[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4157 Reported in House (RH)]







                                                 Union Calendar No. 347
109th CONGRESS
  2d Session
                                H. R. 4157

                  [Report No. 109-601, Parts I and II]

   To amend the Social Security Act to encourage the dissemination, 
    security, confidentiality, and usefulness of health information 
                              technology.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 27, 2005

  Mrs. Johnson of Connecticut (for herself, Mr. Deal of Georgia, Mr. 
Blunt, Mr. Cantor, Mr. McCrery, Mr. Sam Johnson of Texas, Mr. Camp, Mr. 
 Ramstad, Mr. English of Pennsylvania, Mr. Hayworth, Mr. Hulshof, Mr. 
 Herger, Mr. Lewis of Kentucky, Mr. Weller, Mr. Ryan of Wisconsin, Mr. 
 Beauprez, Mr. Upton, Mrs. Wilson of New Mexico, Mr. Bass, Mr. Terry, 
  Mr. Murphy, Mr. Bradley of New Hampshire, Mr. Boehlert, Mr. Castle, 
  Mrs. Emerson, Mr. Gerlach, Mr. Hobson, Mrs. Kelly, Mr. Jindal, Mr. 
    Schwarz of Michigan, Mr. Shays, and Mr. Simmons) introduced the 
   following bill; which was referred to the Committee on Energy and 
  Commerce, and in addition to the Committee on Ways and Means, 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

                             July 26, 2005

Additional sponsors: Mr. Gillmor, Ms. Hart, Mr. Rogers of Michigan, Mr. 
Ehlers, Mrs. Drake, Mr. Kennedy of Minnesota, Mr. McHugh, Mr. McCotter, 
   Mr. Hastings of Washington, Mr. Porter, Mr. Kuhl of New York, Mr. 
 Leach, Miss McMorris, Mr. Campbell of California, Mr. Lucas, Mr. Cole 
   of Oklahoma, Mr. Kirk, Mrs. Miller of Michigan, Mr. Marchant, Mr. 
 Fortuno, Mr. Boustany, Mr. Fitzpatrick of Pennsylvania, Mrs. Biggert, 
         Mr. Nunes, Mrs. Blackburn, Mr. Hefley, and Ms. Granger
  Deleted sponsors: Ms. Jackson-Lee of Texas (added November 2, 2005; 
deleted June 27, 2006), and Ms. Eshoo (added December 15, 2005; deleted 
                             June 16, 2006)

                             June 26, 2006

   Reported from the Committee on Energy and Commerce with amendments
 [Strike out all after the enacting clause and insert the part printed 
                               in italic]

                             July 26, 2006

   Reported from the Committee on Ways and Means with an amendment; 
committed to the Committee of the Whole House on the State of the Union 
                       and ordered to be printed
 [Strike out all after the enacting clause and insert the part printed 
                           in boldface roman]
[For text of introduced bill, see copy of bill as introduced on October 
                               27, 2005]

_______________________________________________________________________

                                 A BILL


 
   To amend the Social Security Act to encourage the dissemination, 
    security, confidentiality, and usefulness of health information 
                              technology.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Better Health 
Information System Act of 2006''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title and table of contents.
Sec. 2. Preserving privacy and security laws.

TITLE I--COORDINATION FOR, PLANNING FOR, AND INTEROPERABILITY OF HEALTH 
                         INFORMATION TECHNOLOGY

Sec. 101. Office of the National Coordinator for Health Information 
                            Technology.
Sec. 102. Report on the American Health Information Community.
Sec. 103. Interoperability planning process; Federal information 
                            collection activities.
Sec. 104. Ensuring health care providers may maintain health 
                            information in electronic form.
Sec. 105. Study and report on State, regional, and community health 
                            information exchanges.
Sec. 106. Grants to integrated health systems to promote health 
                            information technologies to improve 
                            coordination of care for the uninsured, 
                            underinsured, and medically underserved.
Sec. 107. Demonstration program.

    TITLE II--EXPEDITED MODIFICATION PROCEDURES FOR AND ADOPTION OF 
                   TRANSACTIONAL STANDARDS AND CODES

Sec. 201. Procedures to ensure timely updating of standards that enable 
                            electronic exchanges.
Sec. 202. Upgrading ASC X12 and NCPDP standards.
Sec. 203. Coding and documentation of non-medical information.

TITLE III--PROMOTING THE USE OF HEALTH INFORMATION TECHNOLOGY TO BETTER 
                         COORDINATE HEALTH CARE

Sec. 301. Safe harbors to antikickback civil penalties and criminal 
                            penalties for provision of health 
                            information technology and training 
                            services.
Sec. 302. Exception to limitation on certain physician referrals (under 
                            Stark) for provision of health information 
                            technology and training services to health 
                            care professionals.

SEC. 2. PRESERVING PRIVACY AND SECURITY LAWS.

    Nothing in this Act (or the amendments made by this Act) shall be 
construed to affect the scope, substance, or applicability of section 
264(c) of the Health Insurance Portability and Accountability Act of 
1996 and any regulation issued pursuant to such section.

TITLE I--COORDINATION FOR, PLANNING FOR, AND INTEROPERABILITY OF HEALTH 
                         INFORMATION TECHNOLOGY

SEC. 101. OFFICE OF THE NATIONAL COORDINATOR FOR HEALTH INFORMATION 
              TECHNOLOGY.

    (a) In General.--Title II of the Public Health Service Act is 
amended by adding at the end the following new part:

                ``PART D--HEALTH INFORMATION TECHNOLOGY

``SEC. 271. OFFICE OF THE NATIONAL COORDINATOR FOR HEALTH INFORMATION 
              TECHNOLOGY.

    ``(a) Establishment.--There is established within the Department of 
Health and Human Services an Office of the National Coordinator for 
Health Information Technology that shall be headed by the National 
Coordinator for Health Information Technology (referred to in this part 
as the `National Coordinator'). The National Coordinator shall be 
appointed by and report directly to the Secretary. The National 
Coordinator shall be paid at a rate equal to the rate of basic pay for 
level IV of the Executive Schedule.
    ``(b) Goals of Nationwide Interoperable Health Information 
Technology Infrastructure.--The National Coordinator shall perform the 
duties under subsection (c) in a manner consistent with the development 
of a nationwide interoperable health information technology 
infrastructure that--
            ``(1) improves health care quality, promotes data accuracy, 
        reduces medical errors, increases the efficiency of care, and 
        advances the delivery of appropriate, evidence-based health 
        care services;
            ``(2) promotes wellness, disease prevention, and management 
        of chronic illnesses by increasing the availability and 
        transparency of information related to the health care needs of 
        an individual for such individual;
            ``(3) promotes the availability of appropriate and accurate 
        information necessary to make medical decisions in a usable 
        form at the time and in the location that the medical service 
        involved is provided;
            ``(4) produces greater value for health care expenditures 
        by reducing health care costs that result from inefficiency, 
        medical errors, inappropriate care, and incomplete or 
        inaccurate information;
            ``(5) promotes a more effective marketplace, greater 
        competition, greater systems analysis, increased consumer 
        choice, enhanced quality, and improved outcomes in health care 
        services;
            ``(6) with respect to health information of consumers, 
        advances the portability of such information and the ability of 
        such consumers to share and use such information to assist in 
        the management of their health care;
            ``(7) improves the coordination of information and the 
        provision of such services through an effective infrastructure 
        for the secure and authorized exchange and use of health care 
        information;
            ``(8) is consistent with legally applicable requirements 
        with respect to securing and protecting the confidentiality of 
        individually identifiable health information of a patient;
            ``(9) promotes the creation and maintenance of 
        transportable, secure, Internet-based personal health records, 
        including promoting the efforts of health care payers and 
        health plan administrators for a health plan, such as Federal 
        agencies, private health plans, and third party administrators, 
        to provide for such records on behalf of members of such a 
        plan;
            ``(10) promotes access to and review of the electronic 
        health record of a patient by such patient;
            ``(11) promotes health research and health care quality 
        research and assessment; and
            ``(12) promotes the efficient and streamlined development, 
        submission, and maintenance of electronic health care clinical 
        trial data.
    ``(c) Duties of the National Coordinator.--
            ``(1) Strategic planner for interoperable health 
        information technology.--The National Coordinator shall provide 
        for a strategic plan for the nationwide implementation of 
        interoperable health information technology in both the public 
        and private health care sectors consistent with subsection (b).
            ``(2) Principal advisor to the secretary.--The National 
        Coordinator shall serve as the principal advisor to the 
        Secretary on the development, application, and use of health 
        information technology, and shall coordinate the policies and 
        programs of the Department of Health and Human Services for 
        promoting the use of health information technology.
            ``(3) Intragovernmental coordinator.--The National 
        Coordinator shall ensure that health information technology 
        policies and programs of the Department of Health and Human 
        Services are coordinated with those of relevant executive 
        branch agencies and departments with a goal to avoid 
        duplication of effort, to align the health information 
        architecture of each agency or department toward a common 
        approach, to ensure that each agency or department conducts 
        programs within the areas of its greatest expertise and its 
        mission in order to create a national interoperable health 
        information system capable of meeting national public health 
        needs effectively and efficiently, and to assist Federal 
        agencies and departments in security programs, policies, and 
        protections to prevent unauthorized access to individually 
        identifiable health information created, maintained, or in the 
        temporary possession of that agency or department. The 
        coordination authority provided to the National Coordinator 
        under the previous sentence shall supercede any such authority 
        otherwise provided to any other official of the Department of 
        Health and Human Services. For the purposes of this paragraph, 
        the term `unauthorized access' means access that is not 
        authorized by that agency or department including unauthorized 
        employee access.
            ``(4) Advisor to omb.--The National Coordinator shall 
        provide to the Director of the Office of Management and Budget 
        comments and advice with respect to specific Federal health 
        information technology programs.
            ``(5) Promoter of health information technology in 
        medically underserved communities.--The National Coordinator 
        shall--
                    ``(A) identify sources of funds that will be made 
                available to promote and support the planning and 
                adoption of health information technology in medically 
                underserved communities, including in urban and rural 
                areas, either through grants or technical assistance;
                    ``(B) coordinate with the funding sources to help 
                such communities connect to identified funding; and
                    ``(C) collaborate with the Agency for Healthcare 
                Research and Quality and the Health Services Resources 
                Administration and other Federal agencies to support 
                technical assistance, knowledge dissemination, and 
                resource development, to medically underserved 
                communities seeking to plan for and adopt technology 
                and establish electronic health information networks 
                across providers.''.
    (b) Treatment of Executive Order 13335.--Executive Order 13335 
shall not have any force or effect after the date of the enactment of 
this Act.
    (c) Transition From ONCHIT Under Executive Order.--
            (1) In general.--All functions, personnel, assets, 
        liabilities, administrative actions, and statutory reporting 
        requirements applicable to the old National Coordinator or the 
        Office of the old National Coordinator on the date before the 
        date of the enactment of this Act shall be transferred, and 
        applied in the same manner and under the same terms and 
        conditions, to the new National Coordinator and the Office of 
        the new National Coordinator as of the date of the enactment of 
        this Act.
            (2) Rule of construction.-- Nothing in this section or the 
        amendment made by this section shall be construed as requiring 
        the duplication of Federal efforts with respect to the 
        establishment of the Office of the National Coordinator for 
        Health Information Technology, regardless of whether such 
        efforts are carried out before or after the date of the 
        enactment of this Act.
            (3) Acting national coordinator.--Before the appointment of 
        the new National Coordinator, the old National Coordinator 
        shall act as the National Coordinator for Health Information 
        Technology until the office is filled as provided in section 
        271(a) of the Public Health Service Act, as added by subsection 
        (a). The Secretary of Health and Human Services may appoint the 
        old National Coordinator as the new National Coordinator.
            (4) Definitions.--For purposes of this subsection:
                    (A) New national coordinator.--The term ``new 
                National Coordinator'' means the National Coordinator 
                for Health Information Technology appointed under 
                section 271(a) of the Public Health Service Act, as 
                added by subsection (a).
                    (B) Old national coordinator.--The term ``old 
                National Coordinator'' means the National Coordinator 
                for Health Information Technology appointed under 
                Executive Order 13335.

SEC. 102. REPORT ON THE AMERICAN HEALTH INFORMATION COMMUNITY.

    Not later than one year after the date of the enactment of this 
Act, the Secretary of Health and Human Services shall submit to 
Congress a report on the work conducted by the American Health 
Information Community (in this section referred to as ``AHIC''), as 
established by the Secretary. Such report shall include the following:
            (1) A description of the accomplishments of AHIC, with 
        respect to the promotion of the development of national 
        guidelines, the development of a nationwide health information 
        network, and the increased adoption of health information 
        technology.
            (2) Information on how model privacy and security policies 
        may be used to protect confidentiality of health information, 
        and an assessment of how existing policies compare to such 
        model policies.
            (3) Information on the progress in--
                    (A) establishing uniform industry-wide health 
                information technology standards;
                    (B) achieving an internet-based nationwide health 
                information network; and
                    (C) achieving interoperable electronic health 
                record adoption across health care providers.
            (4) Recommendations for the transition of AHIC to a longer-
        term advisory and facilitation entity, including--
                    (A) a schedule for such transition;
                    (B) options for structuring the entity as either a 
                public-private or private sector entity;
                    (C) the role of the Federal Government in the 
                entity;
                    (D) steps for--
                            (i) continued leadership in the 
                        facilitation of guidelines or standards;
                            (ii) the alignment of financial incentives; 
                        and
                            (iii) the long-term plan for health care 
                        transformation through information technology; 
                        and
                    (E) the elimination or revision of the functions of 
                AHIC during the development of the nationwide health 
                information network.

SEC. 103. INTEROPERABILITY PLANNING PROCESS; FEDERAL INFORMATION 
              COLLECTION ACTIVITIES.

    Part D of title II of the Public Health Service Act, as added by 
section 101, is amended by adding at the end the following new section:

``SEC. 272. INTEROPERABILITY PLANNING PROCESS; FEDERAL INFORMATION 
              COLLECTION ACTIVITIES.

    ``(a) Strategic Interoperability Planning Process.--
            ``(1) Assessment and endorsement of core strategic 
        guidelines.--
                    ``(A) In general.--Not later than December 31, 
                2006, the National Coordinator shall publish a 
                strategic plan, including a schedule, for the 
                assessment and the endorsement of core interoperability 
                guidelines for significant use cases consistent with 
                this subsection. The National Coordinator may update 
                such plan from time to time.
                    ``(B) Endorsement.--
                            ``(i) In general.--Consistent with the 
                        schedule under this paragraph and not later 
                        than one year after the publication of such 
                        schedule, the National Coordinator shall 
                        endorse a subset of core interoperability 
                        guidelines for significant use cases. The 
                        National Coordinator shall continue to endorse 
                        subsets of core interoperability guidelines for 
                        significant use cases annually consistent with 
                        the schedule published pursuant to this 
                        paragraph, with endorsement of all such 
                        guidelines completed not later than August 31, 
                        2009.
                            ``(ii) Consultation.--All such endorsements 
                        shall be in consultation with the American 
                        Health Information Community and other 
                        appropriate entities.
                            ``(iii) Voluntary compliance.--Compliance 
                        with such guidelines shall be voluntary, 
                        subject to subsection (b)(1).
                    ``(C) Consultation with other parties.--The 
                National Coordinator shall develop and implement such 
                strategic plan in consultation with the American Health 
                Information Community and other appropriate entities.
                    ``(D) Definitions.--For purposes of this section:
                            ``(i) Interoperability guideline.--The term 
                        `interoperability guideline' means a guideline 
                        to improve and promote the interoperability of 
                        health information technology for purposes of 
                        electronically accessing and exchanging health 
                        information. Such term includes named 
                        standards, architectures, software schemes for 
                        identification, authentication, and security, 
                        and other information needed to ensure the 
                        reproducible development of common solutions 
                        across disparate entities.
                            ``(ii) Core interoperability guideline.--
                        The term `core interoperability guideline' 
                        means an interoperability guideline that the 
                        National Coordinator determines is essential 
                        and necessary for purposes described in clause 
                        (i).
                            ``(iii) Significant use case.--The term 
                        `significant use case' means a category (as 
                        specified by the National Coordinator) that 
                        identifies a significant use or purpose for the 
                        interoperability of health information 
                        technology, such as for the exchange of 
                        laboratory information, drug prescribing, 
                        clinical research, and electronic health 
                        records.
            ``(2) National survey.--
                    ``(A) In general.--Not later than August 31, 2008, 
                the National Coordinator shall conduct one or more 
                surveys designed to measure the capability of entities 
                (including Federal agencies, State and local government 
                agencies, and private sector entities) to exchange 
                electronic health information by appropriate 
                significant use case. Such surveys shall identify the 
                extent to which the type of health information, the use 
                for such information, or any other appropriate 
                characterization of such information may relate to the 
                capability of such entities to exchange health 
                information in a manner that is consistent with methods 
                to improve the interoperability of health information 
                and with core interoperability guidelines.
                    ``(B) Dissemination of survey results.--The 
                National Coordinator shall disseminate the results of 
                such surveys in a manner so as to--
                            ``(i) inform the public on the capabilities 
                        of entities to exchange electronic health 
                        information;
                            ``(ii) assist in establishing a more 
                        interoperable information architecture; and
                            ``(iii) identify the status of health 
                        information systems used in Federal agencies 
                        and the status of such systems with respect to 
                        interoperability guidelines.
    ``(b) Federal Health Information Collection Activities.--
            ``(1) Requirements.--With respect to a core 
        interoperability guideline endorsed under subsection (a)(1)(B) 
        for a significant use case, the President shall take measures 
        to ensure that Federal activities involving the broad 
        collection and submission of health information are consistent 
        with such guideline within three years after the date of such 
        endorsement.
            ``(2) Promoting use of non-identifiable health information 
        to improve health research and health care quality.--
                    ``(A) In general.--Where feasible, and consistent 
                with applicable privacy or security or other laws, the 
                President, in consultation with the Secretary, shall 
                take measures to allow timely access to useful 
                categories of non-identifiable health information in 
                records maintained by the Federal government, or 
                maintained by entities under contract with the Federal 
                government, to advance health care quality and health 
                research where such information is in a form that can 
                be used in such research. The President shall consult 
                with appropriate Federal agencies, and solicit public 
                comment, on useful categories of information, and 
                appropriate measures to take. The President may 
                consider the administrative burden and the potential 
                for improvements in health care quality in determining 
                such appropriate measures. In addition, the President, 
                in consultation with the Secretary, shall encourage 
                voluntary private and public sector efforts to allow 
                access to such useful categories of non-identifiable 
                health information to advance health care quality and 
                health research.
                    ``(B) Non-identifiable health information 
                defined.--For purposes of this paragraph, the term 
                `non-identifiable health information' means information 
                that is not individually identifiable health 
                information as defined in rules promulgated pursuant to 
                section 264(c) of the Health Insurance Portability and 
                Accountability Act of 1996 (42 U.S.C. 1320d-2 note), 
                and includes information that has been de-identified so 
                that it is no longer individually identifiable health 
                information, as defined in such rules.
            ``(3) Annual review and report.--For each year during the 
        five-year period following the date of the enactment of this 
        section, the National Coordinator shall review the operation of 
        health information collection by and submission to the Federal 
        government and the purchases (and planned purchases) of health 
        information technology by the Federal government. For each such 
        year and based on the review for such year, the National 
        Coordinator shall submit to the President and Congress 
        recommendations on methods to--
                    ``(A) streamline (and eliminate redundancy in) 
                Federal systems used for the collection and submission 
                of health information;
                    ``(B) improve efficiency in such collection and 
                submission;
                    ``(C) increase the ability to assess health care 
                quality; and
                    ``(D) reduce health care costs.''.

SEC. 104. ENSURING HEALTH CARE PROVIDERS MAY MAINTAIN HEALTH 
              INFORMATION IN ELECTRONIC FORM.

    Part D of title II of the Public Health Service Act, as added by 
section 101(a) and amended by section 103, is amended by adding at the 
end the following new section:

``SEC. 273. ENSURING HEALTH CARE PROVIDERS MAY MAINTAIN HEALTH 
              INFORMATION IN ELECTRONIC FORM.

    ``(a) In General.--Any health care provider that participates in a 
health care program that receives Federal funds shall be deemed as 
meeting any requirement for the maintenance of data in paper form under 
such program (whether or not for purposes of management, billing, 
reporting, reimbursement, or otherwise) if the required data is 
maintained in an electronic form.
    ``(b) Relation to State Laws.--Beginning on the date that is one 
year after the date of the enactment of this section, subsection (a) 
shall supersede any contrary provision of State law.
    ``(c) Construction.--Nothing in this section shall be construed 
as--
            ``(1) requiring health care providers to maintain or submit 
        data in electronic form;
            ``(2) preventing a State from permitting health care 
        providers to maintain or submit data in paper form; or
            ``(3) preventing a State from requiring health care 
        providers to maintain or submit data in electronic form.''.

SEC. 105. STUDY AND REPORT ON STATE, REGIONAL, AND COMMUNITY HEALTH 
              INFORMATION EXCHANGES.

    (a) Study.--The Secretary of Health and Human Services shall 
conduct a study on issues related to the development, operation, and 
implementation of State, regional, and community health information 
exchanges. Such study shall include the following, with respect to such 
health information exchanges:
            (1) Profiles detailing the current stages of such health 
        information exchanges with respect to the progression of the 
        development, operation, implementation, organization, and 
        governance of such exchanges.
            (2) The impact of such exchanges on healthcare quality, 
        safety, and efficiency, including--
                    (A) any impact on the coordination of health 
                information and services across healthcare providers 
                and other organizations relevant to health care;
                    (B) any impact on the availability of health 
                information at the point-of-care to make timely medical 
                decisions;
                    (C) any benefits with respect to the promotion of 
                wellness, disease prevention, and chronic disease 
                management;
                    (D) any improvement with respect to public health 
                preparedness and response;
                    (E) any impact on the widespread adoption of 
                interoperable health information technology, including 
                electronic health records;
                    (F) any contributions to achieving an Internet-
                based national health information network;
                    (G) any contribution of health information 
                exchanges to consumer access and to consumers' use of 
                their health information; and
                    (H) any impact on the operation of--
                            (i) the Medicaid program;
                            (ii) the State Children's Health Insurance 
                        Program (SCHIP);
                            (iii) disproportionate share hospitals 
                        described in section 1923 of the Social 
                        Security Act;
                            (iv) Federally-qualified health centers; or
                            (v) managed care plans, if a significant 
                        number of the plan's enrollees are 
                        beneficiaries in the Medicaid program or SCHIP.
            (3) Best practice models for financing, incentivizing, and 
        sustaining such health information exchanges.
            (4) Information identifying the common principles, 
        policies, tools, and standards used (or proposed) in the public 
        and private sectors to support the development, operation, and 
        implementation of such health information exchanges.
            (5) A description of any areas in which Federal government 
        leadership is needed to support growth and sustainability of 
        such health information exchanges.
    (b) Report.--Not later than one year after the date of enactment of 
this Act, the Secretary of Health and Human Services shall submit to 
Congress a report on the study described in subsection (a), including 
such recommendations as the Secretary determines appropriate to 
facilitate the development, operation, and implementation of health 
information exchanges.

SEC. 106. GRANTS TO INTEGRATED HEALTH SYSTEMS TO PROMOTE HEALTH 
              INFORMATION TECHNOLOGIES TO IMPROVE COORDINATION OF CARE 
              FOR THE UNINSURED, UNDERINSURED, AND MEDICALLY 
              UNDERSERVED.

    Subpart I of part D of title III of the Public Health Service Act 
(42 U.S.C. 254b et seq.) is amended by adding at the end the following:

``SEC. 330M. GRANTS FOR IMPROVEMENT OF THE COORDINATION OF CARE FOR THE 
              UNINSURED, UNDERINSURED, AND MEDICALLY UNDERSERVED.

    ``(a) In General.--The Secretary may make grants to integrated 
health care systems, in accordance with this section, for projects to 
better coordinate the provision of health care through the adoption of 
new health information technology, or the significant improvement of 
existing health information technology, to improve the provision of 
health care to uninsured, underinsured, and medically underserved 
individuals (including in urban and rural areas) through health-related 
information about such individuals, throughout such a system and at the 
point of service.
    ``(b) Eligibility.--
            ``(1) Application.--To be eligible to receive a grant under 
        this section, an integrated health care system shall prepare 
        and submit to the Secretary an application, at such time, in 
        such manner, and containing such information as the Secretary 
        may require, including--
                    ``(A) a description of the project that the system 
                will carry out using the funds provided under the 
                grant;
                    ``(B) a description of the manner in which the 
                project funded under the grant will advance the goal 
                specified in subsection (a); and
                    ``(C) a description of the populations to be served 
                by the adoption or improvement of health information 
                technology.
            ``(2) Optional reporting condition.--The Secretary may also 
        condition the provision of a grant to an integrated health care 
        system under this section for a project on the submission by 
        such system to the Secretary of a report on the impact of the 
        health information technology adopted (or improved) under such 
        project on the delivery of health care and the quality of care 
        (in accordance with applicable measures of such quality). Such 
        report shall be at such time and in such form and manner as 
        specified by the Secretary.
    ``(c) Integrated Health Care System Defined.--For purposes of this 
section, the term `integrated health care system' means a system of 
health care providers that is organized to provide care in a 
coordinated fashion and has a demonstrated commitment to provide 
uninsured, underinsured, and medically underserved individuals with 
access to such care.
    ``(d) Priorities.--In making grants under this section, the 
Secretary shall give priority to an integrated health care system--
            ``(1) that can demonstrate past successful community-wide 
        efforts to improve the quality of care provided and the 
        coordination of care for the uninsured, underinsured, and 
        medically underserved; or
            ``(2) if the project to be funded through such a grant--
                    ``(A) will improve the delivery of health care and 
                the quality of care provided; and
                    ``(B) will demonstrate savings for State or Federal 
                health care benefits programs or entities legally 
                obligated under Federal law to provide health care from 
                the reduction of duplicative health care services, 
                administrative costs, and medical errors.
    ``(e) Limitation, Matching Requirement, and Conditions.--
            ``(1) Limitation on use of funds.--None of the funds 
        provided under a grant made under this section may be used for 
        a project providing for the adoption or improvement of health 
        information technology that is used exclusively for financial 
        record keeping, billing, or other non-clinical applications.
            ``(2) Matching requirement.--To be eligible for a grant 
        under this section an integrated health care system shall 
        contribute non-Federal contributions to the costs of carrying 
        out the project for which the grant is awarded in an amount 
        equal to $1 for each $5 of Federal funds provided under the 
        grant.
    ``(f) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section $15,000,000 for each of fiscal 
years 2007 and 2008.''.

SEC. 107. DEMONSTRATION PROGRAM.

    (a) In General.--The Secretary of Health and Human Services shall 
establish a demonstration program under which the Secretary makes 
grants to small physician practices (including such practices that 
furnish services to individuals with chronic illnesses) that are 
located in rural areas or medically underserved urban areas for the 
purchase and support of health information technology.
    (b) Eligibility.--To be eligible to receive a grant under this 
section, an applicant shall prepare and submit to the Secretary of 
Health and Human Services an application, at such time, in such manner, 
and containing such information, as the Secretary may require.
    (c) Reporting.--
            (1) Required reports by small physician practices.--A small 
        physician practice receiving a grant under subsection (a) shall 
        submit to the Secretary of Health and Human Services an 
        evaluation on the health information technology funded by such 
        grant. Such evaluation shall include information on--
                    (A) barriers to the adoption of health information 
                technology by the small physician practice;
                    (B) issues for such practice in the use of health 
                information technology;
                    (C) the effect health information technology will 
                have on the quality of health care furnished by such 
                practice; and
                    (D) the effect of the rules under sections 1128A, 
                1128B, and 1877 of the Social Security Act and any 
                medical liability rules on such practice.
            (2) Report to congress.--Not later than January 1, 2009, 
        the Secretary of Health and Human Services shall submit to 
        Congress a report on the results of the demonstration program 
        under this section.
    (d) Authorization of Appropriations.--There are authorized to be 
appropriated to carry out this section $5,000,000 for each of fiscal 
years 2007 and 2008.

    TITLE II--EXPEDITED MODIFICATION PROCEDURES FOR AND ADOPTION OF 
                   TRANSACTIONAL STANDARDS AND CODES

SEC. 201. PROCEDURES TO ENSURE TIMELY UPDATING OF STANDARDS THAT ENABLE 
              ELECTRONIC EXCHANGES.

    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 section 
                1173(c)(2), the term `modification' includes 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 standards.--
                    ``(A) In general.--For purposes of paragraph (1), 
                the Secretary shall provide for an expedited upgrade 
                program (in this paragraph referred to as the `upgrade 
                program'), in accordance with this paragraph, to 
                develop and approve additions and modifications to the 
                standards 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 initiation of 
                        process.--Not later than 30 days after the date 
                        the Secretary receives a notice from a standard 
                        setting organization that the organization is 
                        initiating a process to develop an addition or 
                        modification to a standard adopted under 
                        section 1173(a), the Secretary shall publish a 
                        notice 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 preliminary 
                        draft of additions or modifications to 
                        standards.--Not later than 30 days after the 
                        date of the date the Secretary receives a 
                        notice from a standard setting organization 
                        that the organization has prepared a 
                        preliminary draft of an addition or 
                        modification to a standard adopted by section 
                        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;
                                    ``(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 of the date the Secretary 
                        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 Register that 
                        contains, with respect to the proposed addition 
                        or modification, the information required in 
                        the notice under clause (ii) with respect to 
                        the addition or modification.
                            ``(iv) Construction.--Nothing in this 
                        paragraph shall be construed as requiring 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 determination.--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 
                setting organization developed such addition or 
                modification in accordance with the requirements of 
                subparagraph (D) and the National Committee on Vital 
                and Health Statistics recommends approval of such 
                addition or modification under subparagraph (E), the 
                Secretary shall provide for expedited treatment of such 
                proposal in accordance with subparagraph (F).
                    ``(D) Requirements.--The requirements under this 
                subparagraph with respect to a proposed addition or 
                modification to a standard by a standard setting 
                organization are the following:
                            ``(i) Request for publication of notice.--
                        The standard setting organization submits to 
                        the Secretary a request for publication in the 
                        Federal Register of a notice 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 publication of the 
                        notice referred to under clause (i), the 
                        organization--
                                    ``(I) receives and responds to 
                                public comments submitted on a timely 
                                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);
                                    ``(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 
                                received under clause (I) available, or 
                                provides access to such comments, to 
                                the Secretary.
                            ``(iii) Submittal of final proposed 
                        addition or modification to ncvhs.--After 
                        completion of the process under clause (ii), 
                        the standard setting organization 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 
                        responses to those comments) under clause (ii).
                    ``(E) Hearing and recommendations by national 
                committee on vital and health statistics.--Under the 
                upgrade program, upon receipt of a proposal submitted 
                by a standard setting organization under subparagraph 
                (D)(iii) for the adoption of an addition or 
                modification to a standard, the National Committee on 
                Vital and Health Statistics shall provide notice to the 
                public and a reasonable opportunity for public 
                testimony at a hearing on such addition or 
                modification. The Secretary may participate in such 
                hearing in such capacity (including presiding ex 
                officio) as the Secretary 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 recommendation.--
                            ``(i) Timely determination.--Under the 
                        upgrade program, if the National Committee on 
                        Vital and Health Statistics submits to the 
                        Secretary a recommendation under subparagraph 
                        (E) to adopt a proposed addition or 
                        modification, not later than 90 days after the 
                        date of receipt of such recommendation the 
                        Secretary shall make a determination to accept 
                        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 recommendation, 
                        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 accepted proposed 
                        addition or modification accepted).
                            ``(iii) Limitation on consideration.--The 
                        Secretary shall not consider a proposal under 
                        this subparagraph unless the Secretary 
                        determines that the requirements of 
                        subparagraph (D) (including publication of 
                        notice and opportunity for public comment) have 
                        been met with respect to the proposal.
                    ``(G) Exemption from paperwork reduction act.--
                Chapter 35 of title 44, United States Code, shall not 
                apply to a final rule promulgated under subparagraph 
                (F).''.

SEC. 202. UPGRADING ASC X12 AND NCPDP STANDARDS.

    The Secretary of Health and Human Services shall provide by notice 
published in the Federal Register for the following replacements of 
standards to apply to transactions occurring on or after April 1, 2009:
            (1) Accredited standards committee x12 (asc x12) 
        standard.--The replacement of the Accredited Standards 
        Committee X12 (ASC X12) version 4010 adopted under section 
        1173(a) of such Act (42 U.S.C. 1320d-2(a)) with the ASC X12 
        version 5010, as reviewed by the National Committee on Vital 
        Health Statistics.
            (2) National council for prescription drug programs (ncpdp) 
        telecommunications standards.--The replacement of the National 
        Council for Prescription Drug Programs (NCPDP) 
        Telecommunications Standards version 5.1 adopted under section 
        1173(a) of such Act (42 U.S.C. 1320d-2(a)) with whichever is 
        the latest version of the NCPDP Telecommunications Standards 
        that has been approved by such Council and reviewed by the 
        National Committee on Vital Health Statistics as of April 1, 
        2007.

SEC. 203. CODING AND DOCUMENTATION OF NON-MEDICAL INFORMATION.

    In any regulation or other action implementing the International 
Classification of Diseases, 10th revision, Clinical Modification (ICD-
10-CM), the International Classification of Diseases, 10th revision, 
Procedure Coding System (ICD-10-PCS), or other version of the 
International Classification of Diseases, 10th revision, the Secretary 
of Health and Human Services shall ensure that no health care provider 
is required to code to a level of specificity that would require 
documentation of non-medical information on the external cause of any 
given type of injury.

TITLE III--PROMOTING THE USE OF HEALTH INFORMATION TECHNOLOGY TO BETTER 
                         COORDINATE HEALTH CARE

SEC. 301. SAFE HARBORS TO ANTIKICKBACK CIVIL PENALTIES AND CRIMINAL 
              PENALTIES FOR PROVISION OF HEALTH INFORMATION TECHNOLOGY 
              AND TRAINING SERVICES.

    (a) For Civil Penalties.--Section 1128A of the Social Security Act 
(42 U.S.C. 1320a-7a) is amended--
            (1) in subsection (b), by adding at the end the following 
        new paragraph:
    ``(4) For purposes of this subsection, inducements to reduce or 
limit services described in paragraph (1) shall not include the 
practical or other advantages resulting from health information 
technology or related installation, maintenance, support, or training 
services.''; and
            (2) in subsection (i), by adding at the end the following 
        new paragraph:
            ``(8) The term `health information technology' means 
        hardware, software, license, right, intellectual property, 
        equipment, or other information technology (including new 
        versions, upgrades, and connectivity) designed primarily for 
        the electronic creation, maintenance, or exchange of health 
        information to better coordinate care or improve health care 
        quality, efficiency, or research.''.
    (b) For Criminal Penalties.--Section 1128B(b)(3) of such Act (42 
U.S.C. 1320a-7b(b)(3)) is amended--
            (1) in subparagraph (G), by striking ``and'' at the end;
            (2) in the subparagraph (H) added by section 237(d) of the 
        Medicare Prescription Drug, Improvement, and Modernization Act 
        of 2003 (Public Law 108-173; 117 Stat. 2213)--
                    (A) by moving such subparagraph 2 ems to the left; 
                and
                    (B) by striking the period at the end and inserting 
                a semicolon;
            (3) in the subparagraph (H) added by section 431(a) of such 
        Act (117 Stat. 2287)--
                    (A) by redesignating such subparagraph as 
                subparagraph (I);
                    (B) by moving such subparagraph 2 ems to the left; 
                and
                    (C) by striking the period at the end and inserting 
                ``; and''; and
            (4) by adding at the end the following new subparagraph:
            ``(J) any nonmonetary remuneration (in the form of health 
        information technology, as defined in section 1128A(i)(8), or 
        related installation, maintenance, support or training 
        services) made to a person by an entity that is a hospital, 
        group practice, prescription drug plan sponsor, or Medicare 
        Advantage organization if--
                    ``(i) the provision of such remuneration is without 
                an agreement between the parties or legal condition 
                that--
                            ``(I) limits or restricts the use of the 
                        health information technology to services 
                        provided by the physician to individuals 
                        receiving services at the entity;
                            ``(II) limits or restricts the use of the 
                        health information technology in conjunction 
                        with other health information technology; or
                            ``(III) conditions the provision of such 
                        remuneration on the referral of patients or 
                        business to the entity;
                    ``(ii) such remuneration is arranged for in a 
                written agreement that is signed by the parties 
                involved (or their representatives) and that specifies 
                the remuneration solicited or received (or offered or 
                paid) and states that the provision of such 
                remuneration is made for the primary purpose of better 
                coordination of care or improvement of health quality, 
                efficiency, or research; and
                    ``(iii) the entity providing the remuneration (or a 
                representative of such entity) has not taken any action 
                to disable any basic feature of any hardware or 
                software component of such remuneration that would 
                permit interoperability.''.
    (c) Effective Date and Effect on State Laws.--
            (1) Effective date.--The amendments made by subsections (a) 
        and (b) shall take effect on the date that is 120 days after 
        the date of the enactment of this Act.
            (2) Preemption of state laws.--No State (as defined in 
        section 1101(a) of the Social Security Act (42 U.S.C. 1301(a)) 
        for purposes of title XI of such Act) shall have in effect a 
        State law that imposes a criminal or civil penalty for a 
        transaction described in section 1128A(b)(4) or section 
        1128B(b)(3)(J) of such Act, as added by subsections (a)(1) and 
        (b), respectively, if the conditions described in the 
        respective provision, with respect to such transaction, are 
        met.
    (d) Study and Report to Assess Effect of Safe Harbors on Health 
System.--
            (1) In general.--The Inspector General of the Department of 
        Health and Human Services shall conduct a study to determine 
        the impact of each of the safe harbors described in paragraph 
        (3). In particular, the study shall examine the following:
                    (A) The effectiveness of each safe harbor in 
                increasing the adoption of health information 
                technology.
                    (B) The types of health information technology 
                provided under each safe harbor.
                    (C) The extent to which the financial or other 
                business relationships between providers under each 
                safe harbor have changed as a result of the safe harbor 
                in a way that adversely affects or benefits the health 
                care system or choices available to consumers.
                    (D) The impact of the adoption of health 
                information technology on health care quality, cost, 
                and access under each safe harbor.
            (2) Report.--Not later than three years after the effective 
        date described in subsection (c)(1), the Secretary of Health 
        and Human Services shall submit to Congress a report on the 
        study under paragraph (1).
            (3) Safe harbors described.--For purposes of paragraphs (1) 
        and (2), the safe harbors described in this paragraph are--
                    (A) the safe harbor under section 1128A(b)(4) of 
                such Act (42 U.S.C. 1320a-7a(b)(4)), as added by 
                subsection (a)(1); and
                    (B) the safe harbor under section 1128B(b)(3)(J) of 
                such Act (42 U.S.C. 1320a-7b(b)(3)(J)), as added by 
                subsection (b).

SEC. 302. EXCEPTION TO LIMITATION ON CERTAIN PHYSICIAN REFERRALS (UNDER 
              STARK) FOR PROVISION OF HEALTH INFORMATION TECHNOLOGY AND 
              TRAINING SERVICES TO HEALTH CARE PROFESSIONALS.

    (a) In General.--Section 1877(b) of the Social Security Act (42 
U.S.C. 1395nn(b)) is amended by adding at the end the following new 
paragraph:
            ``(6) Information technology and training services.--
                    ``(A) In general.--Any nonmonetary remuneration (in 
                the form of health information technology or related 
                installation, maintenance, support or training 
                services) made by an entity that is a hospital, group 
                practice, prescription drug plan sponsor, or a Medicare 
                Advantage organization to a physician if--
                            ``(i) the provision of such remuneration is 
                        without an agreement between the parties or 
                        legal condition that--
                                    ``(I) limits or restricts the use 
                                of the health information technology to 
                                services provided by the physician to 
                                individuals receiving services at the 
                                entity;
                                    ``(II) limits or restricts the use 
                                of the health information technology in 
                                conjunction with other health 
                                information technology; or
                                    ``(III) conditions the provision of 
                                such remuneration on the referral of 
                                patients or business to the entity;
                            ``(ii) such remuneration is arranged for in 
                        a written agreement that is signed by the 
                        parties involved (or their representatives) and 
                        that specifies the remuneration made and states 
                        that the provision of such remuneration is made 
                        for the primary purpose of better coordination 
                        of care or improvement of health quality, 
                        efficiency, or research; and
                            ``(iii) the entity (or a representative of 
                        such entity) has not taken any action to 
                        disable any basic feature of any hardware or 
                        software component of such remuneration that 
                        would permit interoperability.
                    ``(B) Health information technology defined.--For 
                purposes of subparagraph (A), the term `health 
                information technology' means hardware, software, 
                license, right, intellectual property, equipment, or 
                other information technology (including new versions, 
                upgrades, and connectivity) designed primarily for the 
                electronic creation, maintenance, or exchange of health 
                information to better coordinate care or improve health 
                care quality, efficiency, or research.''.
    (b) Effective Date and Effect on State Laws.--
            (1) Effective date.--The amendment made by subsection (a) 
        shall take effect on the date that is 120 days after the date 
        of the enactment of this Act.
            (2) Preemption of state laws.--No State (as defined in 
        section 1101(a) of the Social Security Act (42 U.S.C. 1301(a)) 
        for purposes of title XI of such Act) shall have in effect a 
        State law that imposes a criminal or civil penalty for a 
        transaction described in section 1877(b)(6) of such Act, as 
        added by subsection (a), if the conditions described in such 
        section, with respect to such transaction, are met.
    (c) Study and Report to Assess Effect of Exception on Health 
System.--
            (1) In general.--The Inspector General of the Department of 
        Health and Human Services shall conduct a study to determine 
        the impact of the exception under section 1877(b)(6) of such 
        Act (42 U.S.C. 1395nn(b)(6)), as added by subsection (a). In 
        particular, the study shall examine the following:
                    (A) The effectiveness of the exception in 
                increasing the adoption of health information 
                technology.
                    (B) The types of health information technology 
                provided under the exception.
                    (C) The extent to which the financial or other 
                business relationships between providers under the 
                exception have changed as a result of the exception in 
                a way that adversely affects or benefits the health 
                care system or choices available to consumers.
                    (D) The impact of the adoption of health 
                information technology on health care quality, cost, 
                and access under the exception.
            (2) Report.--Not later than three years after the effective 
        date described in subsection (b)(1), the Secretary of Health 
        and Human Services shall submit to Congress a report on the 
        study under paragraph (1).

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Health Information 
Technology Promotion Act of 2006''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title and table of contents.
Sec. 2. Office of the National Coordinator for Health Information 
                            Technology.
Sec. 3. Safe harbors for provision of health information technology and 
                            services to health care professionals.
Sec. 4. Commonality and variation in health information laws and 
                            regulations.
Sec. 5. Implementing modern coding system; application under part A of 
                            the Medicare program.
Sec. 6. Procedures to ensure timely updating of standards that enable 
                            electronic exchanges.
Sec. 7. Report on the American Health Information Community.
Sec. 8. Strategic plan for coordinating implementation of health 
                            information technology.
Sec. 9. Promotion of telehealth services.

SEC. 2. OFFICE OF THE NATIONAL COORDINATOR FOR HEALTH INFORMATION 
              TECHNOLOGY.

    (a) In General.--Title II of the Public Health Service Act is 
amended by adding at the end the following new part:

                ``PART D--HEALTH INFORMATION TECHNOLOGY

``SEC. 271. OFFICE OF THE NATIONAL COORDINATOR FOR HEALTH INFORMATION 
              TECHNOLOGY.

    ``(a) Establishment.--There is established within the Department of 
Health and Human Services an Office of the National Coordinator for 
Health Information Technology that shall be headed by the National 
Coordinator for Health Information Technology (referred to in this 
section as the `National Coordinator'). The National Coordinator shall 
be appointed by the President and shall report directly to the 
Secretary. The National Coordinator shall be paid at a rate equal to 
the rate of basic pay for level IV of the Executive Schedule.
    ``(b) Goals of Nationwide Interoperable Health Information 
Technology Infrastructure.--The National Coordinator shall perform the 
duties under subsection (c) in a manner consistent with the development 
of a nationwide interoperable health information technology 
infrastructure that--
            ``(1) improves health care quality, reduces medical errors, 
        increases the efficiency of care, and advances the delivery of 
        appropriate, evidence-based health care services;
            ``(2) promotes wellness, disease prevention, and management 
        of chronic illnesses by increasing the availability and 
        transparency of information related to the health care needs of 
        an individual for such individual;
            ``(3) ensures that appropriate information necessary to 
        make medical decisions is available in a usable form at the 
        time and in the location that the medical service involved is 
        provided;
            ``(4) produces greater value for health care expenditures 
        by reducing health care costs that result from inefficiency, 
        medical errors, inappropriate care, and incomplete information;
            ``(5) promotes a more effective marketplace, greater 
        competition, greater systems analysis, increased choice, 
        enhanced quality, and improved outcomes in health care 
        services;
            ``(6) improves the coordination of information and the 
        provision of such services through an effective infrastructure 
        for the secure and authorized exchange and use of health care 
        information; and
            ``(7) ensures that the confidentiality of individually 
        identifiable health information of a patient is secure and 
        protected.
    ``(c) Duties of National Coordinator.--
            ``(1) Strategic planner for interoperable health 
        information technology.--The National Coordinator shall 
        maintain, direct, and oversee the continuous improvement of a 
        strategic plan to guide the nationwide implementation of 
        interoperable health information technology in both the public 
        and private health care sectors consistent with subsection (b).
            ``(2) Principal advisor to hhs.--The National Coordinator 
        shall serve as the principal advisor of the Secretary on the 
        development, application, and use of health information 
        technology, and coordinate the health information technology 
        programs of the Department of Health and Human Services.
            ``(3) Coordinator of federal government activities.--
                    ``(A) In general.--The National Coordinator shall 
                serve as the coordinator of Federal Government 
                activities relating to health information technology.
                    ``(B) Specific coordination functions.--In carrying 
                out subparagraph (A), the National Coordinator shall 
                provide for--
                            ``(i) the development and approval of 
                        standards used in the electronic creation, 
                        maintenance, or exchange of health information; 
                        and
                            ``(ii) the certification and inspection of 
                        health information technology products, 
                        exchanges, and architectures to ensure that 
                        such products, exchanges, and architectures 
                        conform to the applicable standards approved 
                        under clause (i).
                    ``(C) Use of private entities.--The National 
                Coordinator shall, to the maximum extent possible, 
                contract with or recognize private entities in carrying 
                out subparagraph (B).
                    ``(D) Uniform application of standards.--A standard 
                approved under subparagraph (B)(i) for use in the 
                electronic creation, maintenance, or exchange of health 
                information shall preempt a standard adopted under 
                State law, regulation, or rule for such a use.
            ``(4) Intragovernmental coordinator.--The National 
        Coordinator shall ensure that health information technology 
        policies and programs of the Department of Health and Human 
        Services are coordinated with those of relevant executive 
        branch agencies and departments with a goal to avoid 
        duplication of effort and to ensure that each agency or 
        department conducts programs within the areas of its greatest 
        expertise and its mission in order to create a national 
        interoperable health information system capable of meeting 
        national public health needs effectively and efficiently.
            ``(5) Advisor to omb.--The National Coordinator shall 
        provide to the Director of the Office of Management and Budget 
        comments and advice with respect to specific Federal health 
        information technology programs.
    ``(d) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as may be necessary to carry out this section 
for each of fiscal years 2006 through 2010.''.
    (b) Treatment of Executive Order 13335.--Executive Order 13335 
shall not have any force or effect after the date of the enactment of 
this Act.
    (c) Transition From ONCHIT Under Executive Order.--
            (1) In general.--All functions, personnel, assets, 
        liabilities, administrative actions, and statutory reporting 
        requirements applicable to the old National Coordinator or the 
        Office of the old National Coordinator on the date before the 
        date of the enactment of this Act shall be transferred, and 
        applied in the same manner and under the same terms and 
        conditions, to the new National Coordinator and the Office of 
        the new National Coordinator as of the date of the enactment of 
        this Act.
            (2) Acting national coordinator.--Before the appointment of 
        the new National Coordinator, the old National Coordinator 
        shall act as the National Coordinator for Health Information 
        Technology until the office is filled as provided in section 
        271(a) of the Public Health Service Act, as added by subsection 
        (a). The President may appoint the old National Coordinator as 
        the new National Coordinator.
            (3) Definitions.--For purposes of this subsection:
                    (A) New national coordinator.--The term ``new 
                National Coordinator'' means the National Coordinator 
                for Health Information Technology appointed under 
                section 271(a) of the Public Health Service Act, as 
                added by subsection (a).
                    (B) Old national coordinator.--The term ``old 
                National Coordinator'' means the National Coordinator 
                for Health Information Technology appointed under 
                Executive Order 13335.

SEC. 3. SAFE HARBORS FOR PROVISION OF HEALTH INFORMATION TECHNOLOGY AND 
              SERVICES TO HEALTH CARE PROFESSIONALS.

    (a) For Civil Penalties.--Section 1128A(b) of the Social Security 
Act (42 U.S.C. 1320a-7a(b)) is amended by adding at the end the 
following new paragraph:
    ``(4)(A) For purposes of this subsection, a payment described in 
paragraph (1) does not include any nonmonetary remuneration (in the 
form of health information technology and related services) made on or 
after the HIT effective date (as defined in subparagraph (B)(ii)) by a 
hospital or critical access hospital to a physician if the following 
requirements are met:
            ``(i) The provision of such remuneration is made without a 
        condition that--
                    ``(I) limits or restricts the use of the health 
                information technology to services provided by the 
                physician to individuals receiving services at the 
                location of the hospital or critical access hospital 
                providing such technology;
                    ``(II) limits or restricts the use of the health 
                information technology in conjunction with other health 
                information technology; or
                    ``(III) takes into account the volume or value of 
                referrals (or other business generated) by the 
                physician to the hospital or critical access hospital.
            ``(ii) Such remuneration is arranged for in a written 
        agreement that is signed by a representative of the hospital or 
        critical access hospital and by the physician and that 
        specifies the remuneration made and states that the provision 
        of such remuneration is made for the primary purpose of better 
        coordination of care or improvement of health care quality or 
        efficiency.
    ``(B) For purposes of subparagraph (A) and sections 1128B(b)(3)(J) 
and 1877(e)(9)--
            ``(i) the term `health information technology' means 
        hardware, software, license, intellectual property, equipment, 
        or other information technology (including new versions, 
        upgrades, and connectivity) or related services used for the 
        electronic creation, maintenance, and exchange of clinical 
        health information; and
            ``(ii) the term `HIT effective date' means the date that is 
        180 days after the date of the enactment of this paragraph.''.
    (b) For Criminal Penalties.--Section 1128B(b)(3) of such Act (42 
U.S.C. 1320a-7b(b)(3)) is amended--
            (1) in subparagraph (G), by striking ``and'' at the end;
            (2) in the subparagraph (H) as added by section 237(d) of 
        the Medicare Prescription Drug, Improvement, and Modernization 
        Act of 2003 (Public Law 108-173; 117 Stat. 2213)--
                    (A) by moving such subparagraph 2 ems to the left; 
                and
                    (B) by striking the period at the end and inserting 
                a semicolon;
            (3) in the subparagraph (H) added by section 431(a) of such 
        Act (117 Stat. 2287)--
                    (A) by redesignating such subparagraph as 
                subparagraph (I);
                    (B) by moving such subparagraph 2 ems to the left; 
                and
                    (C) by striking the period at the end and inserting 
                ``; and''; and
            (4) by adding at the end the following new subparagraph:
            ``(J) any nonmonetary remuneration (in the form of health 
        information technology, as defined in section 
        1128A(b)(4)(B)(i), and related services) solicited or received 
        by a person on or after the HIT effective date (as defined in 
        section 1128A(b)(4)(B)(ii)) (or offered or paid to a person on 
        or after such date) if--
                    ``(i) such remuneration is solicited or received 
                (or offered or paid) without a condition that--
                            ``(I) limits or restricts the use of the 
                        health information technology to services 
                        provided by the person to individuals receiving 
                        services at the location of the entity 
                        providing such technology;
                            ``(II) limits or restricts the use of the 
                        health information technology in conjunction 
                        with other health information technology; or
                            ``(III) takes into account the volume or 
                        value of referrals (or other business 
                        generated) by the person to the entity 
                        providing such technology; and
                    ``(ii) such remuneration is arranged for in a 
                written agreement that is signed by a representative of 
                the entity and by the physician and that specifies the 
                remuneration made and states that the provision of such 
                remuneration is made for the primary purpose of better 
                coordination of care or improvement of health care 
                quality or efficiency.''.
    (c) For Limitation on Certain Physician Referrals.--Section 1877(e) 
of such Act (42 U.S.C. 1395nn(e)) is amended by adding at the end the 
following new paragraph:
            ``(9) Information technology and services.--Any nonmonetary 
        remuneration (in the form of health information technology, as 
        defined in section 1128A(b)(4)(B)(i), and related services) 
        made on or after the HIT effective date (as defined in section 
        1128A(b)(4)(B)(ii)) by an entity to a physician if the 
        following requirements are met:
                    ``(A) The provision of such remuneration is made 
                without a condition that--
                            ``(i) limits or restricts the use of the 
                        health information technology to services 
                        provided by the physician to individuals 
                        receiving services at the location of the 
                        entity providing such technology;
                            ``(ii) limits or restricts the use of the 
                        health information technology in conjunction 
                        with other health information technology; or
                            ``(iii) takes into account the volume or 
                        value of referrals (or other business 
                        generated) by the physician to the entity 
                        providing such technology.
                    ``(B) Such remuneration is arranged for in a 
                written agreement that is signed by a representative of 
                the entity and by the physician and that specifies the 
                remuneration made and states that the provision of such 
                remuneration is made for the primary purpose of better 
                coordination of care or improvement of health care 
                quality or efficiency.''.
    (d) Regulation, Effective Date, and Effect on State Laws.--
            (1) Regulations.--Not later than the HIT effective date, 
        the Secretary of Health and Human Services shall promulgate 
        such regulations as may be necessary to carry out the 
        provisions of this section.
            (2) HIT effective date defined.--For purposes of this 
        subsection and subsection (e), the term ``HIT effective date'' 
        has the meaning given such term in section 1128A(b)(4)(B)(ii) 
        of the Social Security Act, as added by subsection (a).
            (3) Preemption of state laws.--No State (as defined in 
        section 4(c)(3)) shall have in effect a State law that imposes 
        a criminal or civil penalty for a transaction described in 
        section 1128A(b)(4), 1128B(b)(3)(J), or 1877(e)(9) of the 
        Social Security Act, as added by this section, if the 
        conditions described in the respective section of such Act, 
        with respect to such transaction, are met.
    (e) Study and Report to Assess Effect of Safe Harbors and Exception 
on Health System.--
            (1) In general.--The Secretary of Health and Human Services 
        shall conduct a study to determine the impact of each of the 
        safe harbors and the exception described in paragraph (3). In 
        particular, the study shall examine the following:
                    (A) The effectiveness of each safe harbor and 
                exception in increasing the adoption of health 
                information technology.
                    (B) The types of health information technology 
                provided under each safe harbor and exception.
                    (C) The extent to which the financial or other 
                business relationships between providers under each 
                safe harbor or exception have changed as a result of 
                the safe harbor or exception in a way that affects the 
                health care system, affects choices available to 
                consumers, or affects health care expenditures.
            (2) Report.--Not later than three years after the HIT 
        effective date, the Secretary of Health and Human Services 
        shall submit to Congress a report on the study under paragraph 
        (1) and shall include such recommendations for changes in the 
        safe harbors and exception as the Secretary determines may be 
        appropriate.
            (3) Safe harbors and exception described.--For purposes of 
        this subsection, the safe harbors and exception described in 
        this paragraph are--
                    (A) the safe harbor under section 1128A(b)(4) of 
                the Social Security Act (42 U.S.C. 1320a-7a(b)(4)), as 
                added by subsection (a);
                    (B) the safe harbor under section 1128B(b)(3)(J) of 
                such Act (42 U.S.C. 1320a-7b(b)(3)(J)), as added by 
                subsection (b); and
                    (C) the exception under section 1877(e)(9) of such 
                Act (42 U.S.C. 1395nn(e)(9)), as added by subsection 
                (c).

SEC. 4. COMMONALITY AND VARIATION IN HEALTH INFORMATION LAWS AND 
              REGULATIONS.

    (a) Study to Determine Impact of Variation and Commonality in State 
Health Information Laws and Regulations.--
            (1) In general.--For purposes of promoting the development 
        of a nationwide interoperable health information technology 
        infrastructure consistent with section 271(b) of the Public 
        Health Service Act (as added by section 2(a)), the Secretary of 
        Health and Human Services shall conduct a study of the impact 
        of variation in State security and confidentiality laws and 
        current Federal security and confidentiality standards on the 
        timely exchanges of health information in order to ensure the 
        availability of health information necessary to make medical 
        decisions at the location in which the medical care involved is 
        provided. Such study shall examine--
                    (A)(i) the degree of variation and commonality 
                among the requirements of such laws for States; and
                    (ii) the degree of variation and commonality 
                between the requirements of such laws and the current 
                Federal standards;
                    (B) insofar as there is variation among and between 
                such requirements, the strengths and weaknesses of such 
                requirements; and
                    (C) the extent to which such variation may 
                adversely impact the secure, confidential, and timely 
                exchange of health information among States, the 
                Federal government, and public and private entities, or 
                may otherwise impact the reliability of such 
                information.
            (2) Report.--Not later than 18 months after the date of the 
        enactment of this Act, the Secretary of Health and Human 
        Services shall submit to Congress a report on the study under 
        paragraph (1) and shall include in such report the following:
                    (A) Analysis of need for greater commonality.--A 
                determination by the Secretary on the extent to which 
                there is a need for greater commonality of the 
                requirements of State security and confidentiality laws 
                and current Federal security and confidentiality 
                standards to better protect or strengthen the security 
                and confidentiality of health information in the timely 
                exchange of health information among States, the 
                Federal government, and public and private entities.
                    (B) Recommendations for greater commonality.--
                Insofar as the Secretary determines under subparagraph 
                (A) that there is a need for greater commonality of 
                such requirements, the extent to which (and how) the 
                current Federal standards should be changed, and the 
                extent to which (and how) the State laws should be 
                conformed, in order to provide the commonality needed 
                to better protect or strengthen the security and 
                confidentiality of health information in the timely 
                exchange of health information.
    (b) Implementation of Recommendations if Congress Fails to Act.--
            (1) In general.--If the conditions under paragraph (2) are 
        met, the Secretary shall, by regulation, modify the current 
        Federal security and confidentiality standards to the extent 
        that the Secretary determines it necessary in order to achieve 
        the needed degree of commonality to better protect or 
        strengthen the security and confidentiality of health 
        information in the timely exchange of health information. Such 
        a modification shall be based upon the recommendations 
        described in subsection (a)(2)(B), and if the Secretary 
        modifies a current Federal security and confidentiality 
        standard, the modified standard shall supersede (and the 
        Secretary shall limit the permissibility of) any State security 
        and confidentiality law that relates to (but is different from) 
        such standard.
            (2) Conditions.--The conditions under this paragraph are 
        the following:
                    (A) Need for greater commonality.--The Secretary 
                determines under subsection (a)(2)(A) that there is a 
                need for greater commonality in the requirements of 
                State security and confidentiality laws and current 
                Federal security and confidentiality standards to 
                better protect or strengthen the security and 
                confidentiality of health information in the timely 
                exchange of health information among States, the 
                Federal government, and public and private entities.
                    (B) Congressional failure to act.--The Congress 
                fails to enact, within 18 months after the date of 
                receipt of the report under subsection (a)(2), 
                legislation that specifically responds to the 
                recommendations described in subsection (a)(2)(B). Such 
                legislation may include any action described in 
                paragraph (1) (relating to modifying Federal security 
                and confidentiality standards).
            (3) Treatment of current laws and standards.--
                    (A) Continuation of current federal standards and 
                state laws permitted.--Nothing in this subsection shall 
                be construed as preventing the Secretary from 
                continuing to apply the current Federal security and 
                confidentiality standards and from permitting the 
                continuance of State security and confidentiality laws 
                if such standards are not modified.
                    (B) No preemption of state law unless rule 
                adopted.--A State security and confidentiality law 
                shall not be preempted under paragraph (1), except to 
                the extent the Secretary limits the application of such 
                law under such paragraph. The Secretary's exercise of 
                such authority supercedes the provisions of section 
                1178(a) of the Social Security Act (42 U.S.C. 1320d-
                7(a)) and section 264(c)(2) of the Health Insurance 
                Portability and Accountability Act of 1996 (42 U.S.C. 
                1320d-2 note).
    (c) Definitions.--For purposes of this section:
            (1) Current federal security and confidentiality 
        standards.--The term ``current Federal security and 
        confidentiality standards'' means the Federal privacy standards 
        established pursuant to section 264(c) of the Health Insurance 
        Portability and Accountability Act of 1996 (42 U.S.C. 1320d-2 
        note) and security standards established under section 1173(d) 
        of the Social Security Act.
            (2) Secretary.--The term ``Secretary'' means the Secretary 
        of Health and Human Services.
            (3) State.--The term ``State'' has the meaning given such 
        term when used in title XI of the Social Security Act, as 
        provided under section 1101(a) of such Act (42 U.S.C. 1301(a)).
            (4) State security and confidentiality laws.--The term 
        ``State security and confidentiality laws'' means State laws 
        and regulations relating to the privacy and confidentiality of 
        health information or to the security of such information.
    (d) Conforming Amendments.--
            (1) HIPAA.--Section 264(c)(2) of the Health Insurance 
        Portability and Accountability Act of 1996 (42 U.S.C. 1320d-2 
        note) is amended by striking ``A regulation'' and inserting 
        ``Subject to section 4(b) of the Health Information Technology 
        Promotion Act of 2006, a regulation''.
            (2) Title xi.--Section 1178(a) of the Social Security Act 
        (42 U.S.C. 1320d-7(a)) is amended, in the matter preceding 
        paragraph (1), by inserting ``Subject to section 4(b) of the 
        Health Information Technology Promotion Act of 2006--'' after 
        ``General Effect.--''.

SEC. 5. IMPLEMENTING MODERN CODING SYSTEM; APPLICATION UNDER PART A OF 
              THE MEDICARE PROGRAM.

    (a) Upgrading ASC X12 and NCPDP Standards.--
            (1) In general.--The Secretary of Health and Human Services 
        shall provide by notice published in the Federal Register for 
        the following replacements of standards to apply, including for 
        purposes of part A of title XVIII of such Act:
                    (A) Accredited standards committee x12 (asc x12) 
                standard.--The replacement of the Accredited Standards 
                Committee X12 (ASC X12) version 4010 adopted under 
                section 1173(a) of such Act (42 U.S.C. 1320d-2(a)) with 
                the ASC X12 version 5010, as reviewed by the National 
                Committee on Vital Health Statistics.
                    (B) National council for prescription drug programs 
                (ncpdp) telecommunications standards.--The replacement 
                of the National Council for Prescription Drug Programs 
                (NCPDP) Telecommunications Standards version 5.1 
                adopted under section 1173(a) of such Act (42 U.S.C. 
                1320d-2(a)) with whichever is the latest version (as 
                determined by the Secretary) of the NCPDP 
                Telecommunications Standards that has been approved by 
                such Council and reviewed by the National Committee on 
                Vital Health Statistics as of April 1, 2008.
            (2) Application.--The replacements made by paragraph (1) 
        shall apply, for purposes of section 1175(b)(2) of the Social 
        Security Act (42 U.S.C. 1320d-4(b)(2)), to transactions 
        occurring on or after April 1, 2009.
            (3) No judicial review.--The determination of the latest 
        version under paragraph (1)(B) shall not be subject to judicial 
        review.
    (b) Upgrading ICD Codes.--
            (1) In general.--The Secretary of Health and Human Services 
        shall provide by notice published in the Federal Register for 
        the replacement of the International Classification of 
        Diseases, 9th revision, Clinical Modification (ICD-9-CM) under 
        the regulation promulgated under section 1173(c) of the Social 
        Security Act (42 U.S.C. 1320d-2(c)), including for purposes of 
        part A of title XVIII of such Act, with both of the following:
                    (A) The International Classification of Diseases, 
                10th revision, Clinical Modification (ICD-10-CM).
                    (B) The International Classification of Diseases, 
                10th revision, Procedure Coding System (ICD-10-PCS).
            (2) Application.--The replacement made by paragraph (1) 
        shall apply, for purposes of section 1175(b)(2) of the Social 
        Security Act (42 U.S.C. 1320d-4(b)(2)), to services furnished 
        on or after October 1, 2009.
            (3) Rules of construction.--Nothing in paragraph (1) shall 
        be construed--
                    (A) as affecting the application of classification 
                methodologies or codes, such as CPT or HCPCS codes, 
                other than under the International Classification of 
                Diseases (ICD); or
                    (B) as superseding the authority of the Secretary 
                of Health and Human Services to maintain and modify the 
                coding set for ICD-10-CM and ICD-10-PCS, including 
                under the amendments made by section 6.
    (c) Application of Upgraded Standards Under Part A of the Medicare 
Program.--Section 1816 of the Social Security Act (42 U.S.C. 1395h) is 
amended by inserting after subsection (a) the following new subsection:
    ``(b) With respect to--
            ``(1) transactions under this part occurring on or after 
        April 1, 2009, all providers of services shall use ASC X12 
        version 5010 with respect to services provided under this part 
        in compliance with section 5(a) of the Health Information 
        Technology Promotion Act of 2006; and
            ``(2) services furnished on or after October 1, 2009--
                    ``(A) all providers of services shall use ICD-10-CM 
                codes with respect to services provided under this part 
                in compliance with section 5(b) of such Act; and
                    ``(B) hospitals shall use ICD-10-PCS codes (as well 
                as ICD-10-CM codes) with respect to inpatient hospital 
                services provided under this part in compliance with 
                such section.''.

SEC. 6. PROCEDURES TO ENSURE TIMELY UPDATING OF STANDARDS THAT ENABLE 
              ELECTRONIC EXCHANGES.

    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 section 
                1173(c)(2), the term `modification' includes 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 standards.--
                    ``(A) In general.--For purposes of paragraph (1), 
                the Secretary shall provide for an expedited upgrade 
                program (in this paragraph referred to as the `upgrade 
                program'), in accordance with this paragraph, to 
                develop and approve additions and modifications to the 
                standards 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 initiation of 
                        process.--Not later than 30 days after the date 
                        the Secretary receives a notice from a standard 
                        setting organization that the organization is 
                        initiating a process to develop an addition or 
                        modification to a standard adopted under 
                        section 1173, the Secretary shall publish a 
                        notice 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 preliminary 
                        draft of additions or modifications to 
                        standards.--Not later than 30 days after the 
                        date the Secretary receives a notice from a 
                        standard setting organization that the 
                        organization has prepared a preliminary draft 
                        of an addition or modification to a standard 
                        adopted by section 1173, the Secretary shall 
                        publish a notice in the Federal Register that--
                                    ``(I) identifies the subject matter 
                                of (and summarizes) the draft;
                                    ``(II) specifies the procedure for 
                                obtaining documentation for the draft;
                                    ``(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 
                                draft; and
                                    ``(IV) invites submission of such 
                                comments and participation in such 
                                hearing or meeting.
                            ``(iii) Notice of proposed addition or 
                        modification to standards.--Not later than 30 
                        days after the date the Secretary receives a 
                        notice from a standard setting organization 
                        that the organization has a proposed addition 
                        or modification to a standard adopted under 
                        section 1173 that the organization intends to 
                        submit under subparagraph (D)(iii), the 
                        Secretary shall publish a notice in the Federal 
                        Register that contains, with respect to the 
                        proposed addition or modification, the 
                        information required in the notice under clause 
                        (ii) with respect to a preliminary draft of an 
                        addition or modification.
                            ``(iv) Construction.--Nothing in this 
                        paragraph shall be construed as requiring 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 determination.--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, 
                if the Secretary determines that the standard setting 
                organization developed such addition or modification in 
                accordance with the requirements of subparagraph (D) 
                and the National Committee on Vital and Health 
                Statistics recommends approval of such addition or 
                modification under subparagraph (E), the Secretary 
                shall provide for expedited treatment of such proposal 
                in accordance with subparagraph (F).
                    ``(D) Requirements.--The requirements under this 
                subparagraph with respect to a proposed addition or 
                modification to a standard by a standard setting 
                organization are the following:
                            ``(i) Request for publication of notice.--
                        The standard setting organization submits to 
                        the Secretary a request for publication in the 
                        Federal Register of a notice 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 publication of the 
                        notice referred to under clause (i), the 
                        organization--
                                    ``(I) receives and responds to 
                                public comments submitted on a timely 
                                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); 
                                and
                                    ``(II) makes publicly available a 
                                written explanation for its response in 
                                the proposed addition or modification 
                                to comments submitted on a timely 
                                basis.
                            ``(iii) Submittal of final proposed 
                        addition or modification to ncvhs.--After 
                        completion of the process under clause (ii), 
                        the standard setting organization 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 
                        responses to those comments) under clause (ii).
                    ``(E) Hearing and recommendations by national 
                committee on vital and health statistics.--Under the 
                upgrade program, upon receipt of a proposal submitted 
                by a standard setting organization under subparagraph 
                (D)(iii) for the adoption of an addition or 
                modification to a standard, the National Committee on 
                Vital and Health Statistics shall provide notice to the 
                public and a reasonable opportunity for public 
                testimony at a hearing on such addition or 
                modification. The Secretary may participate in such 
                hearing in such capacity (including presiding ex 
                officio) as the Secretary shall determine appropriate. 
                Not later than 120 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 recommendation.--
                            ``(i) Timely determination.--Under the 
                        upgrade program, if the National Committee on 
                        Vital and Health Statistics submits to the 
                        Secretary a recommendation under subparagraph 
                        (E) to adopt a proposed addition or 
                        modification, not later than 90 days after the 
                        date of receipt of such recommendation the 
                        Secretary shall make a determination to accept 
                        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 recommendation, 
                        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 accepted proposed 
                        addition or modification accepted) as a final 
                        rule under this subsection without any further 
                        notice or public comment period.
                            ``(iii) Limitation on consideration.--The 
                        Secretary shall not consider a proposal under 
                        this subparagraph unless the Secretary 
                        determines that the requirements of 
                        subparagraph (D) (including publication of 
                        notice and opportunity for public comment) have 
                        been met with respect to the proposal.
                    ``(G) Treatment as satisfying requirements for 
                notice-and-comment.--Any requirements under section 553 
                of title 5, United States Code, relating to notice and 
                an opportunity for public comment with respect to a 
                final rule promulgated under subparagraph (F) shall be 
                treated as having been met by meeting the requirements 
                of the notice and opportunity for public comment 
                provided under provisions of subparagraphs (B)(iii), 
                (D), and (E).
                    ``(H) No judicial review.--A final rule promulgated 
                under subparagraph (F) shall not be subject to judicial 
                review.''.

SEC. 7. REPORT ON THE AMERICAN HEALTH INFORMATION COMMUNITY.

    Not later than one year after the date of the enactment of this 
Act, the Secretary of Health and Human Services shall submit to 
Congress a report on the work conducted by the American Health 
Information Community (in this section referred to as ``AHIC''), as 
established by the Secretary. Such report shall include the following:
            (1) A description of the accomplishments of AHIC, with 
        respect to the promotion of the development of a nationwide 
        health information network and the increased adoption of health 
        information technology.
            (2) Information identifying the practices that are used to 
        protect health information and to guarantee confidentiality and 
        security of such information.
            (3) Information on the progress in--
                    (A) establishing uniform industry-wide health 
                information technology standards;
                    (B) achieving an internet-based nationwide health 
                information network;
                    (C) achieving interoperable electronic health 
                record adoption across health care providers; and
                    (D) making available technological and other 
                innovations to ensure the security and confidentiality 
                of health information in the promotion of health 
                information technology.
            (4) Recommendations for the transition of the AHIC to a 
        permanent entity, including--
                    (A) a schedule for such transition;
                    (B) options for structuring the entity as either a 
                public-private or private sector entity;
                    (C) the collaborative role of the Federal 
                Government in the entity; and
                    (D) the ongoing responsibilities of the entity, 
                such as providing the leadership and planning in 
                establishing standards, certifying health information 
                technology, and providing long-term governance for 
                health care transformation through technology.

SEC. 8. STRATEGIC PLAN FOR COORDINATING IMPLEMENTATION OF HEALTH 
              INFORMATION TECHNOLOGY.

    (a) In General.--Not later than 180 days after the date of the 
enactment of this Act, the Secretary of Health and Human Services, in 
consultation with public and private entities involved in the area of 
health information technology, shall develop a strategic plan related 
to the need for coordination in such area.
    (b) Coordination of Specific Implementation Processes.--The 
strategic plan under subsection (a) shall address the need for 
coordination in the implementation of the following:
            (1) Health information technology standards.--Health 
        information technology standards approved under section 
        271(c)(3)(B)(i) of the Public Health Service Act, as added by 
        section 2.
            (2) HIPAA transaction standards.--Transaction standards 
        under section 1173(a) of the Social Security Act (42 U.S.C. 
        1320d-2(d)).
            (3) Updated icd codes.--The International Statistical 
        Classification of Diseases and Related Health Problems, 10th 
        revision, Clinical Modification (ICD-10-CM) and the 
        International Statistical Classification of Diseases and 
        Related Health Problems, 10th revision, Procedure Coding System 
        (ICD-10-PCS) described in section 5.
    (c) Coordination Among Specific Federal Entities.--The strategic 
plan under subsection (a) shall address any methods to coordinate, with 
respect to the electronic exchange of health information, actions taken 
by the following entities:
            (1) The Office of the National Coordinator for Health 
        Information Technology.
            (2) The American Health Information Community.
            (3) The Office of Electronic Standards and Security of the 
        Centers for Medicare and Medicaid Services.
            (4) The National Committee on Vital Health Statistics.
            (5) Any other entity involved in the electronic exchange of 
        health information that the Secretary determines appropriate.

SEC. 9. PROMOTION OF TELEHEALTH SERVICES.

    (a) Facilitating the Provision of Telehealth Services Across State 
Lines.--
            (1) In general.--The Secretary of Health and Human Services 
        shall, in coordination with representatives of States, 
        physicians, health care practitioners, and patient advocates, 
        encourage and facilitate the adoption of State reciprocity 
        agreements for practitioner licensure in order to expedite the 
        provision across State lines of telehealth services.
            (2) Report.--Not later than 18 months after the date of the 
        enactment of this Act, the Secretary shall submit to Congress a 
        report on the actions taken to carry out paragraph (1).
            (3) State defined.--In this subsection, the term ``State'' 
        has the meaning given that term for purposes of title XVIII of 
        the Social Security Act.
    (b) Use of Store and Forward Technology.--
            (1) Study.--The Secretary of Health and Human Services, 
        acting through the Director of the Office for the Advancement 
        of Telehealth, shall conduct a study on the use of store and 
        forward technologies (that provide for the asynchronous 
        transmission of health care information in single or multimedia 
        formats) in the provision of telehealth services for which 
        payment may be made under the Medicare program. Such study 
        shall include an assessment of the feasibility, advisability, 
        and the costs of expanding the use of such technologies for use 
        in the diagnosis and treatment of certain conditions.
            (2) Report.--Not later than 18 months after the date of the 
        enactment of this Act, the Secretary shall submit to Congress a 
        report on the study conducted under paragraph (1) and shall 
        include in such report such recommendations for legislation or 
        administration action as the Secretary determines appropriate.
    (c) Expansion of Telehealth Services.--
            (1) Study.--The Secretary of Health and Human Services, in 
        coordination with the Office for the Advancement of Telehealth, 
        the Agency for Healthcare Research and Quality, and the Centers 
        for Medicare and Medicaid Services, shall conduct a study to 
        determine the feasibility, advisability, and the costs of--
                    (A) including coverage and payment for home health-
                related telehealth services as part of home health 
                services under title XVIII of the Social Security Act; 
                and
                    (B) expanding the list of sites described in 
                paragraph (4)(C)(ii) of section 1834(m) of the Social 
                Security Act (42 U.S.C. 1395m(m)) to include county 
                mental health clinics or other publicly funded mental 
                health facilities for the purpose of payment under such 
                section for the provision of telehealth services at 
                such clinics or facilities.
            (2) Specifics of study.--Such study shall demonstrate 
        whether the changes described in subparagraphs (A) and (B) of 
        paragraph (1) will result in the following:
                    (A) Enhanced health outcomes for individuals with 
                one or more chronic conditions.
                    (B) Health outcomes for individuals furnished 
                telehealth services or home health-related telehealth 
                services that are at least comparable to the health 
                outcomes for individuals furnished similar items and 
                services by a health care provider at the same location 
                of the individual or at the home of the individual, 
                respectively.
                    (C) Facilitation of communication of more accurate 
                clinical information between health care providers.
                    (D) Closer monitoring of individuals by health care 
                providers.
                    (E) Overall reduction in expenditures for health 
                care items and services.
                    (F) Improved access to health care.
            (3) Home health-related telehealth services defined.--For 
        purposes of this subsection, the term ``home health-related 
        telehealth services'' means technology-based professional 
        consultations, patient monitoring, patient training services, 
        clinical observation, patient assessment, and any other health 
        services that utilize telecommunications technologies. Such 
        term does not include a telecommunication that consists solely 
        of a telephone audio conversation, facsimile, electronic text 
        mail, or consultation between two health care providers.
            (4) Report.--Not later than 18 months after the date of the 
        enactment of this Act, the Secretary shall submit to Congress a 
        report on the study conducted under subparagraph (1) and shall 
        include in such report such recommendations for legislation or 
        administration action as the Secretary determines appropriate.
            Amend the title so as to read: ``A bill to promote a better 
        health information system.''.
                                                 Union Calendar No. 347

109th CONGRESS

  2d Session

                               H. R. 4157

                  [Report No. 109-601, Parts I and II]

_______________________________________________________________________

                                 A BILL

   To amend the Social Security Act to encourage the dissemination, 
    security, confidentiality, and usefulness of health information 
                              technology.

_______________________________________________________________________

                             July 26, 2006

   Reported from the Committee on Energy and Commerce with amendments

                             July 26, 2006

   Reported from the Committee on Ways and Means with an amendment; 
committed to the Committee of the Whole House on the State of the Union 
                       and ordered to be printed