I 
111TH CONGRESS 
1ST SESSION H. R. 3970 
To protect the doctor-patient relationship, improve the quality of health care 
services, lower the costs of health care services, expand access to health 
care services, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
OCTOBER 29, 2009 
Mr. KIRK (for himself, Mr. BURGESS, Mrs. BIGGERT, Mr. LEE of New York, 
Mr. LANCE, Mr. SCHOCK, Mr. MICA, Mrs. CAPITO, Mr. FRELINGHUYSEN, 
and Mr. MACK) introduced the following bill; which was referred to the 
Committee on Energy and Commerce, and in addition to the Committees 
on the Judiciary, Ways and Means, Education and Labor, Appropria-
tions, and Financial Services, for a period to be subsequently determined 
by the Speaker, in each case for consideration of such provisions as fall 
within the jurisdiction of the committee concerned 
A BILL 
To protect the doctor-patient relationship, improve the qual-
ity of health care services, lower the costs of health 
care services, expand access to health care services, and 
for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Medical Rights and 
Reform Act of 2009’’. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
SEC. 2. TABLE OF CONTENTS. 
Sec. 1. Short title. 
Sec. 2. Table of contents. 
TITLE I—PROTECTING THE DOCTOR-PATIENT RELATIONSHIP 
Sec. 101. Prohibition on restrictions on the practice of medicine and other 
health care professions. 
Sec. 102. Right to contract for health care services and health insurance. 
Sec. 103. Prohibition on mandating State restrictions. 
Sec. 104. Clarification. 
Sec. 105. Conforming amendment. 
Sec. 106. Definitions. 
Sec. 107. Effective date. 
TITLE II—IMPROVING QUALITY AND LOWERING THE COST OF 
HEALTH CARE 
Subtitle A—Equity for Our Nation’s Self-Employed 
Sec. 201. SECA tax deduction for health insurance costs. 
Subtitle B—Help Efficient, Accessible, Low-cost, Timely Healthcare 
Sec. 211. Findings and purpose. 
Sec. 212. Encouraging speedy resolution of claims. 
Sec. 213. Compensating patient injury. 
Sec. 214. Maximizing patient recovery. 
Sec. 215. Additional HEALTH benefits. 
Sec. 216. Punitive damages. 
Sec. 217. Authorization of payment of future damages to claimants in 
HEALTH care lawsuits. 
Sec. 218. Definitions. 
Sec. 219. Effect on other laws. 
Sec. 220. State flexibility and protection Sf states’ rights. 
Sec. 221. Applicability; effective date. 
Sec. 222. Sense of Congress. 
Subtitle C—Accelerating the Deployment of Health Information Technology 
PART 1—ENHANCED COORDINATION AND ADOPTION OF HEALTH 
INFORMATION TECHNOLOGY 
Sec. 231. Strategic plan for coordinating implementation of Medicare and Med-
icaid health information technology incentive payments. 
Sec. 232. Procedures to ensure timely updating of standards that enable elec-
tronic exchanges. 
Sec. 233. Study to improve preservation and protection of security and con-
fidentiality of health information. 
Sec. 234. Assisting Doctors to Obtain Proficient and Transmissible Health In-
formation Technology. 
Sec. 235. Expansion of Stark and anti-kickback exceptions for electronic health 
records arrangements. 
Sec. 236. Application of Medicare EHR incentives and adjustments to addi-
tional providers. 
VerDate Nov 24 2008 
04:04 Nov 03, 2009
Jkt 089200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6211
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
PART 2—TELEHEALTH ENHANCEMENT 
SUBPART A—MEDICARE PROGRAM 
Sec. 241. Expansion and improvement of telehealth services. 
Sec. 242. Increase in number of types of originating sites; clarification. 
Sec. 243. Expansion of eligible telehealth providers and credentialing of tele-
medicine practitioners. 
Sec. 244. Access to telehealth services in the home. 
Sec. 245. Coverage of home health remote patient management services for 
chronic health conditions. 
Sec. 246. Sense of Congress on the use of remote patient management services. 
Sec. 247. Telehealth Advisory Committee. 
SUBPART B—HRSA GRANT PROGRAM 
Sec. 250. Grant program for the development of telehealth networks. 
Sec. 251. Reauthorization of telehealth network and telehealth resource centers 
grant programs. 
Subtitle D—Eliminating Waste, Fraud, and Abuse 
Sec. 261. Site inspections; background checks; denial and suspension of billing 
privileges. 
Sec. 262. Registration and background checks of billing agencies and individ-
uals. 
Sec. 263. Expanded access to the healthcare integrity and protection data bank 
(HIPDB). 
Sec. 264. Liability of Medicare administrative contractors for claims submitted 
by excluded providers. 
Sec. 265. Community mental health centers. 
Sec. 266. Limiting the discharge of debts in bankruptcy proceedings in cases 
where a health care provider or a supplier engages in fraudu-
lent activity. 
Sec. 267. Illegal distribution of a Medicare or Medicaid beneficiary identifica-
tion or billing privileges. 
Sec. 268. Treatment of certain Social Security Act crimes as Federal health 
care offenses. 
Sec. 269. Authority of Office of Inspector General of the Department of Health 
and Human Services. 
Sec. 270. Universal product numbers on claims forms for reimbursement under 
the Medicare Program. 
Subtitle E—Promoting Health and Preventing Chronic Disease Through 
Prevention and Wellness Programs 
Sec. 281. Findings. 
Sec. 282. Tax credit to employers for costs of implementing prevention and 
wellness programs. 
Sec. 283. Grants to increase physical activity and emotional wellness, improve 
nutrition, and promote healthy eating behaviors. 
Sec. 284. Prevention and wellness programs for individuals and families. 
TITLE III—EXPANDING ACCESS TO HEALTH CARE 
Subtitle A—State Innovation Program 
Sec. 301. Ensuring affordability and access through universal access programs. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6211
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
Sec. 302. Enhanced Federal funding and reduced red-tape for State efforts to 
improve access to health insurance coverage. 
Sec. 303. State innovation program described. 
Sec. 304. State transparency program described. 
Sec. 305. Health plan finder. 
Sec. 306. Small business health plans. 
Sec. 307. Interstate compacts on health insurance regulation. 
Sec. 308. Definitions. 
Sec. 309. Authorization for appropriations. 
Subtitle B—Interstate Market for Health Insurance 
Sec. 311. Specification of constitutional authority for enactment of law. 
Sec. 312. Findings. 
Sec. 313. Cooperative governing of individual health insurance coverage. 
Sec. 314. Severability. 
Subtitle C—Young Adult Healthcare Coverage 
Sec. 321. Requiring the option of extension of dependent coverage for certain 
unmarried, uninsured young adults. 
TITLE IV—OFFSETS 
Sec. 401. Transfer of unobilgated stimulus funds. 
TITLE I—PROTECTING THE DOC-
TOR-PATIENT RELATIONSHIP 
SEC. 101. PROHIBITION ON RESTRICTIONS ON THE PRAC-
TICE OF MEDICINE AND OTHER HEALTH 
CARE PROFESSIONS. 
(a) IN GENERAL.—Subject to subsection (b), no Fed-
eral funds shall be used to permit any Federal officer or 
employee to exercise any supervision or control over— 
(1) the practice of medicine, the practice of 
other health care professions, or the manner in 
which health care services are provided; 
(2) the provision, by a physician or a health 
care practitioner, of advice to a patient about the 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
patient’s health status or recommended treatment 
for a condition or disease; 
(3) the selection, tenure, or compensation of 
any officer, employee, or contractor of any institu-
tion, business, non-Federal agency, or individual 
providing health care services; or 
(4) the administration or operation of any such 
institution, business, non-Federal agency, or indi-
vidual, with respect to the provision of health care 
services to a patient. 
(b) PRESERVING CERTAIN CURRENT PROGRAMS.— 
Subsection (a) shall not prohibit the Federal Government 
from operating, managing, supervising employees of, or 
defining the scope of services provided by Federal entities 
when directly providing health care services and products, 
only with respect to the following: 
(1) The Veterans Health Administration— 
(A) in the case of directly providing health 
care services through its own facilities and by 
its own employees; or 
(B) in the case of coordinating health care 
services not described in subparagraph (A) and 
paid for with Federal funds under programs op-
erated by the Veterans Health Administration. 
(2) The Department of Defense— 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(C) when necessary to determine whether 
health care services provided to those who are 
not active-duty members of uniformed services 
are eligible for payment with Federal funds or 
to coordinate health care services for patients 
who are served by both non-Federal entities and 
Public Health Service treatment facilities. 
(4) The Indian Health Service— 
(A) in the case of directly providing health 
care services through its own facilities or Fed-
eral employees; or 
(B) in the case of providing care by non- 
Federal entities, to the extent necessary to ad-
minister contracts and grants pursuant to the 
Indian Health Care Improvement Act. 
(5) The National Institutes of Health— 
(A) in the case of providing direct patient 
care incident to medical research; or 
(B) in the case of administering grants for 
medical research, but in no case shall a non- 
Federal entity be required or requested to waive 
the protections of subsection (a) for health care 
services not incident to medical research funded 
by the National Institutes of Health as a condi-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
tion of receiving research grant funding from 
the National Institutes of Health. 
(6) The Health Resources and Services Admin-
istration— 
(A) in the case of certifying federally quali-
fied health centers, as defined by section 
1905(l)(2)(B) of the Social Security Act (42 
U.S.C. 1396d(l)(2)(B)), certifying FQHC look- 
alike status, as defined in section 413.65(n) of 
title 45 of the Code of Federal Regulations, or 
providing grants under section 330 of the Pub-
lic Health Service Act (42 U.S.C. 254b), but 
only to the extent necessary to determine eligi-
bility for such certification and grant funding 
and the appropriate amounts of such funding; 
or 
(B) in the case of operating the nation’s 
human organ, bone marrow, and umbilical cord 
blood donation and transplantation systems, as 
and to the extent authorized by law and nec-
essary for the operation of those programs. 
SEC. 102. RIGHT TO CONTRACT FOR HEALTH CARE SERV-
ICES AND HEALTH INSURANCE. 
(a) RECEIPT OF HEALTH SERVICES.—No Federal 
funds shall be used by any Federal officer or employee 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
to prohibit any individual from receiving health care serv-
ices from any provider of health care services— 
(1) under terms and conditions mutually ac-
ceptable to the patient and the provider; or 
(2) under terms and conditions mutually ac-
ceptable to the patient, the provider, and any group 
health plan or health insurance issuer that is obli-
gated to provide health insurance coverage to the pa-
tient or any other entity indemnifying the patient’s 
consumption of health care services; 
provided that any such agreement shall be subject to the 
requirements of section 1802(b) of the Social Security Act 
(42 U.S.C. 1395a(b)), as amended by section 105. 
(b) HEALTH INSURANCE COVERAGE.—No Federal 
funds shall be used by any Federal officer or employee 
to prohibit any person from entering into a contract with 
any group health plan, health insurance issuer, or other 
business, for the provision of, or payment to other parties 
for, health care services to be determined and provided 
subsequent to the effective date of the contract, according 
to terms, conditions, and procedures specified in such con-
tract. 
(c) ELIGIBILITY FOR FEDERAL BENEFITS.—No per-
son’s eligibility for benefits under any program operated 
by or funded wholly or partly by the Federal Government 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00009
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
shall be adversely affected as a result of having received 
services in a manner described by subsection (a) or having 
entered into a contract described in subsection (b). 
(d) FEDERAL PROGRAM PARTICIPATION.—No pro-
vider of health care services— 
(1) shall be denied participation in a Federal 
program for which it would otherwise be eligible as 
a result of having provided services in a manner de-
scribed in subsection (a); or 
(2) shall be denied payment for services other-
wise eligible for payment under a Federal program 
as a result of having provided services in a manner 
described in subsection (a), except to the extent re-
quired by subsection (a)(1). 
SEC. 103. PROHIBITION ON MANDATING STATE RESTRIC-
TIONS. 
(a) IN GENERAL.—No Federal funds shall be used 
by any Federal officer or employee to induce or encourage 
any State or other jurisdiction of the United States to 
enact any restriction or prohibition prohibited to the Fed-
eral Government by this title. 
(b) PROTECTING STATE ELIGIBILITY FOR FEDERAL 
FUNDS.—No State’s eligibility for participation in any 
program operated by or funded wholly or partly by the 
Federal Government, or for receiving funds from the Fed-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00010
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
eral Government shall be conditioned on that State enact-
ing any restriction or prohibition prohibited to the Federal 
Government by this title, nor adversely affected by that 
State’s failure to enact any restriction or prohibition pro-
hibited to the Federal Government by this title. 
SEC. 104. CLARIFICATION. 
Nothing in this subtitle shall be construed to permit 
the expenditure of funds otherwise prohibited by law. 
SEC. 105. CONFORMING AMENDMENT. 
Section 1802(b)(3) of the Social Security Act (42 
U.S.C. 1395a(b)(3)) is hereby repealed. 
SEC. 106. DEFINITIONS. 
For purposes of this title: 
(1) 
HEALTH
CARE
SERVICES.—The 
term 
‘‘health care services’’ means any lawful service in-
tended to diagnose, cure, prevent, or mitigate the 
adverse effects of any disease, injury, infirmity, or 
physical or mental disability, including the provision 
of any lawful product the use of which is so in-
tended. 
(2) 
PHYSICIAN.—The 
term 
‘‘physician’’ 
means— 
(A) a doctor of medicine or osteopathy le-
gally authorized to practice medicine and sur-
VerDate Nov 24 2008 
04:04 Nov 03, 2009
Jkt 089200
PO 00000
Frm 00011
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
gery by the State in which he performs such 
practice and surgery; 
(B) a doctor of dental surgery or of dental 
medicine who is legally authorized to practice 
dentistry by the State in which he performs 
such function and who is acting within the 
scope of his license when he performs such 
functions; 
(C) a doctor of podiatric medicine but only 
with respect to functions which he is legally au-
thorized to perform as such by the State in 
which he performs them; 
(D) a doctor of optometry with respect to 
the provision of items or services which he is le-
gally authorized to perform as a doctor of op-
tometry by the State in which he performs 
them; or 
(E) a chiropractor who is licensed as such 
by the State (or in a State which does not li-
cense chiropractors as such, is legally author-
ized to perform the services of a chiropractor in 
the jurisdiction in which he performs such serv-
ices), but only with respect to treatment which 
he is legally authorized to perform by the State 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00012
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
or jurisdiction in which such treatment is pro-
vided. 
(3) PRACTICE OF MEDICINE.—The term ‘‘prac-
tice of medicine’’ means— 
(A) health care services that are performed 
by physicians; and 
(B) services and supplies furnished as an 
incident to a physician’s professional service. 
(4) HEALTH CARE PRACTITIONER.—The term 
‘‘health care practitioner’’ means a physician assist-
ant, registered nurse, nurse practitioner, psycholo-
gist, clinical social worker, midwife, or other indi-
vidual (other than a physician) licensed or legally 
authorized to perform health care services in the 
State in which the individual performs such services. 
(5) PRACTICE OF OTHER HEALTH CARE PRO-
FESSIONS.—The term ‘‘practice of other health care 
professions’’ means— 
(A) health care services performed by a 
health care practitioner; and 
(B) services and supplies furnished as an 
incident to a health care practitioner’s profes-
sional service. 
(6) GROUP HEALTH PLAN.—The term ‘‘group 
health plan’’ has the meaning given such term in 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00013
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
section 733(a)(1) of the Employee Retirement In-
come Security Act of 1974 (29 U.S.C. 1191b(a)(1)). 
(7) HEALTH
INSURANCE
ISSUER.—The term 
‘‘health insurance issuer’’ has the meaning given 
such term in section 733(b)(2) of the Employee Re-
tirement Income Security Act of 1974 (29 U.S.C. 
1191b(b)(2)). 
(8) BUSINESS.—The term ‘‘business’’ means 
any sole proprietorship, partnership, for-profit cor-
poration, or not-for-profit corporation. 
(9) STATE.—The term ‘‘State’’ means any of 
the United States, the Commonwealth of Puerto 
Rico, the Commonwealth of the Northern Mariana 
Islands, the United States Virgin Islands, Guam, 
American Samoa, or the District of Columbia. 
SEC. 107. EFFECTIVE DATE. 
The provisions of this title shall apply to Federal enti-
ties, including employees and officials of such entities, be-
ginning on January 1, 2009. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00014
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
TITLE II—IMPROVING QUALITY 
AND LOWERING THE COST OF 
HEALTH CARE 
Subtitle A—Equity for Our Nation’s 
Self-Employed 
SEC. 201. SECA TAX DEDUCTION FOR HEALTH INSURANCE 
COSTS. 
(a) IN GENERAL.—Subsection (l) of section 162 of 
the Internal Revenue Code of 1986 (relating to special 
rules for health insurance costs of self-employed individ-
uals) is amended by striking paragraph (4) and by redes-
ignating paragraph (5) as paragraph (4). 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
the date of the enactment of this subtitle. 
Subtitle B—Help Efficient, Acces-
sible, 
Low-cost, 
Timely 
Healthcare 
SEC. 211. FINDINGS AND PURPOSE. 
(a) FINDINGS.— 
(1) EFFECT
ON
HEALTH
CARE
ACCESS
AND 
COSTS.—Congress finds that our current civil justice 
system is adversely affecting patient access to health 
care services, better patient care, and cost-efficient 
health care, in that the health care liability system 
VerDate Nov 24 2008 
04:04 Nov 03, 2009
Jkt 089200
PO 00000
Frm 00015
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
is a costly and ineffective mechanism for resolving 
claims of health care liability and compensating in-
jured patients, and is a deterrent to the sharing of 
information among health care professionals which 
impedes efforts to improve patient safety and quality 
of care. 
(2) EFFECT
ON
INTERSTATE
COMMERCE.— 
Congress finds that the health care and insurance 
industries are industries affecting interstate com-
merce and the health care liability litigation systems 
existing throughout the United States are activities 
that affect interstate commerce by contributing to 
the high costs of health care and premiums for 
health care liability insurance purchased by health 
care system providers. 
(3) EFFECT
ON
FEDERAL
SPENDING.—Con-
gress finds that the health care liability litigation 
systems existing throughout the United States have 
a significant effect on the amount, distribution, and 
use of Federal funds because of— 
(A) the large number of individuals who 
receive health care benefits under programs op-
erated or financed by the Federal Government; 
(B) the large number of individuals who 
benefit because of the exclusion from Federal 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00016
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
taxes of the amounts spent to provide them 
with health insurance benefits; and 
(C) the large number of health care pro-
viders who provide items or services for which 
the Federal Government makes payments. 
(b) PURPOSE.—It is the purpose of this subtitle to 
implement reasonable, comprehensive, and effective health 
care liability reforms designed to— 
(1) improve the availability of health care serv-
ices in cases in which health care liability actions 
have been shown to be a factor in the decreased 
availability of services; 
(2) reduce the incidence of ‘‘defensive medi-
cine’’ and lower the cost of health care liability in-
surance, all of which contribute to the escalation of 
health care costs; 
(3) ensure that persons with meritorious health 
care injury claims receive fair and adequate com-
pensation, including reasonable noneconomic dam-
ages; 
(4) improve the fairness and cost-effectiveness 
of our current health care liability system to resolve 
disputes over, and provide compensation for, health 
care liability by reducing uncertainty in the amount 
of compensation provided to injured individuals; and 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00017
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(5) provide an increased sharing of information 
in the health care system which will reduce unin-
tended injury and improve patient care. 
SEC. 212. ENCOURAGING SPEEDY RESOLUTION OF CLAIMS. 
The time for the commencement of a health care law-
suit shall be 3 years after the date of manifestation of 
injury or 1 year after the claimant discovers, or through 
the use of reasonable diligence should have discovered, the 
injury, whichever occurs first. In no event shall the time 
for commencement of a health care lawsuit exceed 3 years 
after the date of manifestation of injury unless tolled for 
any of the following— 
(1) upon proof of fraud; 
(2) intentional concealment; or 
(3) the presence of a foreign body, which has no 
therapeutic or diagnostic purpose or effect, in the 
person of the injured person. 
Actions by a minor shall be commenced within 3 years 
from the date of the alleged manifestation of injury except 
that actions by a minor under the full age of 6 years shall 
be commenced within 3 years of manifestation of injury 
or prior to the minor’s 8th birthday, whichever provides 
a longer period. Such time limitation shall be tolled for 
minors for any period during which a parent or guardian 
and a health care provider or health care organization 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00018
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
have committed fraud or collusion in the failure to bring 
an action on behalf of the injured minor. 
SEC. 213. COMPENSATING PATIENT INJURY. 
(a) UNLIMITED AMOUNT OF DAMAGES FOR ACTUAL 
ECONOMIC LOSSES IN HEALTH CARE LAWSUITS.—In any 
health care lawsuit, nothing in this subtitle shall limit a 
claimant’s recovery of the full amount of the available eco-
nomic damages, notwithstanding the limitation in sub-
section (b). 
(b) ADDITIONAL NONECONOMIC DAMAGES.—In any 
health care lawsuit, the amount of noneconomic damages, 
if available, may be as much as $250,000, regardless of 
the number of parties against whom the action is brought 
or the number of separate claims or actions brought with 
respect to the same injury. 
(c) NO DISCOUNT OF AWARD FOR NONECONOMIC 
DAMAGES.—For purposes of applying the limitation in 
subsection (b), future noneconomic damages shall not be 
discounted to present value. The jury shall not be in-
formed about the maximum award for noneconomic dam-
ages. An award for noneconomic damages in excess of 
$250,000 shall be reduced either before the entry of judg-
ment, or by amendment of the judgment after entry of 
judgment, and such reduction shall be made before ac-
counting for any other reduction in damages required by 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00019
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
law. If separate awards are rendered for past and future 
noneconomic damages and the combined awards exceed 
$250,000, the future noneconomic damages shall be re-
duced first. 
(d) FAIR SHARE RULE.—In any health care lawsuit, 
each party shall be liable for that party’s several share 
of any damages only and not for the share of any other 
person. Each party shall be liable only for the amount of 
damages allocated to such party in direct proportion to 
such party’s percentage of responsibility. Whenever a 
judgment of liability is rendered as to any party, a sepa-
rate judgment shall be rendered against each such party 
for the amount allocated to such party. For purposes of 
this section, the trier of fact shall determine the propor-
tion of responsibility of each party for the claimant’s 
harm. 
SEC. 214. MAXIMIZING PATIENT RECOVERY. 
(a) COURT SUPERVISION OF SHARE OF DAMAGES 
ACTUALLY PAID TO CLAIMANTS.—In any health care law-
suit, the court shall supervise the arrangements for pay-
ment of damages to protect against conflicts of interest 
that may have the effect of reducing the amount of dam-
ages awarded that are actually paid to claimants. In par-
ticular, in any health care lawsuit in which the attorney 
for a party claims a financial stake in the outcome by vir-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00020
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
tue of a contingent fee, the court shall have the power 
to restrict the payment of a claimant’s damage recovery 
to such attorney, and to redirect such damages to the 
claimant based upon the interests of justice and principles 
of equity. In no event shall the total of all contingent fees 
for representing all claimants in a health care lawsuit ex-
ceed the following limits: 
(1) 40 percent of the first $50,000 recovered by 
the claimant(s). 
(2) 331⁄3 percent of the next $50,000 recovered 
by the claimant(s). 
(3) 25 percent of the next $500,000 recovered 
by the claimant(s). 
(4) 15 percent of any amount by which the re-
covery by the claimant(s) is in excess of $600,000. 
(b) APPLICABILITY.—The limitations in this section 
shall apply whether the recovery is by judgment, settle-
ment, mediation, arbitration, or any other form of alter-
native dispute resolution. In a health care lawsuit involv-
ing a minor or incompetent person, a court retains the 
authority to authorize or approve a fee that is less than 
the maximum permitted under this section. The require-
ment for court supervision in the first two sentences of 
subsection (a) applies only in civil actions. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00021
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
SEC. 215. ADDITIONAL HEALTH BENEFITS. 
In any health care lawsuit involving injury or wrong-
ful death, any party may introduce evidence of collateral 
source benefits. If a party elects to introduce such evi-
dence, any opposing party may introduce evidence of any 
amount paid or contributed or reasonably likely to be paid 
or contributed in the future by or on behalf of the oppos-
ing party to secure the right to such collateral source bene-
fits. No provider of collateral source benefits shall recover 
any amount against the claimant or receive any lien or 
credit against the claimant’s recovery or be equitably or 
legally subrogated to the right of the claimant in a health 
care lawsuit involving injury or wrongful death. This sec-
tion shall apply to any health care lawsuit that is settled 
as well as a health care lawsuit that is resolved by a fact 
finder. This section shall not apply to section 1862(b) (42 
U.S.C. 1395y(b)) or section 1902(a)(25) (42 U.S.C. 
1396a(a)(25)) of the Social Security Act. 
SEC. 216. PUNITIVE DAMAGES. 
(a) IN GENERAL.—Punitive damages may, if other-
wise permitted by applicable State or Federal law, be 
awarded against any person in a health care lawsuit only 
if it is proven by clear and convincing evidence that such 
person acted with malicious intent to injure the claimant, 
or that such person deliberately failed to avoid unneces-
sary injury that such person knew the claimant was sub-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00022
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
stantially certain to suffer. In any health care lawsuit 
where no judgment for compensatory damages is rendered 
against such person, no punitive damages may be awarded 
with respect to the claim in such lawsuit. No demand for 
punitive damages shall be included in a health care lawsuit 
as initially filed. A court may allow a claimant to file an 
amended pleading for punitive damages only upon a mo-
tion by the claimant and after a finding by the court, upon 
review of supporting and opposing affidavits or after a 
hearing, after weighing the evidence, that the claimant has 
established by a substantial probability that the claimant 
will prevail on the claim for punitive damages. At the re-
quest of any party in a health care lawsuit, the trier of 
fact shall consider in a separate proceeding— 
(1) whether punitive damages are to be award-
ed and the amount of such award; and 
(2) the amount of punitive damages following a 
determination of punitive liability. 
If a separate proceeding is requested, evidence relevant 
only to the claim for punitive damages, as determined by 
applicable State law, shall be inadmissible in any pro-
ceeding to determine whether compensatory damages are 
to be awarded. 
(b) DETERMINING AMOUNT
OF PUNITIVE DAM-
AGES.— 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00023
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(1) FACTORS
CONSIDERED.—In determining 
the amount of punitive damages, if awarded, in a 
health care lawsuit, the trier of fact shall consider 
only the following— 
(A) the severity of the harm caused by the 
conduct of such party; 
(B) the duration of the conduct or any 
concealment of it by such party; 
(C) the profitability of the conduct to such 
party; 
(D) the number of products sold or med-
ical procedures rendered for compensation, as 
the case may be, by such party, of the kind 
causing the harm complained of by the claim-
ant; 
(E) any criminal penalties imposed on such 
party, as a result of the conduct complained of 
by the claimant; and 
(F) the amount of any civil fines assessed 
against such party as a result of the conduct 
complained of by the claimant. 
(2) MAXIMUM AWARD.—The amount of punitive 
damages, if awarded, in a health care lawsuit may 
be as much as $250,000 or as much as two times 
the amount of economic damages awarded, which-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00024
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
ever is greater. The jury shall not be informed of 
this limitation. 
(c) NO PUNITIVE DAMAGES FOR PRODUCTS THAT 
COMPLY WITH FDA STANDARDS.— 
(1) IN GENERAL.— 
(A) No punitive damages may be awarded 
against the manufacturer or distributor of a 
medical product, or a supplier of any compo-
nent or raw material of such medical product, 
based on a claim that such product caused the 
claimant’s harm where— 
(i)(I) such medical product was sub-
ject to premarket approval, clearance, or li-
censure by the Food and Drug Administra-
tion with respect to the safety of the for-
mulation or performance of the aspect of 
such medical product which caused the 
claimant’s harm or the adequacy of the 
packaging or labeling of such medical 
product; and 
(II) such medical product was so ap-
proved, cleared, or licensed; or 
(ii) such medical product is generally 
recognized among qualified experts as safe 
and effective pursuant to conditions estab-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00025
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
lished by the Food and Drug Administra-
tion and applicable Food and Drug Admin-
istration regulations, including without 
limitation those related to packaging and 
labeling, unless the Food and Drug Admin-
istration has determined that such medical 
product was not manufactured or distrib-
uted in substantial compliance with appli-
cable Food and Drug Administration stat-
utes and regulations. 
(B) RULE OF CONSTRUCTION.—Subpara-
graph (A) may not be construed as establishing 
the obligation of the Food and Drug Adminis-
tration to demonstrate affirmatively that a 
manufacturer, distributor, or supplier referred 
to in such subparagraph meets any of the con-
ditions described in such subparagraph. 
(2) LIABILITY OF HEALTH CARE PROVIDERS.— 
A health care provider who prescribes, or who dis-
penses pursuant to a prescription, a medical product 
approved, licensed, or cleared by the Food and Drug 
Administration shall not be named as a party to a 
product liability lawsuit involving such product and 
shall not be liable to a claimant in a class action 
lawsuit against the manufacturer, distributor, or 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00026
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
seller of such product. Nothing in this paragraph 
prevents a court from consolidating cases involving 
health care providers and cases involving products li-
ability claims against the manufacturer, distributor, 
or product seller of such medical product. 
(3) PACKAGING.—In a health care lawsuit for 
harm which is alleged to relate to the adequacy of 
the packaging or labeling of a drug which is required 
to have tamper-resistant packaging under regula-
tions of the Secretary of Health and Human Serv-
ices (including labeling regulations related to such 
packaging), the manufacturer or product seller of 
the drug shall not be held liable for punitive dam-
ages unless such packaging or labeling is found by 
the trier of fact by clear and convincing evidence to 
be substantially out of compliance with such regula-
tions. 
(4) EXCEPTION.—Paragraph (1) shall not 
apply in any health care lawsuit in which— 
(A) a person, before or after premarket ap-
proval, clearance, or licensure of such medical 
product, knowingly misrepresented to or with-
held from the Food and Drug Administration 
information that is required to be submitted 
under the Federal Food, Drug, and Cosmetic 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00027
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
Act (21 U.S.C. 301 et seq.) or section 351 of 
the Public Health Service Act (42 U.S.C. 262) 
that is material and is causally related to the 
harm which the claimant allegedly suffered; or 
(B) a person made an illegal payment to 
an official of the Food and Drug Administra-
tion for the purpose of either securing or main-
taining approval, clearance, or licensure of such 
medical product. 
SEC. 217. AUTHORIZATION OF PAYMENT OF FUTURE DAM-
AGES TO CLAIMANTS IN HEALTH CARE LAW-
SUITS. 
(a) IN GENERAL.—In any health care lawsuit, if an 
award of future damages, without reduction to present 
value, equaling or exceeding $50,000 is made against a 
party with sufficient insurance or other assets to fund a 
periodic payment of such a judgment, the court shall, at 
the request of any party, enter a judgment ordering that 
the future damages be paid by periodic payments. In any 
health care lawsuit, the court may be guided by the Uni-
form Periodic Payment of Judgments Act promulgated by 
the National Conference of Commissioners on Uniform 
State Laws. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00028
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(b) APPLICABILITY.—This section applies to all ac-
tions which have not been first set for trial or retrial be-
fore the effective date of this subtitle. 
SEC. 218. DEFINITIONS. 
In this subtitle: 
(1) ALTERNATIVE DISPUTE RESOLUTION SYS-
TEM; ADR.—The term ‘‘alternative dispute resolution 
system’’ or ‘‘ADR’’ means a system that provides 
for the resolution of health care lawsuits in a man-
ner other than through a civil action brought in a 
State or Federal court. 
(2) CLAIMANT.—The term ‘‘claimant’’ means 
any person who brings a health care lawsuit, includ-
ing a person who asserts or claims a right to legal 
or equitable contribution, indemnity, or subrogation, 
arising out of a health care liability claim or action, 
and any person on whose behalf such a claim is as-
serted or such an action is brought, whether de-
ceased, incompetent, or a minor. 
(3) COLLATERAL
SOURCE
BENEFITS.—The 
term ‘‘collateral source benefits’’ means any amount 
paid or reasonably likely to be paid in the future to 
or on behalf of the claimant, or any service, product, 
or other benefit provided or reasonably likely to be 
provided in the future to or on behalf of the claim-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00029
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
ant, as a result of the injury or wrongful death, pur-
suant to— 
(A) any State or Federal health, sickness, 
income-disability, accident, or workers’ com-
pensation law; 
(B) any health, sickness, income-disability, 
or accident insurance that provides health bene-
fits or income-disability coverage; 
(C) any contract or agreement of any 
group, organization, partnership, or corporation 
to provide, pay for, or reimburse the cost of 
medical, hospital, dental, or income-disability 
benefits; and 
(D) any other publicly or privately funded 
program. 
(4) 
COMPENSATORY
DAMAGES.—The 
term 
‘‘compensatory 
damages’’ 
means 
objectively 
verifiable monetary losses incurred as a result of the 
provision of, use of, or payment for (or failure to 
provide, use, or pay for) health care services or med-
ical products, such as past and future medical ex-
penses, loss of past and future earnings, cost of ob-
taining domestic services, loss of employment, and 
loss of business or employment opportunities, dam-
ages for physical and emotional pain, suffering, in-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00030
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
convenience, physical impairment, mental anguish, 
disfigurement, loss of enjoyment of life, loss of soci-
ety and companionship, loss of consortium (other 
than loss of domestic service), hedonic damages, in-
jury to reputation, and all other nonpecuniary losses 
of any kind or nature. The term ‘‘compensatory 
damages’’ includes economic damages and non-
economic damages, as such terms are defined in this 
section. 
(5) CONTINGENT FEE.—The term ‘‘contingent 
fee’’ includes all compensation to any person or per-
sons which is payable only if a recovery is effected 
on behalf of one or more claimants. 
(6) ECONOMIC DAMAGES.—The term ‘‘economic 
damages’’ means objectively verifiable monetary 
losses incurred as a result of the provision of, use 
of, or payment for (or failure to provide, use, or pay 
for) health care services or medical products, such as 
past and future medical expenses, loss of past and 
future earnings, cost of obtaining domestic services, 
loss of employment, and loss of business or employ-
ment opportunities. 
(7) 
HEALTH
CARE
LAWSUIT.—The 
term 
‘‘health care lawsuit’’ means any health care liability 
claim concerning the provision of health care goods 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00031
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
or services or any medical product affecting inter-
state commerce, or any health care liability action 
concerning the provision of health care goods or 
services or any medical product affecting interstate 
commerce, brought in a State or Federal court or 
pursuant to an alternative dispute resolution system, 
against a health care provider, a health care organi-
zation, or the manufacturer, distributor, supplier, 
marketer, promoter, or seller of a medical product, 
regardless of the theory of liability on which the 
claim is based, or the number of claimants, plain-
tiffs, defendants, or other parties, or the number of 
claims or causes of action, in which the claimant al-
leges a health care liability claim. Such term does 
not include a claim or action which is based on 
criminal liability; which seeks civil fines or penalties 
paid to Federal, State, or local government; or which 
is grounded in antitrust. 
(8) HEALTH
CARE
LIABILITY
ACTION.—The 
term ‘‘health care liability action’’ means a civil ac-
tion brought in a State or Federal court or pursuant 
to an alternative dispute resolution system, against 
a health care provider, a health care organization, or 
the manufacturer, distributor, supplier, marketer, 
promoter, or seller of a medical product, regardless 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00032
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
of the theory of liability on which the claim is based, 
or the number of plaintiffs, defendants, or other par-
ties, or the number of causes of action, in which the 
claimant alleges a health care liability claim. 
(9) HEALTH
CARE
LIABILITY
CLAIM.—The 
term ‘‘health care liability claim’’ means a demand 
by any person, whether or not pursuant to ADR, 
against a health care provider, health care organiza-
tion, or the manufacturer, distributor, supplier, mar-
keter, promoter, or seller of a medical product, in-
cluding, but not limited to, third-party claims, cross- 
claims, counter-claims, or contribution claims, which 
are based upon the provision of, use of, or payment 
for (or the failure to provide, use, or pay for) health 
care services or medical products, regardless of the 
theory of liability on which the claim is based, or the 
number of plaintiffs, defendants, or other parties, or 
the number of causes of action. 
(10) HEALTH CARE ORGANIZATION.—The term 
‘‘health care organization’’ means any person or en-
tity which is obligated to provide or pay for health 
benefits under any health plan, including any person 
or entity acting under a contract or arrangement 
with a health care organization to provide or admin-
ister any health benefit. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00033
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(11) HEALTH
CARE
PROVIDER.—The term 
‘‘health care provider’’ means any person or entity 
required by State or Federal laws or regulations to 
be licensed, registered, or certified to provide health 
care services, and being either so licensed, reg-
istered, or certified, or exempted from such require-
ment by other statute or regulation. 
(12) HEALTH CARE GOODS OR SERVICES.—The 
term ‘‘health care goods or services’’ means any 
goods or services provided by a health care organiza-
tion, provider, or by any individual working under 
the supervision of a health care provider, that relates 
to the diagnosis, prevention, or treatment of any 
human disease or impairment, or the assessment or 
care of the health of human beings. 
(13) MALICIOUS
INTENT
TO
INJURE.—The 
term ‘‘malicious intent to injure’’ means inten-
tionally causing or attempting to cause physical in-
jury other than providing health care goods or serv-
ices. 
(14) MEDICAL PRODUCT.—The term ‘‘medical 
product’’ means a drug, device, or biological product 
intended for humans, and the terms ‘‘drug’’, ‘‘de-
vice’’, and ‘‘biological product’’ have the meanings 
given such terms in sections 201(g)(1) and 201(h) 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00034
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
of the Federal Food, Drug and Cosmetic Act (21 
U.S.C. 321(g)(1) and (h)) and section 351(a) of the 
Public Health Service Act (42 U.S.C. 262(a)), re-
spectively, including any component or raw material 
used therein, but excluding health care services. 
(15) 
NONECONOMIC
DAMAGES.—The 
term 
‘‘noneconomic damages’’ means damages for phys-
ical and emotional pain, suffering, inconvenience, 
physical impairment, mental anguish, disfigurement, 
loss of enjoyment of life, loss of society and compan-
ionship, loss of consortium (other than loss of do-
mestic service), hedonic damages, injury to reputa-
tion, and all other nonpecuniary losses of any kind 
or nature. 
(16) PUNITIVE DAMAGES.—The term ‘‘punitive 
damages’’ means damages awarded, for the purpose 
of punishment or deterrence, and not solely for com-
pensatory purposes, against a health care provider, 
health care organization, or a manufacturer, dis-
tributor, or supplier of a medical product. Punitive 
damages are neither economic nor noneconomic 
damages. 
(17) RECOVERY.—The term ‘‘recovery’’ means 
the net sum recovered after deducting any disburse-
ments or costs incurred in connection with prosecu-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00035
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
tion or settlement of the claim, including all costs 
paid or advanced by any person. Costs of health care 
incurred by the plaintiff and the attorneys’ office 
overhead costs or charges for legal services are not 
deductible disbursements or costs for such purpose. 
(18) STATE.—The term ‘‘State’’ means each of 
the several States, the District of Columbia, the 
Commonwealth of Puerto Rico, the Virgin Islands, 
Guam, American Samoa, the Northern Mariana Is-
lands, the Trust Territory of the Pacific Islands, and 
any other territory or possession of the United 
States, or any political subdivision thereof. 
SEC. 219. EFFECT ON OTHER LAWS. 
(a) VACCINE INJURY.— 
(1) To the extent that title XXI of the Public 
Health Service Act establishes a Federal rule of law 
applicable to a civil action brought for a vaccine-re-
lated injury or death— 
(A) this subtitle does not affect the appli-
cation of the rule of law to such an action; and 
(B) any rule of law prescribed by this sub-
title in conflict with a rule of law of such title 
XXI shall not apply to such action. 
(2) If there is an aspect of a civil action 
brought for a vaccine-related injury or death to 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00036
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
which a Federal rule of law under title XXI of the 
Public Health Service Act does not apply, then this 
subtitle or otherwise applicable law (as determined 
under this subtitle) will apply to such aspect of such 
action. 
(b) OTHER FEDERAL LAW.—Except as provided in 
this section, nothing in this subtitle shall be deemed to 
affect any defense available to a defendant in a health care 
lawsuit or action under any other provision of Federal law. 
SEC. 
220. 
STATE 
FLEXIBILITY 
AND 
PROTECTION 
OF 
STATES’ RIGHTS. 
(a) HEALTH CARE LAWSUITS.—The provisions gov-
erning health care lawsuits set forth in this subtitle pre-
empt, subject to subsections (b) and (c), State law to the 
extent that State law prevents the application of any pro-
visions of law established by or under this subtitle. The 
provisions governing health care lawsuits set forth in this 
subtitle supersede chapter 171 of title 28, United States 
Code, to the extent that such chapter— 
(1) provides for a greater amount of damages 
or contingent fees, a longer period in which a health 
care lawsuit may be commenced, or a reduced appli-
cability or scope of periodic payment of future dam-
ages, than provided in this subtitle; or 
VerDate Nov 24 2008 
04:04 Nov 03, 2009
Jkt 089200
PO 00000
Frm 00037
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(2) prohibits the introduction of evidence re-
garding collateral source benefits, or mandates or 
permits subrogation or a lien on collateral source 
benefits. 
(b) PROTECTION OF STATES’ RIGHTS AND OTHER 
LAWS.—(1) Any issue that is not governed by any provi-
sion of law established by or under this subtitle (including 
State standards of negligence) shall be governed by other-
wise applicable State or Federal law. 
(2) This subtitle shall not preempt or supersede any 
State or Federal law that imposes greater procedural or 
substantive protections for health care providers and 
health care organizations from liability, loss, or damages 
than those provided by this subtitle or create a cause of 
action. 
(c) STATE FLEXIBILITY.—No provision of this sub-
title shall be construed to preempt— 
(1) any State law (whether effective before, on, 
or after the date of the enactment of this subtitle) 
that specifies a particular monetary amount of com-
pensatory or punitive damages (or the total amount 
of damages) that may be awarded in a health care 
lawsuit, regardless of whether such monetary 
amount is greater or lesser than is provided for 
under this subtitle, notwithstanding section 4(a); or 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00038
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(2) any defense available to a party in a health 
care lawsuit under any other provision of State or 
Federal law. 
SEC. 221. APPLICABILITY; EFFECTIVE DATE. 
This subtitle shall apply to any health care lawsuit 
brought in a Federal or State court, or subject to an alter-
native dispute resolution system, that is initiated on or 
after the date of the enactment of this subtitle, except that 
any health care lawsuit arising from an injury occurring 
prior to the date of the enactment of this subtitle shall 
be governed by the applicable statute of limitations provi-
sions in effect at the time the injury occurred. 
SEC. 222. SENSE OF CONGRESS. 
It is the sense of Congress that a health insurer 
should be liable for damages for harm caused when it 
makes a decision as to what care is medically necessary 
and appropriate. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00039
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
Subtitle C—Accelerating the De-
ployment of Health Information 
Technology 
PART 1—ENHANCED COORDINATION AND ADOP-
TION 
OF 
HEALTH 
INFORMATION 
TECH-
NOLOGY 
SEC. 231. STRATEGIC PLAN FOR COORDINATING IMPLE-
MENTATION OF MEDICARE AND MEDICAID 
HEALTH INFORMATION TECHNOLOGY INCEN-
TIVE PAYMENTS. 
Section 3001(c) of the Public Health Service Act (42 
U.S.C. 300jj–11(c)) is amended by adding at the end the 
following new paragraph: 
‘‘(9) STRATEGIC
PLAN
FOR
MEDICARE
AND 
MEDICAID EHR PAYMENT INCENTIVES AND ADJUST-
MENTS.—Not later than 90 days after the date of 
the enactment of the Medical Rights and Reform 
Act of 2009, the National Coordinator shall publish 
a strategic plan including— 
‘‘(A) timelines for applying the incentive 
payments and incentive adjustments applicable 
to eligible providers, eligible hospitals, and eligi-
ble 
professionals 
under 
sections 
1848(a), 
1848(o), 
1853(l), 
1853(m), 
1886(n), 
1814(l)(3), 
1886(b)(3)(B)(ix), 
and 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00040
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
1903(a)(3)(F) during the 18-month period fol-
lowing such date of enactment, including speci-
fying specific steps by date that providers and 
hospitals must take to be eligible for such in-
centive payments; and 
‘‘(B) a specific plan to educate health care 
providers, consumers, and vendors of health in-
formation technology about how eligible pro-
viders, eligible hospitals, and eligible profes-
sionals may become compliant with require-
ments under such sections for purposes of eligi-
bility for incentive payments under such sec-
tions.’’. 
SEC. 232. PROCEDURES TO ENSURE TIMELY UPDATING OF 
STANDARDS THAT ENABLE ELECTRONIC EX-
CHANGES. 
Section 1174(b) of the Social Security Act (42 U.S.C. 
1320d–3(b)) is amended— 
(1) in paragraph (1)— 
(A) in the first sentence, by inserting ‘‘and 
in accordance with paragraph (3)’’ before the 
period; and 
(B) by adding at the end the following new 
sentence: ‘‘For purposes of this subsection and 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00041
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
section 1173(c)(2), the term ‘modification’ in-
cludes a new version or a version upgrade’’; and 
(2) by adding at the end the following new 
paragraph: 
‘‘(3) EXPEDITED PROCEDURES FOR ADOPTION 
OF
ADDITIONS
AND
MODIFICATIONS
TO
STAND-
ARDS.— 
‘‘(A) IN GENERAL.—For purposes of para-
graph (1), the Secretary shall provide for an ex-
pedited upgrade program (in this paragraph re-
ferred to as the ‘upgrade program’), in accord-
ance with this paragraph, to develop and ap-
prove additions and modifications to the stand-
ards adopted under section 1173(a) to improve 
the quality of such standards or to extend the 
functionality of such standards to meet evolving 
requirements in health care. 
‘‘(B) PUBLICATION
OF
NOTICES.—Under 
the upgrade program: 
‘‘(i) VOLUNTARY
NOTICE
OF
INITI-
ATION
OF
PROCESS.—Not later than 30 
days after the date the Secretary receives 
a notice from a standard setting organiza-
tion that the organization is initiating a 
process to develop an addition or modifica-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00042
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
tion to a standard adopted under section 
1173(a), the Secretary shall publish a no-
tice in the Federal Register that— 
‘‘(I) identifies the subject matter 
of the addition or modification; 
‘‘(II) provides a description of 
how persons may participate in the 
development process; and 
‘‘(III) invites public participation 
in such process. 
‘‘(ii) VOLUNTARY
NOTICE
OF
PRE-
LIMINARY DRAFT OF ADDITIONS OR MODI-
FICATIONS
TO
STANDARDS.—Not later 
than 30 days after the date the Secretary 
receives a notice from a standard setting 
organization that the organization has pre-
pared a preliminary draft of an addition or 
modification to a standard adopted by sec-
tion 1173(a), the Secretary shall publish a 
notice in the Federal Register that— 
‘‘(I) identifies the subject matter 
of (and summarizes) the addition or 
modification; 
‘‘(II) specifies the procedure for 
obtaining the draft; 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00043
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘(III) provides a description of 
how persons may submit comments in 
writing and at any public hearing or 
meeting held by the organization on 
the addition or modification; and 
‘‘(IV) invites submission of such 
comments and participation in such 
hearing or meeting without requiring 
the public to pay a fee to participate. 
‘‘(iii) NOTICE OF PROPOSED ADDITION 
OR
MODIFICATION
TO
STANDARDS.—Not 
later than 30 days after the date the Sec-
retary receives a notice from a standard 
setting organization that the organization 
has a proposed addition or modification to 
a standard adopted under section 1173(a) 
that the organization intends to submit 
under subparagraph (D)(iii), the Secretary 
shall publish a notice in the Federal Reg-
ister that contains, with respect to the pro-
posed addition or modification, the infor-
mation required in the notice under clause 
(ii) with respect to the addition or modi-
fication. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00044
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘(iv) 
CONSTRUCTION.—Nothing 
in 
this paragraph shall be construed as re-
quiring a standard setting organization to 
request the notices described in clauses (i) 
and (ii) with respect to an addition or 
modification to a standard in order to 
qualify for an expedited determination 
under subparagraph (C) with respect to a 
proposal submitted to the Secretary for 
adoption of such addition or modification. 
‘‘(C) PROVISION
OF
EXPEDITED
DETER-
MINATION.—Under the upgrade program and 
with respect to a proposal by a standard setting 
organization for an addition or modification to 
a standard adopted under section 1173(a), if 
the Secretary determines that the standard set-
ting organization developed such addition or 
modification in accordance with the require-
ments of subparagraph (D) and the National 
Committee on Vital and Health Statistics rec-
ommends approval of such addition or modifica-
tion under subparagraph (E), the Secretary 
shall provide for expedited treatment of such 
proposal in accordance with subparagraph (F). 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00045
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘(D) REQUIREMENTS.—The requirements 
under this subparagraph with respect to a pro-
posed addition or modification to a standard by 
a standard setting organization are the fol-
lowing: 
‘‘(i) REQUEST FOR PUBLICATION OF 
NOTICE.—The standard setting organiza-
tion submits to the Secretary a request for 
publication in the Federal Register of a no-
tice described in subparagraph (B)(iii) for 
the proposed addition or modification. 
‘‘(ii) PROCESS
FOR
RECEIPT
AND 
CONSIDERATION
OF
PUBLIC
COMMENT.— 
The standard setting organization provides 
for a process through which, after the pub-
lication of the notice referred to under 
clause (i), the organization— 
‘‘(I) receives and responds to 
public comments submitted on a time-
ly basis on the proposed addition or 
modification before submitting such 
proposed addition or modification to 
the National Committee on Vital and 
Health Statistics under clause (iii); 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00046
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘(II) makes publicly available a 
written explanation for its response in 
the proposed addition or modification 
to comments submitted on a timely 
basis; and 
‘‘(III) makes public comments re-
ceived under clause (I) available, or 
provides access to such comments, to 
the Secretary. 
‘‘(iii) SUBMITTAL
OF
FINAL
PRO-
POSED
ADDITION
OR
MODIFICATION
TO 
NCVHS.—After completion of the process 
under clause (ii), the standard setting or-
ganization submits the proposed addition 
or modification to the National Committee 
on Vital and Health Statistics for review 
and consideration under subparagraph (E). 
Such submission shall include information 
on the organization’s compliance with the 
notice and comment requirements (and re-
sponses to those comments) under clause 
(ii). 
‘‘(E) HEARING
AND
RECOMMENDATIONS 
BY
NATIONAL
COMMITTEE
ON
VITAL
AND 
HEALTH STATISTICS.—Under the upgrade pro-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00047
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
gram, upon receipt of a proposal submitted by 
a standard setting organization under subpara-
graph (D)(iii) for the adoption of an addition or 
modification to a standard, the National Com-
mittee on Vital and Health Statistics shall pro-
vide notice to the public and a reasonable op-
portunity for public testimony at a hearing on 
such addition or modification. The Secretary 
may participate in such hearing in such capac-
ity (including presiding ex officio) as the Sec-
retary shall determine appropriate. Not later 
than 90 days after the date of receipt of the 
proposal, the Committee shall submit to the 
Secretary its recommendation to adopt (or not 
adopt) the proposed addition or modification. 
‘‘(F) DETERMINATION BY SECRETARY TO 
ACCEPT OR REJECT NATIONAL COMMITTEE ON 
VITAL AND HEALTH STATISTICS RECOMMENDA-
TION.— 
‘‘(i) 
TIMELY
DETERMINATION.— 
Under the upgrade program, if the Na-
tional Committee on Vital and Health Sta-
tistics submits to the Secretary a rec-
ommendation under subparagraph (E) to 
adopt a proposed addition or modification, 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00048
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
not later than 90 days after the date of re-
ceipt of such recommendation the Sec-
retary shall make a determination to ac-
cept or reject the recommendation and 
shall publish notice of such determination 
in the Federal Register not later than 30 
days after the date of the determination. 
‘‘(ii) CONTENTS OF NOTICE.—If the 
determination is to reject the recommenda-
tion, such notice shall include the reasons 
for the rejection. If the determination is to 
accept the recommendation, as part of 
such notice the Secretary shall promulgate 
the modified standard (including the ac-
cepted proposed addition or modification 
accepted). 
‘‘(iii) 
LIMITATION
ON
CONSIDER-
ATION.—The Secretary shall not consider a 
proposal under this subparagraph unless 
the Secretary determines that the require-
ments of subparagraph (D) (including pub-
lication of notice and opportunity for pub-
lic comment) have been met with respect to 
the proposal. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00049
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘(G) EXEMPTION FROM PAPERWORK RE-
DUCTION ACT.—Chapter 35 of title 44, United 
States Code, shall not apply to a final rule pro-
mulgated under subparagraph (F).’’. 
SEC. 233. STUDY TO IMPROVE PRESERVATION AND PRO-
TECTION 
OF 
SECURITY 
AND 
CONFIDEN-
TIALITY OF HEALTH INFORMATION. 
(a) IN GENERAL.—The Secretary of Health and 
Human Services shall conduct a study of the following: 
(1) Current Federal security and confidentiality 
standards to determine the strengths and weak-
nesses of such standards for purposes of protecting 
the security and confidentiality of individually identi-
fiable health information while taking into account 
the need for timely and efficient exchanges of health 
information to improve quality of care and ensure 
the availability of health information necessary to 
make medical decisions at the location in which the 
medical care involved is provided. 
(2) The extent to which current security and 
confidentiality standards and State laws relating to 
security and confidentiality of individually identifi-
able health information should be reconciled to 
produce uniform standards, especially in the case of 
data that is shared by health care providers for pa-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00050
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
tient care and other activities across State borders 
that would often result in more than one set of such 
standards that would apply. 
(b) REPORT.—Not later than 9 months after the date 
of the enactment of this subtitle, the Secretary of Health 
and Human Services shall submit to Congress a report 
on the study under subsection (a) and shall include in such 
report recommendations for improving the current Federal 
security and confidentiality standards, including rec-
ommendations for a mechanism to track breaches to the 
security or confidentiality of individually identifiable 
health information and for appropriate penalties to apply 
in the case of such a breach and including proposals to 
address issues examined in subsection (a)(2). 
(c) PRESERVATION
OF CURRENT SECURITY
AND 
CONFIDENTIALITY STANDARDS BEFORE SUBMITTAL OF 
REPORT.—None of the provisions of this subtitle or 
amendments made by this subtitle may limit, or require 
issuance of a regulation that would limit, the effect of a 
current Federal security and confidentiality standard be-
fore the date of the submittal of the report under sub-
section (b). 
(d) CURRENT FEDERAL SECURITY AND CONFIDEN-
TIALITY STANDARDS DEFINED.—For purposes of this sec-
tion, the term ‘‘current Federal security and confiden-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00051
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
tiality standards’’ means the Federal privacy standards es-
tablished pursuant to section 264(c) of the Health Insur-
ance Portability and Accountability Act of 1996 (42 
U.S.C. 1320d–2 note) and security standards established 
under section 1173(d) of the Social Security Act. 
SEC. 234. ASSISTING DOCTORS TO OBTAIN PROFICIENT 
AND TRANSMISSIBLE HEALTH INFORMATION 
TECHNOLOGY. 
(a) IN GENERAL.—Section 179 of the Internal Rev-
enue Code of 1986 (relating to election to expense certain 
depreciable assets) is amended by adding at the end the 
following new subsection: 
‘‘(f) HEALTH CARE INFORMATION TECHNOLOGY.— 
‘‘(1) IN
GENERAL.—In the case of qualified 
health care information technology purchased by a 
medical care provider and placed in service during a 
taxable year— 
‘‘(A) subsection (b)(1) shall be applied by 
substituting ‘$250,000’ for ‘$125,000’; 
‘‘(B) subsection (b)(2) shall be applied by 
substituting ‘$600,000’ for ‘$500,000’; and 
‘‘(C) subsection (b)(5)(A) shall be applied 
by substituting ‘$250,000 and $600,000’ for 
‘$125,000 and $500,000’. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00052
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘(2) DEFINITIONS.—For purposes of this sub-
section— 
‘‘(A) QUALIFIED HEALTH CARE INFORMA-
TION TECHNOLOGY.—The term ‘qualified health 
care information technology’ means section 179 
property which— 
‘‘(i) has been certified pursuant to 
section 3001(c)(3) of the Public Health 
Service Act; and 
‘‘(ii) is used primarily for the elec-
tronic creation, maintenance, and exchange 
of medical care information to provide or 
improve the quality or efficiency of medical 
care. 
‘‘(B) MEDICAL
CARE
PROVIDER.—The 
term ‘medical care provider’ means any person 
engaged in the trade or business of providing 
medical care. 
‘‘(C) MEDICAL CARE.—The term ‘medical 
care’ has the meaning given such term by sec-
tion 213(d).’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to property placed in service after 
December 31, 2009. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00053
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
SEC. 235. EXPANSION OF STARK AND ANTI-KICKBACK EX-
CEPTIONS 
FOR 
ELECTRONIC 
HEALTH 
RECORDS ARRANGEMENTS. 
(a) STARK EXCEPTION.—In applying section 1877(e) 
of the Social Security Act (42 U.S.C. 1395(e)), with re-
spect to a regulation implementing such section by pro-
viding an exception to the prohibition against making cer-
tain physician referrals in the case of the offering or pay-
ment of nonmonetary remuneration (consisting of items 
and services in the form of software or information tech-
nology and training services) necessary and used predomi-
nantly to create, maintain, transmit, or receive electronic 
health records, the Secretary of Health and Human Serv-
ices shall— 
(1) not limit the period in which such an excep-
tion under such a regulation applies; 
(2) not require the physician to pay any per-
centage of the cost of such nonmonetary remunera-
tion; and 
(3) apply the exception to such items and serv-
ices in the form of hardware and maintenance serv-
ices, in addition to such items and services in the 
form of software or information technology and 
training services. 
(b) ANTI-KICKBACK EXCEPTION.—In applying sec-
tion 1128B(b)(3)(E) of the Social Security Act (42 U.S.C. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00054
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
1320a–7b(b)(3)(E)), with respect to a regulation imple-
menting such section by providing an exception to the pro-
hibition against offering, paying, soliciting, or receiving re-
muneration in order to induce or reward referrals making 
certain physician referrals in the case of the offering, pay-
ment, solicitation, or receipt of remuneration (consisting 
of certain arrangements involving interoperable electronic 
health records software or information technology and 
training services) necessary and used predominantly to 
create, maintain, transmit, or receive electronic health 
records, the Secretary of Health and Human Services 
shall— 
(1) not limit the period in which such an excep-
tion under such a regulation applies; 
(2) not require the recipient of such remunera-
tion to pay any percentage of the cost of such remu-
neration; and 
(3) apply the exception to such arrangements 
involving interoperable electronic health records 
hardware and maintenance services, in addition to 
software or information technology and training 
services. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00055
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
SEC. 236. APPLICATION OF MEDICARE EHR INCENTIVES 
AND ADJUSTMENTS TO ADDITIONAL PRO-
VIDERS. 
(a) APPLICATION OF EHR MEDICARE INCENTIVE 
PAYMENTS
AND
ADJUSTMENTS
TO
NURSE
PRACTI-
TIONER, PHYSICIAN ASSISTANTS, AND CLINICAL NURSE 
SPECIALISTS.— 
(1) 
INCENTIVE
PAYMENT.—Section 
1848(o)(5)(C) of the Social Security Act is amended 
by inserting ‘‘, and a practitioner described in sec-
tion 1842(b)(18)(C)(i)’’ after ‘‘1861(r)’’. 
(2) 
INCENTIVE
ADJUSTMENT.—Section 
1848(a)(7)(E)(iii) of such Act is amended by insert-
ing ‘‘, and a practitioner described in section 
1842(b)(18)(C)(i)’’ after ‘‘1861(r)’’. 
(b) APPLICATION OF EHR MEDICARE INCENTIVE 
PAYMENTS AND ADJUSTMENTS TO SNFS, HOME HEALTH 
AGENCIES, IRFS, LTCHS, ASCS, AND LONG-TERM CARE 
PHARMACIES.— 
(1) IN GENERAL.—The Secretary of Health and 
Human Services shall establish a methodology to— 
(A) determine eligible entities described in 
paragraph (2) that are to be considered mean-
ingful EHR users in a manner similar to how 
eligible hospitals are determined to be meaning-
ful EHR users for purposes of sections 1886(n) 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00056
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
and 1886(b)(3)(B)(ix) of the Social Security 
Act; and 
(B) apply the provisions of such sections to 
such eligible entities in a similar manner as 
they apply to hospitals under such section. 
(2) ELIGIBLE ENTITIES DESCRIBED.—Eligible 
entities described in this paragraph are the fol-
lowing: 
(A) Skilled nursing facilities. 
(B) Home health agencies. 
(C) Inpatient rehabilitation facilities . 
(D) Ambulatory surgical centers. 
(E) Long-term care pharmacies. 
(F) Long-term care hospitals. 
PART 2—TELEHEALTH ENHANCEMENT 
Subpart A—Medicare Program 
SEC. 241. EXPANSION AND IMPROVEMENT OF TELEHEALTH 
SERVICES. 
(a) EXPANDING ACCESS TO TELEHEALTH SERVICES 
TO ALL AREAS.—Section 1834(m)(4)(C)(i) of the Social 
Security Act (42 U.S.C. 1395m(m)(4)(C)(i)) is amended 
in paragraph (4)(C)(i) by striking ‘‘and only if such site 
is located’’ and all that follows and inserting ‘‘without re-
gard to the geographic area within the United States 
where the site is located.’’. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00057
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(b) EXPANSION OF USE OF STORE-AND-FORWARD 
TECHNOLOGY.—The 
second 
sentence 
of 
section 
1834(m)(1) of such Act (42 U.S.C. 1395m(m)(1)) is 
amended by inserting ‘‘and any telehealth program that 
has been the recipient of any Federal support from the 
Centers for Medicare & Medicaid Services, the Indian 
Health Service, or the Health Services and Resources Ad-
ministration’’ after ‘‘Alaska or Hawaii’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to services furnished on or after 
January 1, 2010. 
SEC. 242. INCREASE IN NUMBER OF TYPES OF ORIGI-
NATING SITES; CLARIFICATION. 
(a) INCREASE.—Paragraph (4)(C)(ii) of section 
1834(m) of the Social Security Act (42 U.S.C. 1395m(m)) 
is amended by adding at the end the following new sub-
clause: 
‘‘(IX) A renal dialysis facility.’’. 
(b) CLARIFICATION OF INTENT OF THE TERM ORIGI-
NATING SITE.—Such section is further amended by add-
ing at the end the following new paragraph: 
‘‘(5) CONSTRUCTION.—In applying the term 
‘originating site’ under this subsection, the Secretary 
shall apply the term only for the purpose of deter-
mining whether a site is eligible to receive a facility 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00058
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
fee. Nothing in the application of such term under 
this subsection shall be construed as affecting the 
ability of an eligible practitioner to submit claims for 
telehealth services that are provided to other sites 
that have telehealth systems and capabilities.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to services furnished on or after 
January 1, 2010. 
SEC. 243. EXPANSION OF ELIGIBLE TELEHEALTH PRO-
VIDERS AND CREDENTIALING OF TELEMEDI-
CINE PRACTITIONERS. 
(a) EXPANSION OF ELIGIBLE TELEHEALTH PRO-
VIDERS.—Section 1834(m)(1) of the Social Security Act 
(42 U.S.C. 1395m(m)(1)) is amended— 
(1) in paragraph (1)— 
(A) by striking ‘‘or a practitioner’’ and in-
serting ‘‘, a practitioner’’; 
(B) by inserting ‘‘, or other telehealth pro-
vider’’ after ‘‘1842(b)(18)(C))’’; and 
(C) by striking ‘‘or practitioner’’ and in-
serting ‘‘, practitioner, or provider’’; 
(2) in paragraphs (2), (3)(A), and (4), by strik-
ing ‘‘or practitioner’’ and inserting ‘‘, practitioner, 
or other telehealth provider’’ each place it appears; 
and 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00059
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(3) in paragraph (4), by adding at the end the 
following new subparagraph: 
‘‘(G) TELEHEALTH PROVIDER.—The term 
‘telehealth provider’ means any supplier or pro-
vider of services (other than a physician or 
practitioner) that is eligible to provide other 
health services under this title.’’. 
(b) 
CREDENTIALING
TELEMEDICINE
PRACTI-
TIONERS.—Section 1834(m) of such Act is amended by 
adding at the end the following new paragraph: 
‘‘(5) HOSPITAL CREDENTIALING OF TELEMEDI-
CINE PRACTITIONERS.—A telemedicine practitioner 
that is credentialed by a hospital in compliance with 
the Joint Commission Standards for Telemedicine 
shall be considered in compliance with Medicare con-
dition 
of 
participation 
and 
reimbursement 
credentialing requirements for telemedicine serv-
ices.’’. 
SEC. 244. ACCESS TO TELEHEALTH SERVICES IN THE 
HOME. 
(a) IN GENERAL.—Section 1895 of the Social Secu-
rity Act (42 U.S.C. 1395fff(e)) is amended by adding at 
the end the following new subsection: 
‘‘(f) COVERAGE OF TELEHEALTH SERVICES.— 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00060
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘(1) IN GENERAL.—The Secretary shall include 
telehealth services that are furnished via a tele-
communication system by a home health agency to 
an individual receiving home health services under 
section 1814(a)(2)(C) or 1835(a)(2)(A) as a home 
health visit for purposes of eligibility and payment 
under this title if the telehealth services— 
‘‘(A) are ordered as part of a plan of care 
certified by a physician pursuant to section 
1814(a)(2)(C) or 1835(a)(2)(A); 
‘‘(B) do not substitute for in-person home 
health services ordered as part of a plan of care 
certified by a physician pursuant to such re-
spective section; and 
‘‘(C) are considered the equivalent of a 
visit under criteria developed by the Secretary 
under paragraph (3). 
‘‘(2) PHYSICIAN
CERTIFICATION.—Nothing in 
this section shall be construed as waiving the re-
quirement for a physician certification under section 
1814(a)(2)(C) or 1835(a)(2)(A) for the payment for 
home health services, whether or not furnished via 
a telecommunication system. 
‘‘(3) CRITERIA FOR VISIT EQUIVALENCY.— 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00061
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘(A) STANDARDS.—The Secretary shall es-
tablish standards and qualifications for catego-
rizing and coding under HCPCS codes tele-
health services under this subsection as equiva-
lent to an in-person visit for purposes of eligi-
bility and payment for home health services 
under this title. In establishing the standards 
and qualifications, the Secretary may distin-
guish between varying modes and modalities of 
telehealth services and shall consider— 
‘‘(i) the nature and amount of service 
time involved; and 
‘‘(ii) the functions of the telecommuni-
cations. 
‘‘(B) LIMITATION.—A telecommunication 
that consists solely of a telephone audio con-
versation, facsimile, electronic text mail, or con-
sultation between two health care practitioners 
is not considered a visit under this subsection. 
‘‘(4) TELEHEALTH SERVICE.— 
‘‘(A) DEFINITION.—For purposes of this 
subsection, the term ‘telehealth service’ means 
technology-based professional consultations, pa-
tient monitoring, patient training services, clin-
ical observation, assessment, or treatment, and 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00062
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
any additional services that utilize technologies 
specified by the Secretary as HCPCS codes de-
veloped under paragraph (3). 
‘‘(B) UPDATE
OF
HCPCS
CODES.—The 
Secretary shall establish a process for the up-
dating, not less frequently than annually, of 
HCPCS codes for telehealth services. 
‘‘(5) CONDITIONS
FOR
PAYMENT
AND
COV-
ERAGE.—Nothing in this subsection shall be con-
strued as waiving any condition of payment under 
sections 1814(a)(2)(C) or 1835(a)(2)(A) or exclu-
sion of coverage under section 1862(a)(1). 
‘‘(6) COST REPORTING.—Notwithstanding any 
provision to the contrary, the Secretary shall provide 
that the costs of telehealth services under this sub-
section shall be reported as a reimbursable cost cen-
ter on any cost report submitted by a home health 
agency to the Secretary.’’. 
(b) EFFECTIVE DATE.— 
(1) The amendment made by subsection (a) 
shall apply to telehealth services furnished on or 
after October 1, 2010. The Secretary of Health and 
Human Services shall develop and implement cri-
teria and standards under section 1895(f)(3) of the 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00063
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
Social Security Act, as amended by subsection (a), 
by no later than July 1, 2010. 
(2) In the event that the Secretary has not 
complied with these deadlines, beginning October 1, 
2010, a home health visit for purpose of eligibility 
and payment under title XVIII of the Social Secu-
rity Act shall include telehealth services under sec-
tion 1895(f) of such Act with the aggregate of tele-
communication encounters in a 24-hour period con-
sidered the equivalent of one in-person visit. 
SEC. 245. COVERAGE OF HOME HEALTH REMOTE PATIENT 
MANAGEMENT 
SERVICES 
FOR 
CHRONIC 
HEALTH CONDITIONS. 
(a) MEDICARE COVERAGE.— 
(1) IN
GENERAL.—Section 1861(s)(2) of the 
Social Security Act (42 U.S.C. 1395x(s)(2)) is 
amended— 
(A) in subparagraph (DD), by striking 
‘‘and’’ at the end; 
(B) in subparagraph (EE), by adding 
‘‘and’’ at the end; and 
(C) by inserting after subparagraph (EE) 
the following new subparagraph: 
‘‘(FF) home health remote patient management 
services (as defined in subsection (hhh));’’. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00064
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(2) SERVICES
DESCRIBED.—Section 1861 of 
such Act (42 U.S.C. 1395x) is amended by adding 
at the end the following new subsection: 
‘‘(hhh) HOME HEALTH REMOTE PATIENT MANAGE-
MENT SERVICES FOR CHRONIC HEALTH CONDITIONS.— 
(1) The term ‘remote patient management services’ means 
the remote monitoring, evaluation, and management of an 
individual with a covered chronic health condition (as de-
fined in paragraph (2)) through the utilization of a system 
of technology that allows a remote interface to collect and 
transmit clinical data between the individual and a home 
health agency, in accordance with a plan of care estab-
lished by a physician, for the purposes of clinical review 
or response by the home health agency. Such term, with 
respect to an individual, does not include any remote mon-
itoring, evaluation, or management of the individual if 
such remote monitoring, evaluation, or management, re-
spectively, is included as a home health visit under section 
1895(f) for purposes of payment under this title. 
‘‘(2) For purposes of paragraph (1), the term ‘cov-
ered chronic health condition’ means any chronic health 
condition specified by the Secretary.’’. 
(b) PAYMENT.— 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00065
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(1) IN GENERAL.—Section 1834 of such Act 
(42 U.S.C. 1395l) is amended by adding at the end 
the following new subsection: 
‘‘(n) HOME HEALTH REMOTE PATIENT MANAGE-
MENT SERVICES.— 
‘‘(1) IN GENERAL.—The Secretary shall estab-
lish a fee schedule for home health remote patient 
management 
services 
(as 
defined 
in 
section 
1861(hhh)) for which payment is made under this 
part. The fee schedule shall be designed in a manner 
so that, on an annual basis, the aggregate payment 
amounts under this title for such services approxi-
mates 50 percent of the savings amount described in 
paragraph (2) for such year. 
‘‘(2) SAVINGS DESCRIBED.— 
‘‘(A) IN GENERAL.—For purposes of para-
graph (1), the savings amount described in this 
paragraph for a year is the amount (if any), as 
estimated by the Secretary before the beginning 
of the year, by which— 
‘‘(i) the product described in subpara-
graph (B) for the year, exceeds 
‘‘(ii) the total payments under this 
part and part A for items and services fur-
nished to individuals receiving home health 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00066
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
remote patient management services at any 
time during the year. 
‘‘(B) PRODUCT DESCRIBED.—The product 
described in this subparagraph for a year is the 
product of— 
‘‘(i) the average per capita total pay-
ments under this part and part A for items 
and services furnished during the year to 
individuals not described in subparagraph 
(A)(ii), adjusted to remove case mix dif-
ferences between such individuals not de-
scribed in such subparagraph and the indi-
viduals described in such subparagraph; 
and 
‘‘(ii) the number of individuals under 
subparagraph (A)(ii) for the year. 
‘‘(3) LIMITATION.—In no case may payments 
under this subsection result in the aggregate expend-
itures under this title (including payments under 
this subsection) exceeding the amount that the Sec-
retary estimates would have been expended if cov-
erage under this title for home health patient man-
agement services was not provided. 
‘‘(4) CLARIFICATION.—Payments under the fee 
schedule under this subsection, with respect to an 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00067
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
individual, shall be in addition to any other pay-
ments that a home health agency would otherwise 
receive under this title for items and services fur-
nished to such individual and shall have no effect on 
the amount of such other payments. 
‘‘(5) PAYMENT
TRANSFER.—There shall be 
transferred from the Federal Hospital Insurance 
Trust Fund under section 1817 to the Federal Sup-
plementary Medical Insurance Trust Fund under 
section 1841 each year an amount equivalent to the 
product of— 
‘‘(A) expenditures under this subsection 
for the year, and 
‘‘(B) the ratio of the portion of the savings 
described in paragraph (2) for the year that are 
attributable to part A, to the total savings de-
scribed in such paragraph for the year.’’. 
(2) 
CONFORMING
AMENDMENT.—Section 
1833(a)(1) of such Act (42 U.S.C. 1395l(1)) is 
amended— 
(A) by striking ‘‘and (W)’’ and inserting 
‘‘(W)’’; and 
(B) by inserting before the semicolon at 
the end the following: ‘‘, (X) with respect to 
home health remote patient management serv-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00068
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
ices (as defined in section 1861(hhh)), the 
amounts paid shall be the amount determined 
under the fee schedule established under section 
1834(n)’’. 
(c) EXPANSION
OF HOME HEALTH REMOTE PA-
TIENT MANAGEMENT SERVICES COVERAGE
TO ADDI-
TIONAL CHRONIC HEALTH CONDITIONS.—The Secretary 
of Health and Human Services is authorized to carry out 
pilot projects for purposes of determining the extent to 
which the coverage under title XVIII of the Social Security 
Act of home health remote patient management services 
(as defined in paragraph (1) of section 1861(hhh) of such 
Act, as added by subsection (a)) should be extended to 
individuals with chronic health conditions other than those 
initially specified by the Secretary under paragraph (2) 
of such section. 
(d) EFFECTIVE DATE.—The amendments made by 
subsections (a), (b), and (c) shall apply to services fur-
nished on or after January 1, 2010. 
SEC. 246. SENSE OF CONGRESS ON THE USE OF REMOTE 
PATIENT MANAGEMENT SERVICES. 
(a) FINDINGS.—Congress finds as follows: 
(1) Remote patient management services can 
make chronic disease management more effective 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00069
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
and efficient for patients and for the health care sys-
tem. 
(2) By collecting, analyzing, and transmitting 
clinical health information to a health care provider, 
remote patient management services allow patients 
and providers to manage the medical condition of 
patients in a consistent and real time fashion. 
(3) Utilization of remote patient management 
services not only improves the quality of care given 
to patients, it also reduces the need for frequent of-
fice appointments, costly emergency room visits, and 
unnecessary hospitalizations. 
(4) Management the medical condition or dis-
ease of a patient from the patient’s home reduces 
the need for face to face provider interactions. Use 
of remote patient management services minimizes 
unnecessary travel and missed work and provides 
particular value to patients residing in rural or un-
derserved communities who would otherwise face po-
tentially significant access barriers to receiving need-
ed care. 
(5) Among the areas in which remote patient 
management services are emerging in health care 
are the treatment of congestive heart failure, diabe-
tes, cardiac arrhythmia, epilepsy, and sleep apnea. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00070
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
Prompt transmission of clinical data on each of 
these conditions, to the health care provider or the 
patient as appropriate, is essential to providing time-
ly and appropriate therapeutic interventions which 
can then reduce expensive hospitalizations. 
(6) Despite these benefits, remote patient man-
agement services have failed to diffuse rapidly. A 
significant barrier to wider adoption is the relative 
lack of payment mechanisms in fee for service Medi-
care to reimburse for remote, non face to face pa-
tient management. 
(7) Elimination of this barrier to new remote 
patient management services should be encouraged 
by requiring reimbursement under the Medicare pro-
gram for providers’ time spent analyzing and re-
sponding to patient data transmitted by remote 
technologies. 
(8) Reimbursement under the Medicare pro-
gram for health care providers’ time spent analyzing 
and responding to data transmitted to providers by 
remote technologies should be made on a separate 
basis and should not be combined with payments for 
others services (also referred to as ‘‘bundled pay-
ments’’). 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00071
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(9) Payment codes used for reporting and bill-
ing for payment for providers’ remote patient man-
agement services should be revised or adjusted, as 
appropriate, to encourage the application of such 
services for other medical conditions. 
(b) SENSE OF CONGRESS.—It is the sense of the 
Congress that— 
(1) remote patient management services are in-
tegral to improvement in the delivery, care, and effi-
ciency of health care services furnished in the 
United States; and 
(2) the Administrator of the Centers for Medi-
care & Medicaid Services should be encouraged to— 
(A) expand the types of medical conditions 
for which the use of remote patient manage-
ment services are reimbursed under the Medi-
care program; 
(B) provide for separate, non-bundled pay-
ment under the Medicare program for remote 
patient management services; and 
(C) create, revise and adjust, as appro-
priate, codes for the accurate reporting and bill-
ing for payment for remote patient manage-
ment services. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00072
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
SEC. 247. TELEHEALTH ADVISORY COMMITTEE. 
(a) IN GENERAL.—Section 1834(m)(4)(F)(ii) of the 
Social Security Act (42 U.S.C. 1395m(m)(4)(F)(ii)) is 
amended by adding at the end the following sentences: 
‘‘Such process shall require the Secretary to take into ac-
count the recommendations of the Telehealth Advisory 
Committee (as established under section 247(b) of the 
Medical Rights and Reform Act of 2009) when adding or 
deleting services (and HCPCS codes) and in establishing 
policies of the Centers for Medicare & Medicaid Services 
regarding the delivery of telehealth services. If the Sec-
retary does not implement a recommendation of the Tele-
health Advisory Committee, the Secretary shall publish in 
the Federal Register a statement regarding the reason 
such recommendation was not implemented.’’. 
(b) TELEHEALTH ADVISORY COMMITTEE.— 
(1) ESTABLISHMENT.—On and after the date 
that is 6 months after the date of enactment of this 
subtitle, the Secretary of Health and Human Serv-
ices (in this subsection referred to as the ‘‘Sec-
retary’’) shall have in place a Telehealth Advisory 
Committee (in this subsection referred to as the 
‘‘Advisory Committee’’) to make recommendations to 
the Secretary on— 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00073
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(A) policies of the Centers for Medicare & 
Medicaid Services regarding the delivery of tele-
health services; and 
(B) the appropriate addition or deletion of 
services (and HCPCS codes) to those specified 
in paragraph (4)(F)(i) of section 1834(m) of 
the Social Security Act (42 U.S.C. 1395m(m)) 
for authorized payment under paragraph (1) of 
such section. 
(2) MEMBERSHIP; TERMS.— 
(A) MEMBERSHIP.— 
(i) IN GENERAL.—The Advisory Com-
mittee shall be composed of 9 members, to 
be appointed by the Secretary, of whom— 
(I) five shall be practicing physi-
cians; 
(II) two shall be practicing non- 
physician health care providers; and 
(III) two shall be administrators 
of telehealth programs. 
(ii) REQUIREMENTS FOR APPOINTING 
MEMBERS.—In appointing members of the 
Advisory Committee, the Secretary shall— 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00074
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(I) ensure that each member has 
prior experience with the practice of 
telemedicine or telehealth; 
(II) give preference to individuals 
who are currently providing telemedi-
cine or telehealth services or who are 
involved in telemedicine or telehealth 
programs; 
(III) ensure that the membership 
of the Advisory Committee represents 
a balance of specialties and geo-
graphic regions; and 
(IV) take into account the rec-
ommendations of stakeholders. 
(B) TERMS.—The members of the Advi-
sory Committee shall serve for such term as the 
Secretary may specify. 
(C) CONFLICTS OF INTEREST.—An advi-
sory committee member may not participate 
with respect to a particular matter considered 
in an advisory committee meeting if such mem-
ber (or an immediate family member of such 
member) has a financial interest that could be 
affected by the advice given to the Secretary 
with respect to such matter. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00075
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(3) MEETINGS.—The Advisory Committee shall 
meet twice per year and at such other times as the 
Advisory Committee may provide. 
(4) PERMANENT
COMMITTEE.—Section 14 of 
the Federal Advisory Committee Act (5 U.S.C. 
App.) shall not apply to the Advisory Committee. 
(5) WAIVER
OF
ADMINISTRATIVE
LIMITA-
TION.—The Secretary shall establish the Advisory 
Committee notwithstanding any limitation that may 
apply to the number of advisory committees that 
may be established (within the Department of 
Health and Human Services or otherwise). 
Subpart B—HRSA Grant Program 
SEC. 250. GRANT PROGRAM FOR THE DEVELOPMENT OF 
TELEHEALTH NETWORKS. 
(a) IN GENERAL.—The Secretary of Health and 
Human Services (in this section referred to as the ‘‘Sec-
retary’’), acting through the Director of the Office for the 
Advancement of Telehealth (of the Health Resources and 
Services Administration), shall make grants to eligible en-
tities (as described in subsection (b)(2)) for the purpose 
of expanding access to health care services for individuals 
in rural areas, frontier areas, and urban medically under-
served areas through the use of telehealth. 
(b) ELIGIBLE ENTITIES.— 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00076
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(1) APPLICATION.—To be eligible to receive a 
grant under this section, an eligible entity described 
in paragraph (2) shall, in consultation with the 
State office of rural health or other appropriate 
State entity, prepare and submit to the Secretary an 
application, at such time, in such manner, and con-
taining such information as the Secretary may re-
quire, including the following: 
(A) A description of the anticipated need 
for the grant. 
(B) A description of the activities which 
the entity intends to carry out using amounts 
provided under the grant. 
(C) A plan for continuing the project after 
Federal support under this section is ended. 
(D) A description of the manner in which 
the activities funded under the grant will meet 
health care needs of underserved rural popu-
lations within the State. 
(E) A description of how the local commu-
nity or region to be served by the network or 
proposed network will be involved in the devel-
opment and ongoing operations of the network. 
(F) The source and amount of non-Federal 
funds the entity would pledge for the project. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00077
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(G) A showing of the long-term viability of 
the project and evidence of health care provider 
commitment to the network. 
The application should demonstrate the manner in 
which the project will promote the integration of 
telehealth in the community so as to avoid redun-
dancy of technology and achieve economies of scale. 
(2) ELIGIBLE ENTITIES.— 
(A) IN GENERAL.—An eligible entity de-
scribed in this paragraph is a hospital or other 
health care provider in a health care network of 
community-based health care providers that in-
cludes at least— 
(i) two of the organizations described 
in subparagraph (B); and 
(ii) one of the institutions and entities 
described in subparagraph (C), 
if the institution or entity is able to dem-
onstrate use of the network for purposes of 
education or economic development (as required 
by the Secretary). 
(B) ORGANIZATIONS DESCRIBED.—The or-
ganizations described in this subparagraph are 
the following: 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00078
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(i) Community or migrant health cen-
ters. 
(ii) Local health departments. 
(iii) Nonprofit hospitals. 
(iv) Private practice health profes-
sionals, including community and rural 
health clinics. 
(v) Other publicly funded health or so-
cial services agencies. 
(vi) Skilled nursing facilities. 
(vii) County mental health and other 
publicly funded mental health facilities. 
(viii) Providers of home health serv-
ices. 
(ix) Renal dialysis facilities. 
(C) INSTITUTIONS
AND
ENTITIES
DE-
SCRIBED.—The institutions and entities de-
scribed in this subparagraph are the following: 
(i) A public school. 
(ii) A public library. 
(iii) A university or college. 
(iv) A local government entity. 
(v) A local health entity. 
(vi) A health-related nonprofit founda-
tion. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00079
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(vii) An academic health center. 
An eligible entity may include for-profit entities so 
long as the recipient of the grant is a not-for-profit 
entity. 
(c) PREFERENCE.—The Secretary shall establish pro-
cedures to prioritize financial assistance under this section 
based upon the following considerations: 
(1) The applicant is a health care provider in 
a health care network or a health care provider that 
proposes to form such a network that furnishes or 
proposes to furnish services in a medically under-
served area, health professional shortage area, or 
mental health professional shortage area. 
(2) The applicant is able to demonstrate broad 
geographic coverage in the rural or medically under-
served areas of the State, or States in which the ap-
plicant is located. 
(3) The applicant proposes to use Federal 
funds to develop plans for, or to establish, telehealth 
systems that will link rural hospitals and rural 
health care providers to other hospitals, health care 
providers, and patients. 
(4) The applicant will use the amounts provided 
for a range of health care applications and to pro-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00080
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
mote greater efficiency in the use of health care re-
sources. 
(5) The applicant is able to demonstrate the 
long-term viability of projects through cost participa-
tion (cash or in-kind). 
(6) The applicant is able to demonstrate finan-
cial, institutional, and community support for the 
long-term viability of the network. 
(7) The applicant is able to provide a detailed 
plan for coordinating system use by eligible entities 
so that health care services are given a priority over 
non-clinical uses. 
(d) MAXIMUM AMOUNT OF ASSISTANCE TO INDI-
VIDUAL RECIPIENTS.—The Secretary shall establish, by 
regulation, the terms and conditions of the grant and the 
maximum amount of a grant award to be made available 
to an individual recipient for each fiscal year under this 
section. The Secretary shall cause to have published in the 
Federal Register or the ‘‘HRSA Preview’’ notice of the 
terms and conditions of a grant under this section and 
the maximum amount of such a grant for a fiscal year. 
(e) USE OF AMOUNTS.—The recipient of a grant 
under this section may use sums received under such 
grant for the acquisition of telehealth equipment and 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00081
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
modifications or improvements of telecommunications fa-
cilities including the following: 
(1) The development and acquisition through 
lease or purchase of computer hardware and soft-
ware, audio and video equipment, computer network 
equipment, interactive equipment, data terminal 
equipment, and other facilities and equipment that 
would further the purposes of this section. 
(2) The provision of technical assistance and in-
struction for the development and use of such pro-
gramming equipment or facilities. 
(3) The development and acquisition of instruc-
tional programming. 
(4) Demonstration projects for teaching or 
training medical students, residents, and other 
health profession students in rural or medically un-
derserved training sites about the application of tele-
health. 
(5) The provision of telenursing services de-
signed to enhance care coordination and promote pa-
tient self-management skills. 
(6) The provision of services designed to pro-
mote patient understanding and adherence to na-
tional guidelines for common chronic diseases, such 
as congestive heart failure or diabetes. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00082
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(7) Transmission costs, maintenance of equip-
ment, and compensation of specialists and referring 
health care providers, when no other form of reim-
bursement is available. 
(8) Development of projects to use telehealth to 
facilitate collaboration between health care providers. 
(9) Electronic archival of patient records. 
(10) Collection and analysis of usage statistics 
and data that can be used to document the cost-ef-
fectiveness of the telehealth services. 
(11) Such other uses that are consistent with 
achieving the purposes of this section as approved by 
the Secretary. 
(f) PROHIBITED USES.—Sums received under a 
grant under this section may not be used for any of the 
following: 
(1) To acquire real property. 
(2) Expenditures to purchase or lease equip-
ment to the extent the expenditures would exceed 
more than 40 percent of the total grant funds. 
(3) To purchase or install transmission equip-
ment off the premises of the telehealth site and any 
transmission costs not directly related to the grant. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00083
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(4) For construction, except that such funds 
may be expended for minor renovations relating to 
the installation of equipment. 
(5) Expenditures for indirect costs (as deter-
mined by the Secretary) to the extent the expendi-
tures would exceed more than 15 percent of the total 
grant. 
(g) ADMINISTRATION.— 
(1) NONDUPLICATION.—The Secretary shall en-
sure that facilities constructed using grants provided 
under this section do not duplicate adequately estab-
lished telehealth networks. 
(2) COORDINATION WITH OTHER AGENCIES.— 
The Secretary shall coordinate, to the extent prac-
ticable, with other Federal and State agencies and 
not-for-profit organizations, operating similar grant 
programs to pool resources for funding meritorious 
proposals. 
(3) INFORMATIONAL EFFORTS.—The Secretary 
shall establish and implement procedures to carry 
out outreach activities to advise potential end users 
located in rural and medically underserved areas of 
each State about the program authorized by this 
section. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00084
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(h) PROMPT IMPLEMENTATION.—The Secretary shall 
take such actions as are necessary to carry out the grant 
program as expeditiously as possible. 
(i) AUTHORIZATION
OF APPROPRIATIONS.—There 
are authorized to be appropriated to carry out this section 
$10,000,000 for fiscal year 2010, and such sums as may 
be necessary for each of the fiscal years 2011 through 
2014. 
SEC. 251. REAUTHORIZATION OF TELEHEALTH NETWORK 
AND 
TELEHEALTH 
RESOURCE 
CENTERS 
GRANT PROGRAMS. 
Subsection (s) of section 330I of the Public Health 
Service Act (42 U.S.C. 254c–14) is amended— 
(1) in paragraph (1)— 
(A) by striking ‘‘and’’ before ‘‘such sums’’; 
and 
(B) by inserting ‘‘$10,000,000 for fiscal 
year 2010, and such sums as may be necessary 
for each of fiscal years 2011 through 2014’’ be-
fore the semicolon; and 
(2) in paragraph (2)— 
(A) by striking ‘‘and’’ before ‘‘such sums’’; 
and 
(B) by inserting ‘‘$10,000,000 for fiscal 
year 2010, and such sums as may be necessary 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00085
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
for each of fiscal years 2011 through 2014’’ be-
fore the semicolon. 
Subtitle D—Eliminating Waste, 
Fraud, and Abuse 
SEC. 261. SITE INSPECTIONS; BACKGROUND CHECKS; DE-
NIAL AND SUSPENSION OF BILLING PRIVI-
LEGES. 
(a) SITE INSPECTIONS FOR DME SUPPLIERS, COM-
MUNITY MENTAL HEALTH CENTERS, AND OTHER PRO-
VIDER GROUPS.—Title XVIII of the Social Security Act 
(42 U.S.C. 1395 et seq.) is amended by adding at the end 
the following: 
‘‘SITE INSPECTIONS FOR DME SUPPLIERS, COMMUNITY 
MENTAL HEALTH CENTERS, AND OTHER PROVIDER 
GROUPS 
‘‘SEC. 1898. (a) SITE INSPECTIONS.— 
‘‘(1) IN GENERAL.—The Secretary shall con-
duct a site inspection for each applicable provider 
(as defined in paragraph (2)) that applies to enroll 
under this title in order to provide items or services 
under this title. Such site inspection shall be in addi-
tion to any other site inspection that the Secretary 
would otherwise conduct with regard to an applica-
ble provider. 
‘‘(2) APPLICABLE PROVIDER DEFINED.— 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00086
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), in this section the term ‘ap-
plicable provider’ means— 
‘‘(i) a supplier of durable medical 
equipment (including items described in 
section 1834(a)(13)); 
‘‘(ii) 
a 
supplier 
of 
prosthetics, 
orthotics, or supplies (including items de-
scribed in paragraphs (8) and (9) of sec-
tion 1861(s)); 
‘‘(iii) a community mental health cen-
ter; or 
‘‘(iv) any other provider group, as de-
termined by the Secretary (including sup-
pliers, both participating suppliers and 
non-participating suppliers, as such terms 
are defined for purposes of section 1842). 
‘‘(B) EXCEPTION.—In this section, the 
term ‘applicable provider’ does not include— 
‘‘(i) a physician that provides durable 
medical equipment (as described in sub-
paragraph (A)(i)) or prosthetics, orthotics, 
or supplies (as described in subparagraph 
(A)(ii)) to an individual as incident to an 
office visit by such individual; or 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00087
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘(ii) a hospital that provides durable 
medical equipment (as described in sub-
paragraph (A)(i)) or prosthetics, orthotics, 
or supplies (as described in subparagraph 
(A)(ii)) to an individual as incident to an 
emergency room visit by such individual. 
‘‘(b) STANDARDS
AND REQUIREMENTS.—In con-
ducting the site inspection pursuant to subsection (a), the 
Secretary shall ensure that the site being inspected is in 
full compliance with all the conditions and standards of 
participation and requirements for obtaining billing privi-
leges under this title. 
‘‘(c) TIME.—The Secretary shall conduct the site in-
spection for an applicable provider prior to the issuance 
of billing privileges under this title to such provider. 
‘‘(d) TIMELY REVIEW.—The Secretary shall provide 
for procedures to ensure that the site inspection required 
under this section does not unreasonably delay the 
issuance of billing privileges under this title to an applica-
ble provider.’’. 
(b) BACKGROUND CHECKS.—Title XVIII of the So-
cial Security Act (42 U.S.C. 1395 et seq.) (as amended 
by subsection (a)) is amended by adding at the end the 
following new section: 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00088
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘BACKGROUND CHECKS; DENIAL AND SUSPENSION OF 
BILLING PRIVILEGES 
‘‘SEC. 1899. (a) BACKGROUND CHECK REQUIRED.— 
Except as provided in subsection (b), the Secretary shall 
conduct a background check on any individual or entity 
that enrolls under this title for the purpose of furnishing 
any item or service under this title, including any indi-
vidual or entity that is a supplier, a person with an owner-
ship or control interest, a managing employee (as defined 
in section 1126(b)), or an authorized or delegated official 
of the individual or entity. In performing the background 
check, the Secretary shall— 
‘‘(1) conduct the background check before au-
thorizing billing privileges under this title to the in-
dividual or entity, respectively; 
‘‘(2) include a search of criminal records in the 
background check; 
‘‘(3) provide for procedures that ensure the 
background check does not unreasonably delay the 
authorization of billing privileges under this title to 
an eligible individual or entity, respectively; and 
‘‘(4) establish criteria for targeted reviews when 
the individual or entity renews participation under 
this title, with respect to the background check of 
the individual or entity, respectively, to detect 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00089
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
changes in ownership, bankruptcies, or felonies by 
the individual or entity. 
‘‘(b) USE OF STATE LICENSING PROCEDURE.—The 
Secretary may use the results of a State licensing proce-
dure as a background check under subsection (a) if the 
State licensing procedure meets the requirements of such 
subsection. 
‘‘(c) ATTORNEY GENERAL REQUIRED TO PROVIDE 
INFORMATION.— 
‘‘(1) IN GENERAL.—Upon request of the Sec-
retary, the Attorney General shall provide the crimi-
nal background check information referred to in sub-
section (a)(2) to the Secretary. 
‘‘(2) RESTRICTION ON USE OF DISCLOSED IN-
FORMATION.—The Secretary may only use the infor-
mation disclosed under subsection (a) for the pur-
pose of carrying out the Secretary’s responsibilities 
under this title. 
‘‘(d) REFUSAL
TO
AUTHORIZE
BILLING
PRIVI-
LEGES.— 
‘‘(1) AUTHORITY.—In addition to any other 
remedy available to the Secretary, the Secretary may 
refuse to authorize billing privileges under this title 
to an individual or entity if the Secretary deter-
mines, after a background check conducted under 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00090
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
this section, that such individual or entity, respec-
tively, has a history of acts that indicate authoriza-
tion of billing privileges under this title to such indi-
vidual or entity, respectively, would be detrimental 
to the best interests of the program or program 
beneficiaries. Such acts may include— 
‘‘(A) any bankruptcy; 
‘‘(B) any act resulting in a civil judgment 
against such individual or entity; or 
‘‘(C) any felony conviction under Federal 
or State law. 
‘‘(2) REPORTING OF REFUSAL TO AUTHORIZE 
BILLING PRIVILEGES TO THE HEALTHCARE INTEG-
RITY AND PROTECTION DATA BANK (HIPDB).— 
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), a determination under paragraph 
(1) to refuse to authorize billing privileges 
under this title to an individual or entity as a 
result of a background check conducted under 
this section shall be reported to the healthcare 
integrity and protection data bank established 
under section 1128E in accordance with the 
procedures for reporting final adverse actions 
taken against a health care provider, supplier, 
or practitioner under that section. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00091
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘(B) EXCEPTION.—Any determination de-
scribed in subparagraph (A) that the Secretary 
specifies is not appropriate for inclusion in the 
healthcare integrity and protection data bank 
established under section 1128E shall not be 
reported to such data bank.’’. 
(c) DENIAL AND SUSPENSION OF BILLING PRIVI-
LEGES.—Section 1899 of the Social Security Act, as 
added by subsection (b), is amended by adding at the end 
the following new subsection: 
‘‘(e) AUTHORITY TO SUSPEND BILLING PRIVILEGES 
OR REFUSE TO AUTHORIZE ADDITIONAL BILLING PRIVI-
LEGES.— 
‘‘(1) IN GENERAL.—The Secretary may suspend 
any billing privilege under this title authorized for 
an individual or entity or refuse to authorize any ad-
ditional billing privilege under this title to such indi-
vidual or entity if— 
‘‘(A) such individual or entity, respectively, 
has an outstanding overpayment due to the 
Secretary under this title; 
‘‘(B) payments under this title to such in-
dividual or entity, respectively, have been sus-
pended; or 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00092
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘(C) 100 percent of the payment claims 
under this title for such individual or entity, re-
spectively, are reviewed on a pre-payment basis. 
‘‘(2) APPLICATION
TO
RESTRUCTURED
ENTI-
TIES.—In the case that an individual or entity is 
subject to a suspension or refusal of billing privileges 
under this section, if the Secretary determines that 
the ownership or management of a new entity is 
under the control or management of such an indi-
vidual or entity subject to such a suspension or re-
fusal, the new entity shall be subject to any such ap-
plicable suspension or refusal in the same manner 
and to the same extent as the initial individual or 
entity involved had been subject to such applicable 
suspension or refusal. 
‘‘(3) DURATION
OF
SUSPENSION.—A suspen-
sion of billing privileges under this subsection, with 
respect to an individual or entity, shall be in effect 
beginning on the date of the Secretary’s determina-
tion that the offense was committed and ending not 
earlier than such date on which all applicable over-
payments and other applicable outstanding debts 
have been paid and all applicable payment suspen-
sions have been lifted.’’. 
(d) REGULATIONS; EFFECTIVE DATE.— 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00093
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(1) REGULATIONS.—Not later than one year 
after the date of the enactment of this Act, the Sec-
retary of Health and Human Services shall promul-
gate such regulations as are necessary to implement 
the amendments made by subsections (a), (b), and 
(c). 
(2) EFFECTIVE DATES.— 
(A) SITE INSPECTIONS AND BACKGROUND 
CHECKS.—The amendments made by sub-
sections (a) and (b) shall apply to applications 
to enroll under title XVIII of the Social Secu-
rity Act received by the Secretary of Health and 
Human Services on or after the first day of the 
first year beginning after the date of the enact-
ment of this Act. 
(B) DENIALS AND SUSPENSIONS OF BILL-
ING
PRIVILEGES.—The amendment made by 
subsection (c) shall apply to overpayments or 
debts in existence on or after the date of the 
enactment of this Act, regardless of whether the 
final determination, with respect to such over-
payment or debt, was made before, on, or after 
such date. 
(e) USE
OF
MEDICARE
INTEGRITY
PROGRAM 
FUNDS.—The Secretary of Health and Human Services 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00094
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
may use funds appropriated or transferred for purposes 
of carrying out the Medicare integrity program established 
under section 1893 of the Social Security Act (42 U.S.C. 
1395ddd) to carry out the provisions of sections 1898 and 
1899 of that Act (as added by subsections (a) and (b)). 
SEC. 262. REGISTRATION AND BACKGROUND CHECKS OF 
BILLING AGENCIES AND INDIVIDUALS. 
(a) IN GENERAL.—Title XVIII of the Social Security 
Act (42 U.S.C. 1395 et seq.) (as amended by section 2(b)) 
is amended by adding at the end the following new section: 
‘‘REGISTRATION AND BACKGROUND CHECKS OF BILLING 
AGENCIES AND INDIVIDUALS; IDENTIFICATION NUM-
BERS REQUIRED FOR PROVIDERS AND SUPPLIERS 
‘‘SEC. 1899A. (a) REGISTRATION.— 
‘‘(1) IN GENERAL.—The Secretary shall estab-
lish procedures, including modifying the Provider 
Enrollment and Chain Ownership System (PECOS) 
administered by the Centers for Medicare & Med-
icaid Services, to provide for the registration of all 
applicable persons in accordance with this section. 
‘‘(2) REQUIRED APPLICATION.—Each applicable 
person shall submit a registration application to the 
Secretary at such time, in such manner, and accom-
panied by such information as the Secretary may re-
quire. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00095
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘(3) IDENTIFICATION
NUMBER.—If the Sec-
retary approves an application submitted under sub-
section (b), the Secretary shall assign a unique iden-
tification number to the applicable person. 
‘‘(4) REQUIREMENT.—Every claim for reim-
bursement under this title that is compiled or sub-
mitted by an applicable person shall contain the 
identification number that is assigned to the applica-
ble person pursuant to subsection (c). 
‘‘(5) TIMELY
REVIEW.—The Secretary shall 
provide for procedures that ensure the timely consid-
eration and determination regarding approval of ap-
plications under this subsection. 
‘‘(6) DEFINITION OF APPLICABLE PERSON.—In 
this section, the term ‘applicable person’ means any 
individual or entity that compiles or submits claims 
for reimbursement under this title to the Secretary 
on behalf of any individual or entity. 
‘‘(b) BACKGROUND CHECKS.— 
‘‘(1) IN GENERAL.—Except as provided in paragraph 
(2), the Secretary shall conduct a background check on 
any applicable person that registers under subsection (a). 
In performing the background check, the Secretary 
shall— 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00096
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
‘‘(A) conduct the background check before 
issuing a unique identification number to the appli-
cable person; 
‘‘(B) include a search of criminal records in the 
background check; 
‘‘(C) provide for procedures that ensure the 
background check does not unreasonably delay the 
issuance of the unique identification number to an 
eligible applicable person; and 
‘‘(D) establish criteria for periodic targeted re-
views with respect to the background check of the 
applicable person. 
‘‘(2) USE OF STATE LICENSING PROCEDURE.—The 
Secretary may use the results of a State licensing proce-
dure as a background check under paragraph (1) if the 
State licensing procedure meets the requirements of such 
paragraph. 
‘‘(3) ATTORNEY GENERAL REQUIRED TO PROVIDE 
INFORMATION.— 
‘‘(A) IN GENERAL.—Upon request of the Sec-
retary, the Attorney General shall provide the crimi-
nal background check information referred to in 
paragraph (1)(B) to the Secretary. 
‘‘(B) RESTRICTION ON USE OF DISCLOSED IN-
FORMATION.—The Secretary may only use the infor-
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00097
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
mation disclosed under paragraph (1) for the pur-
pose of carrying out the Secretary’s responsibilities 
under this title. 
‘‘(4) REFUSAL TO ISSUE UNIQUE IDENTIFICATION 
NUMBER.—In addition to any other remedy available to 
the Secretary, the Secretary may refuse to issue a unique 
identification number described in subsection (a)(3) to an 
applicable person if the Secretary determines, after a 
background check conducted under this subsection, that 
such person has a history of acts that indicate issuance 
of such number under this title to such person would be 
detrimental to the best interests of the program or pro-
gram beneficiaries. Such acts may include— 
‘‘(A) any bankruptcy; 
‘‘(B) any act resulting in a civil judgment 
against such person; or 
‘‘(C) any felony conviction under Federal or 
State law. 
‘‘(c) IDENTIFICATION NUMBERS
FOR PROVIDERS 
AND SUPPLIERS.—The Secretary shall establish proce-
dures to ensure that each provider of services and each 
supplier that submits claims for reimbursement under this 
title to the Secretary is assigned a unique identification 
number.’’. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00098
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
(b) PERMISSIVE EXCLUSION.—Section 1128(b) of 
the Social Security Act (42 U.S.C. 1320a–7(b)) is amend-
ed by adding at the end the following: 
‘‘(16) FRAUD BY APPLICABLE PERSON.—An ap-
plicable person (as defined in section 1899A(a)(6)) 
that the Secretary determines knowingly submitted 
or caused to be submitted a claim for reimbursement 
under title XVIII that the applicable person knows 
or should know is false or fraudulent.’’. 
(c) REGULATIONS; EFFECTIVE DATE.— 
(1) REGULATIONS.—Not later than one year 
after the date of the enactment of this Act, the Sec-
retary of Health and Human Services shall promul-
gate such regulations as are necessary to implement 
the amendments made by subsections (a) and (b). 
(2) EFFECTIVE DATE.—The amendments made 
by subsections (a) and (b) shall apply to applicable 
persons and other entities on and after the first day 
of the first year beginning after the date of the en-
actment of this Act. 
SEC. 263. EXPANDED ACCESS TO THE HEALTHCARE INTEG-
RITY AND PROTECTION DATA BANK (HIPDB). 
(a) IN GENERAL.—Section 1128E(d)(1) of the Social 
Security Act (42 U.S.C. 1320a–7e(d)(1)) is amended to 
read as follows: 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00099
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
111 
‘‘(iv) any other item for which pay-
ment is made under this title that the Sec-
retary determines to be appropriate. 
‘‘(B) EXCLUSION.—The term ‘UPN cov-
ered item’ does not include a customized item 
for which payment is made under this title. 
‘‘(2) 
UNIVERSAL
PRODUCT
NUMBER.—The 
term ‘universal product number’ means a number 
that is— 
‘‘(A) affixed by the manufacturer to each 
individual UPN covered item that uniquely 
identifies the item at each packaging level; and 
‘‘(B) based on commercially acceptable 
identification standards such as, but not limited 
to, standards established by the Uniform Code 
Council-International Article Numbering Sys-
tem or the Health Industry Business Commu-
nication Council.’’. 
(3) DEVELOPMENT AND IMPLEMENTATION OF 
PROCEDURES.— 
(A) INFORMATION
INCLUDED
IN
UPN.— 
The Secretary of Health and Human Services, 
in consultation with manufacturers and entities 
with appropriate expertise, shall determine the 
relevant descriptive information appropriate for 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00111
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
112 
inclusion in a universal product number for a 
UPN covered item. 
(B) REVIEW OF PROCEDURE.—From the 
information obtained by the use of universal 
product numbers on claims for reimbursement 
under the Medicare program, the Secretary of 
Health and Human Services, in consultation 
with interested parties, shall periodically review 
the UPN covered items billed under the Health 
Care Financing Administration Common Proce-
dure Coding System and adjust such coding 
system to ensure that functionally equivalent 
UPN covered items are billed and reimbursed 
under the same codes. 
(4) EFFECTIVE DATE.—The amendment made 
by paragraph (2) shall apply to claims for reim-
bursement submitted on and after February 1, 
2011. 
(b) STUDY AND REPORTS TO CONGRESS.— 
(1) STUDY.—The Secretary of Health and 
Human Services shall conduct a study on the results 
of the implementation of the provisions in para-
graphs (1) and (3) of subsection (a) and the amend-
ment to the Social Security Act in paragraph (2) of 
such subsection. 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00112
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS
113 
(2) REPORTS.— 
(A) PROGRESS REPORT.—Not later than 
six months after the date of the enactment of 
this Act, the Secretary of Health and Human 
Services shall submit to Congress a report that 
contains a detailed description of the progress 
of the matters studied pursuant to paragraph 
(1). 
(B) IMPLEMENTATION.—Not later than 18 
months after the date of the enactment of this 
Act, and annually thereafter for three years, the 
Secretary of Health and Human Services shall 
submit to Congress a report that contains a de-
tailed description of the results of the study 
conducted pursuant to paragraph (1), together 
with the Secretary’s recommendations regard-
ing the use of universal product numbers and 
the use of data obtained from the use of such 
numbers. 
(c) DEFINITIONS.—In this section: 
(1) UPN COVERED
ITEM.—The term ‘‘UPN 
covered item’’ has the meaning given such term in 
section 1899B(b)(1) of the Social Security Act (as 
added by subsection (a)(2)). 
VerDate Nov 24 2008 
20:23 Nov 02, 2009
Jkt 089200
PO 00000
Frm 00113
Fmt 6652
Sfmt 6201
E:\BILLS\H3970.IH
H3970
sroberts on DSKD5P82C1PROD with BILLS