H. R. 3590—251 
‘‘(E) PUBLIC AVAILABILITY OF DATA SUBMITTED.—The 
Secretary shall establish procedures for making data sub-
mitted under subparagraph (C) available to the public. 
Such procedures shall ensure that a long-term care hospital 
has the opportunity to review the data that is to be made 
public with respect to the hospital prior to such data being 
made public. The Secretary shall report quality measures 
that relate to services furnished in inpatient settings in 
long-term care hospitals on the Internet website of the 
Centers for Medicare & Medicaid Services.’’. 
(b) INPATIENT REHABILITATION HOSPITALS.—Section 1886(j) of 
the Social Security Act (42 U.S.C. 1395ww(j)) is amended— 
(1) by redesignating paragraph (7) as paragraph (8); and 
(2) by inserting after paragraph (6) the following new para-
graph: 
‘‘(7) QUALITY REPORTING.— 
‘‘(A) REDUCTION IN UPDATE FOR FAILURE TO REPORT.— 
‘‘(i) IN GENERAL.—For purposes of fiscal year 2014 
and each subsequent fiscal year, in the case of a 
rehabilitation facility that does not submit data to 
the Secretary in accordance with subparagraph (C) 
with respect to such a fiscal year, after determining 
the increase factor described in paragraph (3)(C), and 
after application of paragraph (3)(D), the Secretary 
shall reduce such increase factor for payments for dis-
charges occurring during such fiscal year by 2 percent-
age points. 
‘‘(ii) SPECIAL
RULE.—The application of this 
subparagraph may result in the increase factor 
described in paragraph (3)(C) being less than 0.0 for 
a fiscal year, and may result in payment rates under 
this subsection for a fiscal year being less than such 
payment rates for the preceding fiscal year. 
‘‘(B) NONCUMULATIVE
APPLICATION.—Any reduction 
under subparagraph (A) shall apply only with respect to 
the fiscal year involved and the Secretary shall not take 
into account such reduction in computing the payment 
amount under this subsection for a subsequent fiscal year. 
‘‘(C) SUBMISSION
OF
QUALITY
DATA.—For fiscal year 
2014 and each subsequent rate year, each rehabilitation 
facility shall submit to the Secretary data on quality meas-
ures specified under subparagraph (D). Such data shall 
be submitted in a form and manner, and at a time, specified 
by the Secretary for purposes of this subparagraph. 
‘‘(D) QUALITY MEASURES.— 
‘‘(i) IN
GENERAL.—Subject to clause (ii), any 
measure specified by the Secretary under this subpara-
graph must have been endorsed by the entity with 
a contract under section 1890(a). 
‘‘(ii) EXCEPTION.—In the case of a specified area 
or medical topic determined appropriate by the Sec-
retary for which a feasible and practical measure has 
not been endorsed by the entity with a contract under 
section 1890(a), the Secretary may specify a measure 
that is not so endorsed as long as due consideration 
is given to measures that have been endorsed or
H. R. 3590—252 
adopted by a consensus organization identified by the 
Secretary. 
‘‘(iii) TIME FRAME.—Not later than October 1, 2012, 
the Secretary shall publish the measures selected 
under this subparagraph that will be applicable with 
respect to fiscal year 2014. 
‘‘(E) PUBLIC AVAILABILITY OF DATA SUBMITTED.—The 
Secretary shall establish procedures for making data sub-
mitted under subparagraph (C) available to the public. 
Such procedures shall ensure that a rehabilitation facility 
has the opportunity to review the data that is to be made 
public with respect to the facility prior to such data being 
made public. The Secretary shall report quality measures 
that relate to services furnished in inpatient settings in 
rehabilitation facilities on the Internet website of the Cen-
ters for Medicare & Medicaid Services.’’. 
(c) HOSPICE PROGRAMS.—Section 1814(i) of the Social Security 
Act (42 U.S.C. 1395f(i)) is amended— 
(1) by redesignating paragraph (5) as paragraph (6); and 
(2) by inserting after paragraph (4) the following new para-
graph: 
‘‘(5) QUALITY REPORTING.— 
‘‘(A) REDUCTION IN UPDATE FOR FAILURE TO REPORT.— 
‘‘(i) IN GENERAL.—For purposes of fiscal year 2014 
and each subsequent fiscal year, in the case of a hospice 
program that does not submit data to the Secretary 
in accordance with subparagraph (C) with respect to 
such a fiscal year, after determining the market basket 
percentage increase under paragraph (1)(C)(ii)(VII) or 
paragraph (1)(C)(iii), as applicable, and after applica-
tion of paragraph (1)(C)(iv), with respect to the fiscal 
year, the Secretary shall reduce such market basket 
percentage increase by 2 percentage points. 
‘‘(ii) SPECIAL
RULE.—The application of this 
subparagraph may result in the market basket percent-
age increase under paragraph (1)(C)(ii)(VII) or para-
graph (1)(C)(iii), as applicable, being less than 0.0 for 
a fiscal year, and may result in payment rates under 
this subsection for a fiscal year being less than such 
payment rates for the preceding fiscal year. 
‘‘(B) NONCUMULATIVE
APPLICATION.—Any reduction 
under subparagraph (A) shall apply only with respect to 
the fiscal year involved and the Secretary shall not take 
into account such reduction in computing the payment 
amount under this subsection for a subsequent fiscal year. 
‘‘(C) SUBMISSION
OF
QUALITY
DATA.—For fiscal year 
2014 and each subsequent fiscal year, each hospice program 
shall submit to the Secretary data on quality measures 
specified under subparagraph (D). Such data shall be sub-
mitted in a form and manner, and at a time, specified 
by the Secretary for purposes of this subparagraph. 
‘‘(D) QUALITY MEASURES.— 
‘‘(i) IN
GENERAL.—Subject to clause (ii), any 
measure specified by the Secretary under this subpara-
graph must have been endorsed by the entity with 
a contract under section 1890(a).
H. R. 3590—253 
‘‘(ii) EXCEPTION.—In the case of a specified area 
or medical topic determined appropriate by the Sec-
retary for which a feasible and practical measure has 
not been endorsed by the entity with a contract under 
section 1890(a), the Secretary may specify a measure 
that is not so endorsed as long as due consideration 
is given to measures that have been endorsed or 
adopted by a consensus organization identified by the 
Secretary. 
‘‘(iii) TIME FRAME.—Not later than October 1, 2012, 
the Secretary shall publish the measures selected 
under this subparagraph that will be applicable with 
respect to fiscal year 2014. 
‘‘(E) PUBLIC AVAILABILITY OF DATA SUBMITTED.—The 
Secretary shall establish procedures for making data sub-
mitted under subparagraph (C) available to the public. 
Such procedures shall ensure that a hospice program has 
the opportunity to review the data that is to be made 
public with respect to the hospice program prior to such 
data being made public. The Secretary shall report quality 
measures that relate to hospice care provided by hospice 
programs on the Internet website of the Centers for Medi-
care & Medicaid Services.’’. 
SEC. 3005. QUALITY REPORTING FOR PPS-EXEMPT CANCER HOS-
PITALS. 
Section 1866 of the Social Security Act (42 U.S.C. 1395cc) 
is amended— 
(1) in subsection (a)(1)— 
(A) in subparagraph (U), by striking ‘‘and’’ at the end; 
(B) in subparagraph (V), by striking the period at 
the end and inserting ‘‘, and’’; and 
(C) by adding at the end the following new subpara-
graph: 
‘‘(W) in the case of a hospital described in section 
1886(d)(1)(B)(v), to report quality data to the Secretary 
in accordance with subsection (k).’’; and 
(2) by adding at the end the following new subsection: 
‘‘(k) QUALITY REPORTING BY CANCER HOSPITALS.— 
‘‘(1) IN GENERAL.—For purposes of fiscal year 2014 and 
each subsequent fiscal year, a hospital described in section 
1886(d)(1)(B)(v) shall submit data to the Secretary in accord-
ance with paragraph (2) with respect to such a fiscal year. 
‘‘(2) SUBMISSION OF QUALITY DATA.—For fiscal year 2014 
and each subsequent fiscal year, each hospital described in 
such section shall submit to the Secretary data on quality 
measures specified under paragraph (3). Such data shall be 
submitted in a form and manner, and at a time, specified 
by the Secretary for purposes of this subparagraph. 
‘‘(3) QUALITY MEASURES.— 
‘‘(A) IN GENERAL.—Subject to subparagraph (B), any 
measure specified by the Secretary under this paragraph 
must have been endorsed by the entity with a contract 
under section 1890(a). 
‘‘(B) EXCEPTION.—In the case of a specified area or 
medical topic determined appropriate by the Secretary for 
which a feasible and practical measure has not been
H. R. 3590—254 
endorsed by the entity with a contract under section 
1890(a), the Secretary may specify a measure that is not 
so endorsed as long as due consideration is given to meas-
ures that have been endorsed or adopted by a consensus 
organization identified by the Secretary. 
‘‘(C) TIME FRAME.—Not later than October 1, 2012, 
the Secretary shall publish the measures selected under 
this paragraph that will be applicable with respect to fiscal 
year 2014. 
‘‘(4) PUBLIC AVAILABILITY OF DATA SUBMITTED.—The Sec-
retary shall establish procedures for making data submitted 
under paragraph (4) available to the public. Such procedures 
shall ensure that a hospital described in section 1886(d)(1)(B)(v) 
has the opportunity to review the data that is to be made 
public with respect to the hospital prior to such data being 
made public. The Secretary shall report quality measures of 
process, structure, outcome, patients’ perspective on care, effi-
ciency, and costs of care that relate to services furnished in 
such hospitals on the Internet website of the Centers for Medi-
care & Medicaid Services.’’. 
SEC. 3006. PLANS FOR A VALUE-BASED PURCHASING PROGRAM FOR 
SKILLED NURSING FACILITIES AND HOME HEALTH 
AGENCIES. 
(a) SKILLED NURSING FACILITIES.— 
(1) IN
GENERAL.—The Secretary of Health and Human 
Services (in this section referred to as the ‘‘Secretary’’) shall 
develop a plan to implement a value-based purchasing program 
for payments under the Medicare program under title XVIII 
of the Social Security Act for skilled nursing facilities (as 
defined in section 1819(a) of such Act (42 U.S.C. 1395i–3(a))). 
(2) DETAILS.—In developing the plan under paragraph (1), 
the Secretary shall consider the following issues: 
(A) The ongoing development, selection, and modifica-
tion process for measures (including under section 1890 
of the Social Security Act (42 U.S.C. 1395aaa) and section 
1890A such Act, as added by section 3014), to the extent 
feasible and practicable, of all dimensions of quality and 
efficiency in skilled nursing facilities. 
(i) IN GENERAL.—Subject to clause (ii), any measure 
specified by the Secretary under subparagraph (A)(iii) 
must have been endorsed by the entity with a contract 
under section 1890(a). 
(ii) EXCEPTION.—In the case of a specified area 
or medical topic determined appropriate by the Sec-
retary for which a feasible and practical measure has 
not been endorsed by the entity with a contract under 
section 1890(a), the Secretary may specify a measure 
that is not so endorsed as long as due consideration 
is given to measures that have been endorsed or 
adopted by a consensus organization identified by the 
Secretary. 
(B) The reporting, collection, and validation of quality 
data. 
(C) The structure of value-based payment adjustments, 
including the determination of thresholds or improvements 
in quality that would substantiate a payment adjustment,
H. R. 3590—255 
the size of such payments, and the sources of funding 
for the value-based bonus payments. 
(D) Methods for the public disclosure of information 
on the performance of skilled nursing facilities. 
(E) Any other issues determined appropriate by the 
Secretary. 
(3) CONSULTATION.—In developing the plan under para-
graph (1), the Secretary shall— 
(A) consult with relevant affected parties; and 
(B) consider experience with such demonstrations that 
the Secretary determines are relevant to the value-based 
purchasing program described in paragraph (1). 
(4) REPORT TO CONGRESS.—Not later than October 1, 2011, 
the Secretary shall submit to Congress a report containing 
the plan developed under paragraph (1). 
(b) HOME HEALTH AGENCIES.— 
(1) IN
GENERAL.—The Secretary of Health and Human 
Services (in this section referred to as the ‘‘Secretary’’) shall 
develop a plan to implement a value-based purchasing program 
for payments under the Medicare program under title XVIII 
of the Social Security Act for home health agencies (as defined 
in section 1861(o) of such Act (42 U.S.C. 1395x(o))). 
(2) DETAILS.—In developing the plan under paragraph (1), 
the Secretary shall consider the following issues: 
(A) The ongoing development, selection, and modifica-
tion process for measures (including under section 1890 
of the Social Security Act (42 U.S.C. 1395aaa) and section 
1890A such Act, as added by section 3014), to the extent 
feasible and practicable, of all dimensions of quality and 
efficiency in home health agencies. 
(B) The reporting, collection, and validation of quality 
data. 
(C) The structure of value-based payment adjustments, 
including the determination of thresholds or improvements 
in quality that would substantiate a payment adjustment, 
the size of such payments, and the sources of funding 
for the value-based bonus payments. 
(D) Methods for the public disclosure of information 
on the performance of home health agencies. 
(E) Any other issues determined appropriate by the 
Secretary. 
(3) CONSULTATION.—In developing the plan under para-
graph (1), the Secretary shall— 
(A) consult with relevant affected parties; and 
(B) consider experience with such demonstrations that 
the Secretary determines are relevant to the value-based 
purchasing program described in paragraph (1). 
(4) REPORT TO CONGRESS.—Not later than October 1, 2011, 
the Secretary shall submit to Congress a report containing 
the plan developed under paragraph (1). 
SEC. 3007. VALUE-BASED PAYMENT MODIFIER UNDER THE PHYSICIAN 
FEE SCHEDULE. 
Section 1848 of the Social Security Act (42 U.S.C. 1395w– 
4) is amended— 
(1) in subsection (b)(1), by inserting ‘‘subject to subsection 
(p),’’ after ‘‘1998,’’; and
H. R. 3590—256 
(2) by adding at the end the following new subsection: 
‘‘(p) ESTABLISHMENT
OF VALUE-BASED PAYMENT MODIFIER.— 
‘‘(1) IN GENERAL.—The Secretary shall establish a payment 
modifier that provides for differential payment to a physician 
or a group of physicians under the fee schedule established 
under subsection (b) based upon the quality of care furnished 
compared to cost (as determined under paragraphs (2) and 
(3), respectively) during a performance period. Such payment 
modifier shall be separate from the geographic adjustment fac-
tors established under subsection (e). 
‘‘(2) QUALITY.— 
‘‘(A) IN
GENERAL.—For purposes of paragraph (1), 
quality of care shall be evaluated, to the extent practicable, 
based on a composite of measures of the quality of care 
furnished (as established by the Secretary under subpara-
graph (B)). 
‘‘(B) MEASURES.— 
‘‘(i) The Secretary shall establish appropriate 
measures of the quality of care furnished by a physi-
cian or group of physicians to individuals enrolled 
under this part, such as measures that reflect health 
outcomes. Such measures shall be risk adjusted as 
determined appropriate by the Secretary. 
‘‘(ii) The Secretary shall seek endorsement of the 
measures established under this subparagraph by the 
entity with a contract under section 1890(a). 
‘‘(3) COSTS.—For purposes of paragraph (1), costs shall 
be evaluated, to the extent practicable, based on a composite 
of appropriate measures of costs established by the Secretary 
(such as the composite measure under the methodology estab-
lished under subsection (n)(9)(C)(iii)) that eliminate the effect 
of geographic adjustments in payment rates (as described in 
subsection (e)), and take into account risk factors (such as 
socioeconomic and demographic characteristics, ethnicity, and 
health status of individuals (such as to recognize that less 
healthy individuals may require more intensive interventions) 
and other factors determined appropriate by the Secretary. 
‘‘(4) IMPLEMENTATION.— 
‘‘(A) PUBLICATION OF MEASURES, DATES OF IMPLEMENTA-
TION, PERFORMANCE PERIOD.—Not later than January 1, 
2012, the Secretary shall publish the following: 
‘‘(i) The measures of quality of care and costs estab-
lished under paragraphs (2) and (3), respectively. 
‘‘(ii) The dates for implementation of the payment 
modifier (as determined under subparagraph (B)). 
‘‘(iii) The initial performance period (as specified 
under subparagraph (B)(ii)). 
‘‘(B) DEADLINES FOR IMPLEMENTATION.— 
‘‘(i) INITIAL IMPLEMENTATION.—Subject to the pre-
ceding provisions of this subparagraph, the Secretary 
shall begin implementing the payment modifier estab-
lished under this subsection through the rulemaking 
process during 2013 for the physician fee schedule 
established under subsection (b). 
‘‘(ii) INITIAL PERFORMANCE PERIOD.— 
‘‘(I) IN GENERAL.—The Secretary shall specify 
an initial performance period for application of
H. R. 3590—257 
the payment modifier established under this sub-
section with respect to 2015. 
‘‘(II) PROVISION OF INFORMATION DURING INI-
TIAL
PERFORMANCE
PERIOD.—During the initial 
performance period, the Secretary shall, to the 
extent practicable, provide information to physi-
cians and groups of physicians about the quality 
of care furnished by the physician or group of 
physicians to individuals enrolled under this part 
compared to cost (as determined under paragraphs 
(2) and (3), respectively) with respect to the 
performance period. 
‘‘(iii) APPLICATION.—The Secretary shall apply the 
payment modifier established under this subsection 
for items and services furnished— 
‘‘(I) beginning on January 1, 2015, with respect 
to specific physicians and groups of physicians the 
Secretary determines appropriate; and 
‘‘(II) beginning not later than January 1, 2017, 
with respect to all physicians and groups of physi-
cians. 
‘‘(C) BUDGET
NEUTRALITY.—The payment modifier 
established under this subsection shall be implemented 
in a budget neutral manner. 
‘‘(5) SYSTEMS-BASED CARE.—The Secretary shall, as appro-
priate, apply the payment modifier established under this sub-
section in a manner that promotes systems-based care. 
‘‘(6) CONSIDERATION OF SPECIAL CIRCUMSTANCES OF CERTAIN 
PROVIDERS.—In applying the payment modifier under this sub-
section, the Secretary shall, as appropriate, take into account 
the special circumstances of physicians or groups of physicians 
in rural areas and other underserved communities. 
‘‘(7) APPLICATION.—For purposes of the initial application 
of the payment modifier established under this subsection 
during the period beginning on January 1, 2015, and ending 
on December 31, 2016, the term ‘physician’ has the meaning 
given such term in section 1861(r). On or after January 1, 
2017, the Secretary may apply this subsection to eligible profes-
sionals (as defined in subsection (k)(3)(B)) as the Secretary 
determines appropriate. 
‘‘(8) DEFINITIONS.—For purposes of this subsection: 
‘‘(A) COSTS.—The term ‘costs’ means expenditures per 
individual as determined appropriate by the Secretary. In 
making the determination under the preceding sentence, 
the Secretary may take into account the amount of growth 
in expenditures per individual for a physician compared 
to the amount of such growth for other physicians. 
‘‘(B) PERFORMANCE
PERIOD.—The term ‘performance 
period’ means a period specified by the Secretary. 
‘‘(9) COORDINATION WITH OTHER VALUE-BASED PURCHASING 
REFORMS.—The Secretary shall coordinate the value-based pay-
ment modifier established under this subsection with the Physi-
cian Feedback Program under subsection (n) and, as the Sec-
retary determines appropriate, other similar provisions of this 
title.
H. R. 3590—258 
‘‘(10) LIMITATIONS ON REVIEW.—There shall be no adminis-
trative or judicial review under section 1869, section 1878, 
or otherwise of— 
‘‘(A) the establishment of the value-based payment 
modifier under this subsection; 
‘‘(B) the evaluation of quality of care under paragraph 
(2), including the establishment of appropriate measures 
of the quality of care under paragraph (2)(B); 
‘‘(C) the evaluation of costs under paragraph (3), 
including the establishment of appropriate measures of 
costs under such paragraph; 
‘‘(D) the dates for implementation of the value-based 
payment modifier; 
‘‘(E) the specification of the initial performance period 
and any other performance period under paragraphs 
(4)(B)(ii) and (8)(B), respectively; 
‘‘(F) the application of the value-based payment modi-
fier under paragraph (7); and 
‘‘(G) the determination of costs under paragraph 
(8)(A).’’. 
SEC. 3008. PAYMENT ADJUSTMENT FOR CONDITIONS ACQUIRED IN 
HOSPITALS. 
(a) IN GENERAL.—Section 1886 of the Social Security Act (42 
U.S.C. 1395ww), as amended by section 3001, is amended by adding 
at the end the following new subsection: 
‘‘(p) ADJUSTMENT
TO
HOSPITAL
PAYMENTS
FOR
HOSPITAL 
ACQUIRED CONDITIONS.— 
‘‘(1) IN
GENERAL.—In order to provide an incentive for 
applicable hospitals to reduce hospital acquired conditions 
under this title, with respect to discharges from an applicable 
hospital occurring during fiscal year 2015 or a subsequent 
fiscal year, the amount of payment under this section or section 
1814(b)(3), as applicable, for such discharges during the fiscal 
year shall be equal to 99 percent of the amount of payment 
that would otherwise apply to such discharges under this sec-
tion or section 1814(b)(3) (determined after the application of 
subsections (o) and (q) and section 1814(l)(4) but without regard 
to this subsection). 
‘‘(2) APPLICABLE HOSPITALS.— 
‘‘(A) IN GENERAL.—For purposes of this subsection, the 
term ‘applicable hospital’ means a subsection (d) hospital 
that meets the criteria described in subparagraph (B). 
‘‘(B) CRITERIA DESCRIBED.— 
‘‘(i) IN GENERAL.—The criteria described in this 
subparagraph, with respect to a subsection (d) hospital, 
is that the subsection (d) hospital is in the top quartile 
of all subsection (d) hospitals, relative to the national 
average, of hospital acquired conditions during the 
applicable period, as determined by the Secretary. 
‘‘(ii) RISK ADJUSTMENT.—In carrying out clause (i), 
the Secretary shall establish and apply an appropriate 
risk adjustment methodology. 
‘‘(C) EXEMPTION.—In the case of a hospital that is 
paid under section 1814(b)(3), the Secretary may exempt 
such hospital from the application of this subsection if 
the State which is paid under such section submits an
H. R. 3590—259 
annual report to the Secretary describing how a similar 
program in the State for a participating hospital or hos-
pitals achieves or surpasses the measured results in terms 
of patient health outcomes and cost savings established 
under this subsection. 
‘‘(3) HOSPITAL ACQUIRED CONDITIONS.—For purposes of this 
subsection, the term ‘hospital acquired condition’ means a condi-
tion identified for purposes of subsection (d)(4)(D)(iv) and any 
other condition determined appropriate by the Secretary that 
an individual acquires during a stay in an applicable hospital, 
as determined by the Secretary. 
‘‘(4) APPLICABLE
PERIOD.—In this subsection, the term 
‘applicable period’ means, with respect to a fiscal year, a period 
specified by the Secretary. 
‘‘(5) REPORTING TO HOSPITALS.—Prior to fiscal year 2015 
and each subsequent fiscal year, the Secretary shall provide 
confidential reports to applicable hospitals with respect to hos-
pital acquired conditions of the applicable hospital during the 
applicable period. 
‘‘(6) REPORTING HOSPITAL SPECIFIC INFORMATION.— 
‘‘(A) IN GENERAL.—The Secretary shall make informa-
tion available to the public regarding hospital acquired 
conditions of each applicable hospital. 
‘‘(B) OPPORTUNITY
TO
REVIEW
AND
SUBMIT
CORREC-
TIONS.—The Secretary shall ensure that an applicable hos-
pital has the opportunity to review, and submit corrections 
for, the information to be made public with respect to 
the hospital under subparagraph (A) prior to such informa-
tion being made public. 
‘‘(C) WEBSITE.—Such information shall be posted on 
the Hospital Compare Internet website in an easily under-
standable format. 
‘‘(7) LIMITATIONS ON REVIEW.—There shall be no adminis-
trative or judicial review under section 1869, section 1878, 
or otherwise of the following: 
‘‘(A) The criteria described in paragraph (2)(A). 
‘‘(B) The specification of hospital acquired conditions 
under paragraph (3). 
‘‘(C) The specification of the applicable period under 
paragraph (4). 
‘‘(D) The provision of reports to applicable hospitals 
under paragraph (5) and the information made available 
to the public under paragraph (6).’’. 
(b) STUDY
AND
REPORT
ON
EXPANSION
OF
HEALTHCARE 
ACQUIRED CONDITIONS POLICY TO OTHER PROVIDERS.— 
(1) STUDY.—The Secretary of Health and Human Services 
shall conduct a study on expanding the healthcare acquired 
conditions policy under subsection (d)(4)(D) of section 1886 
of the Social Security Act (42 U.S.C. 1395ww) to payments 
made to other facilities under the Medicare program under 
title XVIII of the Social Security Act, including such payments 
made to inpatient rehabilitation facilities, long-term care hos-
pitals (as described in subsection(d)(1)(B)(iv) of such section), 
hospital outpatient departments, and other hospitals excluded 
from the inpatient prospective payment system under such 
section, skilled nursing facilities, ambulatory surgical centers, 
and health clinics. Such study shall include an analysis of
H. R. 3590—260 
how such policies could impact quality of patient care, patient 
safety, and spending under the Medicare program. 
(2) REPORT.—Not later than January 1, 2012, the Secretary 
shall submit to Congress a report containing the results of 
the study conducted under paragraph (1), together with rec-
ommendations for such legislation and administrative action 
as the Secretary determines appropriate. 
PART II—NATIONAL STRATEGY TO IMPROVE 
HEALTH CARE QUALITY 
SEC. 3011. NATIONAL STRATEGY. 
Title III of the Public Health Service Act (42 U.S.C. 241 et 
seq.) is amended by adding at the end the following: 
‘‘PART S—HEALTH CARE QUALITY PROGRAMS 
‘‘Subpart I—National Strategy for Quality 
Improvement in Health Care 
‘‘SEC. 399HH. NATIONAL STRATEGY FOR QUALITY IMPROVEMENT IN 
HEALTH CARE. 
‘‘(a) ESTABLISHMENT OF NATIONAL STRATEGY AND PRIORITIES.— 
‘‘(1) NATIONAL STRATEGY.—The Secretary, through a trans-
parent collaborative process, shall establish a national strategy 
to improve the delivery of health care services, patient health 
outcomes, and population health. 
‘‘(2) IDENTIFICATION OF PRIORITIES.— 
‘‘(A) 
IN
GENERAL.—The 
Secretary 
shall 
identify 
national priorities for improvement in developing the 
strategy under paragraph (1). 
‘‘(B) REQUIREMENTS.—The Secretary shall ensure that 
priorities identified under subparagraph (A) will— 
‘‘(i) have the greatest potential for improving the 
health outcomes, efficiency, and patient-centeredness 
of health care for all populations, including children 
and vulnerable populations; 
‘‘(ii) identify areas in the delivery of health care 
services that have the potential for rapid improvement 
in the quality and efficiency of patient care; 
‘‘(iii) address gaps in quality, efficiency, compara-
tive effectiveness information, and health outcomes 
measures and data aggregation techniques; 
‘‘(iv) improve Federal payment policy to emphasize 
quality and efficiency; 
‘‘(v) enhance the use of health care data to improve 
quality, efficiency, transparency, and outcomes; 
‘‘(vi) address the health care provided to patients 
with high-cost chronic diseases; 
‘‘(vii) improve research and dissemination of strate-
gies and best practices to improve patient safety and 
reduce medical errors, preventable admissions and re-
admissions, and health care-associated infections; 
‘‘(viii) reduce health disparities across health dis-
parity populations (as defined in section 485E) and 
geographic areas; and
H. R. 3590—261 
‘‘(ix) address other areas as determined appro-
priate by the Secretary. 
‘‘(C) CONSIDERATIONS.—In identifying priorities under 
subparagraph (A), the Secretary shall take into consider-
ation the recommendations submitted by the entity with 
a contract under section 1890(a) of the Social Security 
Act and other stakeholders. 
‘‘(D) COORDINATION WITH STATE AGENCIES.—The Sec-
retary shall collaborate, coordinate, and consult with State 
agencies responsible for administering the Medicaid pro-
gram under title XIX of the Social Security Act and the 
Children’s Health Insurance Program under title XXI of 
such Act with respect to developing and disseminating 
strategies, goals, models, and timetables that are consistent 
with the national priorities identified under subparagraph 
(A). 
‘‘(b) STRATEGIC PLAN.— 
‘‘(1) IN GENERAL.—The national strategy shall include a 
comprehensive strategic plan to achieve the priorities described 
in subsection (a). 
‘‘(2) REQUIREMENTS.—The strategic plan shall include 
provisions for addressing, at a minimum, the following: 
‘‘(A) Coordination among agencies within the Depart-
ment, which shall include steps to minimize duplication 
of efforts and utilization of common quality measures, 
where available. Such common quality measures shall be 
measures identified by the Secretary under section 1139A 
or 1139B of the Social Security Act or endorsed under 
section 1890 of such Act. 
‘‘(B) Agency-specific strategic plans to achieve national 
priorities. 
‘‘(C) Establishment of annual benchmarks for each rel-
evant agency to achieve national priorities. 
‘‘(D) A process for regular reporting by the agencies 
to the Secretary on the implementation of the strategic 
plan. 
‘‘(E) Strategies to align public and private payers with 
regard to quality and patient safety efforts. 
‘‘(F) Incorporating quality improvement and measure-
ment in the strategic plan for health information technology 
required by the American Recovery and Reinvestment Act 
of 2009 (Public Law 111–5). 
‘‘(c) PERIODIC UPDATE OF NATIONAL STRATEGY.—The Secretary 
shall update the national strategy not less than annually. Any 
such update shall include a review of short- and long-term goals. 
‘‘(d) SUBMISSION AND AVAILABILITY OF NATIONAL STRATEGY AND 
UPDATES.— 
‘‘(1) DEADLINE
FOR
INITIAL
SUBMISSION
OF
NATIONAL 
STRATEGY.—Not later than January 1, 2011, the Secretary shall 
submit to the relevant committees of Congress the national 
strategy described in subsection (a). 
‘‘(2) UPDATES.— 
‘‘(A) IN GENERAL.—The Secretary shall submit to the 
relevant committees of Congress an annual update to the 
strategy described in paragraph (1). 
‘‘(B) INFORMATION SUBMITTED.—Each update submitted 
under subparagraph (A) shall include—
H. R. 3590—262 
‘‘(i) a review of the short- and long-term goals 
of the national strategy and any gaps in such strategy; 
‘‘(ii) an analysis of the progress, or lack of progress, 
in meeting such goals and any barriers to such 
progress; 
‘‘(iii) the information reported under section 1139A 
of the Social Security Act, consistent with the reporting 
requirements of such section; and 
‘‘(iv) in the case of an update required to be sub-
mitted on or after January 1, 2014, the information 
reported under section 1139B(b)(4) of the Social Secu-
rity Act, consistent with the reporting requirements 
of such section. 
‘‘(C) SATISFACTION
OF
OTHER
REPORTING
REQUIRE-
MENTS.—Compliance with the requirements of clauses (iii) 
and (iv) of subparagraph (B) shall satisfy the reporting 
requirements under sections 1139A(a)(6) and 1139B(b)(4), 
respectively, of the Social Security Act. 
‘‘(e) HEALTH CARE QUALITY INTERNET WEBSITE.—Not later than 
January 1, 2011, the Secretary shall create an Internet website 
to make public information regarding— 
‘‘(1) the national priorities for health care quality improve-
ment established under subsection (a)(2); 
‘‘(2) the agency-specific strategic plans for health care 
quality described in subsection (b)(2)(B); and 
‘‘(3) other information, as the Secretary determines to be 
appropriate.’’. 
SEC. 3012. INTERAGENCY WORKING GROUP ON HEALTH CARE 
QUALITY. 
(a) IN GENERAL.—The President shall convene a working group 
to be known as the Interagency Working Group on Health Care 
Quality (referred to in this section as the ‘‘Working Group’’). 
(b) GOALS.—The goals of the Working Group shall be to achieve 
the following: 
(1) Collaboration, cooperation, and consultation between 
Federal departments and agencies with respect to developing 
and disseminating strategies, goals, models, and timetables 
that are consistent with the national priorities identified under 
section 399HH(a)(2) of the Public Health Service Act (as added 
by section 3011). 
(2) Avoidance of inefficient duplication of quality improve-
ment efforts and resources, where practicable, and a stream-
lined process for quality reporting and compliance require-
ments. 
(3) Assess alignment of quality efforts in the public sector 
with private sector initiatives. 
(c) COMPOSITION.— 
(1) IN GENERAL.—The Working Group shall be composed 
of senior level representatives of— 
(A) the Department of Health and Human Services; 
(B) the Centers for Medicare & Medicaid Services; 
(C) the National Institutes of Health; 
(D) the Centers for Disease Control and Prevention; 
(E) the Food and Drug Administration; 
(F) the Health Resources and Services Administration; 
(G) the Agency for Healthcare Research and Quality;
H. R. 3590—263 
(H) the Office of the National Coordinator for Health 
Information Technology; 
(I) the Substance Abuse and Mental Health Services 
Administration; 
(J) the Administration for Children and Families; 
(K) the Department of Commerce; 
(L) the Office of Management and Budget; 
(M) the United States Coast Guard; 
(N) the Federal Bureau of Prisons; 
(O) the National Highway Traffic Safety Administra-
tion; 
(P) the Federal Trade Commission; 
(Q) the Social Security Administration; 
(R) the Department of Labor; 
(S) the United States Office of Personnel Management; 
(T) the Department of Defense; 
(U) the Department of Education; 
(V) the Department of Veterans Affairs; 
(W) the Veterans Health Administration; and 
(X) any other Federal agencies and departments with 
activities relating to improving health care quality and 
safety, as determined by the President. 
(2) CHAIR AND VICE-CHAIR.— 
(A) CHAIR.—The Working Group shall be chaired by 
the Secretary of Health and Human Services. 
(B) VICE CHAIR.—Members of the Working Group, other 
than the Secretary of Health and Human Services, shall 
serve as Vice Chair of the Group on a rotating basis, 
as determined by the Group. 
(d) REPORT TO CONGRESS.—Not later than December 31, 2010, 
and annually thereafter, the Working Group shall submit to the 
relevant Committees of Congress, and make public on an Internet 
website, a report describing the progress and recommendations 
of the Working Group in meeting the goals described in subsection 
(b). 
SEC. 3013. QUALITY MEASURE DEVELOPMENT. 
(a) PUBLIC HEALTH SERVICE ACT.—Title IX of the Public Health 
Service Act (42 U.S.C. 299 et seq.) is amended— 
(1) by redesignating part D as part E; 
(2) by redesignating sections 931 through 938 as sections 
941 through 948, respectively; 
(3) in section 948(1), as so redesignated, by striking ‘‘931’’ 
and inserting ‘‘941’’; and 
(4) by inserting after section 926 the following: 
‘‘PART D—HEALTH CARE QUALITY 
IMPROVEMENT 
‘‘Subpart I—Quality Measure Development 
‘‘SEC. 931. QUALITY MEASURE DEVELOPMENT. 
‘‘(a) QUALITY MEASURE.—In this subpart, the term ‘quality 
measure’ means a standard for measuring the performance and 
improvement of population health or of health plans, providers 
of services, and other clinicians in the delivery of health care 
services.
H. R. 3590—264 
‘‘(b) IDENTIFICATION OF QUALITY MEASURES.— 
‘‘(1) IDENTIFICATION.—The Secretary, in consultation with 
the Director of the Agency for Healthcare Research and Quality 
and the Administrator of the Centers for Medicare & Medicaid 
Services, shall identify, not less often than triennially, gaps 
where no quality measures exist and existing quality measures 
that need improvement, updating, or expansion, consistent with 
the national strategy under section 399HH, to the extent avail-
able, for use in Federal health programs. In identifying such 
gaps and existing quality measures that need improvement, 
the Secretary shall take into consideration— 
‘‘(A) the gaps identified by the entity with a contract 
under section 1890(a) of the Social Security Act and other 
stakeholders; 
‘‘(B) quality measures identified by the pediatric 
quality measures program under section 1139A of the 
Social Security Act; and 
‘‘(C) quality measures identified through the Medicaid 
Quality Measurement Program under section 1139B of the 
Social Security Act. 
‘‘(2) PUBLICATION.—The Secretary shall make available to 
the public on an Internet website a report on any gaps identified 
under paragraph (1) and the process used to make such identi-
fication. 
‘‘(c) GRANTS OR CONTRACTS FOR QUALITY MEASURE DEVELOP-
MENT.— 
‘‘(1) IN GENERAL.—The Secretary shall award grants, con-
tracts, or intergovernmental agreements to eligible entities for 
purposes of developing, improving, updating, or expanding 
quality measures identified under subsection (b). 
‘‘(2) PRIORITIZATION IN THE DEVELOPMENT OF QUALITY MEAS-
URES.—In awarding grants, contracts, or agreements under 
this subsection, the Secretary shall give priority to the develop-
ment of quality measures that allow the assessment of— 
‘‘(A) health outcomes and functional status of patients; 
‘‘(B) the management and coordination of health care 
across episodes of care and care transitions for patients 
across the continuum of providers, health care settings, 
and health plans; 
‘‘(C) the experience, quality, and use of information 
provided to and used by patients, caregivers, and author-
ized representatives to inform decisionmaking about treat-
ment options, including the use of shared decisionmaking 
tools and preference sensitive care (as defined in section 
936); 
‘‘(D) the meaningful use of health information tech-
nology; 
‘‘(E) the safety, effectiveness, patient-centeredness, 
appropriateness, and timeliness of care; 
‘‘(F) the efficiency of care; 
‘‘(G) the equity of health services and health disparities 
across health disparity populations (as defined in section 
485E) and geographic areas; 
‘‘(H) patient experience and satisfaction; 
‘‘(I) the use of innovative strategies and methodologies 
identified under section 933; and