H. R. 1—348 
(A) IN GENERAL.—Subchapter B of chapter 65 of the 
Internal Revenue Code of 1986, as amended by this Act, 
is amended by adding at the end the following new section: 
‘‘SEC. 6432. COBRA PREMIUM ASSISTANCE. 
‘‘(a) IN GENERAL.—The person to whom premiums are payable 
under COBRA continuation coverage shall be reimbursed as pro-
vided in subsection (c) for the amount of premiums not paid by 
assistance eligible individuals by reason of section 3002(a) of the 
Health Insurance Assistance for the Unemployed Act of 2009. 
‘‘(b) PERSON ENTITLED TO REIMBURSEMENT.—For purposes of 
subsection (a), except as otherwise provided by the Secretary, the 
person to whom premiums are payable under COBRA continuation 
coverage shall be treated as being— 
‘‘(1) in the case of any group health plan which is a multi-
employer plan (as defined in section 3(37) of the Employee 
Retirement Income Security Act of 1974), the plan, 
‘‘(2) in the case of any group health plan not described 
in paragraph (1)— 
‘‘(A) which is subject to the COBRA continuation provi-
sions contained in— 
‘‘(i) the Internal Revenue Code of 1986, 
‘‘(ii) the Employee Retirement Income Security Act 
of 1974, 
‘‘(iii) the Public Health Service Act, or 
‘‘(iv) title 5, United States Code, or 
‘‘(B) under which some or all of the coverage is not 
provided by insurance, 
the employer maintaining the plan, and 
‘‘(3) in the case of any group health plan not described 
in paragraph (1) or (2), the insurer providing the coverage 
under the group health plan. 
‘‘(c) METHOD OF REIMBURSEMENT.—Except as otherwise pro-
vided by the Secretary— 
‘‘(1) TREATMENT AS PAYMENT OF PAYROLL TAXES.—Each per-
son entitled to reimbursement under subsection (a) (and filing 
a claim for such reimbursement at such time and in such 
manner as the Secretary may require) shall be treated for 
purposes of this title and section 1324(b)(2) of title 31, United 
States Code, as having paid to the Secretary, on the date 
that the assistance eligible individual’s premium payment is 
received, payroll taxes in an amount equal to the portion of 
such reimbursement which relates to such premium. To the 
extent that the amount treated as paid under the preceding 
sentence exceeds the amount of such person’s liability for such 
taxes, the Secretary shall credit or refund such excess in the 
same manner as if it were an overpayment of such taxes. 
‘‘(2) 
OVERSTATEMENTS.—Any 
overstatement 
of 
the 
reimbursement to which a person is entitled under this section 
(and any amount paid by the Secretary as a result of such 
overstatement) shall be treated as an underpayment of payroll 
taxes by such person and may be assessed and collected by 
the Secretary in the same manner as payroll taxes. 
‘‘(3) 
REIMBURSEMENT
CONTINGENT
ON
PAYMENT
OF 
REMAINING PREMIUM.—No reimbursement may be made under 
this section to a person with respect to any assistance eligible 
individual until after the reduced premium required under
H. R. 1—349 
section 3002(a)(1)(A) of such Act with respect to such individual 
has been received. 
‘‘(d) DEFINITIONS.—For purposes of this section— 
‘‘(1) PAYROLL
TAXES.—The term ‘payroll taxes’ means— 
‘‘(A) amounts required to be deducted and withheld 
for the payroll period under section 3402 (relating to wage 
withholding), 
‘‘(B) amounts required to be deducted for the payroll 
period under section 3102 (relating to FICA employee 
taxes), and 
‘‘(C) amounts of the taxes imposed for the payroll period 
under section 3111 (relating to FICA employer taxes). 
‘‘(2) PERSON.—The term ‘person’ includes any governmental 
entity. 
‘‘(e) REPORTING.—Each person entitled to reimbursement under 
subsection (a) for any period shall submit such reports (at such 
time and in such manner) as the Secretary may require, including— 
‘‘(1) an attestation of involuntary termination of employ-
ment for each covered employee on the basis of whose termi-
nation entitlement to reimbursement is claimed under sub-
section (a), 
‘‘(2) a report of the amount of payroll taxes offset under 
subsection (a) for the reporting period and the estimated offsets 
of such taxes for the subsequent reporting period in connection 
with reimbursements under subsection (a), and 
‘‘(3) a report containing the TINs of all covered employees, 
the amount of subsidy reimbursed with respect to each covered 
employee and qualified beneficiaries, and a designation with 
respect to each covered employee as to whether the subsidy 
reimbursement is for coverage of 1 individual or 2 or more 
individuals. 
‘‘(f) REGULATIONS.—The Secretary shall issue such regulations 
or other guidance as may be necessary or appropriate to carry 
out this section, including— 
‘‘(1) the requirement to report information or the establish-
ment of other methods for verifying the correct amounts of 
reimbursements under this section, and 
‘‘(2) the application of this section to group health plans 
that are multiemployer plans (as defined in section 3(37) of 
the Employee Retirement Income Security Act of 1974).’’. 
(B) SOCIAL SECURITY TRUST FUNDS HELD HARMLESS.— 
In determining any amount transferred or appropriated 
to any fund under the Social Security Act, section 6432 
of the Internal Revenue Code of 1986 shall not be taken 
into account. 
(C) CLERICAL AMENDMENT.—The table of sections for 
subchapter B of chapter 65 of the Internal Revenue Code 
of 1986 is amended by adding at the end the following 
new item: 
‘‘Sec. 6432. COBRA premium assistance.’’. 
(D) EFFECTIVE DATE.—The amendments made by this 
paragraph shall apply to premiums to which subsection 
(a)(1)(A) applies. 
(E) SPECIAL RULE.— 
(i) IN
GENERAL.—In the case of an assistance 
eligible individual who pays, with respect to the first
H. R. 1—350 
period of COBRA continuation coverage to which sub-
section (a)(1)(A) applies or the immediately subsequent 
period, the full premium amount for such coverage, 
the person to whom such payment is payable shall— 
(I) make a reimbursement payment to such 
individual for the amount of such premium paid 
in excess of the amount required to be paid under 
subsection (a)(1)(A); or 
(II) provide credit to the individual for such 
amount in a manner that reduces one or more 
subsequent premium payments that the individual 
is required to pay under such subsection for the 
coverage involved. 
(ii) REIMBURSING EMPLOYER.—A person to which 
clause (i) applies shall be reimbursed as provided for 
in section 6432 of the Internal Revenue Code of 1986 
for any payment made, or credit provided, to the 
employee under such clause. 
(iii) PAYMENT OR CREDITS.—Unless it is reasonable 
to believe that the credit for the excess payment in 
clause (i)(II) will be used by the assistance eligible 
individual within 180 days of the date on which the 
person receives from the individual the payment of 
the full premium amount, a person to which clause 
(i) applies shall make the payment required under 
such clause to the individual within 60 days of such 
payment of the full premium amount. If, as of any 
day within the 180-day period, it is no longer reason-
able to believe that the credit will be used during 
that period, payment equal to the remainder of the 
credit outstanding shall be made to the individual 
within 60 days of such day. 
(13) PENALTY FOR FAILURE TO NOTIFY HEALTH PLAN OF 
CESSATION OF ELIGIBILITY FOR PREMIUM ASSISTANCE.— 
(A) IN GENERAL.—Part I of subchapter B of chapter 
68 of the Internal Revenue Code of 1986 is amended by 
adding at the end the following new section: 
‘‘SEC. 6720C. PENALTY FOR FAILURE TO NOTIFY HEALTH PLAN OF 
CESSATION OF ELIGIBILITY FOR COBRA PREMIUM 
ASSISTANCE. 
‘‘(a) IN GENERAL.—Any person required to notify a group health 
plan under section 3002(a)(2)(C)) of the Health Insurance Assistance 
for the Unemployed Act of 2009 who fails to make such a notification 
at such time and in such manner as the Secretary of Labor may 
require shall pay a penalty of 110 percent of the premium reduction 
provided under such section after termination of eligibility under 
such subsection. 
‘‘(b) REASONABLE CAUSE EXCEPTION.—No penalty shall be 
imposed under subsection (a) with respect to any failure if it is 
shown that such failure is due to reasonable cause and not to 
willful neglect.’’.
H. R. 1—351 
(B) CLERICAL AMENDMENT.—The table of sections of 
part I of subchapter B of chapter 68 of such Code is 
amended by adding at the end the following new item: 
‘‘Sec. 6720C. Penalty for failure to notify health plan of cessation of eligibility for 
COBRA premium assistance.’’. 
(C) EFFECTIVE DATE.—The amendments made by this 
paragraph shall apply to failures occurring after the date 
of the enactment of this Act. 
(14) COORDINATION WITH HCTC.— 
(A) IN GENERAL.—Subsection (g) of section 35 of the 
Internal Revenue Code of 1986 is amended by redesignating 
paragraph (9) as paragraph (10) and inserting after para-
graph (8) the following new paragraph: 
‘‘(9) COBRA PREMIUM ASSISTANCE.—In the case of an assist-
ance eligible individual who receives premium reduction for 
COBRA continuation coverage under section 3002(a) of the 
Health Insurance Assistance for the Unemployed Act of 2009 
for any month during the taxable year, such individual shall 
not be treated as an eligible individual, a certified individual, 
or a qualifying family member for purposes of this section 
or section 7527 with respect to such month.’’. 
(B) EFFECTIVE
DATE.—The amendment made by 
subparagraph (A) shall apply to taxable years ending after 
the date of the enactment of this Act. 
(15) EXCLUSION OF COBRA PREMIUM ASSISTANCE FROM GROSS 
INCOME.— 
(A) IN GENERAL.—Part III of subchapter B of chapter 
1 of the Internal Revenue Code of 1986 is amended by 
inserting after section 139B the following new section: 
‘‘SEC. 139C. COBRA PREMIUM ASSISTANCE. 
‘‘In the case of an assistance eligible individual (as defined 
in section 3002 of the Health Insurance Assistance for the 
Unemployed Act of 2009), gross income does not include any pre-
mium reduction provided under subsection (a) of such section.’’. 
(B) CLERICAL AMENDMENT.—The table of sections for 
part III of subchapter B of chapter 1 of such Code is 
amended by inserting after the item relating to section 
139B the following new item: 
‘‘Sec. 139C. COBRA premium assistance.’’. 
(C) EFFECTIVE DATE.—The amendments made by this 
paragraph shall apply to taxable years ending after the 
date of the enactment of this Act. 
(b) ELIMINATION
OF
PREMIUM
SUBSIDY
FOR
HIGH-INCOME 
INDIVIDUALS.— 
(1) RECAPTURE
OF
SUBSIDY
FOR
HIGH-INCOME
INDIVID-
UALS.—If— 
(A) premium assistance is provided under this section 
with respect to any COBRA continuation coverage which 
covers the taxpayer, the taxpayer’s spouse, or any 
dependent (within the meaning of section 152 of the 
Internal Revenue Code of 1986, determined without regard 
to subsections (b)(1), (b)(2), and (d)(1)(B) thereof) of the 
taxpayer during any portion of the taxable year, and 
(B) the taxpayer’s modified adjusted gross income for 
such taxable year exceeds $125,000 ($250,000 in the case 
of a joint return),
H. R. 1—352 
then the tax imposed by chapter 1 of such Code with respect 
to the taxpayer for such taxable year shall be increased by 
the amount of such assistance. 
(2) PHASE-IN OF RECAPTURE.— 
(A) IN
GENERAL.—In the case of a taxpayer whose 
modified adjusted gross income for the taxable year does 
not exceed $145,000 ($290,000 in the case of a joint return), 
the increase in the tax imposed under paragraph (1) shall 
not exceed the phase-in percentage of such increase (deter-
mined without regard to this paragraph). 
(B) PHASE-IN PERCENTAGE.—For purposes of this sub-
section, the term ‘‘phase-in percentage’’ means the ratio 
(expressed as a percentage) obtained by dividing— 
(i) the excess of described in subparagraph (B) 
of paragraph (1), by 
(ii) $20,000 ($40,000 in the case of a joint return). 
(3) OPTION FOR HIGH-INCOME INDIVIDUALS TO WAIVE ASSIST-
ANCE
AND
AVOID
RECAPTURE.—Notwithstanding subsection 
(a)(3), an individual shall not be treated as an assistance 
eligible individual for purposes of this section and section 6432 
of the Internal Revenue Code of 1986 if such individual— 
(A) makes a permanent election (at such time and 
in such form and manner as the Secretary of the Treasury 
may prescribe) to waive the right to the premium assistance 
provided under this section, and 
(B) notifies the entity to whom premiums are 
reimbursed under section 6432(a) of such Code of such 
election. 
(4) MODIFIED ADJUSTED GROSS INCOME.—For purposes of 
this subsection, the term ‘‘modified adjusted gross income’’ 
means the adjusted gross income (as defined in section 62 
of the Internal Revenue Code of 1986) of the taxpayer for 
the taxable year increased by any amount excluded from gross 
income under section 911, 931, or 933 of such Code. 
(5) CREDITS NOT ALLOWED AGAINST TAX, ETC.—For purposes 
determining regular tax liability under section 26(b) of such 
Code, the increase in tax under this subsection shall not be 
treated as a tax imposed under chapter 1 of such Code. 
(6) REGULATIONS.—The Secretary of the Treasury shall 
issue such regulations or other guidance as are necessary or 
appropriate to carry out this subsection, including requirements 
that the entity to whom premiums are reimbursed under section 
6432(a) of the Internal Revenue Code of 1986 report to the 
Secretary, and to each assistance eligible individual, the 
amount of premium assistance provided under subsection (a) 
with respect to each such individual. 
(7) EFFECTIVE
DATE.—The provisions of this subsection 
shall apply to taxable years ending after the date of the enact-
ment of this Act.
H. R. 1—355 
‘‘(ii) HOSPITAL-BASED ELIGIBLE PROFESSIONAL.—For 
purposes of clause (i), the term ‘hospital-based eligible 
professional’ means, with respect to covered profes-
sional services furnished by an eligible professional 
during the EHR reporting period for a payment year, 
an eligible professional, such as a pathologist, anesthe-
siologist, or emergency physician, who furnishes 
substantially all of such services in a hospital setting 
(whether inpatient or outpatient) and through the use 
of the facilities and equipment, including qualified elec-
tronic health records, of the hospital. The determina-
tion of whether an eligible professional is a hospital- 
based eligible professional shall be made on the basis 
of the site of service (as defined by the Secretary) 
and without regard to any employment or billing 
arrangement between the eligible professional and any 
other provider. 
‘‘(D) PAYMENT.— 
‘‘(i) FORM OF PAYMENT.—The payment under this 
paragraph may be in the form of a single consolidated 
payment or in the form of such periodic installments 
as the Secretary may specify. 
‘‘(ii) COORDINATION OF APPLICATION OF LIMITATION 
FOR PROFESSIONALS IN DIFFERENT PRACTICES.—In the 
case of an eligible professional furnishing covered 
professional services in more than one practice (as 
specified by the Secretary), the Secretary shall estab-
lish rules to coordinate the incentive payments, 
including the application of the limitation on amounts 
of such incentive payments under this paragraph, 
among such practices. 
‘‘(iii) COORDINATION
WITH
MEDICAID.—The Sec-
retary shall seek, to the maximum extent practicable, 
to avoid duplicative requirements from Federal and 
State governments to demonstrate meaningful use of 
certified EHR technology under this title and title XIX. 
The Secretary may also adjust the reporting periods 
under such title and such subsections in order to carry 
out this clause. 
‘‘(E) PAYMENT YEAR DEFINED.— 
‘‘(i) IN GENERAL.—For purposes of this subsection, 
the term ‘payment year’ means a year beginning with 
2011. 
‘‘(ii) FIRST, SECOND, ETC. PAYMENT
YEAR.—The 
term ‘first payment year’ means, with respect to cov-
ered professional services furnished by an eligible 
professional, the first year for which an incentive pay-
ment is made for such services under this subsection. 
The terms ‘second payment year’, ‘third payment year’, 
‘fourth payment year’, and ‘fifth payment year’ mean, 
with respect to covered professional services furnished 
by such eligible professional, each successive year 
immediately following the first payment year for such 
professional. 
‘‘(2) MEANINGFUL EHR USER.— 
‘‘(A) IN GENERAL.—For purposes of paragraph (1), an 
eligible professional shall be treated as a meaningful EHR
H. R. 1—356 
user for an EHR reporting period for a payment year 
(or, for purposes of subsection (a)(7), for an EHR reporting 
period under such subsection for a year) if each of the 
following requirements is met: 
‘‘(i) MEANINGFUL
USE
OF
CERTIFIED
EHR
TECH-
NOLOGY.—The eligible professional demonstrates to the 
satisfaction of the Secretary, in accordance with 
subparagraph (C)(i), that during such period the profes-
sional is using certified EHR technology in a meaning-
ful manner, which shall include the use of electronic 
prescribing as determined to be appropriate by the 
Secretary. 
‘‘(ii) INFORMATION EXCHANGE.—The eligible profes-
sional demonstrates to the satisfaction of the Secretary, 
in accordance with subparagraph (C)(i), that during 
such period such certified EHR technology is connected 
in a manner that provides, in accordance with law 
and standards applicable to the exchange of informa-
tion, for the electronic exchange of health information 
to improve the quality of health care, such as pro-
moting care coordination. 
‘‘(iii) REPORTING ON MEASURES USING EHR.—Sub-
ject to subparagraph (B)(ii) and using such certified 
EHR technology, the eligible professional submits 
information for such period, in a form and manner 
specified by the Secretary, on such clinical quality 
measures and such other measures as selected by the 
Secretary under subparagraph (B)(i). 
The Secretary may provide for the use of alternative means 
for meeting the requirements of clauses (i), (ii), and (iii) 
in the case of an eligible professional furnishing covered 
professional services in a group practice (as defined by 
the Secretary). The Secretary shall seek to improve the 
use of electronic health records and health care quality 
over time by requiring more stringent measures of mean-
ingful use selected under this paragraph. 
‘‘(B) REPORTING ON MEASURES.— 
‘‘(i) SELECTION.—The Secretary shall select meas-
ures for purposes of subparagraph (A)(iii) but only 
consistent with the following: 
‘‘(I) The Secretary shall provide preference to 
clinical quality measures that have been endorsed 
by the entity with a contract with the Secretary 
under section 1890(a). 
‘‘(II) Prior to any measure being selected under 
this subparagraph, the Secretary shall publish in 
the Federal Register such measure and provide 
for a period of public comment on such measure. 
‘‘(ii) LIMITATION.—The Secretary may not require 
the electronic reporting of information on clinical 
quality measures under subparagraph (A)(iii) unless 
the Secretary has the capacity to accept the informa-
tion electronically, which may be on a pilot basis. 
‘‘(iii) COORDINATION
OF
REPORTING
OF
INFORMA-
TION.—In selecting such measures, and in establishing 
the form and manner for reporting measures under 
subparagraph (A)(iii), the Secretary shall seek to avoid
H. R. 1—357 
redundant or duplicative reporting otherwise required, 
including reporting under subsection (k)(2)(C). 
‘‘(C) DEMONSTRATION OF MEANINGFUL USE OF CERTIFIED 
EHR TECHNOLOGY AND INFORMATION EXCHANGE.— 
‘‘(i) IN GENERAL.—A professional may satisfy the 
demonstration requirement of clauses (i) and (ii) of 
subparagraph (A) through means specified by the Sec-
retary, which may include— 
‘‘(I) an attestation; 
‘‘(II) the submission of claims with appropriate 
coding (such as a code indicating that a patient 
encounter was documented using certified EHR 
technology); 
‘‘(III) a survey response; 
‘‘(IV) reporting under subparagraph (A)(iii); 
and 
‘‘(V) other means specified by the Secretary. 
‘‘(ii) USE OF PART D DATA.—Notwithstanding sec-
tions 1860D–15(d)(2)(B) and 1860D–15(f)(2), the Sec-
retary may use data regarding drug claims submitted 
for purposes of section 1860D–15 that are necessary 
for purposes of subparagraph (A). 
‘‘(3) APPLICATION.— 
‘‘(A) PHYSICIAN REPORTING SYSTEM RULES.—Paragraphs 
(5), (6), and (8) of subsection (k) shall apply for purposes 
of this subsection in the same manner as they apply for 
purposes of such subsection. 
‘‘(B) COORDINATION WITH OTHER PAYMENTS.—The provi-
sions of this subsection shall not be taken into account 
in applying the provisions of subsection (m) of this section 
and of section 1833(m) and any payment under such provi-
sions shall not be taken into account in computing allow-
able charges under this subsection. 
‘‘(C) LIMITATIONS
ON
REVIEW.—There shall be no 
administrative or judicial review under section 1869, sec-
tion 1878, or otherwise, of— 
‘‘(i) the methodology and standards for determining 
payment amounts under this subsection and payment 
adjustments under subsection (a)(7)(A), including the 
limitation under paragraph (1)(B) and coordination 
under clauses (ii) and (iii) of paragraph (1)(D); 
‘‘(ii) the methodology and standards for deter-
mining a meaningful EHR user under paragraph (2), 
including selection of measures under paragraph (2)(B), 
specification of the means of demonstrating meaningful 
EHR use under paragraph (2)(C), and the hardship 
exception under subsection (a)(7)(B); 
‘‘(iii) the methodology and standards for deter-
mining a hospital-based eligible professional under 
paragraph (1)(C); and 
‘‘(iv) the specification of reporting periods under 
paragraph (5) and the selection of the form of payment 
under paragraph (1)(D)(i). 
‘‘(D) POSTING ON WEBSITE.—The Secretary shall post 
on the Internet website of the Centers for Medicare & 
Medicaid Services, in an easily understandable format, a 
list of the names, business addresses, and business phone
H. R. 1—358 
numbers of the eligible professionals who are meaningful 
EHR users and, as determined appropriate by the Sec-
retary, of group practices receiving incentive payments 
under paragraph (1). 
‘‘(4) CERTIFIED EHR TECHNOLOGY DEFINED.—For purposes 
of this section, the term ‘certified EHR technology’ means a 
qualified electronic health record (as defined in section 3000(13) 
of the Public Health Service Act) that is certified pursuant 
to section 3001(c)(5) of such Act as meeting standards adopted 
under section 3004 of such Act that are applicable to the 
type of record involved (as determined by the Secretary, such 
as an ambulatory electronic health record for office-based physi-
cians or an inpatient hospital electronic health record for hos-
pitals). 
‘‘(5) DEFINITIONS.—For purposes of this subsection: 
‘‘(A) COVERED PROFESSIONAL SERVICES.—The term ‘cov-
ered professional services’ has the meaning given such 
term in subsection (k)(3). 
‘‘(B) 
EHR 
REPORTING
PERIOD.—The 
term 
‘EHR 
reporting period’ means, with respect to a payment year, 
any period (or periods) as specified by the Secretary. 
‘‘(C) 
ELIGIBLE
PROFESSIONAL.—The 
term 
‘eligible 
professional’ means a physician, as defined in section 
1861(r).’’. 
(b) INCENTIVE PAYMENT ADJUSTMENT.—Section 1848(a) of the 
Social Security Act (42 U.S.C. 1395w–4(a)) is amended by adding 
at the end the following new paragraph: 
‘‘(7) INCENTIVES FOR MEANINGFUL USE OF CERTIFIED EHR 
TECHNOLOGY.— 
‘‘(A) ADJUSTMENT.— 
‘‘(i) IN
GENERAL.—Subject to subparagraphs (B) 
and (D), with respect to covered professional services 
furnished by an eligible professional during 2015 or 
any subsequent payment year, if the eligible profes-
sional is not a meaningful EHR user (as determined 
under subsection (o)(2)) for an EHR reporting period 
for the year, the fee schedule amount for such services 
furnished by such professional during the year 
(including the fee schedule amount for purposes of 
determining a payment based on such amount) shall 
be equal to the applicable percent of the fee schedule 
amount that would otherwise apply to such services 
under this subsection (determined after application of 
paragraph (3) but without regard to this paragraph). 
‘‘(ii) APPLICABLE PERCENT.—Subject to clause (iii), 
for purposes of clause (i), the term ‘applicable percent’ 
means— 
‘‘(I) for 2015, 99 percent (or, in the case of 
an eligible professional who was subject to the 
application of the payment adjustment under sec-
tion 1848(a)(5) for 2014, 98 percent); 
‘‘(II) for 2016, 98 percent; and 
‘‘(III) for 2017 and each subsequent year, 97 
percent. 
‘‘(iii) 
AUTHORITY
TO
DECREASE
APPLICABLE 
PERCENTAGE FOR 2018 AND SUBSEQUENT YEARS.—For 
2018 and each subsequent year, if the Secretary finds