SEC. 2. INCREASED MATCHING PAYMENTS UNDER MED-
ICAID FOR HEALTH INFORMATION TECH-
NOLOGY. 
Section 1903 of the Social Security Act (42 U.S.C. 
1396b) is amended— 
(1) in subsection (a)(3)(E), by inserting ‘‘(other 
than costs attributable to programs described in sub-
section (bb))’’ after ‘‘costs incurred during such 
quarter’’; and 
(2) by adding at the end the following new sub-
sections: 
‘‘(aa) 
ENHANCED
PAYMENTS
FOR
CERTIFIED 
HEALTH INFORMATION TECHNOLOGY INCENTIVES.— 
‘‘(1) IN GENERAL.—The Secretary shall provide 
for payments to each State that provides incentive 
payments to physicians, hospitals, community health 
centers, rural health clinics, and community mental 
health centers that exhibit meaningful use of health 
information technology certified under this sub-
section, as determined by the measures for meaning-
ful use of health information technology under para-
graph (5). No payment may be made to a State for 
incentive payments made by a State for meaningful 
use of health information technology that occurs be-
fore January 1, 2010. 
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‘‘(2) APPLICATION.—To qualify for payments 
under paragraph (1), a State shall submit an appli-
cation in a time and manner specified by the Sec-
retary and containing the following: 
‘‘(A) A description of the incentive pay-
ments. 
‘‘(B) A description of the method the State 
will use to allocate such incentive payments 
among physicians, hospitals, community health 
centers, rural health clinics, and community 
mental health centers, including how the State 
will prioritize payments to providers serving a 
high percentage of Medicaid, SCHIP, and unin-
sured patients. 
‘‘(C) A time line for implementing such 
payment incentives. 
‘‘(D) A plan for disseminating information 
to physicians, hospitals, community health cen-
ters, rural health clinics, and community mental 
health centers about the availability of such 
payment incentives. 
‘‘(E) An assessment of the current level of 
use of health information technology by physi-
cians, hospitals, community health centers, 
rural health clinics, and community mental 
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health centers in the State, using a standard 
assessment form developed by the Secretary. 
‘‘(F) Any other information required by 
the Secretary. 
‘‘(3) AMOUNT OF PAYMENTS TO STATES.— 
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), the payment made to a State under 
this subsection for a quarter, with respect to 
sums expended by such State during such quar-
ter that are attributable to providing incentive 
payments under paragraph (1), shall be in an 
amount equal to the following: 
‘‘(i) For any quarter in 2010, the en-
hanced FMAP (as defined in section 
2105(b)) of such sums. 
‘‘(ii) For any quarter in 2011 or 
2012, such sums multiplied by a percent-
age equal to such enhanced FMAP minus 
1.5 percentage points. 
‘‘(iii) For any quarter in 2013 or 
2014, such sums multiplied by a percent-
age equal to such enhanced FMAP minus 
3 percentage points. 
‘‘(iv) For any quarter beginning after 
2014, 0. 
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‘‘(B) LIMITATION.— 
‘‘(i) FISCAL YEAR LIMITATION.—The 
total amount of payments made under this 
subsection shall not exceed $500,000,000 
for any fiscal year. 
‘‘(ii) ALLOCATION.—If the amounts 
otherwise payable under this subsection for 
a fiscal year exceed the amount specified in 
clause (i), the Secretary shall reduce the 
amounts payable under this subsection, in 
a manner specified by the Secretary, to 
comply with the limitation under such 
clause. 
‘‘(iii) DUPLICATIVE
PAYMENTS
PRO-
HIBITED.—No payment shall be made 
under any other provision of this title for 
expenditures for which payment is made 
under this subsection. 
‘‘(C) MANNER OF PAYMENT.—Payment to 
a State under this subsection shall be made in 
the same manner as payments under subsection 
(a). 
‘‘(4) 
CERTIFICATION
REQUIREMENTS
FOR 
HEALTH INFORMATION TECHNOLOGY.— 
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‘‘(A) IN GENERAL.—The Secretary, in con-
sultation with the Office of the National Coor-
dinator for Health Information Technology and 
the Certification Commission of Health Infor-
mation Technology, shall determine the require-
ments for certification of health information 
technology under this subsection. 
‘‘(B) INTERIM
CERTIFICATION
REQUIRE-
MENTS.—During any period in which the Sec-
retary has not determined such certification re-
quirements, the Secretary, for purposes of this 
subsection, shall use the certification require-
ments for health information technology estab-
lished by the Certification Commission for 
Health Information Technology. 
‘‘(5) MEASURES
FOR
MEANINGFUL
USE
OF 
HEALTH INFORMATION TECHNOLOGY.— 
‘‘(A) IN GENERAL.—For purposes of this 
subsection, the Secretary shall publish standard 
measures of meaningful use of health informa-
tion technology to be used by providers to dem-
onstrate meaningful use of certified health in-
formation technology. Such measures may in-
clude— 
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‘‘(i) self-certification of operational 
use of such technology; 
‘‘(ii) the submission of (or ability to 
submit), in a form and manner specified 
by the Secretary, such information on clin-
ical measures and data (that do not in-
clude individually identifiable health infor-
mation) from such technology as indicates 
a meaningful utilization of such tech-
nology; and 
‘‘(iii) such other means as the Sec-
retary may specify. 
‘‘(B) ALTERNATIVE MEASURES.—The Sec-
retary may establish and apply different meas-
ures based on the stage of implementation or 
adoption of the certified health information 
technology involved. 
‘‘(bb) PAYMENTS FOR ELECTRONIC INFORMATION 
AND ELIGIBILITY SYSTEMS AND PATIENT REGISTRIES.— 
‘‘(1) IN
GENERAL.—In addition to the pay-
ments provided under subsection (a), the Secretary 
shall provide for payments to each State that estab-
lishes a program to— 
‘‘(A) design, develop, install, maintain, and 
operate— 
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‘‘(i) electronic information and eligi-
bility systems; and 
‘‘(ii) patient registries for the purpose 
of disease screening; 
‘‘(B) coordinate benefits and services 
under this title and under title XVIII for indi-
viduals under the State plan who are full-ben-
efit dual eligible individuals. 
‘‘(C) train providers in the use of such sys-
tems and registries. 
‘‘(2) APPLICATION.—To qualify for payments 
under paragraph (1), a State shall submit an appli-
cation in such time and manner as required by the 
Secretary and containing such information as the 
Secretary specifies and include, at a minimum, a de-
scription of the electronic information and eligibility 
systems and patient registries covered by the pro-
gram described in paragraph (1). 
‘‘(3) AMOUNT OF PAYMENTS TO STATES.— 
‘‘(A) IN GENERAL.—The payments made a 
State under this subsection shall be an amount 
equal to— 
‘‘(i) 90 percent of so much of the 
sums expended by such State during any 
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the same manner as payments under subsection 
(a). 
‘‘(4) ELECTRONIC
INFORMATION
AND
ELIGI-
BILITY
SYSTEM
DEFINED.—For purposes of this 
subsection, the term ‘electronic information and eli-
gibility system’ means a system for determining eli-
gibility and exchanging information that meets such 
requirements as the Secretary shall specify. Such re-
quirements for a system shall include a requirement 
that the system— 
‘‘(A) be interconnected and interoperable 
with other electronic systems and registries, in-
cluding— 
‘‘(i) systems administered by the Cen-
ters for Disease Control for disease report-
ing purposes; 
‘‘(ii) systems that exist for the pur-
pose of determining eligibility for the Medi-
care program under title XVIII; and 
‘‘(iii) systems that exist for the pur-
pose of determining eligibility for the Tem-
porary Assistance for Needy Families pro-
gram under title IV, free and reduced price 
lunches under the Richard B. Russell Na-
tional School Lunch Act (42 U.S.C. 1751 
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et seq.), or other federally funded pro-
grams targeted to low-income populations; 
and 
‘‘(B) can be used to automatically send, re-
ceive, and integrate data (including laboratory 
results and medical histories) from systems and 
registries administered by other providers or or-
ganizations or through a health information ex-
change.’’. 
SEC. 3. MEDICAID TRANSFORMATION PAYMENTS REPORT. 
(a) IN GENERAL.—Not later than June 30, 2009, the 
Secretary of Health and Human Services shall submit to 
Congress a report on Medicaid transformation payments 
under section 1903(z) of the Social Security Act (42 
U.S.C. 1396b(z)). 
(b) CONTENTS.—The report under subsection (a) 
shall include— 
(1) a description— 
(A) of the financial costs and benefits of 
the Medicaid transformation payments; 
(B) of the entities to which such costs and 
benefits accrue; and 
(C) of any reduction in duplicative or un-
necessary care resulting from methods adopted 
by States and funded by such payments; and 
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(2) an analysis of the information contained in 
the reports submitted to the Secretary by States 
under section 1903(z)(3)(C) of the Social Security 
Act during the two-year period ending on December 
31, 2008, including— 
(A) the impact of the methods funded by 
the payments on— 
(i) health care quality and safety; and 
(ii) the privacy and security of identi-
fiable health information; 
(B) the effect of such methods on fur-
thering interconnectedness between— 
(i) providers and State Medicaid pro-
grams; and 
(ii) State Medicaid programs and 
other programs for low-income populations 
administered by State and Federal entities; 
(C) the extent to which such methods re-
duce the administrative burden on such pro-
grams; and 
(D) the contribution of the payments to 
the goals of public health and public health re-
porting. 
Æ 
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