TITLE III—VOLUNTARY REPORT-
ING OF MEDICAL SAFETY IN-
CIDENTS 
Subtitle A—Reporting by Individ-
uals Involved in the Provision 
of Health Care 
SEC. 301. AMENDMENTS TO PUBLIC HEALTH SERVICE ACT. 
(a) IN GENERAL.—Title IX of the Public Health 
Service Act (42 U.S.C. 299 et seq.) is amended— 
(1) in section 912(c), by inserting ‘‘, in accord-
ance with part C,’’ after ‘‘The Director shall’’; 
(2) by redesignating part C as part D; 
(3) by redesignating sections 921 through 928, 
as sections 931 through 938, respectively; 
(4) in section 938(1) (as so redesignated), by 
striking ‘‘921’’ and inserting ‘‘931’’; and 
(5) by inserting after part B the following: 
‘‘PART C—PATIENT SAFETY IMPROVEMENT 
‘‘SEC. 921. DEFINITIONS. 
‘‘In this part: 
‘‘(1) IDENTIFIABLE INFORMATION.—The term 
‘identifiable information’ means information that is 
presented in a form and manner that allows the 
identification of any provider, patient, or reporter of 
patient safety work product. With respect to pa-
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tients, such information includes any individually 
identifiable health information as that term is de-
fined in the regulations promulgated pursuant to 
section 264(c) of the Health Insurance Portability 
and Accountability Act of 1996 (Public Law 104– 
191; 110 Stat. 2033). 
‘‘(2) NONIDENTIFIABLE
INFORMATION.—The 
term ‘nonidentifiable information’ means informa-
tion that is presented in a form and manner that 
prevents the identification of any provider, patient, 
or reporter of patient safety work product. With re-
spect to patients, such information must be de-iden-
tified consistent with the regulations promulgated 
pursuant to section 264(c) of the Health Insurance 
Portability and Accountability Act of 1996 (Public 
Law 104–191; 110 Stat. 2033). 
‘‘(3) PATIENT SAFETY EVALUATION SYSTEM.— 
The term ‘patient safety evaluation system’ means a 
process that involves the collection, management, or 
analysis of information for submission to or by a pa-
tient safety organization. 
‘‘(4) PATIENT
SAFETY
ORGANIZATION.—The 
term ‘patient safety organization’ means a private or 
public organization or component thereof that is cer-
tified, through a process to be determined by the 
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Secretary under section 925, to perform each of the 
following activities: 
‘‘(A) The conduct, as the organization or 
component’s primary activity, of efforts to im-
prove patient safety and the quality of health 
care delivery. 
‘‘(B) The collection and analysis of patient 
safety work product that is submitted by pro-
viders. 
‘‘(C) The development and dissemination 
of evidence-based information to providers with 
respect to improving patient safety, such as rec-
ommendations, protocols, or information re-
garding best practices. 
‘‘(D) The utilization of patient safety work 
product to carry out activities limited to those 
described under this paragraph and for the pur-
poses of encouraging a culture of safety and of 
providing direct feedback and assistance to pro-
viders to effectively minimize patient risk. 
‘‘(E) The maintenance of confidentiality 
with respect to identifiable information. 
‘‘(F) The provision of appropriate security 
measures with respect to patient safety work 
product. 
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‘‘(G) The submission of nonidentifiable in-
formation to the Agency consistent with stand-
ards established by the Secretary under section 
923(b) for any National Patient Safety Data-
base. 
‘‘(5) PATIENT SAFETY WORK PRODUCT.— 
‘‘(A) The term ‘patient safety work prod-
uct’ means any document or communication 
(including any information, report, record, 
memorandum, analysis, deliberative work, state-
ment, or root cause analysis) that— 
‘‘(i) except as provided in subpara-
graph (B), is developed by a provider for 
the purpose of reporting to a patient safety 
organization, and is reported to a patient 
safety organization; 
‘‘(ii) is created by a patient safety or-
ganization; or 
‘‘(iii) would reveal the deliberations or 
analytic process of a patient safety evalua-
tion system (as defined in paragraph (3)). 
‘‘(B)(i) Patient safety work product de-
scribed in subparagraph (A)(i)— 
‘‘(I) does not include any separate in-
formation described in clause (ii); and 
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‘‘(II) shall not be construed to include 
such separate information merely by rea-
son of inclusion of a copy of the document 
or communication involved in a submission 
to, or the fact of submission of such a copy 
to, a patient safety organization. 
‘‘(ii) Separate information described in this 
clause is a document or communication (includ-
ing a patient’s medical record or any other pa-
tient or hospital record) that is developed or 
maintained, or exists, separately from any pa-
tient safety evaluation system. 
‘‘(C) Information available from sources 
other than a patient safety work product under 
this section may be discovered or admitted in a 
civil or administrative proceeding, if discover-
able or admissible under applicable law. 
‘‘(6) PROVIDER.—The term ‘provider’ means— 
‘‘(A) an individual or entity licensed or 
otherwise authorized under State law to provide 
health care services, including— 
‘‘(i) a hospital, nursing facility, com-
prehensive outpatient rehabilitation facil-
ity, home health agency, and hospice pro-
gram; 
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‘‘(ii) a physician, physician assistant, 
nurse practitioner, clinical nurse specialist, 
certified nurse midwife, nurse anesthetist, 
psychologist, certified social worker, reg-
istered dietitian or nutrition professional, 
physical or occupational therapist, or other 
individual health care practitioner; 
‘‘(iii) a pharmacist; and 
‘‘(iv) a renal dialysis facility, ambula-
tory surgical center, pharmacy, physician 
or health care practitioner’s office, long- 
term care facility, behavioral health resi-
dential treatment facility, clinical labora-
tory, or community health center; or 
‘‘(B) any other person or entity specified 
in regulations by the Secretary after public no-
tice and comment. 
‘‘SEC. 922. PRIVILEGE FOR PATIENT SAFETY WORK PROD-
UCT. 
‘‘(a) PRIVILEGE.—Notwithstanding any other provi-
sion of law and subject to subsection (c), patient safety 
work product shall not be— 
‘‘(1) subject to a civil or administrative sub-
poena or order; 
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‘‘(A) to the provider with the intention of 
having the information reported to a patient 
safety organization; or 
‘‘(B) directly to a patient safety organiza-
tion. 
‘‘(2) ADVERSE
EMPLOYMENT
ACTION.—For 
purposes of this subsection, an ‘adverse employment 
action’ includes— 
‘‘(A) the failure to promote an individual 
or provide any other employment-related benefit 
for which the individual would otherwise be eli-
gible; 
‘‘(B) an adverse evaluation or decision 
made in relation to accreditation, certification, 
credentialing, or licensing of the individual; and 
‘‘(C) a personnel action that is adverse to 
the individual concerned. 
‘‘(3) REMEDIES.—Any provider that violates 
this subsection shall be subject to a civil monetary 
penalty of not more than $20,000 for each such vio-
lation involved. Such penalty shall be imposed and 
collected in the same manner as civil money pen-
alties under subsection (a) of section 1128A of the 
Social Security Act are imposed and collected. 
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‘‘(c) DISCLOSURES.—Nothing in this section pro-
hibits any of the following disclosures: 
‘‘(1) Voluntary disclosure of nonidentifiable in-
formation. 
‘‘(2) Voluntary disclosure of identifiable infor-
mation by a provider or patient safety organization, 
if such disclosure— 
‘‘(A) is authorized by the provider for the 
purposes of improving quality and safety; 
‘‘(B) is to an entity or person subject to 
the requirements of section 264(c) of the 
Health Insurance Portability and Accountability 
Act of 1996 (Public Law 104–191; 110 Stat. 
2033), or any regulation promulgated under 
such section; and 
‘‘(C) is not in conflict with such section or 
any regulation promulgated under such section. 
‘‘(3) Disclosure as required by law by a pro-
vider to the Food and Drug Administration, or on 
a voluntary basis by a provider to a federally estab-
lished patient safety program, with respect to an Ad-
ministration-regulated product or activity for which 
that entity has responsibility, for the purposes of ac-
tivities related to the quality, safety, or effectiveness 
of such Administration-regulated product or activity. 
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‘‘(4) Disclosures of patient safety work product 
in accordance with this part by a provider to a pa-
tient safety organization. 
‘‘(d) EFFECT OF TRANSFER, DISCLOSURE.—The fol-
lowing shall not be treated as a waiver of any privilege 
or protection established under this part: 
‘‘(1) The transfer of any patient safety work 
product between a provider and a patient safety or-
ganization. 
‘‘(2) Disclosure of patient safety work product 
as described in subsection (c). 
‘‘(3) The unauthorized disclosure of patient 
safety work product. 
‘‘(e) PENALTY.— 
‘‘(1) PROHIBITION.—Except as provided in this 
part, and subject to paragraphs (2) and (4), it shall 
be unlawful for any person to disclose patient safety 
work product in violation of this section, if such dis-
closure constitutes a negligent or knowing breach of 
confidentiality. 
‘‘(2) RELATION TO HIPAA.—The penalty under 
paragraph (3) for a disclosure in violation of para-
graph (1) does not apply if the person would be sub-
ject to a penalty under section 264(c) of the Health 
Insurance Portability and Accountability Act of 
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1996 (Public Law 104–191; 110 Stat. 2033), or any 
regulation promulgated under such section, for the 
same disclosure. 
‘‘(3) AMOUNT.—Any person who violates para-
graph (1) shall be subject to a civil monetary penalty 
of not more than $10,000 for each such violation in-
volved. Such penalty shall be imposed and collected 
in the same manner as civil money penalties under 
subsection (a) of section 1128A of the Social Secu-
rity Act are imposed and collected. 
‘‘(4) SUBSEQUENT
DISCLOSURE.—Paragraph 
(1) applies only to the first person that breaches 
confidentiality with respect to particular patient 
safety work product. 
‘‘(f) RELATION TO HIPAA.— 
‘‘(1) IN GENERAL.—For purposes of applying 
the regulations promulgated pursuant to section 
264(c) of the Health Insurance Portability and Ac-
countability Act of 1996 (Public Law 104–191; 110 
Stat. 2033)— 
‘‘(A) patient safety organizations shall be 
treated as business associates; and 
‘‘(B) activities of such organizations de-
scribed in section 921(4) in relation to a pro-
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vider are deemed to be health care operations 
(as defined in such regulations) of the provider. 
‘‘(2) RULE
OF
CONSTRUCTION.—Nothing in 
this section shall be construed to alter or affect the 
implementation of such regulations or such section 
264(c). 
‘‘(g) NO LIMITATION
OF OTHER PRIVILEGES.— 
Nothing in this section shall be construed to affect privi-
leges, including peer review and confidentiality protec-
tions, that are otherwise available under Federal or State 
laws. 
‘‘(h) NO LIMITATION ON CONTRACTS.—Nothing in 
this section shall be construed to limit the power of a pro-
vider and a patient safety organization, or a patient safety 
organization and the Agency or any National Patient 
Safety Database, consistent with the provisions of this Act 
and other applicable law, to enter into a contract requiring 
greater confidentiality or delegating authority to make an 
authorized disclosure. 
‘‘(i) RELATION
TO STATE REPORTING REQUIRE-
MENTS.—Nothing in this part shall be construed as pre-
empting or otherwise affecting any State law requiring a 
provider to report information, including information de-
scribed in section 921(5)(B), that is not patient safety 
work product. 
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‘‘(j) CONTINUATION OF PRIVILEGE.—Patient safety 
work product of an organization that is certified as a pa-
tient safety organization shall continue to be privileged 
and confidential, in accordance with this section, if the or-
ganization’s certification is terminated or revoked or if the 
organization otherwise ceases to qualify as a patient safety 
organization. 
‘‘(k) REPORTS ON STRATEGIES TO IMPROVE PA-
TIENT SAFETY.— 
‘‘(1) DRAFT REPORT.—Not later than the date 
that is 18 months after any National Patient Safety 
Database is operational, the Secretary, in consulta-
tion with the Director, shall prepare a draft report 
on effective strategies for reducing medical errors 
and increasing patient safety. The draft report shall 
include any measure determined appropriate by the 
Secretary to encourage the appropriate use of such 
strategies, including use in any federally funded pro-
grams. The Secretary shall make the draft report 
available for public comment and submit the draft 
report to the Institute of Medicine for review. 
‘‘(2) FINAL REPORT.—Not later than 1 year 
after the date described in paragraph (1), the Sec-
retary shall submit a final report to the Congress 
that includes, in an appendix, any findings by the 
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Institute of Medicine concerning research on the 
strategies discussed in the draft report and any 
modifications made by the Secretary based on such 
findings. 
‘‘SEC. 923. NATIONAL PATIENT SAFETY DATABASE. 
‘‘(a) AUTHORITY.— 
‘‘(1) IN
GENERAL.—In conducting activities 
under this part, the Secretary shall provide for the 
establishment and maintenance of a database to re-
ceive relevant nonidentifiable patient safety work 
product, and may designate entities to collect rel-
evant nonidentifiable patient safety work product 
that is voluntarily reported by patient safety organi-
zations upon the request of the Secretary. Any data-
base established or designated under this paragraph 
may be referred to as a ‘National Patient Safety 
Database’. 
‘‘(2) USE OF INFORMATION.—Information re-
ported to any National Patient Safety Database 
shall be used to analyze national and regional statis-
tics, including trends and patterns of health care er-
rors. The information resulting from such analyses 
may be included in the annual quality reports pre-
pared under section 913(b)(2). 
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‘‘(3) ADVISORY
ROLE.—The Secretary shall 
provide scientific support to patient safety organiza-
tions, including the dissemination of methodologies 
and evidence-based information related to root 
causes and quality improvement. 
‘‘(b) STANDARDS.—In establishing or designating a 
database under subsection (a)(1), the Secretary shall, in 
consultation with representatives of patient safety organi-
zations, the provider community, and the health informa-
tion technology industry, determine common formats for 
the voluntary reporting of nonidentifiable patient safety 
work product, including necessary elements, common and 
consistent definitions, and a standardized computer inter-
face for the processing of the work product. To the extent 
practicable, such standards shall be consistent with the 
administrative simplification provisions of part C of title 
XI of the Social Security Act. 
‘‘(c) CERTAIN METHODOLOGIES FOR COLLECTION.— 
The Secretary shall ensure that the methodologies for the 
collection of nonidentifiable patient safety work product 
for any National Patient Safety Database include the 
methodologies developed or recommended by the Patient 
Safety Task Force of the Department of Health and 
Human Services. 
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‘‘(d) FACILITATION OF INFORMATION EXCHANGE.— 
To the extent practicable, the Secretary may facilitate the 
direct link of information between providers and patient 
safety organizations and between patient safety organiza-
tions and any National Patient Safety Database. 
‘‘(e) RESTRICTION ON TRANSFER.—Only nonidentifi-
able information may be transferred to any National Pa-
tient Safety Database. 
‘‘SEC. 924. TECHNICAL ASSISTANCE. 
‘‘(a) IN GENERAL.—The Secretary, acting through 
the Director, may— 
‘‘(1) provide technical assistance to patient 
safety organizations, and to States with reporting 
systems for health care errors; and 
‘‘(2) provide guidance on the type of data to be 
voluntarily submitted to any National Patient Safety 
Database. 
‘‘(b) 
ANNUAL
MEETINGS.—Assistance 
provided 
under subsection (a) may include annual meetings for pa-
tient safety organizations to discuss methodology, commu-
nication, information collection, or privacy concerns. 
‘‘SEC. 925. CERTIFICATION OF PATIENT SAFETY ORGANIZA-
TIONS. 
‘‘(a) IN GENERAL.—Not later than 6 months after 
the date of enactment of the Patient Safety and Quality 
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Improvement Act, the Secretary shall establish a process 
for certifying patient safety organizations. 
‘‘(b) PROCESS.—The process established under sub-
section (a) shall include the following: 
‘‘(1) Certification of patient safety organiza-
tions by the Secretary or by such other national or 
State governmental organizations as the Secretary 
determines appropriate. 
‘‘(2) If the Secretary allows other governmental 
organizations to certify patient safety organizations 
under paragraph (1), the Secretary shall establish a 
process for approving such organizations. Any such 
approved organization shall conduct certifications 
and reviews in accordance with this section. 
‘‘(3) A review of each certification under para-
graph (1) (including a review of compliance with 
each criterion in this section and any related imple-
menting standards as determined by the Secretary 
through rulemaking) not less often than every 3 
years, as determined by the Secretary. 
‘‘(4) Revocation of any such certification by the 
Secretary or other such governmental organization 
that issued the certification, upon a showing of 
cause. 
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‘‘(c) CRITERIA.—A patient safety organization must 
meet the following criteria as conditions of certification: 
‘‘(1) The mission of the patient safety organiza-
tion is to conduct activities that are to improve pa-
tient safety and the quality of health care delivery 
and is not in conflict of interest with the providers 
that contract with the patient safety organization. 
‘‘(2) The patient safety organization has appro-
priately qualified staff, including licensed or certified 
medical professionals. 
‘‘(3) The patient safety organization, within any 
2-year period, contracts with more than 1 provider 
for the purpose of receiving and reviewing patient 
safety work product. 
‘‘(4) The patient safety organization is not a 
component of a health insurer or other entity that 
offers a group health plan or health insurance cov-
erage. 
‘‘(5) The patient safety organization is man-
aged, controlled, and operated independently from 
any provider that contracts with the patient safety 
organization for reporting patient safety work prod-
uct. 
‘‘(6) To the extent practical and appropriate, 
the patient safety organization collects patient safety 
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work product from providers in a standardized man-
ner that permits valid comparisons of similar cases 
among similar providers. 
‘‘(d) ADDITIONAL CRITERIA FOR COMPONENT ORGA-
NIZATIONS.—If a patient safety organization is a compo-
nent of another organization, the patient safety organiza-
tion must, in addition to meeting the criteria described 
in subsection (c), meet the following criteria as conditions 
of certification: 
‘‘(1) The patient safety organization maintains 
patient safety work product separately from the rest 
of the organization, and establishes appropriate se-
curity measures to maintain the confidentiality of 
the patient safety work product. 
‘‘(2) The patient safety organization does not 
make an unauthorized disclosure under this Act of 
patient safety work product to the rest of the orga-
nization in breach of confidentiality. 
‘‘(3) The mission of the patient safety organiza-
tion does not create a conflict of interest with the 
rest of the organization.’’. 
(b) AUTHORIZATION OF APPROPRIATIONS.—Section 
937 of the Public Health Service Act (as redesignated by 
subsection (a)) is amended by adding at the end the fol-
lowing: 
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‘‘(e) PATIENT SAFETY
AND QUALITY IMPROVE-
MENT.—For the purpose of carrying out part C, there are 
authorized to be appropriated such sums as may be nec-
essary for each of the fiscal years 2010 through 2014.’’. 
Subtitle B—Liability Protection in 
Good-Faith Reporting 
SEC. 311. LIABILITY PROTECTION FOR HEALTH CARE PRO-
VIDERS 
IN 
GOOD-FAITH 
REPORTING 
TO 
STATE MEDICAL BOARDS. 
(a) IN GENERAL.—Notwithstanding any other provi-
sion of law, no health care provider providing information 
(including by making a report, filing charges, or pre-
senting evidence) to a State medical board regarding the 
competence or professional conduct of a physician shall 
be held, by reason of having provided such information, 
to be liable in damages under any law of the United States 
or of any State (or political subdivision thereof) unless 
such information is false and the person providing the in-
formation knew that the information was false. 
(b) ATTORNEY FEES.—If a health care provider es-
tablishes in a civil action that the health care provider is 
not liable in damages because of the application of sub-
section (a), the court shall award to the provider any at-
torney fees and costs incurred by the provider in estab-
lishing the application of subsection (a). 
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(c) DEFINITION.—In this section, the term ‘‘State 
medical board’’ means a State entity responsible for li-
censing physicians or a subdivision of such an entity. 
TITLE IV—INSURANCE REFORM 
SEC. 401. UNIFORM STATE REQUIREMENTS REGARDING 
PROPOSED RATE INCREASES. 
(a) IN GENERAL.—The Congress intends that each 
State have in effect laws or regulations providing that— 
(1) a provider of medical malpractice insurance 
in the State may not implement any increase in the 
rate for such insurance that would result in such 
rate increasing more than a certain percentage, as 
specified in such laws or regulations, within a cer-
tain period of time, as specified in such laws or reg-
ulations, unless, before such increase takes effect— 
(A) the provider submits to an appropriate 
State agency a description and justification of 
the rate increase; and 
(B) such agency makes a determination 
that the increase is justified; and 
(2) any determination referred to in paragraph 
(1)(B) regarding an increase in medical malpractice 
insurance rates is made pursuant to an administra-
tive hearing held by the appropriate State agency; 
and 
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(3) any individual or institution that is involved 
in the provision of health care and is licensed by the 
State to provide such care has standing, in any ad-
ministrative proceeding of the State regarding a pro-
posed increase in the rate for medical malpractice 
insurance (including a hearing referred to in para-
graph (2)), to challenge such increase. 
(b) REPORT.—Not later than 2 years after the date 
of the enactment of this Act, the Secretary of Health and 
Human Services shall— 
(1) conduct and complete a survey of the laws 
and regulations of the States to determine the extent 
to which the States have in effects laws or regula-
tions described in subsection (a); and 
(2) submit a report to the Congress setting 
forth the results of the survey, describing such laws 
and regulations of the various States, and describing 
the extent of the uniformity of such laws and regula-
tions. 
(c) DEFINITION.—For purposes of this section, the 
term ‘‘State’’ has the meaning given such term in section 
105. 
(d) EFFECTIVE DATE.—This section shall take effect 
on the date of the enactment of this Act. 
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SEC. 402. REDUCTION IN PREMIUMS PAID BY PHYSICIANS 
FOR 
MEDICAL 
MALPRACTICE 
INSURANCE 
COVERAGE. 
(a) IN GENERAL.—Not later than 180 days after the 
date of the enactment of this Act, each medical mal-
practice liability insurance company shall— 
(1) develop a reasonable estimate of the annual 
amount of financial savings that will be achieved by 
the company as a result of section 101; 
(2) develop and implement a plan to annually 
dedicate at least 50 percent of such annual savings 
to reduce the amount of premiums that the company 
charges physicians for medical malpractice liability 
coverage; and 
(3) submit to the Secretary of Health and 
Human Services (in this subsection referred to as 
the ‘‘Secretary’’) a written certification that the 
company has complied with paragraphs (1) and (2). 
(b) REPORTS.—Not later than one year after the date 
of the enactment of this Act and annually thereafter, each 
medical malpractice liability insurance company shall sub-
mit to the Secretary a report that identifies the percentage 
by which the company has reduced medical malpractice 
coverage premiums relative to the date of the enactment 
of this Act. 
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(c) ENFORCEMENT.—A medical malpractice liability 
insurance company that violates a provision of this section 
is liable to the United States for a civil penalty in an 
amount assessed by the Secretary, not to exceed $11,000 
for each such violation. The provisions of paragraphs (3) 
through (5) of section 303(g) of the Federal Food, Drug, 
and Cosmetic Act apply to such a civil penalty to the same 
extent and in the same manner as such paragraphs apply 
to a civil penalty under such section. 
(d) DEFINITION.—For purposes of this section, the 
term ‘‘medical malpractice liability insurance company’’ 
means an entity in the business of providing an insurance 
policy under which the entity makes payment in settlement 
(or partial settlement) of, or in satisfaction of a judgment 
in, a medical malpractice action or claim. 
SEC. 403. EFFECTIVE DATE. 
Except as provided in section 401(d), this title shall 
take effect 1 year after the date of the enactment of this 
Act. 
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TITLE V—EXCLUSION OF PHAR-
MACEUTICALS AND DEVICES 
FROM LIABILITY REFORMS 
SEC. 501. EXCLUSION OF PHARMACEUTICALS AND DE-
VICES. 
For purposes of title I and II of this Act, the manu-
facturer or distributor of a pharmaceutical or device is not 
a health care provider, and health care malpractice does 
not include responsibility based on products liability. 
Æ 
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