specified by the Sec-
retary, shall be calculated in the same manner as the Medi-
care share under section 1886(n)(2)(D) for such a hospital 
and period, except that there shall be substituted for the nu-
merator under clause (i) of such section the amount that 
is equal to the number of inpatient-bed-days (as established 
by the Secretary) which are attributable to individuals who 
are receiving medical assistance under this title and who 
are not described in section 1886(n)(2)(D)(i). In computing 
inpatient-bed-days under the previous sentence, the Sec-
retary shall take into account inpatient-bed-days attrib-
utable to inpatient-bed-days that are paid for individuals 
enrolled in a Medicaid managed care plan (under section 
1903(m) or section 1932).
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‘‘(7) With respect to health care providers other than 
hospitals, the Secretary shall establish and implement a de-
tailed process to ensure coordination of the different pro-
grams for payment of such health care providers for adop-
tion or use of health information technology (including cer-
tified EHR technology), as well as payments for such health 
care providers provided under this title or title XVIII, to 
assure no duplication of funding. The Secretary shall pro-
mulgate regulations to carry out the preceding sentence. 
‘‘(8) In carrying out paragraph (5)(C), the State and 
Secretary shall seek, to the maximum extent practicable, to 
avoid duplicative requirements from Federal and State 
Governments to demonstrate meaningful use of certified 
EHR technology under this title and title XVIII. In doing 
so, the Secretary may deem satisfaction of requirements for 
such meaningful use for a payment year under title XVIII 
to be sufficient to qualify as meaningful use under this sub-
section. The Secretary may also specify the reporting peri-
ods under this subsection in order to carry out this para-
graph. 
‘‘(9) In order to be provided Federal financial partici-
pation under subsection (a)(3)(F)(ii), a State must dem-
onstrate to the satisfaction of the Secretary, that the State— 
‘‘(A) is using the funds provided for the purposes 
of administering payments under this subsection, in-
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cluding tracking of meaningful use by Medicaid pro-
viders; 
‘‘(B) is conducting adequate oversight of the pro-
gram under this subsection, including routine track-
ing of meaningful use attestations and reporting 
mechanisms; and 
‘‘(C) is pursuing initiatives to encourage the 
adoption of certified EHR technology to promote 
health care quality and the exchange of health care 
information under this title, subject to applicable 
laws and regulations governing such exchange. 
‘‘(10) The Secretary shall periodically submit reports 
to the Committee on Energy and Commerce of the House 
of Representatives and the Committee on Finance of the 
Senate on status, progress, and oversight of payments under 
paragraph (1).’’. 
(b) IMPLEMENTATION FUNDING.—In addition to funds 
otherwise available, out of any funds in the Treasury not 
otherwise appropriated, there are appropriated to the Sec-
retary of Health and Human Services for the Center for 
Medicare & Medicaid Services Program Management Ac-
count, $40,000,000 for each of fiscal years 2009 through 
2015 and $20,000,000 for each succeeding fiscal year 
through fiscal year 2018, which shall be available for pur-
poses of carrying out the provisions of (and the amendments
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made by) this part. Amounts appropriated under this sub-
section for a fiscal year shall be available until expended. 
(c) HHS REPORT ON IMPLEMENTATION OF DETAILED 
PROCESS TO ASSURE NO DUPLICATION OF FUNDING.—Not 
later than July 1, 2012, the Secretary of Health and 
Human Services shall submit to Congress a report on the 
establishment and implementation of the detailed process 
under section 1903(t)(7) of the Social Security Act, as 
added by subsection (a), together with recommendations for 
such legislation and administrative action as the Secretary 
determines appropriate. 
TITLE V—STATE FISCAL RELIEF 
SEC. 5000. PURPOSES; TABLE OF CONTENTS. 
(a) PURPOSES.—The purposes of this title are as fol-
lows: 
(1) To provide fiscal relief to States in a period 
of economic downturn. 
(2) To protect and maintain State Medicaid 
programs during a period of economic downturn, in-
cluding by helping to avert cuts to provider payment 
rates and benefits or services, and to prevent constric-
tions of income eligibility requirements for such pro-
grams, but not to promote increases in such require-
ments.
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(b) TABLE OF CONTENTS.—The table of contents for 
this title is as follows: 
TITLE V—STATE FISCAL RELIEF 
Sec. 5000. Purposes; table of contents. 
Sec. 5001. Temporary increase of Medicaid FMAP. 
Sec. 5002. Extension and update of special rule for increase of Medicaid DSH 
allotments for low DSH States. 
Sec. 5003. Payment of Medicare liability to States as a result of the Special Dis-
ability Workload Project. 
Sec. 5004. Funding for the Department of Health and Human Services Office of 
the Inspector General. 
Sec. 5005. GAO study and report regarding State needs during periods of na-
tional economic downturn. 
SEC. 5001. TEMPORARY INCREASE OF MEDICAID FMAP. 
(a) PERMITTING MAINTENANCE OF FMAP.—Subject to 
subsections (e), (f), and (g), if the FMAP determined with-
out regard to this section for a State for— 
(1) fiscal year 2009 is less than the FMAP as so 
determined for fiscal year 2008, the FMAP for the 
State for fiscal year 2008 shall be substituted for the 
State’s FMAP for fiscal year 2009, before the applica-
tion of this section; 
(2) fiscal year 2010 is less than the FMAP as so 
determined for fiscal year 2008 or fiscal year 2009 
(after the application of paragraph (1)), the greater 
of such FMAP for the State for fiscal year 2008 or 
fiscal year 2009 shall be substituted for the State’s 
FMAP for fiscal year 2010, before the application of 
this section; and 
(3) fiscal year 2011 is less than the FMAP as so 
determined for fiscal year 2008, fiscal year 2009
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(after the application of paragraph (1)), or fiscal 
year 2010 (after the application of paragraph (2)), 
the greatest of such FMAP for the State for fiscal year 
2008, fiscal year 2009, or fiscal year 2010 shall be 
substituted for the State’s FMAP for fiscal year 2011, 
before the application of this section, but only for the 
first calendar quarter in fiscal year 2011. 
(b) GENERAL 7.6 PERCENTAGE POINT INCREASE.— 
Subject to subsections (e), (f), and (g), for each State for 
calendar quarters during the recession adjustment period 
(as defined in subsection (h)(2)) , the FMAP (after the ap-
plication of subsection (a)) shall be increased (without re-
gard to any limitation otherwise specified in section 
1905(b) of the Social Security Act) by 7.6 percentage 
points. 
(c) ADDITIONAL RELIEF BASED ON INCREASE IN UN-
EMPLOYMENT.— 
(1) IN GENERAL.—Subject to subsections (e), (f), 
and (g), if a State is a qualifying State under para-
graph (2) for a calendar quarter occurring during the 
recession adjustment period, the FMAP for the State 
shall be further increased by the number of percentage 
points equal to the product of the State percentage 
applicable for the State under section 1905(b) of the 
Social Security Act (42 U.S.C. 1396d(b)) after the
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recently available monthly publications of 
the Bureau of Labor Statistics of the De-
partment of Labor). 
(ii) An increase of at least 2.5 percent-
age points, but less than 3.5 percentage 
points, in the average monthly unemploy-
ment rate, seasonally adjusted, for the State 
or District (as so determined). 
(iii) An increase of at least 3.5 per-
centage points for the State or District, in 
the average monthly unemployment rate, 
seasonally adjusted, for the State or District 
(as so determined). 
(B) MAINTENANCE OF STATUS.—If a State 
qualifies for additional relief under this sub-
section for a calendar quarter, it shall be deemed 
to have qualified for such relief for each subse-
quent calendar quarter ending before July 1, 
2010. 
(3) APPLICABLE
PERCENT.—For purposes of 
paragraph (1), the applicable percent is— 
(A) 2.5 percent, if the State satisfies the cri-
teria described in paragraph (2)(A)(i) for the 
calendar quarter;
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(B) 4.5 percent if the State satisfies the cri-
teria described in paragraph (2)(A)(ii) for the 
calendar quarter; and 
(C) 6.5 percent if the State satisfies the cri-
teria described in paragraph (2)(A)(iii) for the 
calendar quarter. 
(4) MAINTENANCE OF HIGHER PERCENTAGE RE-
DUCTION
FOR
PERIOD
AFTER
LOWER
PERCENTAGE 
DEDUCTION WOULD OTHERWISE TAKE EFFECT.— 
(A) HOLD HARMLESS PERIOD.—If the per-
centage reduction applied to a State under para-
graph (3) for any calendar quarter in the reces-
sion adjustment period beginning on or after 
January 1, 2009, and ending before July 1, 
2010, (determined without regard to this para-
graph) is less than the percentage reduction ap-
plied for the preceding quarter (as so deter-
mined), the higher percentage reduction shall 
continue in effect for each subsequent calendar 
quarter ending before July 1, 2010. 
(B) NOTICE OF DECREASE IN PERCENTAGE 
REDUCTION.—The Secretary shall notify a State 
at least 3 months prior to applying any lower 
percentage reduction to the State under para-
graph (3).
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(d) INCREASE IN CAP ON MEDICAID PAYMENTS TO 
TERRITORIES.—Subject to subsections (f) and (g), with re-
spect to entire fiscal years occurring during the recession 
adjustment period and with respect to fiscal years only a 
portion of which occurs during such period (and in propor-
tion to the portion of the fiscal year that occurs during such 
period), the amounts otherwise determined for Puerto Rico, 
the Virgin Islands, Guam, the Northern Mariana Islands, 
and American Samoa under subsections (f) and (g) of sec-
tion 1108 of the Social Security Act (42 6 U.S.C. 1308) 
shall each be increased by 15.2 percent. 
(e) SCOPE OF APPLICATION.—The increases in the 
FMAP for a State under this section shall apply for pur-
poses of title XIX of the Social Security Act and shall not 
apply with respect to— 
(1) disproportionate share hospital payments de-
scribed in section 1923 of such Act (42 U.S.C. 1396r– 
4); 
(2) payments under title IV of such Act (42 
U.S.C. 601 et seq.) (except that the increases under 
subsections (a) and (b) shall apply to payments under 
part E of title IV of such Act (42 U.S.C. 670 et seq.)); 
(3) payments under title XXI of such Act (42 
U.S.C. 1397aa et seq.);
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(4) any payments under title XIX of such Act 
that are based on the enhanced FMAP described in 
section 2105(b) of such Act (42 U.S.C. 1397ee(b)); or 
(5) any payments under title XIX of such Act 
that are attributable to expenditures for medical as-
sistance provided to individuals made eligible under 
a State plan under title XIX of the Social Security 
Act (including under any waiver under such title or 
under section 1115 of such Act (42 U.S.C. 1315)) be-
cause of income standards (expressed as a percentage 
of the poverty line) for eligibility for medical assist-
ance that are higher than the income standards (as 
so expressed) for such eligibility as in effect on July 
1, 2008. 
(f) STATE INELIGIBILITY.— 
(1) MAINTENANCE
OF
ELIGIBILITY
REQUIRE-
MENTS.— 
(A) IN
GENERAL.—Subject to subpara-
graphs (B) and (C), a State is not eligible for 
an increase in its FMAP under subsection (a), 
(b), or (c), or an increase in a cap amount 
under subsection (d), if eligibility standards, 
methodologies, or procedures under its State plan 
under title XIX of the Social Security Act (in-
cluding any waiver under such title or under
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section 1115 of such Act (42 U.S.C. 1315)) are 
more restrictive than the eligibility standards, 
methodologies, or procedures, respectively, under 
such plan (or waiver) as in effect on July 1, 
2008. 
(B) STATE REINSTATEMENT OF ELIGIBILITY 
PERMITTED.—Subject to subparagraph (C), a 
State that has restricted eligibility standards, 
methodologies, or procedures under its State plan 
under title XIX of the Social Security Act (in-
cluding any waiver under such title or under 
section 1115 of such Act (42 U.S.C. 1315)) after 
July 1, 2008, is no longer ineligible under sub-
paragraph (A) beginning with the first calendar 
quarter in which the State has reinstated eligi-
bility standards, methodologies, or procedures 
that are no more restrictive than the eligibility 
standards, methodologies, or procedures, respec-
tively, under such plan (or waiver) as in effect 
on July 1, 2008. 
(C) SPECIAL RULES.—A State shall not be 
ineligible under subparagraph (A)— 
(i) for the calendar quarters before 
July 1, 2009, on the basis of a restriction 
that was applied after July 1, 2008, and be-
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fore the date of the enactment of this Act, if 
the State prior to July 1, 2009, has rein-
stated eligibility standards, methodologies, 
or procedures that are no more restrictive 
than the eligibility standards, methodolo-
gies, or procedures, respectively, under such 
plan (or waiver) as in effect on July 1, 
2008; or 
(ii) on the basis of a restriction that 
was directed to be made under State law as 
of July 1, 2008, and would have been in ef-
fect as of such date, but for a delay in the 
request for, and approval of, a waiver under 
section 1115 of such Act with respect to 
such restriction. 
(2) COMPLIANCE WITH PROMPT PAY REQUIRE-
MENTS.—No State shall be eligible for an increased 
FMAP rate as provided under this section for any 
claim submitted by a provider subject to the terms of 
section 1902(a)(37)(A) of the Social Security Act (42 
U.S.C. 1396a(a)(37)(A)) during any period in which 
that State has failed to pay claims in accordance 
with section 1902(a)(37)(A) of such Act. Each State 
shall report to the Secretary, no later than 30 days 
following the 1st day of the month, its compliance
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with the requirements of section 1902(a)(37)(A) of the 
Social Security Act as they pertain to claims made 
for covered services during the preceding month. 
(3) NO WAIVER AUTHORITY.—The Secretary may 
not waive the application of this subsection or sub-
section (g) under section 1115 of the Social Security 
Act or otherwise. 
(g) REQUIREMENTS.— 
(1) IN GENERAL.—A State may not deposit or 
credit the additional Federal funds paid to the State 
as a result of this section to any reserve or rainy day 
fund maintained by the State. 
(2) STATE REPORTS.—Each State that is paid 
additional Federal funds as a result of this section 
shall, not later than September 30, 2011, submit a re-
port to the Secretary, in such form and such manner 
as the Secretary shall determine, regarding how the 
additional Federal funds were expended. 
(3) ADDITIONAL
REQUIREMENT
FOR
CERTAIN 
STATES.—In the case of a State that requires political 
subdivisions within the State to contribute toward the 
non-Federal share of expenditures under the State 
Medicaid plan required under section 1902(a)(2) of 
the Social Security Act (42 U.S.C. 1396a(a)(2)), the 
State is not eligible for an increase in its FMAP
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under subsection (b) or (c), or an increase in a cap 
amount under subsection (d), if it requires that such 
political subdivisions pay for quarters during the re-
cession adjustment period a greater percentage of the 
non-Federal share of such expenditures, or a greater 
percentage of the non-Federal share of payments 
under section 1923, than the respective percentage 
that would have been required by the State under 
such plan on September 30, 2008, prior to applica-
tion of this section. 
(h) DEFINITIONS.—In this section, except as otherwise 
provided: 
(1) FMAP.—The term ‘‘FMAP’’ means the Fed-
eral medical assistance percentage, as defined in sec-
tion 1905(b) of the Social Security Act (42 U.S.C. 
1396d(b)), as determined without regard to this sec-
tion except as otherwise specified. 
(2) POVERTY
LINE.—The term ‘‘poverty line’’ 
has the meaning given such term in section 673(2) of 
the Community Services Block Grant Act (42 U.S.C. 
9902(2)), including any revision required by such sec-
tion. 
(3) RECESSION ADJUSTMENT PERIOD.—The term 
‘‘recession adjustment period’’ means the period be-
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ginning on October 1, 2008, and ending on December 
31, 2010. 
(4) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of Health and Human Services. 
(5) STATE.—The term ‘‘State’’ has the meaning 
given such term for purposes of title XIX of the Social 
Security Act (42 U.S.C. 1396 et seq.). 
(i) SUNSET.—This section shall not apply to items and 
services furnished after the end of the recession adjustment 
period. 
SEC. 5002. EXTENSION AND UPDATE OF SPECIAL RULE FOR 
INCREASE OF MEDICAID DSH ALLOTMENTS 
FOR LOW DSH STATES. 
Section 1923(f)(5) of the Social Security Act (42 
U.S.C. 1396r–4(f)(5)) is amended— 
(1) in subparagraph (B)— 
(A) in the subparagraph heading, by strik-
ing ‘‘YEAR
2004
AND
SUBSEQUENT
FISCAL 
YEARS’’ and inserting ‘‘YEARS
2004
THROUGH 
2008’’; 
(B) in clause (i), by inserting ‘‘and’’ after 
the semicolon; 
(C) in clause (ii), by striking ‘‘; and’’ and 
inserting a period; and 
(D) by striking clause (iii); and
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(2) by adding at the end the following subpara-
graph: 
‘‘(C) FOR FISCAL YEAR 2009 AND SUBSE-
QUENT FISCAL YEARS.—In the case of a State in 
which the total expenditures under the State 
plan (including Federal and State shares) for 
disproportionate 
share 
hospital 
adjustments 
under this section for fiscal year 2006, as re-
ported to the Administrator of the Centers for 
Medicare & Medicaid Services as of August 31, 
2009, is greater than 0 but less than 3 percent 
of the State’s total amount of expenditures under 
the State plan for medical assistance during the 
fiscal year, the DSH allotment for the State with 
respect to— 
‘‘(i) fiscal year 2009, shall be the DSH 
allotment for the State for fiscal year 2008 
increased by 16 percent; 
‘‘(ii) fiscal year 2010, shall be the 
DSH allotment for the State for fiscal year 
2009 increased by 16 percent; 
‘‘(iii) fiscal year 2011 for the period 
ending on December 31, 2010, shall be 1⁄4 of 
the DSH allotment for the State for fiscal 
year 2010 increased by 16 percent;
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‘‘(iv) fiscal year 2011 for the period be-
ginning on January 1, 2011, and ending on 
September 30, 2011, shall be 3⁄4 of the DSH 
allotment that would have been determined 
under this subsection for the State for fiscal 
year 2011 if this subparagraph had not 
been enacted; 
‘‘(v) fiscal year 2012, shall be the DSH 
allotment that would have been determined 
under this subsection for the State for fiscal 
year 2012 if this subparagraph had not 
been enacted; and 
‘‘(vi) fiscal year 2013 and any subse-
quent fiscal year, shall be the DSH allot-
ment for the State for the previous fiscal 
year subject to an increase for inflation as 
provided in paragraph (3)(A).’’. 
SEC. 5003. PAYMENT OF MEDICARE LIABILITY TO STATES 
AS A RESULT OF THE SPECIAL DISABILITY 
WORKLOAD PROJECT. 
(a) IN GENERAL.—The Secretary, in consultation with 
the Commissioner, shall work with each State to reach an 
agreement, not later than 3 months after the date of enact-
ment of this Act, on the amount of a payment for the State 
related to the Medicare program liability as a result of the
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Special Disability Workload project, subject to the require-
ments of subsection (c). 
(b) PAYMENTS.— 
(1) DEADLINE
FOR
MAKING
PAYMENTS.—Not 
later than 30 days after reaching an agreement with 
a State under subsection (a), the Secretary shall pay 
the State, from the amounts appropriated under 
paragraph (2), the payment agreed to for the State. 
(2) APPROPRIATION.—Out of any money in the 
Treasury not otherwise appropriated, there is appro-
priated $3,000,000,000 for fiscal year 2009 for mak-
ing payments to States under paragraph (1). 
(3) LIMITATIONS.—In no case may— 
(A) the aggregate amount of payments made 
by the Secretary to States under paragraph (1) 
exceed $3,000,000,000; or 
(B) any payments be provided by the Sec-
retary under this section after the first day of the 
first month that begins 4 months after the date 
of enactment of this Act. 
(c) REQUIREMENTS.—The requirements of this sub-
section are the following: 
(1) FEDERAL
DATA
USED
TO
DETERMINE 
AMOUNT OF PAYMENTS.—The amount of the payment 
under subsection (a) for each State is determined on
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the basis of the most recent Federal data available, 
including the use of proxies and reasonable estimates 
as necessary, for determining expeditiously the 
amount of the payment that shall be made to each 
State that enters into an agreement under this sec-
tion. The payment methodology shall consider the fol-
lowing factors: 
(A) The number of SDW cases found to 
have been eligible for benefits under the Medicare 
program and the month of the initial Medicare 
program eligibility for such cases. 
(B) The applicable non-Federal share of ex-
penditures made by a State under the Medicaid 
program during the time period for SDW cases. 
(C) Such other factors as the Secretary and 
the Commissioner, in consultation with the 
States, determine appropriate. 
(2) CONDITIONS FOR PAYMENTS.—A State shall 
not receive a payment under this section unless the 
State— 
(A) waives the right to file a civil action (or 
to be a party to any action) in any Federal or 
State court in which the relief sought includes a 
payment from the United States to the State re-
lated to the Medicare liability under title XVIII
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of the Social Security Act (42 U.S.C. 1395 et 
seq.) as a result of the Special Disability Work-
load project; and 
(B) releases the United States from any fur-
ther claims for reimbursement of State expendi-
tures as a result of the Special Disability Work-
load project. 
(3) NO
INDIVIDUAL
STATE
CLAIMS
DATA
RE-
QUIRED.—No State shall be required to submit indi-
vidual claims evidencing payment under the Med-
icaid program as a condition for receiving a payment 
under this section. 
(4) INELIGIBLE
STATES.—No State that is a 
party to a civil action in any Federal or State court 
in which the relief sought includes a payment from 
the United States to the State related to the Medicare 
liability under title XVIII of the Social Security Act 
(42 U.S.C. 1395 et seq.) as a result of the Special 
Disability Workload project shall be eligible to receive 
a payment under this section while such an action is 
pending or if such an action is resolved in favor of 
the State. 
(d) DEFINITIONS.—In this section: 
(1) COMMISSIONER.—The term ‘‘Commissioner’’ 
means the Commissioner of Social Security.
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(2) MEDICAID PROGRAM.—The term ‘‘Medicaid 
program’’ means the program of medical assistance 
established under title XIX of the Social Security Act 
(42 U.S.C. 1396a et seq.) and includes medical assist-
ance provided under any waiver of that program ap-
proved under section 1115 or 1915 of such Act (42 
U.S.C. 1315, 1396n) or otherwise. 
(3) MEDICARE PROGRAM.—The term ‘‘Medicare 
program’’ means the program established under title 
XVIII of the Social Security Act (42 U.S.C. 1395 et 
seq.). 
(4) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of Health and Human Services. 
(5) SDW CASE.—The term ‘‘SDW case’’ means 
a case in the Special Disability Workload project in-
volving an individual determined by the Commis-
sioner to have been eligible for benefits under title II 
of the Social Security Act (42 U.S.C. 401 et seq.) for 
a period during which such benefits were not provided 
to the individual and who was, during all or part of 
such period, enrolled in a State Medicaid program. 
(6) SPECIAL DISABILITY WORKLOAD PROJECT.— 
The term ‘‘Special Disability Workload project’’ 
means the project described in the 2008 Annual Re-
port of the Board of Trustees of the Federal Old-Age
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and Survivors Insurance and Federal Disability In-
surance Trust Funds, H.R. Doc. No. 110–104, 110th 
Cong. (2008). 
(7) STATE.—The term ‘‘State’’ means each of the 
50 States and the District of Columbia. 
SEC. 5004. FUNDING FOR THE DEPARTMENT OF HEALTH 
AND HUMAN SERVICES OFFICE OF THE IN-
SPECTOR GENERAL. 
For purposes of ensuring the proper expenditure of 
Federal funds under title XIX of the Social Security Act 
(42 U.S.C. 1396 et seq.), there is appropriated to the Office 
of the Inspector General of the Department of Health and 
Human Services, out of any money in the Treasury not 
otherwise appropriated and without further appropriation, 
$31,250,000 for the recession adjustment period (as defined 
in section 5001(h)(3)). Amounts appropriated under this 
section shall remain available for expenditure until Sep-
tember 30, 2012, and shall be in addition to any other 
amounts appropriated or made available to such Office for 
such purposes. 
SEC. 5005. GAO STUDY AND REPORT REGARDING STATE 
NEEDS DURING PERIODS OF NATIONAL ECO-
NOMIC DOWNTURN. 
(a) IN GENERAL.—The Comptroller General of the 
United States shall study the period of national economic
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downturn in effect on the date of enactment of this Act, 
as well as previous periods of national economic downturn 
since 1974, for the purpose of developing recommendations 
for addressing the needs of States during such periods. As 
part of such analysis, the Comptroller General shall study 
the past and projected effects of temporary increases in the 
Federal medical assistance percentage under the Medicaid 
program with respect to such periods. 
(b) REPORT.—Not later than April 1, 2011, the Comp-
troller General of the United States shall submit a report 
to the appropriate committees of Congress on the results of 
the study conducted under paragraph (1). Such report shall 
include the following: 
(1) Such recommendations as the Comptroller 
General determines appropriate for modifying the na-
tional economic downturn assistance formula for tem-
porary adjustment of the Federal medical assistance 
percentage under Medicaid (also referred to as a 
‘‘countercyclical FMAP’’) described in GAO report 
number GAO–07–97 to improve the effectiveness of the 
application of such percentage in addressing the needs 
of States during periods of national economic down-
turn, including recommendations for—
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(A) improvements to the factors that would 
begin and end the application of such percent-
age; 
(B) how the determination of the amount of 
such percentage could be adjusted to address 
State and regional economic variations during 
such periods; and 
(C) how the determination of the amount of 
such percentage could be adjusted to be more re-
sponsive to actual Medicaid costs incurred by 
States during such periods. 
(2) An analysis of the impact on States during 
such periods of— 
(A) declines in private health benefits cov-
erage; 
(B) declines in State revenues; and 
(C) caseload maintenance and growth under 
Medicaid, the State Children’s Health Insurance 
Program, or any other publicly-funded programs 
to provide health benefits coverage for State resi-
dents. 
(3) Identification of, and recommendations for 
addressing, the effects on States of any other specific 
economic indicators that the Comptroller General de-
termines appropriate.
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TITLE VI—EXECUTIVE 
COMPENSATION 
SUBTITLE A—OVERSIGHT 
TITLE VI—EXECUTIVE COMPENSATION OVERSIGHT 
Sec. 6001. Definitions. 
Sec. 6002. Executive compensation and corporate governance. 
Sec. 6003. Board Compensation Committee. 
Sec. 6004. Limitation on luxury expenditures. 
Sec. 6005. Shareholder approval of executive compensation. 
Sec. 6006. Review of prior payments to executives. 
SEC. 6001. DEFINITIONS. 
For purposes of this title, the following definitions 
shall apply: 
(1) SENIOR
EXECUTIVE
OFFICER.—The term 
‘‘senior executive officer’’ means an individual who is 
1 of the top 5 most highly paid executives of a public 
company, whose compensation is required to be dis-
closed pursuant to the Securities Exchange Act of 
1934, and any regulations issued thereunder, and 
non-public company counterparts. 
(2) GOLDEN PARACHUTE PAYMENT.—The term 
‘‘golden parachute payment’’ means any payment to 
a senior executive officer for departure from a com-
pany for any reason, except for payments for services 
performed or benefits accrued. 
(3) TARP.—The term ‘‘TARP’’ means the Trou-
bled Asset Relief Program established under the
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Emergency Economic Stabilization Act of 2008 (Pub-
lic Law 110–343, 12 U.S.C. 5201 et seq.). 
(4) TARP RECIPIENT.—The term ‘‘TARP recipi-
ent’’ means any entity that has received or will re-
ceive financial assistance under the financial assist-
ance provided under the TARP. 
(5) SECRETARY.—The term ‘‘Secretary’’ means 
the Secretary of the Treasury. 
(6) 
COMMISSION.—The 
term 
‘‘Commission’’ 
means the Securities and Exchange Commission. 
SEC. 6002. EXECUTIVE COMPENSATION AND CORPORATE 
GOVERNANCE. 
(a) IN GENERAL.—During the period in which any 
obligation arising from financial assistance provided under 
the TARP remains outstanding, each TARP recipient shall 
be subject to— 
(1) the standards established by the Secretary 
under this title; and 
(2) the provisions of section 162(m)(5) of the In-
ternal Revenue Code of 1986, as applicable. 
(b) STANDARDS REQUIRED.—The Secretary shall re-
quire each TARP recipient to meet appropriate standards 
for executive compensation and corporate governance. 
(c) SPECIFIC REQUIREMENTS.—The standards estab-
lished under subsection (b) shall include—
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HR 1 EAS 
(1) limits on compensation that exclude incen-
tives for senior executive officers of the TARP recipi-
ent to take unnecessary and excessive risks that 
threaten the value of such recipient during the period 
that any obligation arising from TARP assistance is 
outstanding; 
(2) a provision for the recovery by such TARP 
recipient of any bonus, retention award, or incentive 
compensation paid to a senior executive officer and 
any of the next 20 most highly-compensated employees 
of the TARP recipient based on statements of earn-
ings, revenues, gains, or other criteria that are later 
found to be materially inaccurate; 
(3) a prohibition on such TARP recipient mak-
ing any golden parachute payment to a senior execu-
tive officer or any of the next 5 most highly-com-
pensated employees of the TARP recipient during the 
period that any obligation arising from TARP assist-
ance is outstanding; 
(4) a prohibition on such TARP recipient pay-
ing or accruing any bonus, retention award, or incen-
tive compensation during the period that the obliga-
tion is outstanding to at least the 25 most highly- 
compensated employees, or such higher number as the
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HR 1 EAS 
Secretary may determine is in the public interest 
with respect to any TARP recipient; 
(5) a prohibition on any compensation plan that 
would encourage manipulation of the reported earn-
ings of such TARP recipient to enhance the com-
pensation of any of its employees; and 
(6) a requirement for the establishment of a 
Board Compensation Committee that meets the re-
quirements of section 6003. 
(d) CERTIFICATION OF COMPLIANCE.—The chief execu-
tive officer and chief financial officer (or the equivalents 
thereof) of each TARP recipient shall provide a written cer-
tification of compliance by the TARP recipient with the 
requirements of this title— 
(1) in the case of a TARP recipient, the securi-
ties of which are publicly traded, to the Securities 
and Exchange Commission, together with annual fil-
ings required under the securities laws; and 
(2) in the case of a TARP recipient that is not 
a publicly traded company, to the Secretary. 
SEC. 6003. BOARD COMPENSATION COMMITTEE. 
(a) ESTABLISHMENT
OF BOARD REQUIRED.—Each 
TARP recipient shall establish a Board Compensation 
Committee, comprised entirely of independent directors, for 
the purpose of reviewing employee compensation plans.
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(b) MEETINGS.—The Board Compensation Committee 
of each TARP recipient shall meet at least semiannually 
to discuss and evaluate employee compensation plans in 
light of an assessment of any risk posed to the TARP recipi-
ent from such plans. 
SEC. 6004. LIMITATION ON LUXURY EXPENDITURES. 
(a) POLICY REQUIRED.—The board of directors of any 
TARP recipient shall have in place a company-wide policy 
regarding excessive or luxury expenditures, as identified by 
the Secretary, which may include excessive expenditures 
on— 
(1) entertainment or events; 
(2) office and facility renovations; 
(3) aviation or other transportation services; or 
(4) other activities or events that are not reason-
able expenditures for conferences, staff development, 
reasonable performance incentives, or other similar 
measures conducted in the normal course of the busi-
ness operations of the TARP recipient. 
SEC. 6005. SHAREHOLDER APPROVAL OF EXECUTIVE COM-
PENSATION. 
(a) ANNUAL SHAREHOLDER APPROVAL OF EXECUTIVE 
COMPENSATION.—Any proxy or consent or authorization 
for an annual or other meeting of the shareholders of any 
TARP recipient during the period in which any obligation
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HR 1 EAS 
arising from financial assistance provided under the TARP 
remains outstanding shall permit a separate shareholder 
vote to approve the compensation of executives, as disclosed 
pursuant to the compensation disclosure rules of the Com-
mission (which disclosure shall include the compensation 
discussion and analysis, the compensation tables, and any 
related material). 
(b) NONBINDING VOTE.—A shareholder vote described 
in subsection (a) shall not be binding on the board of direc-
tors of a TARP recipient, and may not be construed as over-
ruling a decision by such board, nor to create or imply any 
additional fiduciary duty by such board, nor shall such vote 
be construed to restrict or limit the ability of shareholders 
to make proposals for inclusion in proxy materials related 
to executive compensation. 
(c) DEADLINE FOR RULEMAKING.—Not later than 1 
year after the date of enactment of this Act, the Commission 
shall issue any final rules and regulations required by this 
section. 
SEC. 6006. REVIEW OF PRIOR PAYMENTS TO EXECUTIVES. 
(a) IN GENERAL.—The Secretary shall review bonuses, 
retention awards, and other compensation paid to employ-
ees of each entity receiving TARP assistance before the date 
of enactment of this Act to determine whether any such pay-
ments were excessive, inconsistent with the purposes of this
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HR 1 EAS 
Act or the TARP, or otherwise contrary to the public inter-
est. 
(b) NEGOTIATIONS FOR REIMBURSEMENT.—If the Sec-
retary makes a determination described in subsection (a), 
the Secretary shall seek to negotiate with the TARP recipi-
ent and the subject employee for appropriate reimburse-
ments to the Federal Government with respect to compensa-
tion or bonuses. 
Subtitle B—Limits on Executive 
Compensation 
SEC. 6011. SHORT TITLE. 
This subtitle may be cited as the ‘‘Cap Executive Offi-
cer Pay Act of 2009’’. 
SEC. 6012. LIMIT ON EXECUTIVE COMPENSATION. 
(a) IN GENERAL.—Notwithstanding any other provi-
sion of law or agreement to the contrary, no person who 
is an officer, director, executive, or other employee of a fi-
nancial institution or other entity that receives or has re-
ceived funds under the Troubled Asset Relief Program (or 
‘‘TARP’’), established under section 101 of the Emergency 
Economic Stabilization Act of 2008, may receive annual 
compensation in excess of the amount of compensation paid 
to the President of the United States. 
(b) DURATION.—The limitation in subsection (a) shall 
be a condition of the receipt of assistance under the TARP,
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and of any modification to such assistance that was re-
ceived on or before the date of enactment of this Act, and 
shall remain in effect with respect to each financial institu-
tion or other entity that receives such assistance or modi-
fication for the duration of the assistance or obligation pro-
vided under the TARP. 
SEC. 6013. RULEMAKING AUTHORITY. 
The Secretary shall expeditiously issue such rules as 
are necessary to carry out this subtitle, including with re-
spect to reimbursement of compensation amounts, as appro-
priate. 
SEC. 6014. COMPENSATION. 
As used in this subtitle, the term ‘‘compensation’’ in-
cludes wages, salary, deferred compensation, retirement 
contributions, options, bonuses, property, and any other 
form of compensation or bonus that the Secretary of the 
Treasury determines is appropriate. 
Subtitle C—Excessive Bonuses 
SEC. 6021. TREATMENT OF EXCESSIVE BONUSES BY TARP 
RECIPIENTS. 
(a) IN GENERAL.—If, before the date of enactment of 
this Act, the preferred stock of a financial institution was 
purchased by the Government using funds provided under 
the Troubled Asset Relief Program established pursuant to 
the Emergency Economic Stabilization Act of 2008, then,
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notwithstanding any otherwise applicable restriction on the 
redeemability of such preferred stock, such financial institu-
tion shall redeem an amount of such preferred stock equal 
to the aggregate amount of all excessive bonuses paid or 
payable to all covered individuals. 
(b) TIMING.—Each financial institution described in 
subsection (a) shall comply with the requirements of sub-
section (a)— 
(1) not later than 120 days after the date of en-
actment of this Act, with respect to excessive bonuses 
(or portions thereof) paid before the date of enactment 
of this Act; and 
(2) not later than the day before an excessive 
bonus (or portion thereof) is paid, with respect to any 
excessive bonus (or portion thereof) paid on or after 
the date of enactment of this Act. 
(c) DEFINITIONS.—As used in this section, the fol-
lowing definitions shall apply: 
(1) EXCESSIVE BONUS.— 
(A) IN
GENERAL.—The term ‘‘excessive 
bonus’’ means the portion of the applicable bonus 
payments made to a covered individual in excess 
of $100,000. 
(B) APPLICABLE BONUS PAYMENTS.—
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(i) IN GENERAL.—The term ‘‘applica-
ble bonus payment’’ means any bonus pay-
ment to a covered individual— 
(I) which is paid or payable by 
reason of services performed by such 
individual in a taxable year of the fi-
nancial institution (or any member of 
a controlled group described in sub-
paragraph (D)) ending in 2008, and 
(II) the amount of which was first 
communicated to such individual dur-
ing the period beginning on January 
1, 2008, and ending January 31, 2009, 
or was based on a resolution of the 
board of directors of such institution 
that was adopted before the end of such 
taxable year. 
(ii) CERTAIN
PAYMENTS
AND
CONDI-
TIONS
DISREGARDED.—In 
determining 
whether a bonus payment is described in 
clause (i)(I)— 
(I) a bonus payment that relates 
to services performed in any taxable 
year before the taxable year described 
in such clause and that is wholly or
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HR 1 EAS 
partially contingent on the perform-
ance of services in the taxable year so 
described shall be disregarded, and 
(II) any condition on a bonus 
payment for services performed in the 
taxable year so described that the em-
ployee perform services in taxable 
years after the taxable year so de-
scribed shall be disregarded. 
(C) BONUS
PAYMENT.—The term ‘‘bonus 
payment’’ means any payment which— 
(i) is a discretionary payment to a 
covered individual by a financial institu-
tion (or any member of a controlled group 
described in subparagraph (D)) for services 
rendered, 
(ii) is in addition to any amount pay-
able to such individual for services per-
formed by such individual at a regular 
hourly, daily, weekly, monthly, or similar 
periodic rate, and 
(iii) is paid or payable in cash or 
other property other than— 
(I) stock in such institution or 
member, or
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(II) an interest in a troubled asset 
(within the meaning of the Emergency 
Economic Stabilization Act of 2008) 
held directly or indirectly by such in-
stitution or member. 
Such term does not include payments to an em-
ployee as commissions, welfare and fringe bene-
fits, or expense reimbursements. 
(D) COVERED INDIVIDUAL.—The term ‘‘cov-
ered individual’’ means, with respect to any fi-
nancial institution, any director or officer or 
other employee of such financial institution or of 
any member of a controlled group of corpora-
tions (within the meaning of section 52(a) of the 
Internal Revenue Code of 1986) that includes 
such financial institution. 
(2) FINANCIAL INSTITUTION.—The term ‘‘finan-
cial institution’’ has the same meaning as in section 
3 of the Emergency Economic Stabilization Act of 
2008 (12 U.S.C. 5252). 
(d) EXCISE TAX ON TARP COMPANIES THAT FAIL TO 
REDEEM CERTAIN SECURITIES FROM UNITED STATES.— 
(1) IN GENERAL.—Chapter 46 of the Internal 
Revenue Code of 1986 (relating to excise tax on gold-
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en parachute payments) is amended by adding at the 
end the following new section: 
‘‘SEC. 4999A. FAILURE TO REDEEM CERTAIN SECURITIES 
FROM UNITED STATES. 
‘‘(a) IMPOSITION OF TAX.—There is hereby imposed a 
tax on any financial institution which— 
‘‘(1) is required to redeem an amount of its pre-
ferred stock from the United States pursuant to sec-
tion 1903(a) of the American Recovery and Reinvest-
ment Tax Act of 2009, and 
‘‘(2) fails to redeem all or any portion of such 
amount within the period prescribed for such redemp-
tion. 
‘‘(b) AMOUNT OF TAX.—The amount of the tax im-
posed by subsection (a) shall be equal to 35 percent of the 
amount which the financial institution failed to redeem 
within the time prescribed under 1903(b) of the American 
Recovery and Reinvestment Tax Act of 2009. 
‘‘(c) ADMINISTRATIVE PROVISIONS.— 
‘‘(1) IN GENERAL.—For purposes of subtitle F, 
any tax imposed by this section shall be treated as a 
tax imposed by subtitle A for the taxable year in 
which a deduction is allowed for any excessive bonus 
with respect to which the redemption described in 
subsection (a)(1) is required to be made.
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‘‘(2) EXTENSION
OF
TIME.—The due date for 
payment of tax imposed by this section shall in no 
event be earlier than the 150th day following the date 
of the enactment of this section.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) The heading for chapter 46 of such Code 
are amended to read as follows: 
‘‘CHAPTER 46-TAXES ON CERTAIN EXCESSIVE REMUNERATION 
‘‘Sec. 4999. Golden parachute payments. 
‘‘Sec. 4999A. Failure to redeem certain securities from United States.’’. 
(B) The item relating to chapter 46 in the 
table of chapters for subtitle D of such Code is 
amended to read as follows: 
‘‘Chapter 46. Taxes on excessive remuneration.’’. 
(3) EFFECTIVE DATE.—The amendments made 
by this subsection shall apply to failures described in 
section 4999A(a)(2) of the Internal Revenue Code of 
1986 occurring after the date of the enactment of this 
Act. 
TITLE VII—FORECLOSURE 
PREVENTION 
TITLE VII—FORECLOSURE PREVENTION 
Sec. 7001. Mandatory loan modifications. 
SEC. 7001. MANDATORY LOAN MODIFICATIONS. 
Section 109(a) of the Emergency Economic Stabiliza-
tion Act of 2008 (12 U.S.C. 5219) is amended—
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(1) by striking the last sentence; 
(2) by striking ‘‘To the extent’’ and inserting the 
following: 
‘‘(1) IN GENERAL.—To the extent’’; and 
(3) by adding at the end the following: 
‘‘(2) LOAN MODIFICATIONS REQUIRED.— 
‘‘(A) IN GENERAL.—In addition to actions 
required under paragraph (1), the Secretary 
shall, not later than 15 days after the date of en-
actment of this paragraph, develop and imple-
ment a plan to facilitate loan modifications to 
prevent avoidable mortgage loan foreclosures. 
‘‘(B) FUNDING.—Of amounts made avail-
able under section 115 and not otherwise obli-
gated, not less than $50,000,000,000, shall be 
made available to the Secretary for purposes of 
carrying out the mortgage loan modification 
plan required to be developed and implemented 
under this paragraph. 
‘‘(C) CRITERIA.—The loan modification 
plan required by this paragraph may incor-
porate the use of— 
‘‘(i) loan guarantees and credit en-
hancements;
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‘‘(ii) the reduction of loan principal 
amounts and interest rates; 
‘‘(iii) extension of mortgage loan terms; 
and 
‘‘(iv) any other similar mechanisms or 
combinations thereof, as determined appro-
priate by the Secretary. 
‘‘(D) DESIGNATION AUTHORITY.— 
‘‘(i) FDIC.—The Secretary may des-
ignate the Corporation, on a reimbursable 
basis, to carry out the loan modification 
plan developed under this paragraph. 
‘‘(ii) 
CONTRACTING
AUTHORITY.—If 
designated under clause (i), the Corporation 
may use its contracting authority under 
section 9 of the Federal Deposit Insurance 
Act. 
‘‘(E) CONSULTATION REQUIRED.—In devel-
oping the loan modification plan under this 
paragraph, the Secretary shall consult with the 
Chairperson of the Board of Directors of the Cor-
poration, the Board, and the Secretary of Hous-
ing and Urban Development. 
‘‘(F) REPORTS
TO
CONGRESS.—The Sec-
retary shall provide to the Committee on Bank-
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ing, Housing, and Urban Affairs of the Senate 
and the Committee on Financial Services of the 
House of Representatives— 
‘‘(i) upon development of the plan re-
quired by this paragraph, a report describ-
ing such plan; and 
‘‘(ii) a monthly report on the number 
and types of loan modifications occurring 
during the reporting period, and the per-
formance of the loan modification plan 
overall.’’. 
TITLE VIII—FORECLOSURE 
MITIGATION 
TITLE VIII—FORECLOSURE MITIGATION 
Sec. 8001. Short Title. 
Sec. 8002. Definitions. 
Sec. 8003. Payments to eligible servicers authorized. 
Sec. 8004. Authorization of appropriations. 
Sec. 8005. Sunset of authority. 
SEC. 8001. SHORT TITLE. 
This title may be cited as the ‘‘Help Families Keep 
Their Homes Act of 2009’’. 
SEC. 8002. DEFINITIONS. 
For purposes of this title— 
(1) the term ‘‘securitized mortgages’’ means resi-
dential mortgages that have been pooled by a 
securitization vehicle;
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(2) the term ‘‘securitization vehicle’’ means a 
trust, corporation, partnership, limited liability enti-
ty, special purpose entity, or other structure that— 
(A) is the issuer, or is created by the issuer, 
of mortgage pass-through certificates, participa-
tion certificates, mortgage-backed securities, or 
other similar securities backed by a pool of assets 
that includes residential mortgage loans; 
(B) holds all of the mortgage loans which 
are the basis for any vehicle described in sub-
paragraph (A); and 
(C) has not issued securities that are guar-
anteed by the Federal National Mortgage Asso-
ciation, the Federal Home Loan Mortgage Cor-
poration, or the Government National Mortgage 
Association; 
(3) the term ‘‘servicer’’ means a servicer of 
securitized mortgages; 
(4) the term ‘‘eligible servicer’’ means a servicer 
of pooled and securitized residential mortgages; 
(5) the term ‘‘eligible mortgage’’ means a resi-
dential mortgage, the principal amount of which did 
not exceed the conforming loan size limit that was in 
existence at the time of origination for a comparable
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dwelling, as established by the Federal National Mort-
gage Association; 
(6) the term ‘‘Secretary’’ means the Secretary of 
the Treasury; 
(7) the term ‘‘effective term of the Act’’ means the 
period beginning on the effective date of this title and 
ending on December 31, 2011; 
(8) the term ‘‘incentive fee’’ means the monthly 
payment to eligible servicers, as determined under 
section 7003; and 
(9) the term ‘‘prepayment fee’’ means the pay-
ment to eligible servicers, as determined under section 
7003(b). 
SEC. 8003. PAYMENTS TO ELIGIBLE SERVICERS AUTHOR-
IZED. 
(a) AUTHORITY.—The Secretary is authorized to make 
payments to eligible servicers, subject to the terms and con-
ditions established under this title. 
(b) FEES PAID TO ELIGIBLE SERVICERS.— 
(1) IN GENERAL.—An eligible servicer may col-
lect reasonable incentive fee payments, as established 
by the Secretary, not to exceed $2,000 per loan. 
(2) CONSULTATION.—The fees permitted under 
this section shall be subject to standards established 
by the Secretary, in consultation with the Secretary
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of Housing and Urban Development and the Chair-
man of the Board of Directors of the Federal Deposit 
Insurance Corporation, which standards shall— 
(A) include an evaluation of whether an eli-
gible mortgage is affordable for the remainder of 
its term; and 
(B) identify a reasonable fee to be paid to 
the servicer in the event that an eligible mortgage 
is prepaid. 
(3) FORM OF PAYMENT.—Fees permitted under 
this section may be paid in a lump sum or on a 
monthly basis. If paid on a monthly basis, the fee 
may only be remitted as long as the loan performs. 
(c) SAFE HARBOR.—Notwithstanding any other provi-
sion of law, and notwithstanding any investment contract 
between a servicer and a securitization vehicle, a servicer— 
(1) owes any duty to maximize the net present 
value of the pooled mortgages in the securitization ve-
hicle to all investors and parties having a direct or 
indirect interest in such vehicle, and not to any indi-
vidual party or group of parties; and 
(2) shall be deemed to act in the best interests of 
all such investors and parties if the servicer agrees to 
or implements a modification, workout, or other loss 
mitigation plan for a residential mortgage or a class
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of residential mortgages that constitutes a part or all 
of the pooled mortgages in such securitization vehicle, 
if— 
(A) default on the payment of such mort-
gage has occurred or is reasonably foreseeable; 
(B) the property securing such mortgage is 
occupied by the mortgagor of such mortgage or 
the homeowner; and 
(C) the servicer reasonably and in good 
faith believes that the anticipated recovery on the 
principal outstanding obligation of the mortgage 
under the modification or workout plan exceeds, 
on a net present value basis, the anticipated re-
covery on the principal outstanding obligation of 
the mortgage through foreclosure; 
(3) shall not be obligated to repurchase loans 
from, 
or 
otherwise 
make 
payments 
to, 
the 
securitization vehicle on account of a modification, 
workout, or other loss mitigation plan that satisfies 
the conditions of paragraph (2); and 
(4) if it acts in a manner consistent with the du-
ties set forth in paragraphs (1) and (2), shall not be 
liable for entering into a modification or workout 
plan to any person—
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(A) based on ownership by that person of a 
residential mortgage loan or any interest in a 
pool of residential mortgage loans, or in securi-
ties that distribute payments out of the prin-
cipal, interest, and other payments in loans in 
the pool; 
(B) who is obligated pursuant to a deriva-
tive instrument to make payments determined in 
reference to any loan or any interest referred to 
in subparagraph (A); or 
(C) that insures any loan or any interest 
referred to in subparagraph (A) under any pro-
vision of law or regulation of the United States 
or any State or political subdivision thereof. 
(d) REPORTING REQUIREMENTS.— 
(1) IN GENERAL.—Each servicer shall report reg-
ularly, not less frequently than monthly, to the Sec-
retary on the extent and scope of the loss mitigation 
activities of the mortgage owner. 
(2) CONTENT.—Each report required by this sub-
section shall include— 
(A) the number and percent of residential 
mortgage loans receiving loss mitigation that 
have become performing loans;
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(B) the number and percent of residential 
mortgage loans receiving loss mitigation that 
have proceeded to foreclosure; 
(C) the total number of foreclosures initi-
ated during the reporting period; 
(D) data on loss mitigation activities, in-
cluding the performance of mitigated loans, 
disagreggated for each form of loss mitigation, 
which forms may include— 
(i) a waiver of any late payment 
charge, penalty interest, or any other fees or 
charges, or any combination thereof; 
(ii) the establishment of a repayment 
plan under which the homeowner resumes 
regularly scheduled payments and pays ad-
ditional amounts at scheduled intervals to 
cure the delinquency; 
(iii) forbearance under the loan that 
provides for a temporary reduction in or 
cessation of monthly payments, followed by 
a reamortization of the amounts due under 
the loan, including arrearage, and a new 
schedule of repayment amounts; 
(iv) waiver, modification, or variation 
of any material term of the loan, including
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short-term, long-term, or life-of-loan modi-
fications that change the interest rate, for-
give or forbear with respect to the payment 
of principal or interest, or extend the final 
maturity date of the loan; 
(v) short refinancing of the loan con-
sisting of acceptance of payment from or on 
behalf of the homeowner of an amount less 
than the amount alleged to be due and 
owing under the loan, including principal, 
interest, and fees, in full satisfaction of the 
obligation under such loan and as part of 
a refinance transaction in which the prop-
erty is intended to remain the principal 
residence of the homeowner; 
(vi) acquisition of the property by the 
owner or servicer by deed in lieu of fore-
closure; 
(vii) short sale of the principal resi-
dence that is subject to the lien securing the 
loan; 
(viii) assumption of the obligation of 
the homeowner under the loan by a third 
party;
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(ix) cancellation or postponement of a 
foreclosure sale to allow the homeowner ad-
ditional time to sell the property; or 
(x) any other loss mitigation activity 
not covered; and 
(E) such other information as the Secretary 
determines to be relevant. 
(3) PUBLIC AVAILABILITY OF REPORTS.—After 
removing information that would compromise the pri-
vacy interests of mortgagors, the Secretary shall make 
public the reports required by this subsection and 
summary data. 
SEC. 8004. AUTHORIZATION OF APPROPRIATIONS. 
There are authorized to be appropriated to the Sec-
retary, such sums as may be necessary to carry out this 
title. 
SEC. 8005. SUNSET OF AUTHORITY. 
The authority of the Secretary to provide assistance 
under this title shall terminate on December 31, 2011. 
Attest: 
Secretary.