130 
‘‘(2) PAYMENTS FROM STATES.— 
‘‘(A) BILLING NOTIFICATION.— 
‘‘(i) TIMING.—On June 30th and De-
cember 31st of each year, the Secretary 
shall send written notification to each 
State of that State’s 50 percent share of 
expenses, as described in paragraph (1), 
for the 6-month period ending on the last 
day of the month previous to such notifica-
tion. 
‘‘(ii) CONTENTS.—Each such notifica-
tion to a State shall clearly state— 
‘‘(I) the payment amount due 
from the State; 
‘‘(II) the name of each individual 
for whom payment was made through 
the supplemental debit card program; 
‘‘(III) the health care provider to 
whom each payment was made; 
‘‘(IV) the amount of each pay-
ment; and 
‘‘(V) any other information, as 
the Secretary requires. 
‘‘(B) PAYMENTS.—Each State shall make 
a payment to the Secretary, in the amount 
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131 
billed, not later than 30 days after the billing 
notification date, in accordance with subpara-
graph (A)(i). 
‘‘(C) PENALTIES.—If a State fails to pay 
to the Secretary an amount required under sub-
paragraph (B), interest shall accrue on such 
amount at the rate provided under old section 
1903(d)(5) of the Social Security Act. The 
amount so owed and applicable interest shall be 
immediately offset against amounts otherwise 
payable to the State under this section, in ac-
cordance with the Federal Claims Collection Act 
of 1996 and applicable regulations. 
‘‘(f) ENROLLMENT.— 
‘‘(1) IN GENERAL.—The Secretary shall estab-
lish procedures and times for enrollment in the sup-
plemental debit card program. Open enrollment shall 
be available not less than 4 times per calendar year. 
‘‘(2) TRANSITION OF INDIVIDUALS ENROLLED 
IN MEDICAID OR THE STATE CHILDREN’S HEALTH 
INSURANCE PROGRAM.— 
‘‘(A) INFORMATION FROM THE STATES.— 
Each State shall— 
‘‘(i) not later than June 30, 2010, in-
form all individuals then enrolled in Med-
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132 
icaid or the State Children’s Health Insur-
ance Program (SCHIP), of the changes in 
effect beginning on January 1, 2011; and 
‘‘(ii) not later than October 31, 2010, 
redetermine the eligibility of each indi-
vidual enrolled in Medicaid or SCHIP, 
other than those individuals who qualify 
for Medicaid or SCHIP as disabled, elder-
ly, or a special population, for the supple-
mental debit card program, according to 
the eligibility criteria under subsection (b). 
‘‘(B) 
AUTOMATIC
ENROLLMENT.—The 
Secretary shall provide for the automatic enroll-
ment in the supplemental debit card program of 
all individuals who are enrolled in Medicaid or 
SCHIP and who have been redetermined by a 
State under subparagraph (A) to be eligible for 
Medicaid or SCHIP. Any individual who is de-
termined by a State not to qualify for the sup-
plemental debit card program may retain cov-
erage under Medicaid or SCHIP until June 30, 
2011. 
‘‘(3) ASSISTANCE WITH QUALIFIED HEALTH IN-
SURANCE CREDIT.—Each State shall, to the extent 
practicable, provide individuals residing within the 
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133 
State with information regarding the qualified health 
insurance credit described in section 25E of the In-
ternal Revenue Code of 1986, including information 
regarding eligibility for, and how to claim, such 
credit. 
‘‘(g) ADMINISTRATION.— 
‘‘(1) NATIONAL SYSTEM.—The Secretary may 
enter into contracts or agreements with a State, a 
consortium of States, or a private entity, including 
a bank, enrollment broker, or similar entity, to es-
tablish and maintain a unified national system to 
support the processes and transactions necessary to 
administer this section. 
‘‘(2) AUTOMATED
SYSTEM.—The Secretary 
shall establish an automated means, such as an elec-
tronic benefit transfer system, by which the benefits 
under this section shall be transferred to eligible 
families. 
‘‘(3) VERIFICATION
OF
APPLICANT
INFORMA-
TION.—The Secretary may verify information pro-
vided by applicants with the appropriate Federal, 
State, and local agencies, including the Internal Rev-
enue Service, the Social Security Administration, the 
Department of Labor, and child support enforce-
ment agencies. 
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134 
‘‘(4) CHOICE
COUNSELING.—The Secretary 
may enter into contracts or agreements with a State, 
a consortium of a State, or a private entity, includ-
ing an enrollment broker or community organization 
or other organization, to educate eligible families 
about their options and to assist in their enrollment 
in the supplemental debit card plan. 
‘‘(5) APPEALS.—The Secretary shall establish 
an independent appeals process, to be administered 
by an entity separate from the entity that makes ini-
tial eligibility determinations, which shall be avail-
able to individuals who are denied benefits under the 
supplemental debit card program. 
‘‘(6) RESOLUTION OF ERRORS.—The Secretary 
shall provide for a reconciliation process with the 
States to resolve any errors and adjudicate disputes 
due to incomplete or false information in a family’s 
application or in the billing process described in sub-
section (e). 
‘‘(7) PENALTIES FOR FALSE INFORMATION.— 
Any person who provides false information to qualify 
for the supplemental debit card program shall pay a 
penalty in the amount of 110 percent of the amount 
of assistance paid on behalf of such person and all 
members of such person’s family. 
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135 
‘‘(h) IMPLEMENTATION PLAN.—Not later than 6 
months after the date of enactment of this section, the 
Secretary shall submit to Congress a plan for imple-
menting this program during fiscal years 2009–2012. 
‘‘(i) AUTHORIZATION OF APPROPRIATIONS.— 
‘‘(1) ADMINISTRATION OF THE SUPPLEMENTAL 
DEBIT CARD PROGRAM.—To administer the program 
under this section, there are authorized to be appro-
priated— 
‘‘(A) for fiscal year 2009, $300,000,000, 
for the design of a unified, national system of 
conducting the supplemental debit card pro-
gram; 
‘‘(B) for fiscal year 2010, $1,000,000,000 
for start-up costs, including, contracting, hiring 
and training employees, and testing the pro-
gram; and 
‘‘(C) for fiscal year 2011 and each subse-
quent fiscal year, $3,000,000,000. 
‘‘(2) AUTHORIZATION
OF
BENEFITS
UNDER 
THE
SUPPLEMENTAL
DEBIT
CARD
PROGRAM.—To 
provide the supplemental debit card benefits de-
scribed in this section, there are authorized to be ap-
propriated— 
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136 
‘‘(A) 
for 
fiscal 
year 
2011, 
$24,020,000,000; 
‘‘(B) 
for 
fiscal 
year 
2012, 
$25,220,000,000; 
‘‘(C) 
for 
fiscal 
year 
2013, 
$26,480,000,000; 
‘‘(D) 
for 
fiscal 
year 
2014, 
$27,810,000,000; and 
‘‘(E) 
for 
fiscal 
year 
2015, 
$29,200,000,000.’’. 
TITLE V—FIXING MEDICARE FOR 
AMERICAN SENIORS 
Subtitle 
A—Increasing 
Pro-
grammatic Efficiency, Economy, 
and Accountability 
SEC. 501. ELIMINATING INEFFICIENCIES AND INCREASING 
CHOICE IN MEDICARE ADVANTAGE. 
Part C of title XVIII of the Social Security Act is 
amended by adding at the end the following new section: 
‘‘MEDICARE ADVANTAGE COMPETITIVE BIDDING 
‘‘SEC. 1860C–2. (a) COMPETITIVE BIDDING.— 
‘‘(1) IN GENERAL.—In order to promote com-
petition among Medicare Advantage plans and to in-
crease the quality of care furnished under such 
plans, the Secretary shall establish and implement a 
competitive bidding mechanism under this part. 
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137 
‘‘(2) MECHANISM
TO
BEGIN
IN
2011.—The 
mechanism established under paragraph (1) shall 
apply to all MA organizations and plans beginning 
in 2011. 
‘‘(3) NO EFFECT ON PART D BENEFITS.—The 
mechanism established under paragraph (1) shall 
not affect the provisions of this part relating to ben-
efits under part D, including the bidding mechanism 
used for benefits under such part. 
‘‘(b) RULES FOR COMPETITIVE BIDDING MECHA-
NISM.—Notwithstanding any other provision of this part, 
the following rules shall apply under the competitive bid-
ding mechanism established under subsection (a). 
‘‘(1) BENCHMARK.—Benchmark amounts for 
an area for a year shall be established solely through 
the competitive bids of MA plans. The benchmark 
amount for each area for a year shall be the average 
bid of the plans in that area for that year. In estab-
lishing the benchmark for an area for a year under 
the preceding sentence, the Secretary shall exclude 
the highest and lowest bid for that area and year. 
The benchmark amount for an area for a year may 
not exceed the benchmark amount for that area and 
year that would have applied if this section had not 
been enacted. 
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138 
‘‘(2) BIDS.—The MA plan bid shall reflect the 
per capita payments that the MA plan will accept 
for providing a benefit package that is actuarially 
equivalent to 106 percent of the value of the original 
Medicare fee-for-service program option. MA plan 
bid submissions shall include data on plan average 
provider network contract rates compared to the 
rates under the original Medicare fee-for-service pro-
gram option for the top 5 most common claim sub-
missions per provider type. 
‘‘(3) 
RISK
ADJUSTMENT.—The 
benchmark 
under paragraph (1) and the MA plan bid shall be 
risk adjusted using the risk adjustment require-
ments under this part. 
‘‘(4) 
BENEFICIARY
PREMIUMS.—The 
MA 
monthly basic beneficiary premium for a beneficiary 
who enrolls in an MA plan whose plan bid is at or 
below the benchmark shall be zero and the bene-
ficiary shall receive the full difference (if any) be-
tween the bid and the benchmark in the form of ad-
ditional benefits or as a rebate on their premiums 
under this title. The MA monthly basic beneficiary 
premium for a beneficiary who enrolls in an MA 
plan whose plan bid is above the benchmark shall be 
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139 
equal to the amount by which the bid exceeds the 
benchmark. 
‘‘(5) BENCHMARK AMOUNTS FOR RURAL COUN-
TIES.—The Secretary may adjust the benchmark 
amount established under paragraph (1) for any 
rural county (as identified by the Secretary after 
consultation with the Secretary of Commerce) to en-
courage plan participation in such county. 
‘‘(6) EXISTING REQUIREMENTS.—Requirements 
relating to licensure, quality, and beneficiary protec-
tions that would otherwise apply under this part 
shall apply under the competitive bidding mechanism 
established under subsection (a). 
‘‘(c) WAIVER.—In order to implement the competitive 
bidding mechanism under established subsection (a), the 
Secretary may waive or modify requirements under this 
part.’’. 
SEC. 502. MEDICARE ACCOUNTABLE CARE ORGANIZATION 
DEMONSTRATION PROGRAM. 
(a) ESTABLISHMENT.— 
(1) IN GENERAL.—In order to promote innova-
tive care coordination and delivery that is cost-effec-
tive, the Secretary of Health and Human Services 
(in this section referred to as the ‘‘Secretary’’) shall 
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140 
conduct a demonstration program under the Medi-
care program under which— 
(A) groups of providers meeting certain 
criteria may work together to manage and co-
ordinate care for Medicare fee-for-service bene-
ficiaries through an Accountable Care Organi-
zation (in this section referred to as an 
‘‘ACO’’); and 
(B) providers in participating ACOs are el-
igible for bonuses based on performance. 
(2) MEDICARE FEE-FOR-SERVICE BENEFICIARY 
DEFINED.—In this section, the term ‘‘Medicare fee- 
for-service beneficiary’’ means an individual who is 
enrolled in the original medicare fee-for-service pro-
gram under parts A and B of title XVIII of the So-
cial Security Act and not enrolled in an MA plan 
under part C of such title. 
(b) ELIGIBLE ACOS.— 
(1) IN GENERAL.—Subject to paragraph (2), 
the following provider groups are eligible to partici-
pate as ACOs under the demonstration program 
under this section: 
(A) Physicians in group practice arrange-
ments. 
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141 
(B) Networks of individual physician prac-
tices. 
(C) Partnerships or joint venture arrange-
ments between hospitals and physicians. 
(D) Partnerships or joint ventures, which 
may include pharmacists providing medication 
therapy management. 
(E) Hospitals employing physicians. 
(F) Integrated delivery systems. 
(G) Community-based coalitions of pro-
viders. 
(2) REQUIREMENTS.—An ACO shall meet the 
following requirements: 
(A) The ACO shall have a formal legal 
structure that would allow the organization to 
receive and distribute bonuses to participating 
providers. 
(B) The ACO shall include the primary 
care providers of at least 5,000 Medicare fee- 
for-service beneficiaries. 
(C) The ACO shall be willing to become 
accountable for the overall care of the Medicare 
fee-for-service beneficiaries. 
(D) The ACO shall provide the Secretary 
with a list of primary care and specialist physi-
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142 
cians participating in the ACO to support the 
beneficiary assignment, implementation of per-
formance measures, and the determination of 
bonus payments under the demonstration pro-
gram. 
(E) The ACO shall have in place contracts 
with a core group of key specialist physicians, 
a leadership and management structure, and 
processes to promote evidence-based medicine 
and to coordinate care. 
(c) ASSIGNMENT OF MEDICARE FEE-FOR-SERVICE 
BENEFICIARIES.— 
(1) IN
GENERAL.—Under the demonstration 
program under this section, each Medicare fee-for- 
service Medicare beneficiary shall be automatically 
assigned to a primary care provider. Such assign-
ment shall be based on the physician from whom the 
beneficiary received the most primary care in the 
preceding year. 
(2) BENEFICIARIES
MAY
CONTINUE
TO
SEE 
PROVIDERS OUTSIDE OF THE ACO.—Under the dem-
onstration program under this section, a Medicare 
fee-for-service Medicare beneficiary may continue to 
see providers in and outside of the ACO to which 
they have been assigned. 
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143 
(d) BONUS PAYMENTS.— 
(1) IN
GENERAL.—Under the demonstration 
program, Medicare payments shall continue to be 
made to providers under the original Medicare fee- 
for-service program in the same manner as they 
would otherwise be made except that a participating 
ACO is eligible for bonuses if— 
(A) it meets certain quality performance 
measures; and 
(B) spending for their Medicare fee-for- 
service beneficiaries meets the requirement 
under paragraph (3). 
(2) QUALITY.—Under the demonstration pro-
gram under this section, providers meet the require-
ment under paragraph (1)(A) if they generally follow 
consensus-based guidelines established by non-gov-
ernment professional medical societies. Patient satis-
faction and risk-adjusted outcomes shall be deter-
mined through an independent entity with medical 
expertise. 
(3) REQUIREMENT RELATING TO SPENDING.— 
(A) IN GENERAL.—An ACO shall only be 
eligible to receive a bonus payment if the aver-
age Medicare expenditures under the ACO for 
Medicare fee-for-service beneficiaries over a 
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144 
two-year period is at least 2 percent below the 
average benchmark for the corresponding two- 
year period. The benchmark for each ACO shall 
be set using the most recent three years of total 
per-beneficiary spending for Medicare fee-for- 
service beneficiaries assigned to the ACO. Such 
benchmark shall be updated by the projected 
rate of growth in national per capita spending 
for the original medicare fee-for-service pro-
gram, as projected (using the most recent three 
years of data) by the Chief Actuary of the Cen-
ters for Medicare & Medicaid Services. 
(4) AMOUNT
OF
BONUS
PAYMENTS.—The 
amount of the bonus payment to a participating 
ACO shall be one-half of the percentage point dif-
ference between the two-year average of their pa-
tients’ Medicare expenditures and 98 percent of the 
two-year average benchmark. The bonus amount, in 
dollars, shall be equal to the bonus share multiplied 
by the benchmark for the most recent year. 
(5) LIMITATION.—Bonus payments may only be 
made to an ACO if the primary care provider to 
which the Medicare fee-for-service beneficiary has 
been assigned under subsection (c) elects to partici-
pate in such ACO. 
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145 
(e) WAIVER AUTHORITY.—The Secretary may waive 
such requirements of titles XI and XVIII of the Social 
Security Act (42 U.S.C. 1301 et seq.; 1395 et seq.) as 
may be appropriate for the purpose of carrying out the 
demonstration program under this section. 
(f) REPORT.—Upon completion of the demonstration 
program under this section, the Secretary shall submit to 
Congress a report on the program together with such rec-
ommendations as the Secretary determines appropriate. 
SEC. 
503. 
REDUCING 
GOVERNMENT 
HANDOUTS 
TO 
WEALTHIER SENIORS. 
(a) ELIMINATION OF ANNUAL INDEXING OF INCOME 
THRESHOLDS FOR REDUCED PART B PREMIUM SUB-
SIDIES.— 
(1) IN
GENERAL.—Paragraph (5) of section 
1839(i) of the Social Security Act (42 U.S.C. 
1395r(i)) is repealed. 
(2) EFFECTIVE
DATE.—The repeal made by 
paragraph (1) shall apply to premiums for months 
beginning after December 2010. 
(b) INCOME-RELATED REDUCTION IN PART D PRE-
MIUM SUBSIDY.— 
(1) INCOME-RELATED REDUCTION IN PART D 
PREMIUM SUBSIDY.— 
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146 
(A) IN
GENERAL.—Section 1860D–13(a) 
of the Social Security Act (42 U.S.C. 1395w– 
113(a)) is amended by adding at the end the 
following new paragraph: 
‘‘(7) REDUCTION IN PREMIUM SUBSIDY BASED 
ON INCOME.— 
‘‘(A) IN GENERAL.—In the case of an indi-
vidual whose modified adjusted gross income 
exceeds the threshold amount applicable under 
paragraph (2) of section 1839(i) (including ap-
plication of paragraph (5) of such section) for 
the calendar year, the monthly amount of the 
premium subsidy applicable to the premium 
under this section for a month after December 
2010 shall be reduced (and the monthly bene-
ficiary premium shall be increased) by the 
monthly adjustment amount specified in sub-
paragraph (B). 
‘‘(B) MONTHLY ADJUSTMENT AMOUNT.— 
The monthly adjustment amount specified in 
this subparagraph for an individual for a month 
in a year is equal to the product of— 
‘‘(i) the quotient obtained by divid-
ing— 
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147 
‘‘(I) the applicable percentage de-
termined under paragraph (3)(C) of 
section 1839(i) (including application 
of paragraph (5) of such section) for 
the individual for the calendar year 
reduced by 25.5 percent; by 
‘‘(II) 25.5 percent; and 
‘‘(ii) the base beneficiary premium (as 
computed under paragraph (2)). 
‘‘(C) MODIFIED
ADJUSTED
GROSS
IN-
COME.—For purposes of this paragraph, the 
term ‘modified adjusted gross income’ has the 
meaning given such term in subparagraph (A) 
of section 1839(i)(4), determined for the tax-
able year applicable under subparagraphs (B) 
and (C) of such section. 
‘‘(D) DETERMINATION BY COMMISSIONER 
OF
SOCIAL
SECURITY.—The Commissioner of 
Social Security shall make any determination 
necessary to carry out the income-related reduc-
tion in premium subsidy under this paragraph. 
‘‘(E) PROCEDURES TO ASSURE CORRECT 
INCOME-RELATED
REDUCTION
IN
PREMIUM 
SUBSIDY.— 
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148 
‘‘(i) DISCLOSURE
OF
BASE
BENE-
FICIARY
PREMIUM.—Not later than Sep-
tember 15 of each year beginning with 
2010, the Secretary shall disclose to the 
Commissioner 
of 
Social 
Security 
the 
amount of the base beneficiary premium 
(as computed under paragraph (2)) for the 
purpose of carrying out the income-related 
reduction in premium subsidy under this 
paragraph with respect to the following 
year. 
‘‘(ii) ADDITIONAL DISCLOSURE.—Not 
later than October 15 of each year begin-
ning with 2010, the Secretary shall dis-
close to the Commissioner of Social Secu-
rity the following information for the pur-
pose of carrying out the income-related re-
duction in premium subsidy under this 
paragraph with respect to the following 
year: 
‘‘(I) The modified adjusted gross 
income threshold applicable under 
paragraph (2) of section 1839(i) (in-
cluding application of paragraph (5) 
of such section). 
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149 
‘‘(II) The applicable percentage 
determined under paragraph (3)(C) of 
section 1839(i) (including application 
of paragraph (5) of such section). 
‘‘(III) The monthly adjustment 
amount specified in subparagraph 
(B). 
‘‘(IV) Any other information the 
Commissioner of Social Security de-
termines necessary to carry out the 
income-related reduction in premium 
subsidy under this paragraph. 
‘‘(F) RULE OF CONSTRUCTION.—The for-
mula used to determine the monthly adjustment 
amount specified under subparagraph (B) shall 
only be used for the purpose of determining 
such monthly adjustment amount under such 
subparagraph.’’. 
(B) COLLECTION
OF
MONTHLY
ADJUST-
MENT AMOUNT.—Section 1860D–13(c) of the 
Social Security Act (42 U.S.C. 1395w–113(c)) 
is amended— 
(i) in paragraph (1), by striking ‘‘(2) 
and (3)’’ and inserting ‘‘(2), (3), and (4)’’; 
and 
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150 
(ii) by adding at the end the following 
new paragraph: 
‘‘(4) COLLECTION OF MONTHLY ADJUSTMENT 
AMOUNT.— 
‘‘(A) IN GENERAL.—Notwithstanding any 
provision 
of 
this 
subsection 
or 
section 
1854(d)(2), subject to subparagraph (B), the 
amount of the income-related reduction in pre-
mium subsidy for an individual for a month (as 
determined under subsection (a)(7)) shall be 
paid through withholding from benefit pay-
ments in the manner provided under section 
1840. 
‘‘(B) AGREEMENTS.—In the case where 
the monthly benefit payments of an individual 
that are withheld under subparagraph (A) are 
insufficient to pay the amount described in such 
subparagraph, the Commissioner of Social Se-
curity shall enter into agreements with the Sec-
retary, the Director of the Office of Personnel 
Management, and the Railroad Retirement 
Board as necessary in order to allow other 
agencies to collect the amount described in sub-
paragraph (A) that was not withheld under 
such subparagraph.’’. 
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151 
(2) CONFORMING AMENDMENTS.— 
(A) MEDICARE.—Part D of title XVIII of 
the Social Security Act (42 U.S.C. 1395w–101 
et seq.) is amended— 
(i) in section 1860D–13(a)(1)— 
(I) by redesignating subpara-
graph (F) as subparagraph (G); 
(II) in subparagraph (G), as re-
designated by subparagraph (A), by 
striking ‘‘(D) and (E)’’ and inserting 
‘‘(D), (E), and (F)’’; and 
(III) by inserting after subpara-
graph (E) the following new subpara-
graph: 
‘‘(F) INCREASE BASED ON INCOME.—The 
monthly beneficiary premium shall be increased 
pursuant to paragraph (7).’’; and 
(ii) in section 1860D–15(a)(1)(B), by 
striking ‘‘paragraph (1)(B)’’ and inserting 
‘‘paragraphs (1)(B) and (1)(F)’’. 
(B) INTERNAL
REVENUE
CODE.—Section 
6103(l)(20) of the Internal Revenue Code of 
1986 (relating to disclosure of return informa-
tion to carry out Medicare part B premium sub-
sidy adjustment) is amended— 
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(i) in the heading, by striking ‘‘PART 
B
PREMIUM
SUBSIDY
ADJUSTMENT’’ and 
inserting ‘‘PARTS B AND D PREMIUM SUB-
SIDY ADJUSTMENTS’’; 
(ii) in subparagraph (A)— 
(I) in the matter preceding clause 
(i), by inserting ‘‘or 1860D–13(a)(7)’’ 
after ‘‘1839(i)’’; and 
(II) in clause (vii), by inserting 
after ‘‘subsection (i) of such section’’ 
the 
following: 
‘‘or 
under 
section 
1860D–13(a)(7) of such Act’’; 
(iii) in subparagraph (B)— 
(I) by inserting ‘‘or such section 
1860D–13(a)(7)’’ before the period at 
the end; 
(II) as amended by clause (i), by 
inserting ‘‘or for the purpose of re-
solving tax payer appeals with respect 
to any such premium adjustment’’ be-
fore the period at the end; and 
(III) by adding at the end the 
following new sentence: ‘‘Officers, em-
ployees, and contractors of the Social 
Security Administration may disclose 
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153 
such return information to officers, 
employees, and contractors of the De-
partment of Health and Human Serv-
ices, the Office of Personnel Manage-
ment, the Railroad Retirement Board, 
the Department of Justice, and the 
courts of the United States to the ex-
tent necessary to carry out the pur-
poses described in the preceding sen-
tence.’’; and 
(iv) by adding at the end the following 
new subparagraph: 
‘‘(C) TIMING OF DISCLOSURE.—Return in-
formation shall be disclosed to officers, employ-
ees, and contractors of the Social Security Ad-
ministration under subparagraph (A) not later 
than the date that is 90 days prior to the date 
on which the taxpayer first becomes entitled to 
benefits under part A of title XVIII of the So-
cial Security Act or eligible to enroll for benefits 
under part B of such title.’’. 
SEC. 504. REWARDING PREVENTION. 
Section 1839 of the Social Security Act (42 U.S.C. 
1395r) is amended— 
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(1) in subsection (a)(2), by striking ‘‘and (i)’’ 
and inserting ‘‘(i), and (j)’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(j)(1) With respect to the monthly premium amount 
for months after December 2010, the Secretary may ad-
just (under procedures established by the Secretary) the 
amount of such premium for an individual based on 
whether or not the individual participates in certain 
healthy behaviors, such as weight management, exercise, 
nutrition counseling, refraining from tobacco use, desig-
nating a health home, and other behaviors determined ap-
propriate by the Secretary. 
‘‘(2) In making the adjustments under paragraph (1) 
for a month, the Secretary shall ensure that the total 
amount of premiums to be paid under this part for the 
month is equal to the total amount of premiums that 
would have been paid under this part for the month if 
no such adjustments had been made, as estimated by the 
Secretary.’’. 
SEC. 505. PROMOTING HEALTHCARE PROVIDER TRANS-
PARENCY. 
(a) TRANSPARENCY.—Title XVIII of the Social Secu-
rity Act is amended by adding at the end the following 
new section: 
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‘‘PRICE TRANSPARENCY REQUIREMENTS 
‘‘SEC. 1899. (a) PRE-TREATMENT DISCLOSURE.—A 
provider of services (as defined in section 1861(u)) and 
a supplier (as defined in section 1861(d)) shall provide 
to each individual (regardless of whether or not the indi-
vidual is a beneficiary under this title) who is scheduled 
to receive a treatment (or to begin a course of treatment) 
that is not for an emergency medical condition the esti-
mated price that the provider of services or supplier will 
charge for the treatment (or course of treatment). Such 
price shall be determined at the time of scheduling. 
‘‘(b) POST-TREATMENT DISCLOSURE.—A provider of 
services (as so defined) and a supplier (as so defined) shall 
include with any bill that includes the charges for a treat-
ment with respect to an individual (regardless of whether 
or not the individual is a beneficiary under this title), an 
itemized list of component charges for such treatment, in-
cluding charges for drugs and medical equipment involved, 
as determined at the time of billing. With respect to each 
item included on such list, the provider of services or sup-
plier shall include the price charged for the item.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
subsection (a) shall apply to providers of services and sup-
pliers on and after January 1, 2011. 
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156 
SEC. 506. AVAILABILITY OF MEDICARE AND MEDICAID 
CLAIMS AND PATIENT ENCOUNTER DATA. 
(a) PUBLIC AVAILABILITY.—Not later than 1 year 
after the date of enactment of this Act (and annually 
thereafter), the Secretary of Health and Human Services 
(in this section referred to as the ‘‘Secretary’’), shall make 
available to the public (including through an Internet 
website) data on claims and patient encounters under ti-
tles XVIII and XIX of the Social Security Act during the 
preceding calendar year. Such data shall be appropriately 
disaggregated and patient deidentified, as determined nec-
essary by the Secretary in order to comply with the Fed-
eral regulations (concerning the privacy of individually 
identifiable health information) promulgated under section 
264(c) of the Health Insurance Portability and Account-
ability Act of 1996. 
(b) PROVISION OF DATA TO STATE EXCHANGES AND 
HEALTH INSURANCE ISSUERS UNDER THE STATE EX-
CHANGE.—The Secretary shall submit such data directly 
to a State Exchange under title II and health insurance 
issuers under such Exchange (in a form and manner de-
termined appropriate by the Secretary). 
(c) MATCHING OF DATA.—The Secretary shall en-
sure that the total amount of claims under such titles dur-
ing the preceding year for which data is made available 
under subsection (a) is equal to the reported outlays from 
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157 
the Federal government and the States under such titles 
during the preceding years. 
Subtitle B—Reducing Fraud and 
Abuse 
SEC. 511. REQUIRING THE SECRETARY OF HEALTH AND 
HUMAN SERVICES TO CHANGE THE MEDI-
CARE BENEFICIARY IDENTIFIER USED TO 
IDENTIFY MEDICARE BENEFICIARIES UNDER 
THE MEDICARE PROGRAM. 
(a) PROCEDURES.— 
(1) IN GENERAL.—Not later than 1 year after 
the date of enactment of this Act, in order to protect 
beneficiaries from identity theft, the Secretary of 
Health and Human Services (in this section referred 
to as the ‘‘Secretary’’) shall establish and implement 
procedures to change the Medicare beneficiary iden-
tifier used to identify individuals entitled to benefits 
under part A of title XVIII of the Social Security 
Act or enrolled under part B of such title so that 
such an individual’s social security account number 
is not used. Such procedures shall provide that the 
new Medicare beneficiary identifier includes biomet-
ric identification protections. 
(2) MAINTAINING
EXISTING
HICN
STRUC-
TURE.—In order to minimize the impact of the 
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change under paragraph (1) on systems that com-
municate with Medicare beneficiary eligibility sys-
tems, the procedures under paragraph (1) shall pro-
vide that the new Medicare beneficiary identifier 
maintain the existing Health Insurance Claim Num-
ber structure. 
(3) PROTECTION AGAINST FRAUD.—The proce-
dures under paragraph (1) shall provide for a proc-
ess for changing the Medicare beneficiary identifier 
for an individual to a different identifier in the case 
of the discovery of fraud, including identity theft. 
(4) PHASE-IN AUTHORITY.— 
(A) IN
GENERAL.—Subject to subpara-
graphs (B) and (C), the Secretary may phase in 
the change under paragraph (1) in such man-
ner as the Secretary determines appropriate. 
(B) LIMIT.—The phase-in period under 
subparagraph (A) shall not exceed 10 years. 
(C) NEWLY ENTITLED AND ENROLLED IN-
DIVIDUALS.—The Secretary shall ensure that 
the change under paragraph (1) is implemented 
not later than January 1, 2010, with respect to 
any individual who first becomes entitled to 
benefits under part A of title XVIII of the So-
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159 
cial Security Act or enrolled under part B of 
such title on or after such date. 
(b) EDUCATION
AND OUTREACH.—The Secretary 
shall establish a program of education and outreach for 
individuals entitled to, or enrolled for, benefits under part 
A of title XVIII of the Social Security Act or enrolled 
under part B of such title, providers of services (as defined 
in subsection (u) of section 1861 of such Act (42 U.S.C. 
1395x)), and suppliers (as defined in subsection (d) of 
such section) on the change under paragraph (1). 
(c) DATA MATCHING.— 
(1) ACCESS TO CERTAIN INFORMATION.—Sec-
tion 205(r) of the Social Security Act (42 U.S.C. 
405(r)) is amended by adding at the end the fol-
lowing new paragraph: 
‘‘(9)(A) The Commissioner of Social Security 
shall, upon the request of the Secretary— 
‘‘(i) enter into an agreement with the Sec-
retary for the purpose of matching data in the 
system of records of the Commissioner with 
data in the system of records of the Secretary, 
so long as the requirements of subparagraphs 
(A) and (B) of paragraph (3) are met, in order 
to determine— 
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160 
‘‘(I) whether a beneficiary under the 
program under title XVIII, XIX, or XXI is 
dead, imprisoned, or otherwise not eligible 
for benefits under such program; and 
‘‘(II) whether a provider of services or 
a supplier under the program under title 
XVIII, XIX, or XXI is dead, imprisoned, 
or otherwise not eligible to furnish or re-
ceive payment for furnishing items and 
services under such program; and 
‘‘(ii) include in such agreement safeguards 
to assure the maintenance of the confidentiality 
of any information disclosed and procedures to 
permit the Secretary to use such information 
for the purpose described in clause (i). 
‘‘(B) Information provided pursuant to an 
agreement under this paragraph shall be provided at 
such time, in such place, and in such manner as the 
Commissioner determines appropriate. 
‘‘(C) Information provided pursuant to an 
agreement under this paragraph shall include infor-
mation regarding whether— 
‘‘(i) the name (including the first name 
and any family name or surname), the date of 
birth (including the month, day, and year), and 
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161 
social security number of an individual provided 
to the Commissioner match the information 
contained in the Commissioner’s records, and 
‘‘(ii) such individual is shown on the 
records of the Commissioner as being de-
ceased.’’. 
(2) INVESTIGATION BASED ON CERTAIN INFOR-
MATION.—Title XI of the Social Security Act (42 
U.S.C. 1301 et seq.) is amended by inserting after 
section 1128F the following new section: 
‘‘SEC. 1128G. ACCESS TO CERTAIN DATA AND INVESTIGA-
TION OF CLAIMS INVOLVING INDIVIDUALS 
WHO ARE NOT ELIGIBLE FOR BENEFITS OR 
ARE NOT ELIGIBLE PROVIDERS OF SERVICES 
OR SUPPLIERS. 
‘‘(a) DATA AGREEMENT.—The Secretary shall enter 
into an agreement with the Commissioner of Social Secu-
rity pursuant to section 205(r)(9). 
‘‘(b) INVESTIGATION OF CLAIMS INVOLVING CER-
TAIN INDIVIDUALS WHO ARE NOT ELIGIBLE FOR BENE-
FITS OR ARE NOT ELIGIBLE PROVIDERS OF SERVICES OR 
SUPPLIERS.— 
‘‘(1) IN GENERAL.—The Secretary shall, in the 
case where a provider of services or a supplier under 
the program under title XVIII, XIX, or XXI sub-
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162 
mits a claim for payment for items or services fur-
nished to an individual who the Secretary deter-
mines, as a result of information provided pursuant 
to such agreement, is not eligible for benefits under 
such program, or where the Secretary determines, as 
a result of such information, that such provider of 
services or supplier is not eligible to furnish or re-
ceive payment for furnishing such items or services, 
conduct an investigation with respect to the provider 
of services or supplier. If the Secretary determines 
further action is appropriate, the Secretary shall 
refer the investigation to the Inspector General of 
the Department of Health and Human Services as 
soon as practicable. 
‘‘(2) ASSESSMENT
OF
IMPLEMENTATION
AND 
EFFECTIVENESS BY THE OIG.—The Inspector Gen-
eral of the Department of Health and Human Serv-
ices shall test the implementation of the provisions 
of this section (including the implementation of the 
agreement under section 205(r)(9)) and conduct 
such period assessments of such implementation as 
the Inspector General determines necessary to deter-
mine the effectiveness of such implementation.’’. 
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163 
(d) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated such sums as may be 
necessary to carry out this section. 
SEC. 512. USE OF TECHNOLOGY FOR REAL-TIME DATA RE-
VIEW. 
Title XVIII of the Social Security Act, as amended 
by this Act, is amended by adding at the end the following 
new section: 
‘‘USE OF TECHNOLOGY FOR REAL-TIME DATA REVIEW 
‘‘SEC. 1899A. (a) IN GENERAL.—The Secretary shall 
establish procedures for the use of technology (including 
front-end, pre-payment technology similar to that used by 
hedge funds, investment funds, and banks) to provide real- 
time data analysis of claims for payment under this title 
to identify and investigate unusual billing or order prac-
tices under this title that could indicate fraud or abuse. 
‘‘(b) COMPETITIVE BIDDING.—The procedures estab-
lished under subsection (a) shall ensure that the imple-
mentation of such technology is conducted through a com-
petitive bidding process.’’. 
SEC. 513. DETECTION OF MEDICARE FRAUD AND ABUSE. 
(a) IN GENERAL.—Section 1893 of the Social Secu-
rity Act (42 U.S.C. 1395ddd) is amended— 
(1) in subsection (b), by adding at the end the 
following new paragraph: 
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164 
‘‘(7) Implementation of fraud and abuse detec-
tion methods under subsection (i).’’; 
(2) in subsection (c), by adding at the end of 
the flush matter following paragraph (4), the fol-
lowing new sentence ‘‘In the case of an activity de-
scribed in subsection (b)(8), an entity shall only be 
eligible to enter into a contract under the Program 
to carry out the activity if the entity is selected 
through a competitive bidding process in accordance 
with subsection (i)(3).’’; and 
(3) by adding at the end the following new sub-
section: 
‘‘(i) 
DETECTION
OF
MEDICARE
FRAUD
AND 
ABUSE.— 
‘‘(1) ESTABLISHMENT OF SYSTEM TO IDENTIFY 
COUNTIES
MOST
VULNERABLE
TO
FRAUD.—Not 
later than 6 months after the date of enactment of 
this subsection, the Secretary shall establish a sys-
tem to identify the 50 counties most vulnerable to 
fraud with respect to items and services furnished by 
providers of services (other than hospitals and crit-
ical access hospitals) and suppliers based on the de-
gree of county-specific reimbursement and analysis 
of payment trends under this title. The Secretary 
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165 
shall designate the counties identified under the pre-
ceding sentence as ‘high risk areas’. 
‘‘(2) FRAUD AND ABUSE DETECTION.— 
‘‘(A) 
INITIAL
IMPLEMENTATION.—The 
Secretary shall establish procedures for the im-
plementation of fraud and abuse detection 
methods under this title with respect to items 
and services furnished by such providers of 
services and suppliers in high risk areas des-
ignated under paragraph (1) (and, beginning 
not later than 18 months after the date of en-
actment of this subsection, with respect to 
items and services furnished by such providers 
of services and suppliers in areas not so des-
ignated) including the following: 
‘‘(i) Data analysis to establish prepay-
ment claim edits designed to target the 
claims for payment under this title for 
such items and services that are most like-
ly to be fraudulent. 
‘‘(ii) Prepayment benefit integrity re-
views for claims for payment under this 
title for such items and services that are 
suspended as a result of such edits. 
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166 
‘‘(B) 
REQUIREMENT
FOR
PARTICIPA-
TION.—In no case may a provider of services or 
supplier who does not meet the requirements 
under subparagraph (A) participate in the pro-
gram under this title. 
‘‘(C) EXPANDED IMPLEMENTATION.—Not 
later than 24 months after the date of enact-
ment of this subsection, the Secretary shall es-
tablish procedures for the implementation of 
such fraud and abuse detection methods under 
this title with respect to items and services fur-
nished by all providers of services and suppliers, 
including those not in high risk areas des-
ignated under paragraph (1). 
‘‘(3) COMPETITIVE BIDDING.—In selecting enti-
ties to carry out this subsection, the Secretary shall 
use a competitive bidding process. 
‘‘(4) REPORT
TO
CONGRESS.—The Secretary 
shall submit to Congress an annual report on the ef-
fectiveness of activities conducted under this sub-
section, including a description of any savings to the 
program under this title as a result of such activities 
and the overall administrative cost of such activities 
and a determination as to the amount of funding 
needed to carry out this subsection for subsequent 
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167 
fiscal years, together with recommendations for such 
legislation and administrative action as the Sec-
retary determines appropriate.’’. 
(b) AUTHORIZATION OF APPROPRIATIONS.—To carry 
out the amendments made by this section, there are au-
thorized to be appropriated— 
(1) such sums as may be necessary, not to ex-
ceed $50,000,000, for each of fiscal years 2010 
through 2014; and 
(2) such sums as may be necessary, not to ex-
ceed an amount the Secretary determines appro-
priate in the most recent report submitted to Con-
gress under section 1893(j)(4) of the Social Security 
Act, as added by subsection (a), for each subsequent 
fiscal year. 
SEC. 514. EDITS ON 855S MEDICARE ENROLLMENT APPLI-
CATION AND EXEMPTION OF PHARMACISTS 
FROM SURETY BOND REQUIREMENT. 
(a) EDITS ON 855S MEDICARE ENROLLMENT APPLI-
CATION.—Section 1834(a) of the Social Security Act (42 
U.S.C. 1395m(a)) is amended by adding at the end the 
following new paragraphs: 
‘‘(22) CONFIRMATION
WITH
NATIONAL
SUP-
PLIER CLEARINGHOUSE PRIOR TO PAYMENT.— 
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‘‘(A) IN GENERAL.—Not later than 1 year 
after the date of enactment of this paragraph, 
the Secretary shall establish procedures to re-
quire carriers, prior to paying a claim for pay-
ment for durable medical equipment, pros-
thetics, orthotics, and supplies under this title, 
to confirm with the National Supplier Clearing-
house— 
‘‘(i) that the National Provider Identi-
fier of the physician or practitioner pre-
scribing or ordering the item or service is 
valid and active; 
‘‘(ii) that the Medicare identification 
number of the supplier is valid and active; 
and 
‘‘(iii) that the item or service for 
which the claim for payment is submitted 
was properly identified on the CMS–855S 
Medicare enrollment application. 
‘‘(B) ONLINE DATABASE FOR IMPLEMEN-
TATION.—Not later than 18 months after the 
date of enactment of this paragraph, the Sec-
retary shall establish an online database similar 
to that used for the National Provider Identifier 
to enable providers of services, accreditors, car-
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169 
riers, and the National Supplier Clearinghouse 
to view information on specialties and the types 
of items and services each supplier has indi-
cated on the CMS–855S Medicare enrollment 
application submitted by the supplier. 
‘‘(C) NOTIFICATION
OF
CLAIM
DENIAL 
AND RESUBMISSION.—In the case where a claim 
for payment for durable medical equipment, 
prosthetics, orthotics, and supplies under this 
title is denied because the item or service fur-
nished does not correctly match up with the in-
formation on file with the National Supplier 
Clearinghouse— 
‘‘(i) the National Supplier Clearing-
house shall— 
‘‘(I) provide the supplier written 
notification of the reason for such de-
nial; and 
‘‘(II) allow the supplier 60 days 
to provide the National Supplier 
Clearinghouse with appropriate certifi-
cation, licensing, or accreditation; and 
‘‘(ii) the Secretary shall waive applica-
ble requirements relating to the time frame 
for the submission of claims for payment 
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under this title in order to permit the re-
submission of such claim if payment of 
such claim would otherwise be allowed 
under this title. 
‘‘(D) IMPROVEMENTS
TO
MEDICARE
EN-
ROLLMENT APPLICATION.—The Secretary shall 
establish procedures under which a prospective 
supplier of durable medical equipment, pros-
thetics, orthotics, and supplies under this title 
shall certify, as part of the CMS–855S Medi-
care enrollment application submitted by such 
supplier, under penalty of perjury, that the in-
formation provided by the supplier on such ap-
plication is accurate to the best of the supplier’s 
knowledge. 
‘‘(23) TERMINATION
OF
PARTICIPATION
FOR 
SUBMISSION OF FRAUDULENT CLAIMS.—If the Sec-
retary finds that a supplier of durable medical 
equipment, prosthetics, orthotics, and supplies under 
this title has submitted fraudulent claims for pay-
ment under this title, the Secretary shall terminate 
the suppliers participation under this title. Not later 
than 1 year after the date of enactment of this para-
graph, the Secretary shall establish a process under 
which a supplier whose participation has been termi-
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171 
nated under the preceding sentence may appeal such 
termination and such appeal shall be resolved not 
later than 60 days after the date on which the ap-
peal was made.’’. 
(b) EXEMPTION
OF PHARMACISTS FROM SURETY 
BOND REQUIREMENT.—Section 1834(a)(16) of the Social 
Security Act (42 U.S.C. 1395m(a)(16)) is amended, in the 
second sentence, by inserting ‘‘and shall waive such re-
quirement in the case of a pharmacist’’ before the period 
at the end. 
SEC. 515. GAO STUDY AND REPORT ON EFFECTIVENESS OF 
SURETY BOND REQUIREMENTS FOR SUP-
PLIERS OF DURABLE MEDICAL EQUIPMENT 
IN COMBATING FRAUD. 
(a) STUDY.—The Comptroller General of the United 
States shall conduct a study on the effectiveness of the 
surety bond requirement under section 1834(a)(16) of the 
Social Security Act (42 U.S.C. 1395m(a)(16)) in com-
bating fraud. 
(b) REPORT.—Not later than 1 year after the date 
of enactment of this Act, the Comptroller General shall 
submit to Congress a report containing the results of the 
study conducted under subsection (a), together with rec-
ommendations for such legislation and administrative ac-
tion as the Comptroller General determines appropriate. 
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172 
TITLE VI—ENDING LAWSUIT 
ABUSE 
SEC. 601. STATE GRANTS TO CREATE HEALTH COURT SOLU-
TIONS. 
Part P of title III of the Public Health Service Act 
(42 U.S.C. 280g et seq.) is amended by adding at the end 
the following: 
‘‘SEC. 399R. STATE GRANTS TO CREATE HEALTH COURT SO-
LUTIONS. 
‘‘(a) IN GENERAL.—The Secretary may award grants 
to States for the development, implementation, and eval-
uation of alternatives to current tort litigation that comply 
with this section, for the resolution of disputes concerning 
injuries allegedly caused by health care providers or health 
care organizations. 
‘‘(b) CONDITIONS FOR DEMONSTRATION GRANTS.— 
‘‘(1) APPLICATION.—To be eligible to receive a 
grant under this section, a State shall submit to the 
Secretary an application at such time, in such man-
ner, and containing such information as may be re-
quired by the Secretary. A grant shall be awarded 
under this section on such terms and conditions as 
the Secretary determines appropriate. 
‘‘(2) STATE REQUIREMENTS.—To be eligible to 
receive a grant under this section, a State shall— 
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‘‘(A) develop and implement an alternative 
to current tort litigation for resolving disputes 
over injuries allegedly caused by health care 
providers or health care organizations based on 
one or more of the models described in sub-
section (d); and 
‘‘(B) implement policies that provide for a 
reduction in health care errors through the col-
lection and analysis by organizations that en-
gage in voluntary efforts to improve patient 
safety and the quality of health care delivery, of 
patient safety data related to disputes resolved 
under the alternatives under subparagraph (A). 
‘‘(3) DEMONSTRATION
OF
EFFECTIVENESS.— 
To be eligible to receive a grant under subsection 
(a), a State shall demonstrate how the proposed al-
ternative to be implemented under paragraph (2)(A) 
will— 
‘‘(A) make the medical liability system of 
the State more reliable through the prompt and 
fair resolution of disputes; 
‘‘(B) encourage the early disclosure of 
health care errors; 
‘‘(C) enhance patient safety; and 
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‘‘(D) maintain access to medical liability 
insurance. 
‘‘(4) SOURCES OF COMPENSATION.—To be eligi-
ble to receive a grant under subsection (a), a State 
shall identify the sources from, and methods by 
which, compensation would be paid for medical li-
ability claims resolved under the proposed alter-
native to current tort litigation implemented under 
paragraph (2)(A). Funding methods shall, to the ex-
tent practicable, provide financial incentives for ac-
tivities that improve patient safety. 
‘‘(5) SCOPE.— 
‘‘(A) IN GENERAL.—To be eligible to re-
ceive a grant under subsection (a), a State shall 
utilize the proposed alternative identified under 
paragraph (2)(A) for the resolution of all types 
of disputes concerning injuries allegedly caused 
by health care providers or health care organi-
zations. 
‘‘(B) CURRENT STATE EFFORTS TO ESTAB-
LISH ALTERNATIVE TO TORT LITIGATION.— 
‘‘(i) IN
GENERAL.—Nothing in this 
section shall be construed to limit the ef-
forts that any State has made prior to the 
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date of enactment of this section to estab-
lish any alternative to tort litigation. 
‘‘(ii) ALTERNATIVE
FOR
PRACTICE 
AREAS
OR
INJURIES.—In the case of a 
State that has established an alternative to 
tort litigation for a certain area of health 
care practice or a category of injuries, the 
alternative selected as provided for in this 
section shall supplement not replace or in-
validate such established alternative unless 
the State intends otherwise. 
‘‘(6) NOTIFICATION OF PATIENTS.—To be eligi-
ble to receive a grant under subsection (a), the State 
shall demonstrate how patients will be notified when 
they are receiving health care services that fall with-
in the scope of the alternative selected under this 
section by the State to current tort litigation. 
‘‘(c) REPRESENTATION BY COUNSEL.—A State that 
receives a grant under this section may not preclude any 
party to a dispute that falls within the jurisdiction of the 
alternative to current tort litigation that is implemented 
under the grant from obtaining legal representation at any 
point during the consideration of the claim under such al-
ternative. 
‘‘(d) MODELS.— 
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‘‘(1) IN GENERAL.—The models in this section 
are the following: 
‘‘(2) EXPERT
PANEL
REVIEW
AND
EARLY 
OFFER GUIDELINES.— 
‘‘(A) IN
GENERAL.—A State may use 
amounts received under a grant under this sec-
tion to develop and implement an expert panel 
and early offer review system that meets the re-
quirements of this paragraph. 
‘‘(B) ESTABLISHMENT OF PANEL.—Under 
the system under this paragraph, the State 
shall establish an expert panel to review any 
disputes concerning injuries allegedly caused by 
health care providers or health care organiza-
tions according to the guidelines described in 
this paragraph. 
‘‘(C) COMPOSITION.— 
‘‘(i) IN GENERAL.—An expert panel 
under this paragraph shall be composed of 
3 medical experts (either physicians or 
health care professionals) and 3 attorneys 
to be appointed by the head of the State 
agency responsible for health. 
‘‘(ii) LICENSURE AND EXPERTISE.— 
Each physician or health care professional 
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appointed to an expert panel under clause 
(i) shall— 
‘‘(I) be appropriately credentialed 
or licensed in the State in which the 
dispute takes place to deliver health 
care services; and 
‘‘(II) typically treat the condi-
tion, make the diagnosis, or provide 
the type of treatment that is under re-
view. 
‘‘(iii) INDEPENDENCE.— 
‘‘(I) IN
GENERAL.—Subject to 
subclause (II), each individual ap-
pointed to an expert panel under this 
paragraph shall— 
‘‘(aa) not have a material 
familial, financial, or professional 
relationship with a party involved 
in the dispute reviewed by the 
panel; and 
‘‘(bb) not otherwise have a 
conflict of interest with such a 
party. 
‘‘(II) EXCEPTION.—Nothing in 
subclause (I) shall be construed to 
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prohibit an individual who has staff 
privileges at an institution where the 
treatment involved in the dispute was 
provided from serving as a member of 
an expert panel merely on the basis of 
such affiliation, if the affiliation is 
disclosed to the parties and neither 
party objects. 
‘‘(iv) PRACTICING HEALTH CARE PRO-
FESSIONAL IN SAME FIELD.— 
‘‘(I) IN GENERAL.—In a dispute 
before an expert panel that involves 
treatment, or the provision of items or 
services— 
‘‘(aa) by a physician, the 
medical experts on the expert 
panel shall be practicing physi-
cians (allopathic or osteopathic) 
of the same or similar specialty 
as a physician who typically 
treats the condition, makes the 
diagnosis, or provides the type of 
treatment under review; or 
‘‘(bb) by a health care pro-
fessional other than a physician, 
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at least two medical experts on 
the expert panel shall be prac-
ticing physicians (allopathic or 
osteopathic) of the same or simi-
lar specialty as the health care 
professional who typically treats 
the condition, makes the diag-
nosis, or provides the type of 
treatment under review, and, if 
determined appropriate by the 
State agency, the third medical 
expert shall be a practicing 
health care professional (other 
than such a physician) of such a 
same or similar specialty. 
‘‘(II) PRACTICING DEFINED.—In 
this paragraph, the term ‘practicing’ 
means, with respect to an individual 
who is a physician or other health 
care professional, that the individual 
provides health care services to indi-
vidual patients on average at least 2 
days a week. 
‘‘(v) PEDIATRIC EXPERTISE.—In the 
case of dispute relating to a child, at least 
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1 medical expert on the expert panel shall 
have expertise described in clause (iv)(I) in 
pediatrics. 
‘‘(D) DETERMINATION.—After a review, 
an expert panel shall make a determination as 
to the liability of the parties involved and com-
pensation based on a schedule of compensation 
that is developed by the panel. Such a schedule 
shall at least include— 
‘‘(i) payment for the net economic loss 
incurred by the patient, on a periodic 
basis, reduced by any payments received by 
the patient under— 
‘‘(I) any health or accident insur-
ance; 
‘‘(II) any wage or salary continu-
ation plan; or 
‘‘(III) any disability income in-
surance; 
‘‘(ii) payment for the non-economic 
damages incurred by the patient, if appro-
priate for the injury, based on a defined 
payment schedule developed by the State, 
in consultation with relevant experts and 
with the Secretary; 
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‘‘(iii) reasonable attorney’s fees; and 
‘‘(iv) regular updates of the schedule 
under clause (ii) as necessary. 
‘‘(E) ACCEPTANCE.—If the parties to a 
dispute who come before an expert panel under 
this paragraph accept the determination of the 
expert panel concerning liability and compensa-
tion, such compensation shall be paid to the 
claimant and the claimant shall agree to forgo 
any further action against the health care pro-
viders or health care organizations involved. 
‘‘(F) FAILURE TO ACCEPT.—If any party 
decides not to accept the expert panel’s deter-
mination under this paragraph, the State may 
choose whether to allow the panel to review the 
determination de novo, with deference, or to 
provide an opportunity for parties to reject the 
determination of the panel. 
‘‘(G) REVIEW BY STATE COURT AFTER EX-
HAUSTION OF ADMINISTRATIVE REMEDIES.— 
‘‘(i) RIGHT
TO
FILE.—If the State 
elects not to permit the expert panel under 
this paragraph to conduct its own reviews 
of determinations, or if the State elects to 
permit such reviews but a party is not sat-
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isfied with the final decision of the panel 
after such a review, the party shall have 
the right to file a claim relating to the in-
jury involved in a State court of competent 
jurisdiction. 
‘‘(ii) FORFEIT
OF
AWARDS.—Any 
party filing an action in a State court 
under clause (i) shall forfeit any compensa-
tion award made under subparagraph (C). 
‘‘(iii) 
ADMISSIBILITY.—The 
deter-
minations of the expert panel pursuant to 
a review under subparagraph (C) shall be 
admissible into evidence in any State court 
proceeding under this subparagraph. 
‘‘(3) ADMINISTRATIVE
HEALTH
CARE
TRIBU-
NALS.— 
‘‘(A) IN
GENERAL.—A State may use 
amounts received under a grant under this sec-
tion to develop and implement an administra-
tive health care tribunal system under which 
the parties involved shall have the right to re-
quest a hearing to review any dispute con-
cerning injuries allegedly caused by health care 
providers or health care organizations before an 
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183 
administrative health care tribunal established 
by the State involved. 
‘‘(B) REQUIREMENTS.—In establishing an 
administrative health care tribunal under this 
paragraph, a State shall— 
‘‘(i) ensure that such tribunals are 
presided over by special judges with health 
care expertise who meet applicable State 
standards for judges and who agree to pre-
side over such court voluntarily; 
‘‘(ii) provide authority to such judges 
to make binding rulings, rendered in writ-
ten decisions, on standards of care, causa-
tion, compensation, and related issues with 
reliance on independent expert witnesses 
commissioned by the tribunal; 
‘‘(iii) establish a legal standard for 
the tribunal that shall be the same as the 
standard that would apply in the State 
court of competent jurisdiction which 
would otherwise handle the claim; and 
‘‘(iv) provide for an appeals process to 
allow for review of decisions by State 
courts. 
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‘‘(C) DETERMINATION.—After a tribunal 
conducts a review under this paragraph, the tri-
bunal shall make a determination as to the li-
ability of the parties involved and the amount 
of compensation that should be paid based on 
a schedule of compensation developed by the 
tribunal. Such a schedule shall at a minimum 
include— 
‘‘(i) payment for the net economic loss 
incurred by the patient, on a periodic 
basis, reduced by any payments received by 
the patient under— 
‘‘(I) any health or accident insur-
ance; 
‘‘(II) any wage or salary continu-
ation plan; or 
‘‘(III) any disability income in-
surance; 
‘‘(ii) payment for the non-economic 
damages incurred by the patient, if appro-
priate for the injury, based on a defined 
payment schedule developed by the State 
in consultation with relevant experts and 
with the Secretary; 
‘‘(iii) reasonable attorney’s fees; and 
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‘‘(iv) regular updates of the schedule 
under clause (ii) as necessary. 
‘‘(D) REVIEW BY STATE COURT AFTER EX-
HAUSTION OF ADMINISTRATIVE REMEDIES.— 
‘‘(i) RIGHT TO FILE.—Nothing in this 
paragraph shall be construed to prohibit 
any individual who is not satisfied with the 
determinations of a tribunal under this 
paragraph, from filing a claim for the in-
jury involved in a State court of competent 
jurisdiction. 
‘‘(ii) FORFEIT OF AWARD.—Any party 
filing an action in a State court under 
clause (i) shall forfeit any compensation 
award made under subparagraph (C). 
‘‘(iii) 
ADMISSIBILITY.—The 
deter-
minations of the tribunal under subpara-
graph (C) shall be admissible into evidence 
in any State court proceeding under this 
subparagraph. 
‘‘(4) EXPERT PANEL REVIEW AND ADMINISTRA-
TIVE
HEALTH
CARE
TRIBUNAL
COMBINATION 
MODEL.— 
‘‘(A) IN
GENERAL.—A State may use 
amounts received under a grant under this sec-
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186 
tion to develop and implement an expert panel 
review and administrative health care tribunal 
combination system to review any dispute con-
cerning injuries allegedly caused by health care 
providers or health care organizations. Under 
such system, a dispute concerning injuries al-
legedly caused by health care providers or 
health care organizations shall proceed through 
the procedures described in this subparagraph 
prior to the submission of such dispute to a 
State court. 
‘‘(B) GENERAL PROCEDURE.— 
‘‘(i) ESTABLISHMENT
OF
EXPERT 
PANEL.—Prior to submitting any dispute 
described in subparagraph (A) to an ad-
ministrative health care tribunal under the 
system established under this paragraph, 
the State shall establish an expert panel 
(in accordance with subparagraph (C)) to 
review the allegations involved in such dis-
pute. 
‘‘(ii) REFERRAL TO TRIBUNAL.—If ei-
ther party to a dispute described in clause 
(i) fails to accept the determination of the 
expert panel, the dispute shall then be re-
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bunal established by the State involved 
under this subparagraph. 
‘‘(ii) REQUIREMENTS.—The provisions 
of paragraph (3) shall apply with respect 
to the establishment and operation of an 
administrative health care tribunal under 
this subparagraph. 
‘‘(iii) FORFEIT
OF
AWARDS.—Any 
party proceeding to the second step-admin-
istrative health care tribunal-under this 
model shall forfeit any compensation 
awarded by the expert panel. 
‘‘(iv) 
ADMISSIBILITY.—The 
deter-
minations of the expert panel under sub-
paragraph (C) shall be admissible into evi-
dence in any administrative health care tri-
bunal proceeding under this subparagraph. 
‘‘(E) RIGHT
TO
FILE.—Nothing in this 
paragraph shall be construed to prohibit any in-
dividual who is not satisfied with the deter-
mination of the tribunal (after having proceeded 
through both the expert panel under subpara-
graph (C) and the tribunal under subparagraph 
(D)) from filing a claim for the injury involved 
in a State court of competent jurisdiction. 
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‘‘(F) ADMISSIBILITY.—The determinations 
of both the expert panel and the tribunal under 
this paragraph shall be admissible into evidence 
in any State court proceeding under this para-
graph. 
‘‘(G) FORFEIT OF AWARDS.—Any party fil-
ing an action in State court under subpara-
graph (E) shall forfeit any compensation award 
made by both the expert panel and the adminis-
trative health care tribunal under this para-
graph. 
‘‘(e) DEFINITIONS.—In this section: 
‘‘(1) CURRENT
TORT
LITIGATION.—The term 
‘current tort litigation’ means the tort litigation sys-
tem existing in the State on the date on which the 
State submits an application under subsection 
(b)(1), for the resolution of disputes concerning inju-
ries allegedly caused by health care providers or 
health care organizations. 
‘‘(2) HEALTH CARE ORGANIZATION.—The term 
‘health care organization’ means any individual or 
entity that is obligated to provide, pay for, or admin-
ister health benefits under any health plan. 
‘‘(3) NET ECONOMIC LOSS.—The term ‘net eco-
nomic loss’ means— 
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‘‘(A) reasonable expenses incurred for 
products, services and accommodations needed 
for health care, training and other remedial 
treatment and care of an injured individual; 
‘‘(B) reasonable and appropriate expenses 
for rehabilitation treatment and occupational 
training; 
‘‘(C) 100 percent of the loss of income 
from work that an injured individual would 
have performed if not injured, reduced by any 
income from substitute work actually per-
formed; and 
‘‘(D) reasonable expenses incurred in ob-
taining ordinary and necessary services to re-
place services an injured individual would have 
performed for the benefit of the individual or 
the family of such individual if the individual 
had not been injured. 
‘‘(4) NON-ECONOMIC
DAMAGES.—The term 
‘non-economic damages’ means losses for physical 
and emotional pain, suffering, inconvenience, phys-
ical impairment, mental anguish, disfigurement, loss 
of enjoyment of life, loss of society and companion-
ship, loss of consortium (other than loss of domestic 
service), injury to reputation, and all other non-pe-
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cuniary losses of any kind or nature, to the extent 
permitted under State law. 
‘‘(f) FUNDING.— 
‘‘(1) ONE-TIME INCREASE IN MEDICAID PAY-
MENT.—In the case of a State awarded a grant to 
carry out this section, the total amount of the Fed-
eral payment determined for the State under section 
1913 of the Social Security Act (as amended by sec-
tion 401) for fiscal year 2011 (in addition to the any 
increase applicable for that fiscal year under section 
203(b) but determined without regard to any such 
increase) shall be increased by an amount equal to 
1 percent of the total amount of payments made to 
the State for fiscal year 2010 under section 1903(a) 
of the Social Security Act (42 U.S.C. 1396b(a)) for 
purposes of carrying out a grant awarded under this 
section. Amounts paid to a State pursuant to this 
subsection shall remain available until expended. 
‘‘(2) AUTHORIZATION
OF
APPROPRIATIONS.— 
There are authorized to be appropriated for any fis-
cal year such sums as may be necessary for purposes 
of making payments to States pursuant to para-
graph (1).’’. 
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TITLE VII—PROMOTING HEALTH 
INFORMATION TECHNOLOGY 
Subtitle A—Assisting the Develop-
ment 
of 
Health 
Information 
Technology 
SEC. 701. PURPOSE. 
It is the purpose of this subtitle to promote the utili-
zation of health record banking by improving the coordina-
tion of health information through an infrastructure for 
the secure and authorized exchange and use of healthcare 
information. 
SEC. 702. HEALTH RECORD BANKING. 
(a) ESTABLISHMENT.—Not later than 1 year after 
the date of enactment of this Act, the Secretary of Health 
and Human Services shall promulgate regulations to pro-
vide for the certification and auditing of the banking of 
electronic medical records. 
(b) GENERAL RIGHTS.—An individual who has a 
health record contained in a health record bank shall 
maintain ownership over the health record and shall have 
the right to review the contents of the record. 
SEC. 703. APPLICATION OF FEDERAL AND STATE SECURITY 
AND CONFIDENTIALITY STANDARDS. 
(a) IN GENERAL.—Current Federal security and con-
fidentiality standards and State security and confiden-
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tiality laws shall apply to this subtitle until such time as 
Congress acts to amend such standards. 
(b) DEFINITIONS.—In this section: 
(1) CURRENT
FEDERAL
SECURITY
AND
CON-
FIDENTIALITY
STANDARDS.—The term ‘‘current 
Federal security and confidentiality standards’’ 
means the Federal privacy standards established 
pursuant to section 264(c) of the Health Insurance 
Portability and Accountability Act of 1996 (42 
U.S.C. 1320d–2 note) and security standards estab-
lished under section 1173(d) of the Social Security 
Act (42 U.S.C. 1320d–2(d)). 
(2) STATE
SECURITY
AND
CONFIDENTIALITY 
LAWS.—The term ‘‘State security and confidentiality 
laws’’ means State laws and regulations relating to 
the privacy and confidentiality of individually identi-
fiable health information or to the security of such 
information. 
(3) STATE.—The term ‘‘State’’ has the mean-
ing given such term for purposes of title XI of the 
Social Security Act, as provided under section 
1101(a) of such Act (42 U.S.C. 1301(a)). 
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Subtitle B—Removing Barriers to 
the Use of Health Information 
Technology to Better Coordi-
nate Health Care 
SEC. 711. SAFE HARBORS TO ANTIKICKBACK CIVIL PEN-
ALTIES AND CRIMINAL PENALTIES FOR PRO-
VISION OF HEALTH INFORMATION TECH-
NOLOGY AND TRAINING SERVICES. 
(a) FOR CIVIL PENALTIES.—Section 1128A of the 
Social Security Act (42 U.S.C. 1320a–7a) is amended— 
(1) in subsection (b), by adding at the end the 
following new paragraph: 
‘‘(4) For purposes of this subsection, inducements to 
reduce or limit services described in paragraph (1) shall 
not include the practical or other advantages resulting 
from health information technology or related installation, 
maintenance, support, or training services.’’; and 
(2) in subsection (i), by adding at the end the 
following new paragraph: 
‘‘(8) The term ‘health information technology’ 
means hardware, software, license, right, intellectual 
property, equipment, or other information tech-
nology (including new versions, upgrades, and 
connectivity) designed or provided primarily for the 
electronic creation, maintenance, or exchange of 
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195 
health information to better coordinate care or im-
prove health care quality, efficiency, or research.’’. 
(b) FOR CRIMINAL PENALTIES.—Section 1128B of 
such Act (42 U.S.C. 1320a–7b) is amended— 
(1) in subsection (b)(3)— 
(A) in subparagraph (G), by striking 
‘‘and’’ at the end; 
(B) in the subparagraph (H) added by sec-
tion 237(d) of the Medicare Prescription Drug, 
Improvement, and Modernization Act of 2003 
(Public Law 108–173; 117 Stat. 2213)— 
(i) by moving such subparagraph 2 
ems to the left; and 
(ii) by striking the period at the end 
and inserting a semicolon; 
(C) in the subparagraph (H) added by sec-
tion 431(a) of such Act (117 Stat. 2287)— 
(i) by redesignating such subpara-
graph as subparagraph (I); 
(ii) by moving such subparagraph 2 
ems to the left; and 
(iii) by striking the period at the end 
and inserting ‘‘; and’’; and 
(D) by adding at the end the following new 
subparagraph: 
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‘‘(J) any nonmonetary remuneration (in the 
form of health information technology, as defined in 
section 1128A(i)(8), or related installation, mainte-
nance, support or training services) made to a per-
son by a specified entity (as defined in subsection 
(g)) if— 
‘‘(i) the provision of such remuneration is 
without an agreement between the parties or 
legal condition that— 
‘‘(I) limits or restricts the use of the 
health information technology to services 
provided by the physician to individuals re-
ceiving services at the specified entity; 
‘‘(II) limits or restricts the use of the 
health information technology in conjunc-
tion with other health information tech-
nology; or 
‘‘(III) conditions the provision of such 
remuneration on the referral of patients or 
business to the specified entity; 
‘‘(ii) such remuneration is arranged for in 
a written agreement that is signed by the par-
ties involved (or their representatives) and that 
specifies the remuneration solicited or received 
(or offered or paid) and states that the provi-
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197 
sion of such remuneration is made for the pri-
mary purpose of better coordination of care or 
improvement of health quality, efficiency, or re-
search; and 
‘‘(iii) the specified entity providing the re-
muneration (or a representative of such entity) 
has not taken any action to disable any basic 
feature of any hardware or software component 
of such remuneration that would permit inter-
operability.’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(g) SPECIFIED ENTITY DEFINED.—For purposes of 
subsection (b)(3)(J), the term ‘specified entity’ means an 
entity that is a hospital, group practice, prescription drug 
plan sponsor, a Medicare Advantage organization, or any 
other such entity specified by the Secretary, considering 
the goals and objectives of this section, as well as the goals 
to better coordinate the delivery of health care and to pro-
mote the adoption and use of health information tech-
nology.’’. 
(c) EFFECTIVE DATE
AND EFFECT
ON STATE 
LAWS.— 
(1) EFFECTIVE DATE.—The amendments made 
by subsections (a) and (b) shall take effect on the 
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date that is 120 days after the date of the enact-
ment of this Act. 
(2) PREEMPTION OF STATE LAWS.—No State 
(as defined in section 1101(a) of the Social Security 
Act (42 U.S.C. 1301(a)) for purposes of title XI of 
such Act) shall have in effect a State law that im-
poses a criminal or civil penalty for a transaction de-
scribed 
in 
section 
1128A(b)(4) 
or 
section 
1128B(b)(3)(J) of such Act, as added by subsections 
(a)(1) and (b), respectively, if the conditions de-
scribed in the respective provision, with respect to 
such transaction, are met. 
(d) STUDY AND REPORT TO ASSESS EFFECT OF 
SAFE HARBORS ON HEALTH SYSTEM.— 
(1) IN GENERAL.—The Secretary of Health and 
Human Services shall conduct a study to determine 
the impact of each of the safe harbors described in 
paragraph (3). In particular, the study shall examine 
the following: 
(A) The effectiveness of each safe harbor 
in increasing the adoption of health information 
technology. 
(B) The types of health information tech-
nology provided under each safe harbor. 
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(C) The extent to which the financial or 
other business relationships between providers 
under each safe harbor have changed as a re-
sult of the safe harbor in a way that adversely 
affects or benefits the health care system or 
choices available to consumers. 
(D) The impact of the adoption of health 
information technology on health care quality, 
cost, and access under each safe harbor. 
(2) REPORT.—Not later than 3 years after the 
effective date described in subsection (c)(1), the Sec-
retary of Health and Human Services shall submit 
to Congress a report on the study under paragraph 
(1). 
(3) SAFE HARBORS DESCRIBED.—For purposes 
of paragraphs (1) and (2), the safe harbors de-
scribed in this paragraph are— 
(A) 
the 
safe 
harbor 
under 
section 
1128A(b)(4) of such Act (42 U.S.C. 1320a– 
7a(b)(4)), as added by subsection (a)(1); and 
(B) 
the 
safe 
harbor 
under 
section 
1128B(b)(3)(J) of such Act (42 U.S.C. 1320a– 
7b(b)(3)(J)), as added by subsection (b). 
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SEC. 712. EXCEPTION TO LIMITATION ON CERTAIN PHYSI-
CIAN REFERRALS (UNDER STARK) FOR PRO-
VISION OF HEALTH INFORMATION TECH-
NOLOGY 
AND 
TRAINING 
SERVICES 
TO 
HEALTH CARE PROFESSIONALS. 
(a) IN GENERAL.—Section 1877(b) of the Social Se-
curity Act (42 U.S.C. 1395nn(b)) is amended by adding 
at the end the following new paragraph: 
‘‘(6) INFORMATION TECHNOLOGY AND TRAIN-
ING SERVICES.— 
‘‘(A) IN GENERAL.—Any nonmonetary re-
muneration (in the form of health information 
technology or related installation, maintenance, 
support or training services) made by a speci-
fied entity to a physician if— 
‘‘(i) the provision of such remunera-
tion is without an agreement between the 
parties or legal condition that— 
‘‘(I) limits or restricts the use of 
the health information technology to 
services provided by the physician to 
individuals receiving services at the 
specified entity; 
‘‘(II) limits or restricts the use of 
the health information technology in 
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conjunction with other health informa-
tion technology; or 
‘‘(III) conditions the provision of 
such remuneration on the referral of 
patients or business to the specified 
entity; 
‘‘(ii) such remuneration is arranged 
for in a written agreement that is signed 
by the parties involved (or their represent-
atives) and that specifies the remuneration 
made and states that the provision of such 
remuneration is made for the primary pur-
pose of better coordination of care or im-
provement of health quality, efficiency, or 
research; and 
‘‘(iii) the specified entity (or a rep-
resentative of such entity) has not taken 
any action to disable any basic feature of 
any hardware or software component of 
such remuneration that would permit 
interoperability. 
‘‘(B) HEALTH INFORMATION TECHNOLOGY 
DEFINED.—For purposes of this paragraph, the 
term ‘health information technology’ means 
hardware, software, license, right, intellectual 
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202 
property, equipment, or other information tech-
nology (including new versions, upgrades, and 
connectivity) designed or provided primarily for 
the electronic creation, maintenance, or ex-
change of health information to better coordi-
nate care or improve health care quality, effi-
ciency, or research. 
‘‘(C) SPECIFIED
ENTITY
DEFINED.—For 
purposes of this paragraph, the term ‘specified 
entity’ means an entity that is a hospital, group 
practice, prescription drug plan sponsor, a 
Medicare Advantage organization, or any other 
such entity specified by the Secretary, consid-
ering the goals and objectives of this section, as 
well as the goals to better coordinate the deliv-
ery of health care and to promote the adoption 
and use of health information technology.’’. 
(b) EFFECTIVE DATE; EFFECT ON STATE LAWS.— 
(1) EFFECTIVE DATE.—The amendment made 
by subsection (a) shall take effect on the date that 
is 120 days after the date of the enactment of this 
Act. 
(2) PREEMPTION OF STATE LAWS.—No State 
(as defined in section 1101(a) of the Social Security 
Act (42 U.S.C. 1301(a)) for purposes of title XI of 
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203 
such Act) shall have in effect a State law that im-
poses a criminal or civil penalty for a transaction de-
scribed in section 1877(b)(6) of such Act, as added 
by subsection (a), if the conditions described in such 
section, with respect to such transaction, are met. 
(c) STUDY AND REPORT TO ASSESS EFFECT OF EX-
CEPTION ON HEALTH SYSTEM.— 
(1) IN GENERAL.—The Secretary of Health and 
Human Services shall conduct a study to determine 
the impact of the exception under section 1877(b)(6) 
of such Act (42 U.S.C. 1395nn(b)(6)), as added by 
subsection (a). In particular, the study shall examine 
the following: 
(A) The effectiveness of the exception in 
increasing the adoption of health information 
technology. 
(B) The types of health information tech-
nology provided under the exception. 
(C) The extent to which the financial or 
other business relationships between providers 
under the exception have changed as a result of 
the exception in a way that adversely affects or 
benefits the health care system or choices avail-
able to consumers. 
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(D) The impact of the adoption of health 
information technology on health care quality, 
cost, and access under the exception. 
(2) REPORT.—Not later than 3 years after the 
effective date described in subsection (b)(1), the Sec-
retary of Health and Human Services shall submit 
to Congress a report on the study under paragraph 
(1). 
SEC. 713. RULES OF CONSTRUCTION REGARDING USE OF 
CONSORTIA. 
(a) APPLICATION TO SAFE HARBOR FROM CRIMINAL 
PENALTIES.—Section 1128B(b)(3) of the Social Security 
Act (42 U.S.C. 1320a–7b(b)(3)) is amended by adding 
after and below subparagraph (J), as added by section 
711(b)(1), the following: ‘‘For purposes of subparagraph 
(J), nothing in such subparagraph shall be construed as 
preventing a specified entity, consistent with the specific 
requirements of such subparagraph, from forming a con-
sortium composed of health care providers, payers, em-
ployers, and other interested entities to collectively pur-
chase and donate health information technology, or from 
offering health care providers a choice of health informa-
tion technology products in order to take into account the 
varying needs of such providers receiving such products.’’. 
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(b) APPLICATION
TO STARK EXCEPTION.—Para-
graph (6) of section 1877(b) of the Social Security Act 
(42 U.S.C. 1395nn(b)), as added by section 712(a), is 
amended by adding at the end the following new subpara-
graph: 
‘‘(D) RULE OF CONSTRUCTION.—For pur-
poses of subparagraph (A), nothing in such 
subparagraph shall be construed as preventing 
a specified entity, consistent with the specific 
requirements of such subparagraph, from— 
‘‘(i) forming a consortium composed 
of health care providers, payers, employers, 
and other interested entities to collectively 
purchase and donate health information 
technology; or 
‘‘(ii) offering health care providers a 
choice of health information technology 
products in order to take into account the 
varying needs of such providers receiving 
such products.’’. 
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206 
TITLE VIII—HEALTH CARE 
SERVICES COMMISSION 
Subtitle A—Establishment and 
General Duties 
SEC. 801. ESTABLISHMENT. 
(a) IN GENERAL.—There is hereby established a 
Health Care Services Commission (in this title, referred 
to as the ‘‘Commission’’) to be composed of 5 commis-
sioners (in this title referred to as the ‘‘Commissioners’’) 
to be appointed by the President by and with the advice 
and consent of the Senate. Not more than 3 of such Com-
missioners shall be members of the same political party, 
and in making appointments members of different political 
parties shall be appointed alternately as nearly as may be 
practicable. No Commissioner shall engage in any other 
business, vocation, or employment than that of serving as 
Commissioner. Each Commissioner shall hold office for a 
term of 5 years and until a successor is appointed and 
has qualified, except that— 
(1) such Commissioner shall not so continue to 
serve beyond the expiration of the next session of 
Congress subsequent to the expiration of said fixed 
term of office; 
(2) any Commissioner appointed to fill a va-
cancy occurring prior to the expiration of the term 
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for which a predecessor was appointed shall be ap-
pointed for the remainder of such term; and 
(3) the terms of office of the Commissioners 
first taking office after the date of the enactment of 
this Act shall expire as designated by the President 
at the time of nomination, 1 at the end of 1 year, 
1 at the end of 2 years, 1 at the end of 3 years, 1 
at the end of 4 years, and 1 at the end of 5 years, 
after the date of the enactment of this Act. 
(b) PURPOSE.—The purpose of the Commission is to 
enhance the quality, appropriateness, and effectiveness of 
health care services, and access to such services, through 
the establishment of a broad base of scientific research 
and through the promotion of improvements in clinical 
practice and in the organization, financing, and delivery 
of health care services. 
(c) APPOINTMENT
OF CHAIRMAN.—The President 
shall, from among the Commissioners appointed under 
subsection (a), designate an individual to serve as the 
Chairman of the Commission. 
SEC. 802. GENERAL AUTHORITIES AND DUTIES. 
(a) IN GENERAL.—In carrying out section 801(b), 
the Commissioners shall conduct and support research, 
demonstration projects, evaluations, training, guideline de-
velopment, and the dissemination of information, on 
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health care services and on systems for the delivery of 
such services, including activities with respect to— 
(1) the effectiveness, efficiency, and quality of 
health care services; 
(2) the outcomes of health care services and 
procedures; 
(3) clinical practice, including primary care and 
practice-oriented research; 
(4) health care technologies, facilities, and 
equipment; 
(5) health care costs, productivity, and market 
forces; 
(6) health promotion and disease prevention; 
(7) health statistics and epidemiology; and 
(8) medical liability. 
(b) REQUIREMENTS
WITH
RESPECT
TO
RURAL 
AREAS AND UNDERSERVED POPULATIONS.—In carrying 
out subsection (a), the Commissioners shall undertake and 
support research, demonstration projects, and evaluations 
with respect to— 
(1) the delivery of health care services in rural 
areas (including frontier areas); and 
(2) the health of low-income groups, minority 
groups, and the elderly. 
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SEC. 803. DISSEMINATION. 
(a) IN GENERAL.—The Commissioners shall— 
(1) promptly publish, make available, and oth-
erwise disseminate, in a form understandable and on 
as broad a basis as practicable so as to maximize its 
use, the results of research, demonstration projects, 
and evaluations conducted or supported under this 
title and the guidelines, standards, and review cri-
teria developed under this title; 
(2) promptly make available to the public data 
developed in such research, demonstration projects, 
and evaluations; and 
(3) as appropriate, provide technical assistance 
to State and local government and health agencies 
and conduct liaison activities to such agencies to fos-
ter dissemination. 
(b) PROHIBITION AGAINST RESTRICTIONS.—Except 
as provided in subsection (c), the Commissioners may not 
restrict the publication or dissemination of data from, or 
the results of, projects conducted or supported under this 
title. 
(c) LIMITATION
ON USE
OF CERTAIN INFORMA-
TION.—No information, if an establishment or person sup-
plying the information or described in it is identifiable, 
obtained in the course of activities undertaken or sup-
ported under this title may be used for any purpose other 
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210 
than the purpose for which it was supplied unless such 
establishment or person has consented (as determined 
under regulations of the Secretary) to its use for such 
other purpose. Such information may not be published or 
released in other form if the person who supplied the infor-
mation or who is described in it is identifiable unless such 
person has consented (as determined under regulations of 
the Secretary) to its publication or release in other form. 
(d) CERTAIN
INTERAGENCY
AGREEMENT.—The 
Commissioners and the Director of the National Library 
of Medicine shall enter into an agreement providing for 
the implementation of subsection (a)(1). 
Subtitle B—Forum for Quality and 
Effectiveness in Health Care 
SEC. 811. ESTABLISHMENT OF OFFICE. 
There is established within the Commission an office 
to be known as the Office of the Forum for Quality and 
Effectiveness in Health Care. The office shall be headed 
by a director (referred to in this title as the ‘‘Director’’) 
who shall be appointed by the Commissioners. 
SEC. 812. MEMBERSHIP. 
(a) IN GENERAL.—The Office of the Forum for Qual-
ity and Effectiveness in Health Care shall be composed 
of 15 individuals nominated by private sector health care 
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organizations and appointed by the Commission and shall 
include representation from at least the following: 
(1) Health insurance industry. 
(2) Health care provider groups. 
(3) Non-profit organizations. 
(4) Rural health organizations. 
(b) TERMS.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), members of the Office of the Forum for 
Quality and Effectiveness in Health Care shall serve 
for a term of 5 years. 
(2) STAGGERED ROTATION.—Of the members 
first appointed to the Office of the Forum for Qual-
ity and Effectiveness in Health Care, the Commis-
sion shall appoint 5 members to serve for a term of 
2 years, 5 members to serve for a term of 3 years, 
and 5 members to serve for a term of 4 years. 
(c) TREATMENT OF OTHER EMPLOYMENT.—Each 
member of the Office of the Forum for Quality and Effec-
tiveness in Health Care shall serve the Office independ-
ently from any other position of employment. 
SEC. 813. DUTIES. 
(a) ESTABLISHMENT
OF FORUM PROGRAM.—The 
Commissioners, acting through the Director, shall estab-
lish a program to be known as the Forum for Quality and 
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Effectiveness in Health Care. For the purpose of pro-
moting transparency in price, quality, appropriateness, 
and effectiveness of health care, the Director, using the 
process set forth in section 814, shall arrange for the de-
velopment and periodic review and updating of standards 
of quality, performance measures, and medical review cri-
teria through which health care providers and other appro-
priate entities may assess or review the provision of health 
care and assure the quality of such care. 
(b) CERTAIN REQUIREMENTS.—Guidelines, stand-
ards, performance measures, and review criteria under 
subsection (a) shall— 
(1) be based on the best available research and 
professional judgment regarding the effectiveness 
and appropriateness of health care services and pro-
cedures; and 
(2) be presented in formats appropriate for use 
by physicians, health care practitioners, providers, 
medical educators, and medical review organizations 
and in formats appropriate for use by consumers of 
health care. 
(c) AUTHORITY FOR CONTRACTS.—In carrying out 
this subtitle, the Director may enter into contracts with 
public or nonprofit private entities. 
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(d) PUBLIC DISCLOSURE OF RECOMMENDATIONS.— 
For each fiscal year beginning with 2010, the Director 
shall make publicly available the following: 
(1) Quarterly reports for public comment that 
include proposed recommendations for guidelines, 
standards, performance measures, and review cri-
teria under subsection (a) and any updates to such 
guidelines, standards, performance measures, and 
review criteria. 
(2) After consideration of such comments, a 
final report that contains final recommendations for 
such guidelines, standards, performance measures, 
review criteria, and updates. 
(e) DATE CERTAIN FOR INITIAL GUIDELINES AND 
STANDARDS.—The Commissioners, by not later than Jan-
uary 1, 2012, shall assure the development of an initial 
set of guidelines, standards, performance measures, and 
review criteria under subsection (a). 
SEC. 814. ADOPTION AND ENFORCEMENT OF GUIDELINES 
AND STANDARDS. 
(a) ADOPTION OF RECOMMENDATIONS OF FORUM 
FOR QUALITY AND EFFECTIVENESS IN HEALTH CARE.— 
For each fiscal year, the Commissioners shall adopt the 
recommendations made for such year in the final report 
under subsection (d)(2) of section 813 for guidelines, 
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standards, performance measures, and review criteria de-
scribed in subsection (a) of such section. 
(b) ENFORCEMENT
AUTHORITY.—The Commis-
sioners, in consultation with the Secretary of Health and 
Human Services, have the authority to make recommenda-
tions to the Secretary to enforce compliance of health care 
providers with the guidelines, standards, performance 
measures, and review criteria adopted under subsection 
(a). Such recommendations may include the following, 
with respect to a health care provider who is not in compli-
ance with such guidelines, standards, measures, and cri-
teria: 
(1) Exclusion from participation in Federal 
health care programs (as defined in section 
1128B(f) of the Social Security Act (42 U.S.C. 
1320a–7b(f))). 
(2) Imposition of a civil money penalty on such 
provider. 
SEC. 815. ADDITIONAL REQUIREMENTS. 
(a) PROGRAM AGENDA.—The Commissioners shall 
provide for an agenda for the development of the guide-
lines, standards, performance measures, and review cri-
teria described in section 813(a), including with respect 
to the standards, performance measures, and review cri-
teria, identifying specific aspects of health care for which 
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the standards, performance measures, and review criteria 
are to be developed and those that are to be given priority 
in the development of the standards, performance meas-
ures, and review criteria. 
Subtitle C—General Provisions 
SEC. 821. CERTAIN ADMINISTRATIVE AUTHORITIES. 
The Commissioners, in carrying out this title, may 
accept voluntary and uncompensated services. 
SEC. 822. FUNDING. 
For the purpose of carrying out this title, there are 
authorized to be appropriated such sums as may be nec-
essary for fiscal years 2010 through 2014. 
SEC. 823. DEFINITIONS. 
For purposes of this title: 
(1) The term ‘‘Commissioners’’ means the Com-
missioners of the Health Care Services Commission. 
(2) The term ‘‘Commission’’ means the Health 
Care Services Commission. 
(3) The term ‘‘Director’’ means the Director of 
the Office of the Forum for Quality and Effective-
ness in Health Care. 
(4) The term ‘‘Secretary’’ means the Secretary 
of Health and Human Services. 
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216 
Subtitle D—Terminations and 
Transition 
SEC. 831. TERMINATION OF AGENCY FOR HEALTHCARE RE-
SEARCH AND QUALITY. 
As of the date of the enactment of this Act, the Agen-
cy for Healthcare Research and Quality is terminated, and 
title IX of the Public Health Service Act is repealed. 
SEC. 832. TRANSITION. 
All orders, grants, contracts, privileges, and other de-
terminations or actions of the Agency for Healthcare Re-
search and Quality that are effective as of the date before 
the date of the enactment of this Act, shall be transferred 
to the Secretary and shall continue in effect according to 
their terms unless changed pursuant to law. 
Subtitle E—Independent Health 
Record Trust 
SEC. 841. SHORT TITLE. 
This subtitle may be cited as the ‘‘Independent 
Health Record Trust Act of 2009’’. 
SEC. 842. PURPOSE. 
It is the purpose of this subtitle to provide for the 
establishment of a nationwide health information tech-
nology network that— 
(1) improves health care quality, reduces med-
ical errors, increases the efficiency of care, and ad-
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vances the delivery of appropriate, evidence-based 
health care services; 
(2) promotes wellness, disease prevention, and 
the management of chronic illnesses by increasing 
the availability and transparency of information re-
lated to the health care needs of an individual; 
(3) ensures that appropriate information nec-
essary to make medical decisions is available in a us-
able form at the time and in the location that the 
medical service involved is provided; 
(4) produces greater value for health care ex-
penditures by reducing health care costs that result 
from inefficiency, medical errors, inappropriate care, 
and incomplete information; 
(5) promotes a more effective marketplace, 
greater competition, greater systems analysis, in-
creased choice, enhanced quality, and improved out-
comes in health care services; 
(6) improves the coordination of information 
and the provision of such services through an effec-
tive infrastructure for the secure and authorized ex-
change and use of health information; and 
(7) ensures that the health information privacy, 
security, and confidentiality of individually identifi-
able health information is protected. 
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SEC. 843. DEFINITIONS. 
In this subtitle: 
(1) ACCESS.—The term ‘‘access’’ means, with 
respect to an electronic health record, entering infor-
mation into such account as well as retrieving infor-
mation from such account. 
(2) ACCOUNT.—The term ‘‘account’’ means an 
electronic health record of an individual contained in 
an independent health record trust. 
(3) AFFIRMATIVE
CONSENT.—The term ‘‘af-
firmative consent’’ means, with respect to an elec-
tronic health record of an individual contained in an 
IHRT, express consent given by the individual for 
the use of such record in response to a clear and 
conspicuous request for such consent or at the indi-
vidual’s own initiative. 
(4) AUTHORIZED EHR DATA USER.—The term 
‘‘authorized EHR data user’’ means, with respect to 
an electronic health record of an IHRT participant 
contained as part of an IHRT, any entity (other 
than the participant) authorized (in the form of af-
firmative consent) by the participant to access the 
electronic health record. 
(5) CONFIDENTIALITY.—The term ‘‘confiden-
tiality’’ means, with respect to individually identifi-
able health information of an individual, the obliga-
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tion of those who receive such information to respect 
the health information privacy of the individual. 
(6) ELECTRONIC HEALTH RECORD.—The term 
‘‘electronic health record’’ means a longitudinal col-
lection of information concerning a single individual, 
including medical records and personal health infor-
mation, that is stored electronically. 
(7) HEALTH
INFORMATION
PRIVACY.—The 
term ‘‘health information privacy’’ means, with re-
spect to individually identifiable health information 
of an individual, the right of such individual to con-
trol the acquisition, uses, or disclosures of such in-
formation. 
(8) HEALTH PLAN.—The term ‘‘health plan’’ 
means a group health plan (as defined in section 
2208(1) of the Public Health Service Act (42 U.S.C. 
300bb–8(1))) as well as a plan that offers health in-
surance coverage in the individual market. 
(9) HIPAA PRIVACY REGULATIONS.—The term 
‘‘HIPAA privacy regulations’’ means the regulations 
promulgated under section 264(c) of the Health In-
surance Portability and Accountability Act of 1996 
(42 U.S.C. 1320d–2 note). 
(10) INDEPENDENT HEALTH RECORD TRUST; 
IHRT.—The terms ‘‘independent health record trust’’ 
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and ‘‘IHRT’’ mean a legal arrangement under the 
administration of an IHRT operator that meets the 
requirements of this subtitle with respect to elec-
tronic health records of individuals participating in 
the trust or IHRT. 
(11) IHRT OPERATOR.—The term ‘‘IHRT op-
erator’’ means, with respect to an IHRT, the organi-
zation that is responsible for the administration and 
operation of the IHRT in accordance with this sub-
title. 
(12) IHRT PARTICIPANT.—The term ‘‘IHRT 
participant’’ means, with respect to an IHRT, an in-
dividual who has a participation agreement in effect 
with respect to the maintenance of the individual’s 
electronic health record by the IHRT. 
(13) INDIVIDUALLY IDENTIFIABLE HEALTH IN-
FORMATION.—The term ‘‘individually identifiable 
health information’’ has the meaning given such 
term in section 1171(6) of the Social Security Act 
(42 U.S.C. 1320d(6)). 
(14) SECURITY.—The term ‘‘security’’ means, 
with respect to individually identifiable health infor-
mation of an individual, the physical, technological, 
or administrative safeguards or tools used to protect 
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221 
such information from unwarranted access or disclo-
sure. 
SEC. 844. ESTABLISHMENT, CERTIFICATION, AND MEMBER-
SHIP OF INDEPENDENT HEALTH RECORD 
TRUSTS. 
(a) ESTABLISHMENT.—Not later than one year after 
the date of the enactment of this Act, the Federal Trade 
Commission, in consultation with the National Committee 
on Vital and Health Statistics, shall prescribe standards 
for the establishment, certification, operation, and inter-
operability of IHRTs to carry out the purposes described 
in section 842 in accordance with the provisions of this 
subtitle. 
(b) CERTIFICATION.— 
(1) CERTIFICATION
BY
FTC.—The Federal 
Trade Commission shall provide for the certification 
of IHRTs. No IHRT may be certified unless the 
IHRT is determined to meet the standards for cer-
tification established under subsection (a). 
(2) DECERTIFICATION.—The Federal Trade 
Commission shall establish a process for the revoca-
tion of certification of an IHRT under this section 
in the case that the IHRT violates the standards es-
tablished under subsection (a). 
(c) MEMBERSHIP.— 
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222 
(1) IN GENERAL.—To be eligible to be a partic-
ipant in an IHRT, an individual shall— 
(A) submit to the IHRT information as re-
quired by the IHRT to establish an electronic 
health record with the IHRT; and 
(B) enter into a privacy protection agree-
ment described in section 846(b)(1) with the 
IHRT. 
The process to determine eligibility of an individual 
under this subsection shall allow for the establish-
ment by such individual of an electronic health 
record as expeditiously as possible if such individual 
is determined so eligible. 
(2) NO LIMITATION ON MEMBERSHIP.—Nothing 
in this subsection shall be construed to permit an 
IHRT to restrict membership, including on the basis 
of health condition. 
SEC. 845. DUTIES OF IHRT TO IHRT PARTICIPANTS. 
(a) FIDUCIARY DUTY OF IHRT; PENALTIES FOR 
VIOLATIONS OF FIDUCIARY DUTY.— 
(1) FIDUCIARY
DUTY.—With respect to the 
electronic health record of an IHRT participant 
maintained by an IHRT, the IHRT shall have a fi-
duciary duty to act for the benefit and in the inter-
ests of such participant and of the IHRT as a whole. 
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Such duty shall include obtaining the affirmative 
consent of such participant prior to the release of in-
formation in such participant’s electronic health 
record in accordance with the requirements of this 
subtitle. 
(2) PENALTIES.—If the IHRT knowingly or 
recklessly breaches the fiduciary duty described in 
paragraph (1), the IHRT shall be subject to the fol-
lowing penalties: 
(A) Loss of certification of the IHRT. 
(B) A fine that is not in excess of $50,000. 
(C) A term of imprisonment for the indi-
viduals involved of not more than 5 years. 
(b) ELECTRONIC HEALTH RECORD DEEMED TO BE 
HELD IN TRUST BY IHRT.—With respect to an indi-
vidual, an electronic health record maintained by an IHRT 
shall be deemed to be held in trust by the IHRT for the 
benefit of the individual and the IHRT shall have no legal 
or equitable interest in such electronic health record. 
SEC. 846. AVAILABILITY AND USE OF INFORMATION FROM 
RECORDS IN IHRT CONSISTENT WITH PRI-
VACY PROTECTIONS AND AGREEMENTS. 
(a) PROTECTED ELECTRONIC HEALTH RECORDS 
USE AND ACCESS.— 
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224 
(1) GENERAL RIGHTS REGARDING USES OF IN-
FORMATION.— 
(A) IN
GENERAL.—With respect to the 
electronic health record of an IHRT participant 
maintained by an IHRT, subject to paragraph 
(2)(C), primary uses and secondary uses (de-
scribed in subparagraphs (B) and (C), respec-
tively) of information within such record (other 
than by such participant) shall be permitted 
only upon the authorization of such use, prior 
to such use, by such participant. 
(B) PRIMARY USES.—For purposes of sub-
paragraph (A) and with respect to an electronic 
health record of an individual, a primary use is 
a use for purposes of the individual’s self-care 
or care by health care professionals. 
(C) SECONDARY USES.—For purposes of 
subparagraph (B) and with respect to an elec-
tronic health record of an individual, a sec-
ondary use is any use not described in subpara-
graph (B) and includes a use for purposes of 
public health research or other related activi-
ties. Additional authorization is required for a 
secondary use extending beyond the original 
purpose of the secondary use authorized by the 
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225 
IHRT participant involved. Nothing in this 
paragraph shall be construed as requiring au-
thorization for every secondary use that is with-
in the authorized original purpose. 
(2) RULES FOR PRIMARY USE OF RECORDS FOR 
HEALTH CARE PURPOSES.—With respect to the elec-
tronic health record of an IHRT participant (or 
specified parts of such electronic health record) 
maintained by an IHRT standards for access to 
such record shall provide for the following: 
(A) ACCESS
BY
IHRT
PARTICIPANTS
TO 
THEIR ELECTRONIC HEALTH RECORDS.— 
(i) 
OWNERSHIP.—The 
participant 
maintains ownership over the entire elec-
tronic health record (and all portions of 
such record) and shall have the right to 
electronically access and review the con-
tents of the entire record (and any portion 
of such record) at any time, in accordance 
with this subparagraph. 
(ii) ADDITION OF PERSONAL INFOR-
MATION.—The participant may add per-
sonal health information to the health 
record of that participant, except that such 
participant shall not alter information that 
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226 
is entered into the electronic health record 
by any authorized EHR data user. Such 
participant shall have the right to propose 
an amendment to information that is en-
tered by an authorized EHR data user 
pursuant to standards prescribed by the 
Federal Trade Commission for purposes of 
amending such information. 
(iii) IDENTIFICATION
OF
INFORMA-
TION ENTERED BY PARTICIPANT.—Any ad-
ditions or amendments made by the partic-
ipant to the health record shall be identi-
fied and disclosed within such record as 
being made by such participant. 
(B) ACCESS
BY
ENTITIES
OTHER
THAN 
IHRT PARTICIPANT.— 
(i) AUTHORIZED ACCESS ONLY.—Ex-
cept as provided under subparagraph (C) 
and paragraph (4), access to the electronic 
health record (or any portion of the 
record)— 
(I) may be made only by author-
ized EHR data users and only to such 
portions of the record as specified by 
the participant; and 
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227 
(II) may be limited by the partic-
ipant for purposes of entering infor-
mation into such record, retrieving in-
formation from such record, or both. 
(ii) IDENTIFICATION OF ENTITY THAT 
ENTERS
INFORMATION.—Any information 
that is added by an authorized EHR data 
user to the health record shall be identified 
and disclosed within such record as being 
made by such user. 
(iii) SATISFACTION OF HIPAA PRIVACY 
REGULATIONS.—In the case of a record of 
a covered entity (as defined for purposes of 
HIPAA privacy regulations), with respect 
to an individual, if such individual is an 
IHRT participant with an independent 
health record trust and such covered entity 
is an authorized EHR data user, the re-
quirement under the HIPAA privacy regu-
lations for such entity to provide the 
record to the participant shall be deemed 
met if such entity, without charge to the 
IHRT or the participant— 
(I) forwards to the trust an ap-
propriately formatted electronic copy 
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228 
of the record (and updates to such 
records) for inclusion in the electronic 
health record of the participant main-
tained by the trust; 
(II) enters such record into the 
electronic health record of the partici-
pant so maintained; or 
(III) 
otherwise 
makes 
such 
record available for electronic access 
by the IHRT or the individual in a 
manner that permits such record to 
be included in the account of the indi-
vidual contained in the IHRT. 
(iv) NOTIFICATION OF SENSITIVE IN-
FORMATION.—Any information, with re-
spect to the participant, that is sensitive 
information, as specified by the Federal 
Trade Commission, shall not be forwarded 
or entered by an authorized EHR data 
user into the electronic health record of the 
participant maintained by the trust unless 
the user certifies that the participant has 
been notified of such information. 
(C) DEEMED AUTHORIZATION FOR ACCESS 
FOR EMERGENCY HEALTH CARE.— 
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(i) FINDINGS.—Congress finds that— 
(I) given the size and nature of 
visits to emergency departments in 
the United States, readily available 
health information could make the dif-
ference between life and death; and 
(II) because of the case mix and 
volume of patients treated, emergency 
departments are well positioned to 
provide information for public health 
surveillance, community risk assess-
ment, research, education, training, 
quality improvement, and other uses. 
(ii) USE OF INFORMATION.—With re-
spect to the electronic health record of an 
IHRT participant (or specified parts of 
such electronic health record) maintained 
by an IHRT, the participant shall be 
deemed as providing authorization (in the 
form of affirmative consent) for health 
care providers to access, in connection with 
providing emergency care services to the 
participant, a limited, authenticated infor-
mation set concerning the participant for 
emergency response purposes, unless the 
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230 
participant specifies that such information 
set (or any portion of such information 
set) may not be so accessed. Such limited 
information set may include information— 
(I) patient identification data, as 
determined appropriate by the partici-
pant; 
(II) provider identification that 
includes the use of unique provider 
identifiers; 
(III) payment information; 
(IV) information related to the 
individual’s vitals, allergies, and medi-
cation history; 
(V) information related to exist-
ing chronic problems and active clin-
ical conditions of the participant; and 
(VI) 
information 
concerning 
physical examinations, procedures, re-
sults, and diagnosis data. 
(3) RULES FOR SECONDARY USES OF RECORDS 
FOR RESEARCH AND OTHER PURPOSES.— 
(A) IN
GENERAL.—With respect to the 
electronic health record of an IHRT participant 
(or specified parts of such electronic health 
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231 
record) maintained by an IHRT, the IHRT 
may sell such record (or specified parts of such 
record) only if— 
(i) the transfer is authorized by the 
participant pursuant to an agreement be-
tween the participant and the IHRT and is 
in accordance with the privacy protection 
agreement described in subsection (b)(1) 
entered into between such participant and 
such IHRT; 
(ii) such agreement includes param-
eters with respect to the disclosure of in-
formation involved and a process for the 
authorization of the further disclosure of 
information in such record; 
(iii) the information involved is to be 
used for research or other activities only as 
provided for in the agreement; 
(iv) the recipient of the information 
provides assurances that the information 
will not be further transferred or reused in 
violation of such agreement; and 
(v) the transfer otherwise meets the 
requirements and standards prescribed by 
the Federal Trade Commission. 
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(B) TREATMENT OF PUBLIC HEALTH RE-
PORTING.—Nothing in this paragraph shall be 
construed as prohibiting or limiting the use of 
health care information of an individual, includ-
ing an individual who is an IHRT participant, 
for public health reporting (or other research) 
purposes prior to the inclusion of such informa-
tion in an electronic health record maintained 
by an IHRT. 
(4) LAW
ENFORCEMENT
CLARIFICATION.— 
Nothing in this subtitle shall prevent an IHRT from 
disclosing information contained in an electronic 
health record maintained by the IHRT when re-
quired for purposes of a lawful investigation or offi-
cial proceeding inquiring into a violation of, or fail-
ure to comply with, any criminal or civil statute or 
any regulation, rule, or order issued pursuant to 
such a statute. 
(5) RULE OF CONSTRUCTION.—Nothing in this 
section shall be construed to require a health care 
provider that does not utilize electronic methods or 
appropriate levels of health information technology 
on the date of the enactment of this Act to adopt 
such electronic methods or technology as a require-
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233 
ment for participation or compliance under this sub-
title. 
(b) PRIVACY PROTECTION AGREEMENT; TREATMENT 
OF STATE PRIVACY AND SECURITY LAWS.— 
(1) PRIVACY PROTECTION AGREEMENT.—A pri-
vacy protection agreement described in this sub-
section is an agreement, with respect to an electronic 
health record of an IHRT participant to be main-
tained by an independent health record trust, be-
tween the participant and the trust— 
(A) that is consistent with the standards 
described in subsection (a)(2); 
(B) under which the participant specifies 
the portions of the record that may be accessed, 
under what circumstances such portions may be 
accessed, any authorizations for indicated au-
thorized EHR data users to access information 
contained in the record, and the purposes for 
which the information (or portions of the infor-
mation) in the record may be used; 
(C) which provides a process for the au-
thorization of the transfer of information con-
tained in the record to a third party, including 
for the sale of such information for purposes of 
research, by an authorized EHR data user and 
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