    [Congressional Bills 111th Congress]
    [From the U.S. Government Publishing Office]
    [H.R. 3590 Engrossed Amendment Senate (EAS)]

                      In the Senate of the United States,

                                                         December 24, 2009.
          Resolved, That the bill from the House of Representatives (H.R.
    3590) entitled ``An Act to amend the Internal Revenue Code of 1986 to
    modify the first-time homebuyers credit in the case of members of the
    Armed Forces and certain other Federal employees, and for other
    purposes.'', do pass with the following

                                  AMENDMENTS:

                Strike all after the enacting clause and insert the
          following:

    SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

        (a) Short Title.--This Act may be cited as the ``Patient Protection
    and Affordable Care Act''.
        (b) Table of Contents.--The table of contents of this Act is as
    follows:

    Sec. 1. Short title; table of contents.

           TITLE I--QUALITY, AFFORDABLE HEALTH CARE FOR ALL AMERICANS

      Subtitle A--Immediate Improvements in Health Care Coverage for All
                                   Americans

    Sec. 1001. Amendments to the Public Health Service Act.

                 ``PART A--Individual and Group Market Reforms

                        ``subpart ii--improving coverage

            ``Sec. 2711. No lifetime or annual limits.
            ``Sec. 2712. Prohibition on rescissions.
            ``Sec. 2713. Coverage of preventive health services.
            ``Sec. 2714. Extension of dependent coverage.
            ``Sec. 2715. Development and utilization of uniform explanation
                                of coverage documents and standardized
                                definitions.
            ``Sec. 2716. Prohibition of discrimination based on salary.
            ``Sec. 2717. Ensuring the quality of care.
            ``Sec. 2718. Bringing down the cost of health care coverage.
            ``Sec. 2719. Appeals process.
    Sec. 1002. Health insurance consumer information.
    Sec. 1003. Ensuring that consumers get value for their dollars.
    Sec. 1004. Effective dates.

         Subtitle B--Immediate Actions to Preserve and Expand Coverage

    Sec. 1101. Immediate access to insurance for uninsured individuals with
                                a preexisting condition.
    Sec. 1102. Reinsurance for early retirees.
    Sec. 1103. Immediate information that allows consumers to identify
                                affordable coverage options.
    Sec. 1104. Administrative simplification.
    Sec. 1105. Effective date.

        Subtitle C--Quality Health Insurance Coverage for All Americans

                    PART I--Health Insurance Market Reforms

    Sec. 1201. Amendment to the Public Health Service Act.

                          ``subpart i--general reform

            ``Sec. 2704. Prohibition of preexisting condition exclusions or
                                other discrimination based on health
                                status.
            ``Sec. 2701. Fair health insurance premiums.
            ``Sec. 2702. Guaranteed availability of coverage.
            ``Sec. 2703. Guaranteed renewability of coverage.
            ``Sec. 2705. Prohibiting discrimination against individual
                                participants and beneficiaries based on
                                health status.
            ``Sec. 2706. Non-discrimination in health care.
            ``Sec. 2707. Comprehensive health insurance coverage.
            ``Sec. 2708. Prohibition on excessive waiting periods.

                           PART II--Other Provisions

    Sec. 1251. Preservation of right to maintain existing coverage.
    Sec. 1252. Rating reforms must apply uniformly to all health insurance
                                issuers and group health plans.
    Sec. 1253. Effective dates.

            Subtitle D--Available Coverage Choices for All Americans

                PART I--Establishment of Qualified Health Plans

    Sec. 1301. Qualified health plan defined.
    Sec. 1302. Essential health benefits requirements.
    Sec. 1303. Special rules.
    Sec. 1304. Related definitions.

      PART II--Consumer Choices and Insurance Competition Through Health
                               Benefit Exchanges

    Sec. 1311. Affordable choices of health benefit plans.
    Sec. 1312. Consumer choice.
    Sec. 1313. Financial integrity.

               PART III--State Flexibility Relating to Exchanges

    Sec. 1321. State flexibility in operation and enforcement of Exchanges
                                and related requirements.
    Sec. 1322. Federal program to assist establishment and operation of
                                nonprofit, member-run health insurance
                                issuers.
    Sec. 1323. Community health insurance option.
    Sec. 1324. Level playing field.

          PART IV--State Flexibility to Establish Alternative Programs

    Sec. 1331. State flexibility to establish basic health programs for
                                low-income individuals not eligible for
                                Medicaid.
    Sec. 1332. Waiver for State innovation.
    Sec. 1333. Provisions relating to offering of plans in more than one
                                State.

                    PART V--Reinsurance and Risk Adjustment

    Sec. 1341. Transitional reinsurance program for individual and small
                                group markets in each State.
    Sec. 1342. Establishment of risk corridors for plans in individual and
                                small group markets.
    Sec. 1343. Risk adjustment.

           Subtitle E--Affordable Coverage Choices for All Americans

            PART I--Premium Tax Credits and Cost-sharing Reductions

           subpart a--premium tax credits and cost-sharing reductions

    Sec. 1401. Refundable tax credit providing premium assistance for
                                coverage under a qualified health plan.
    Sec. 1402. Reduced cost-sharing for individuals enrolling in qualified
                                health plans.

                     subpart b--eligibility determinations

    Sec. 1411. Procedures for determining eligibility for Exchange
                                participation, premium tax credits and
                                reduced cost-sharing, and individual
                                responsibility exemptions.
    Sec. 1412. Advance determination and payment of premium tax credits and
                                cost-sharing reductions.
    Sec. 1413. Streamlining of procedures for enrollment through an
                                exchange and State Medicaid, CHIP, and
                                health subsidy programs.
    Sec. 1414. Disclosures to carry out eligibility requirements for
                                certain programs.
    Sec. 1415. Premium tax credit and cost-sharing reduction payments
                                disregarded for Federal and Federally-
                                assisted programs.

                       PART II--Small Business Tax Credit

    Sec. 1421. Credit for employee health insurance expenses of small
                                businesses.

               Subtitle F--Shared Responsibility for Health Care

                       PART I--Individual Responsibility

    Sec. 1501. Requirement to maintain minimum essential coverage.
    Sec. 1502. Reporting of health insurance coverage.

                       PART II--Employer Responsibilities

    Sec. 1511. Automatic enrollment for employees of large employers.
    Sec. 1512. Employer requirement to inform employees of coverage
                                options.
    Sec. 1513. Shared responsibility for employers.
    Sec. 1514. Reporting of employer health insurance coverage.
    Sec. 1515. Offering of Exchange-participating qualified health plans
                                through cafeteria plans.

                      Subtitle G--Miscellaneous Provisions

    Sec. 1551. Definitions.
    Sec. 1552. Transparency in government.
    Sec. 1553. Prohibition against discrimination on assisted suicide.
    Sec. 1554. Access to therapies.
    Sec. 1555. Freedom not to participate in Federal health insurance
                                programs.
    Sec. 1556. Equity for certain eligible survivors.
    Sec. 1557. Nondiscrimination.
    Sec. 1558. Protections for employees.
    Sec. 1559. Oversight.
    Sec. 1560. Rules of construction.
    Sec. 1561. Health information technology enrollment standards and
                                protocols.
    Sec. 1562. Conforming amendments.
    Sec. 1563. Sense of the Senate promoting fiscal responsibility.

                       TITLE II--ROLE OF PUBLIC PROGRAMS

                    Subtitle A--Improved Access to Medicaid

    Sec. 2001. Medicaid coverage for the lowest income populations.
    Sec. 2002. Income eligibility for nonelderly determined using modified
                                gross income.
    Sec. 2003. Requirement to offer premium assistance for employer-
                                sponsored insurance.
    Sec. 2004. Medicaid coverage for former foster care children.
    Sec. 2005. Payments to territories.
    Sec. 2006. Special adjustment to FMAP determination for certain States
                                recovering from a major disaster.
    Sec. 2007. Medicaid Improvement Fund rescission.

       Subtitle B--Enhanced Support for the Children's Health Insurance
                                    Program

    Sec. 2101. Additional federal financial participation for CHIP.
    Sec. 2102. Technical corrections.

            Subtitle C--Medicaid and CHIP Enrollment Simplification

    Sec. 2201. Enrollment Simplification and coordination with State Health
                                Insurance Exchanges.
    Sec. 2202. Permitting hospitals to make presumptive eligibility
                                determinations for all Medicaid eligible
                                populations.

                 Subtitle D--Improvements to Medicaid Services

    Sec. 2301. Coverage for freestanding birth center services.
    Sec. 2302. Concurrent care for children.
    Sec. 2303. State eligibility option for family planning services.
    Sec. 2304. Clarification of definition of medical assistance.

     Subtitle E--New Options for States to Provide Long-Term Services and
                                    Supports

    Sec. 2401. Community First Choice Option.
    Sec. 2402. Removal of barriers to providing home and community-based
                                services.
    Sec. 2403. Money Follows the Person Rebalancing Demonstration.
    Sec. 2404. Protection for recipients of home and community-based
                                services against spousal impoverishment.
    Sec. 2405. Funding to expand State Aging and Disability Resource
                                Centers.
    Sec. 2406. Sense of the Senate regarding long-term care.

                Subtitle F--Medicaid Prescription Drug Coverage

    Sec. 2501. Prescription drug rebates.
    Sec. 2502. Elimination of exclusion of coverage of certain drugs.
    Sec. 2503. Providing adequate pharmacy reimbursement.

      Subtitle G--Medicaid Disproportionate Share Hospital (DSH) Payments

    Sec. 2551. Disproportionate share hospital payments.

       Subtitle H--Improved Coordination for Dual Eligible Beneficiaries

    Sec. 2601. 5-year period for demonstration projects.
    Sec. 2602. Providing Federal coverage and payment coordination for dual
                                eligible beneficiaries.

        Subtitle I--Improving the Quality of Medicaid for Patients and
                                   Providers

    Sec. 2701. Adult health quality measures.
    Sec. 2702. Payment Adjustment for Health Care-Acquired Conditions.
    Sec. 2703. State option to provide health homes for enrollees with
                                chronic conditions.
    Sec. 2704. Demonstration project to evaluate integrated care around a
                                hospitalization.
    Sec. 2705. Medicaid Global Payment System Demonstration Project.
    Sec. 2706. Pediatric Accountable Care Organization Demonstration
                                Project.
    Sec. 2707. Medicaid emergency psychiatric demonstration project.

     Subtitle J--Improvements to the Medicaid and CHIP Payment and Access
                              Commission (MACPAC)

    Sec. 2801. MACPAC assessment of policies affecting all Medicaid
                                beneficiaries.

        Subtitle K--Protections for American Indians and Alaska Natives

    Sec. 2901. Special rules relating to Indians.
    Sec. 2902. Elimination of sunset for reimbursement for all medicare
                                part B services furnished by certain indian
                                hospitals and clinics.

                 Subtitle L--Maternal and Child Health Services

    Sec. 2951. Maternal, infant, and early childhood home visiting
                                programs.
    Sec. 2952. Support, education, and research for postpartum depression.
    Sec. 2953. Personal responsibility education.
    Sec. 2954. Restoration of funding for abstinence education.
    Sec. 2955. Inclusion of information about the importance of having a
                                health care power of attorney in transition
                                planning for children aging out of foster
                                care and independent living programs.

         TITLE III--IMPROVING THE QUALITY AND EFFICIENCY OF HEALTH CARE

            Subtitle A--Transforming the Health Care Delivery System

     PART I--Linking Payment to Quality Outcomes Under the Medicare Program

    Sec. 3001. Hospital Value-Based purchasing program.
    Sec. 3002. Improvements to the physician quality reporting system.
    Sec. 3003. Improvements to the physician feedback program.
    Sec. 3004. Quality reporting for long-term care hospitals, inpatient
                                rehabilitation hospitals, and hospice
                                programs.
    Sec. 3005. Quality reporting for PPS-exempt cancer hospitals.
    Sec. 3006. Plans for a Value-Based purchasing program for skilled
                                nursing facilities and home health
                                agencies.
    Sec. 3007. Value-based payment modifier under the physician fee
                                schedule.
    Sec. 3008. Payment adjustment for conditions acquired in hospitals.

           PART II--National Strategy to Improve Health Care Quality

    Sec. 3011. National strategy.
    Sec. 3012. Interagency Working Group on Health Care Quality.
    Sec. 3013. Quality measure development.
    Sec. 3014. Quality measurement.
    Sec. 3015. Data collection; public reporting.

          PART III--Encouraging Development of New Patient Care Models

    Sec. 3021. Establishment of Center for Medicare and Medicaid Innovation
                                within CMS.
    Sec. 3022. Medicare shared savings program.
    Sec. 3023. National pilot program on payment bundling.
    Sec. 3024. Independence at home demonstration program.
    Sec. 3025. Hospital readmissions reduction program.
    Sec. 3026. Community-Based Care Transitions Program.
    Sec. 3027. Extension of gainsharing demonstration.

           Subtitle B--Improving Medicare for Patients and Providers

        PART I--Ensuring Beneficiary Access to Physician Care and Other
                                    Services

    Sec. 3101. Increase in the physician payment update.
    Sec. 3102. Extension of the work geographic index floor and revisions
                                to the practice expense geographic
                                adjustment under the Medicare physician fee
                                schedule.
    Sec. 3103. Extension of exceptions process for Medicare therapy caps.
    Sec. 3104. Extension of payment for technical component of certain
                                physician pathology services.
    Sec. 3105. Extension of ambulance add-ons.
    Sec. 3106. Extension of certain payment rules for long-term care
                                hospital services and of moratorium on the
                                establishment of certain hospitals and
                                facilities.
    Sec. 3107. Extension of physician fee schedule mental health add-on.
    Sec. 3108. Permitting physician assistants to order post-Hospital
                                extended care services.
    Sec. 3109. Exemption of certain pharmacies from accreditation
                                requirements.
    Sec. 3110. Part B special enrollment period for disabled TRICARE
                                beneficiaries.
    Sec. 3111. Payment for bone density tests.
    Sec. 3112. Revision to the Medicare Improvement Fund.
    Sec. 3113. Treatment of certain complex diagnostic laboratory tests.
    Sec. 3114. Improved access for certified nurse-midwife services.

                           PART II--Rural Protections

    Sec. 3121. Extension of outpatient hold harmless provision.
    Sec. 3122. Extension of Medicare reasonable costs payments for certain
                                clinical diagnostic laboratory tests
                                furnished to hospital patients in certain
                                rural areas.
    Sec. 3123. Extension of the Rural Community Hospital Demonstration
                                Program.
    Sec. 3124. Extension of the Medicare-dependent hospital (MDH) program.
    Sec. 3125. Temporary improvements to the Medicare inpatient hospital
                                payment adjustment for low-volume
                                hospitals.
    Sec. 3126. Improvements to the demonstration project on community
                                health integration models in certain rural
                                counties.
    Sec. 3127. MedPAC study on adequacy of Medicare payments for health
                                care providers serving in rural areas.
    Sec. 3128. Technical correction related to critical access hospital
                                services.
    Sec. 3129. Extension of and revisions to Medicare rural hospital
                                flexibility program.

                      PART III--Improving Payment Accuracy

    Sec. 3131. Payment adjustments for home health care.
    Sec. 3132. Hospice reform.
    Sec. 3133. Improvement to medicare disproportionate share hospital
                                (DSH) payments.
    Sec. 3134. Misvalued codes under the physician fee schedule.
    Sec. 3135. Modification of equipment utilization factor for advanced
                                imaging services.
    Sec. 3136. Revision of payment for power-driven wheelchairs.
    Sec. 3137. Hospital wage index improvement.
    Sec. 3138. Treatment of certain cancer hospitals.
    Sec. 3139. Payment for biosimilar biological products.
    Sec. 3140. Medicare hospice concurrent care demonstration program.
    Sec. 3141. Application of budget neutrality on a national basis in the
                                calculation of the Medicare hospital wage
                                index floor.
    Sec. 3142. HHS study on urban Medicare-dependent hospitals.
    Sec. 3143. Protecting home health benefits.

                   Subtitle C--Provisions Relating to Part C

    Sec. 3201. Medicare Advantage payment.
    Sec. 3202. Benefit protection and simplification.
    Sec. 3203. Application of coding intensity adjustment during MA payment
                                transition.
    Sec. 3204. Simplification of annual beneficiary election periods.
    Sec. 3205. Extension for specialized MA plans for special needs
                                individuals.
    Sec. 3206. Extension of reasonable cost contracts.
    Sec. 3207. Technical correction to MA private fee-for-service plans.
    Sec. 3208. Making senior housing facility demonstration permanent.
    Sec. 3209. Authority to deny plan bids.
    Sec. 3210. Development of new standards for certain Medigap plans.

     Subtitle D--Medicare Part D Improvements for Prescription Drug Plans
                                and MA-PD Plans

    Sec. 3301. Medicare coverage gap discount program.
    Sec. 3302. Improvement in determination of Medicare part D low-income
                                benchmark premium.
    Sec. 3303. Voluntary de minimis policy for subsidy eligible individuals
                                under prescription drug plans and MA-PD
                                plans.
    Sec. 3304. Special rule for widows and widowers regarding eligibility
                                for low-income assistance.
    Sec. 3305. Improved information for subsidy eligible individuals
                                reassigned to prescription drug plans and
                                MA-PD plans.
    Sec. 3306. Funding outreach and assistance for low-income programs.
    Sec. 3307. Improving formulary requirements for prescription drug plans
                                and MA-PD plans with respect to certain
                                categories or classes of drugs.
    Sec. 3308. Reducing part D premium subsidy for high-income
                                beneficiaries.
    Sec. 3309. Elimination of cost sharing for certain dual eligible
                                individuals.
    Sec. 3310. Reducing wasteful dispensing of outpatient prescription
                                drugs in long-term care facilities under
                                prescription drug plans and MA-PD plans.
    Sec. 3311. Improved Medicare prescription drug plan and MA-PD plan
                                complaint system.
    Sec. 3312. Uniform exceptions and appeals process for prescription drug
                                plans and MA-PD plans.
    Sec. 3313. Office of the Inspector General studies and reports.
    Sec. 3314. Including costs incurred by AIDS drug assistance programs
                                and Indian Health Service in providing
                                prescription drugs toward the annual out-
                                of-pocket threshold under part D.
    Sec. 3315. Immediate reduction in coverage gap in 2010.

                  Subtitle E--Ensuring Medicare Sustainability

    Sec. 3401. Revision of certain market basket updates and incorporation
                                of productivity improvements into market
                                basket updates that do not already
                                incorporate such improvements.
    Sec. 3402. Temporary adjustment to the calculation of part B premiums.
    Sec. 3403. Independent Medicare Advisory Board.

                  Subtitle F--Health Care Quality Improvements

    Sec. 3501. Health care delivery system research; Quality improvement
                                technical assistance.
    Sec. 3502. Establishing community health teams to support the patient-
                                centered medical home.
    Sec. 3503. Medication management services in treatment of chronic
                                disease.
    Sec. 3504. Design and implementation of regionalized systems for
                                emergency care.
    Sec. 3505. Trauma care centers and service availability.
    Sec. 3506. Program to facilitate shared decisionmaking.
    Sec. 3507. Presentation of prescription drug benefit and risk
                                information.
    Sec. 3508. Demonstration program to integrate quality improvement and
                                patient safety training into clinical
                                education of health professionals.
    Sec. 3509. Improving women's health.
    Sec. 3510. Patient navigator program.
    Sec. 3511. Authorization of appropriations.

       Subtitle G--Protecting and Improving Guaranteed Medicare Benefits

    Sec. 3601. Protecting and improving guaranteed Medicare benefits.
    Sec. 3602. No cuts in guaranteed benefits.

      TITLE IV--PREVENTION OF CHRONIC DISEASE AND IMPROVING PUBLIC HEALTH

      Subtitle A--Modernizing Disease Prevention and Public Health Systems

    Sec. 4001. National Prevention, Health Promotion and Public Health
                                Council.
    Sec. 4002. Prevention and Public Health Fund.
    Sec. 4003. Clinical and community preventive services.
    Sec. 4004. Education and outreach campaign regarding preventive
                                benefits.

         Subtitle B--Increasing Access to Clinical Preventive Services

    Sec. 4101. School-based health centers.
    Sec. 4102. Oral healthcare prevention activities.
    Sec. 4103. Medicare coverage of annual wellness visit providing a
                                personalized prevention plan.
    Sec. 4104. Removal of barriers to preventive services in Medicare.
    Sec. 4105. Evidence-based coverage of preventive services in Medicare.
    Sec. 4106. Improving access to preventive services for eligible adults
                                in Medicaid.
    Sec. 4107. Coverage of comprehensive tobacco cessation services for
                                pregnant women in Medicaid.
    Sec. 4108. Incentives for prevention of chronic diseases in medicaid.

                   Subtitle C--Creating Healthier Communities

    Sec. 4201. Community transformation grants.
    Sec. 4202. Healthy aging, living well; evaluation of community-based
                                prevention and wellness programs for
                                Medicare beneficiaries.
    Sec. 4203. Removing barriers and improving access to wellness for
                                individuals with disabilities.
    Sec. 4204. Immunizations.
    Sec. 4205. Nutrition labeling of standard menu items at chain
                                restaurants.
    Sec. 4206. Demonstration project concerning individualized wellness
                                plan.
    Sec. 4207. Reasonable break time for nursing mothers.

        Subtitle D--Support for Prevention and Public Health Innovation

    Sec. 4301. Research on optimizing the delivery of public health
                                services.
    Sec. 4302. Understanding health disparities: data collection and
                                analysis.
    Sec. 4303. CDC and employer-based wellness programs.
    Sec. 4304. Epidemiology-Laboratory Capacity Grants.
    Sec. 4305. Advancing research and treatment for pain care management.
    Sec. 4306. Funding for Childhood Obesity Demonstration Project.

                      Subtitle E--Miscellaneous Provisions

    Sec. 4401. Sense of the Senate concerning CBO scoring.
    Sec. 4402. Effectiveness of Federal health and wellness initiatives.

                         TITLE V--HEALTH CARE WORKFORCE

                      Subtitle A--Purpose and Definitions

    Sec. 5001. Purpose.
    Sec. 5002. Definitions.

              Subtitle B--Innovations in the Health Care Workforce

    Sec. 5101. National health care workforce commission.
    Sec. 5102. State health care workforce development grants.
    Sec. 5103. Health care workforce assessment.

         Subtitle C--Increasing the Supply of the Health Care Workforce

    Sec. 5201. Federally supported student loan funds.
    Sec. 5202. Nursing student loan program.
    Sec. 5203. Health care workforce loan repayment programs.
    Sec. 5204. Public health workforce recruitment and retention programs.
    Sec. 5205. Allied health workforce recruitment and retention programs.
    Sec. 5206. Grants for State and local programs.
    Sec. 5207. Funding for National Health Service Corps.
    Sec. 5208. Nurse-managed health clinics.
    Sec. 5209. Elimination of cap on commissioned corps.
    Sec. 5210. Establishing a Ready Reserve Corps.

       Subtitle D--Enhancing Health Care Workforce Education and Training

    Sec. 5301. Training in family medicine, general internal medicine,
                                general pediatrics, and physician
                                assistantship.
    Sec. 5302. Training opportunities for direct care workers.
    Sec. 5303. Training in general, pediatric, and public health dentistry.
    Sec. 5304. Alternative dental health care providers demonstration
                                project.
    Sec. 5305. Geriatric education and training; career awards;
                                comprehensive geriatric education.
    Sec. 5306. Mental and behavioral health education and training grants.
    Sec. 5307. Cultural competency, prevention, and public health and
                                individuals with disabilities training.
    Sec. 5308. Advanced nursing education grants.
    Sec. 5309. Nurse education, practice, and retention grants.
    Sec. 5310. Loan repayment and scholarship program.
    Sec. 5311. Nurse faculty loan program.
    Sec. 5312. Authorization of appropriations for parts B through D of
                                title VIII.
    Sec. 5313. Grants to promote the community health workforce.
    Sec. 5314. Fellowship training in public health.
    Sec. 5315. United States Public Health Sciences Track.

           Subtitle E--Supporting the Existing Health Care Workforce

    Sec. 5401. Centers of excellence.
    Sec. 5402. Health care professionals training for diversity.
    Sec. 5403. Interdisciplinary, community-based linkages.
    Sec. 5404. Workforce diversity grants.
    Sec. 5405. Primary care extension program.

    Subtitle F--Strengthening Primary Care and Other Workforce Improvements

    Sec. 5501. Expanding access to primary care services and general
                                surgery services.
    Sec. 5502. Medicare Federally qualified health center improvements.
    Sec. 5503. Distribution of additional residency positions.
    Sec. 5504. Counting resident time in nonprovider settings.
    Sec. 5505. Rules for counting resident time for didactic and scholarly
                                activities and other activities.
    Sec. 5506. Preservation of resident cap positions from closed
                                hospitals.
    Sec. 5507. Demonstration projects To address health professions
                                workforce needs; extension of family-to-
                                family health information centers.
    Sec. 5508. Increasing teaching capacity.
    Sec. 5509. Graduate nurse education demonstration.

              Subtitle G--Improving Access to Health Care Services

    Sec. 5601. Spending for Federally Qualified Health Centers (FQHCs).
    Sec. 5602. Negotiated rulemaking for development of methodology and
                                criteria for designating medically
                                underserved populations and health
                                professions shortage areas.
    Sec. 5603. Reauthorization of the Wakefield Emergency Medical Services
                                for Children Program.
    Sec. 5604. Co-locating primary and specialty care in community-based
                                mental health settings.
    Sec. 5605. Key National indicators.

                         Subtitle H--General Provisions

    Sec. 5701. Reports.

                  TITLE VI--TRANSPARENCY AND PROGRAM INTEGRITY

             Subtitle A--Physician Ownership and Other Transparency

    Sec. 6001. Limitation on Medicare exception to the prohibition on
                                certain physician referrals for hospitals.
    Sec. 6002. Transparency reports and reporting of physician ownership or
                                investment interests.
    Sec. 6003. Disclosure requirements for in-office ancillary services
                                exception to the prohibition on physician
                                self-referral for certain imaging services.
    Sec. 6004. Prescription drug sample transparency.
    Sec. 6005. Pharmacy benefit managers transparency requirements.

             Subtitle B--Nursing Home Transparency and Improvement

                 PART I--Improving Transparency of Information

    Sec. 6101. Required disclosure of ownership and additional disclosable
                                parties information.
    Sec. 6102. Accountability requirements for skilled nursing facilities
                                and nursing facilities.
    Sec. 6103. Nursing home compare Medicare website.
    Sec. 6104. Reporting of expenditures.
    Sec. 6105. Standardized complaint form.
    Sec. 6106. Ensuring staffing accountability.
    Sec. 6107. GAO study and report on Five-Star Quality Rating System.

                         PART II--Targeting Enforcement

    Sec. 6111. Civil money penalties.
    Sec. 6112. National independent monitor demonstration project.
    Sec. 6113. Notification of facility closure.
    Sec. 6114. National demonstration projects on culture change and use of
                                information technology in nursing homes.

                       PART III--Improving Staff Training

    Sec. 6121. Dementia and abuse prevention training.

    Subtitle C--Nationwide Program for National and State Background Checks
      on Direct Patient Access Employees of Long-term Care Facilities and
                                   Providers

    Sec. 6201. Nationwide program for National and State background checks
                                on direct patient access employees of long-
                                term care facilities and providers.

                 Subtitle D--Patient-Centered Outcomes Research

    Sec. 6301. Patient-Centered Outcomes Research.
    Sec. 6302. Federal coordinating council for comparative effectiveness
                                research.

     Subtitle E--Medicare, Medicaid, and CHIP Program Integrity Provisions

    Sec. 6401. Provider screening and other enrollment requirements under
                                Medicare, Medicaid, and CHIP.
    Sec. 6402. Enhanced Medicare and Medicaid program integrity provisions.
    Sec. 6403. Elimination of duplication between the Healthcare Integrity
                                and Protection Data Bank and the National
                                Practitioner Data Bank.
    Sec. 6404. Maximum period for submission of Medicare claims reduced to
                                not more than 12 months.
    Sec. 6405. Physicians who order items or services required to be
                                Medicare enrolled physicians or eligible
                                professionals.
    Sec. 6406. Requirement for physicians to provide documentation on
                                referrals to programs at high risk of waste
                                and abuse.
    Sec. 6407. Face to face encounter with patient required before
                                physicians may certify eligibility for home
                                health services or durable medical
                                equipment under Medicare.
    Sec. 6408. Enhanced penalties.
    Sec. 6409. Medicare self-referral disclosure protocol.
    Sec. 6410. Adjustments to the Medicare durable medical equipment,
                                prosthetics, orthotics, and supplies
                                competitive acquisition program.
    Sec. 6411. Expansion of the Recovery Audit Contractor (RAC) program.

          Subtitle F--Additional Medicaid Program Integrity Provisions

    Sec. 6501. Termination of provider participation under Medicaid if
                                terminated under Medicare or other State
                                plan.
    Sec. 6502. Medicaid exclusion from participation relating to certain
                                ownership, control, and management
                                affiliations.
    Sec. 6503. Billing agents, clearinghouses, or other alternate payees
                                required to register under Medicaid.
    Sec. 6504. Requirement to report expanded set of data elements under
                                MMIS to detect fraud and abuse.
    Sec. 6505. Prohibition on payments to institutions or entities located
                                outside of the United States.
    Sec. 6506. Overpayments.
    Sec. 6507. Mandatory State use of national correct coding initiative.
    Sec. 6508. General effective date.

              Subtitle G--Additional Program Integrity Provisions

    Sec. 6601. Prohibition on false statements and representations.
    Sec. 6602. Clarifying definition.
    Sec. 6603. Development of model uniform report form.
    Sec. 6604. Applicability of State law to combat fraud and abuse.
    Sec. 6605. Enabling the Department of Labor to issue administrative
                                summary cease and desist orders and summary
                                seizures orders against plans that are in
                                financially hazardous condition.
    Sec. 6606. MEWA plan registration with Department of Labor.
    Sec. 6607. Permitting evidentiary privilege and confidential
                                communications.

                         Subtitle H--Elder Justice Act

    Sec. 6701. Short title of subtitle.
    Sec. 6702. Definitions.
    Sec. 6703. Elder Justice.

         Subtitle I--Sense of the Senate Regarding Medical Malpractice

    Sec. 6801. Sense of the Senate regarding medical malpractice.

          TITLE VII--IMPROVING ACCESS TO INNOVATIVE MEDICAL THERAPIES

             Subtitle A--Biologics Price Competition and Innovation

    Sec. 7001. Short title.
    Sec. 7002. Approval pathway for biosimilar biological products.
    Sec. 7003. Savings.

      Subtitle B--More Affordable Medicines for Children and Underserved
                                  Communities

    Sec. 7101. Expanded participation in 340B program.
    Sec. 7102. Improvements to 340B program integrity.
    Sec. 7103. GAO study to make recommendations on improving the 340B
                                program.

                             TITLE VIII--CLASS ACT

    Sec. 8001. Short title of title.
    Sec. 8002. Establishment of national voluntary insurance program for
                                purchasing community living assistance
                                services and support.

                          TITLE IX--REVENUE PROVISIONS

                     Subtitle A--Revenue Offset Provisions

    Sec. 9001. Excise tax on high cost employer-sponsored health coverage.
    Sec. 9002. Inclusion of cost of employer-sponsored health coverage on
                                W-2.
    Sec. 9003. Distributions for medicine qualified only if for prescribed
                                drug or insulin.
    Sec. 9004. Increase in additional tax on distributions from HSAs and
                                Archer MSAs not used for qualified medical
                                expenses.
    Sec. 9005. Limitation on health flexible spending arrangements under
                                cafeteria plans.
    Sec. 9006. Expansion of information reporting requirements.
    Sec. 9007. Additional requirements for charitable hospitals.
    Sec. 9008. Imposition of annual fee on branded prescription
                                pharmaceutical manufacturers and importers.
    Sec. 9009. Imposition of annual fee on medical device manufacturers and
                                importers.
    Sec. 9010. Imposition of annual fee on health insurance providers.
    Sec. 9011. Study and report of effect on veterans health care.
    Sec. 9012. Elimination of deduction for expenses allocable to Medicare
                                Part D subsidy.
    Sec. 9013. Modification of itemized deduction for medical expenses.
    Sec. 9014. Limitation on excessive remuneration paid by certain health
                                insurance providers.
    Sec. 9015. Additional hospital insurance tax on high-income taxpayers.
    Sec. 9016. Modification of section 833 treatment of certain health
                                organizations.
    Sec. 9017. Excise tax on elective cosmetic medical procedures.

                          Subtitle B--Other Provisions

    Sec. 9021. Exclusion of health benefits provided by Indian tribal
                                governments.
    Sec. 9022. Establishment of simple cafeteria plans for small
                                businesses.
    Sec. 9023. Qualifying therapeutic discovery project credit.

        TITLE X--STRENGTHENING QUALITY, AFFORDABLE HEALTH CARE FOR ALL
                                   AMERICANS

                   Subtitle A--Provisions Relating to Title I

    Sec. 10101. Amendments to subtitle A.
    Sec. 10102. Amendments to subtitle B.
    Sec. 10103. Amendments to subtitle C.
    Sec. 10104. Amendments to subtitle D.
    Sec. 10105. Amendments to subtitle E.
    Sec. 10106. Amendments to subtitle F.
    Sec. 10107. Amendments to subtitle G.
    Sec. 10108. Free choice vouchers.
    Sec. 10109. Development of standards for financial and administrative
                                transactions.

                  Subtitle B--Provisions Relating to Title II

                           PART I--Medicaid and CHIP

    Sec. 10201. Amendments to the Social Security Act and title II of this
                                Act.
    Sec. 10202. Incentives for States to offer home and community-based
                                services as a long-term care alternative to
                                nursing homes.
    Sec. 10203. Extension of funding for CHIP through fiscal year 2015 and
                                other CHIP-related provisions.

          PART II--Support for Pregnant and Parenting Teens and Women

    Sec. 10211. Definitions.
    Sec. 10212. Establishment of pregnancy assistance fund.
    Sec. 10213. Permissible uses of Fund.
    Sec. 10214. Appropriations.

                    PART III--Indian Health Care Improvement

    Sec. 10221. Indian health care improvement.

                  Subtitle C--Provisions Relating to Title III

    Sec. 10301. Plans for a Value-Based purchasing program for ambulatory
                                surgical centers.
    Sec. 10302. Revision to national strategy for quality improvement in
                                health care.
    Sec. 10303. Development of outcome measures.
    Sec. 10304. Selection of efficiency measures.
    Sec. 10305. Data collection; public reporting.
    Sec. 10306. Improvements under the Center for Medicare and Medicaid
                                Innovation.
    Sec. 10307. Improvements to the Medicare shared savings program.
    Sec. 10308. Revisions to national pilot program on payment bundling.
    Sec. 10309. Revisions to hospital readmissions reduction program.
    Sec. 10310. Repeal of physician payment update.
    Sec. 10311. Revisions to extension of ambulance add-ons.
    Sec. 10312. Certain payment rules for long-term care hospital services
                                and moratorium on the establishment of
                                certain hospitals and facilities.
    Sec. 10313. Revisions to the extension for the rural community hospital
                                demonstration program.
    Sec. 10314. Adjustment to low-volume hospital provision.
    Sec. 10315. Revisions to home health care provisions.
    Sec. 10316. Medicare DSH.
    Sec. 10317. Revisions to extension of section 508 hospital provisions.
    Sec. 10318. Revisions to transitional extra benefits under Medicare
                                Advantage.
    Sec. 10319. Revisions to market basket adjustments.
    Sec. 10320. Expansion of the scope of, and additional improvements to,
                                the Independent Medicare Advisory Board.
    Sec. 10321. Revision to community health teams.
    Sec. 10322. Quality reporting for psychiatric hospitals.
    Sec. 10323. Medicare coverage for individuals exposed to environmental
                                health hazards.
    Sec. 10324. Protections for frontier States.
    Sec. 10325. Revision to skilled nursing facility prospective payment
                                system.
    Sec. 10326. Pilot testing pay-for-performance programs for certain
                                Medicare providers.
    Sec. 10327. Improvements to the physician quality reporting system.
    Sec. 10328. Improvement in part D medication therapy management (MTM)
                                programs.
    Sec. 10329. Developing methodology to assess health plan value.
    Sec. 10330. Modernizing computer and data systems of the Centers for
                                Medicare & Medicaid services to support
                                improvements in care delivery.
    Sec. 10331. Public reporting of performance information.
    Sec. 10332. Availability of medicare data for performance measurement.
    Sec. 10333. Community-based collaborative care networks.
    Sec. 10334. Minority health.
    Sec. 10335. Technical correction to the hospital value-based purchasing
                                program.
    Sec. 10336. GAO study and report on Medicare beneficiary access to
                                high-quality dialysis services.

                  Subtitle D--Provisions Relating to Title IV

    Sec. 10401. Amendments to subtitle A.
    Sec. 10402. Amendments to subtitle B.
    Sec. 10403. Amendments to subtitle C.
    Sec. 10404. Amendments to subtitle D.
    Sec. 10405. Amendments to subtitle E.
    Sec. 10406. Amendment relating to waiving coinsurance for preventive
                                services.
    Sec. 10407. Better diabetes care.
    Sec. 10408. Grants for small businesses to provide comprehensive
                                workplace wellness programs.
    Sec. 10409. Cures Acceleration Network.
    Sec. 10410. Centers of Excellence for Depression.
    Sec. 10411. Programs relating to congenital heart disease.
    Sec. 10412. Automated Defibrillation in Adam's Memory Act.
    Sec. 10413. Young women's breast health awareness and support of young
                                women diagnosed with breast cancer.

                   Subtitle E--Provisions Relating to Title V

    Sec. 10501. Amendments to the Public Health Service Act, the Social
                                Security Act, and title V of this Act.
    Sec. 10502. Infrastructure to Expand Access to Care.
    Sec. 10503. Community Health Centers and the National Health Service
                                Corps Fund.
    Sec. 10504. Demonstration project to provide access to affordable care.

                  Subtitle F--Provisions Relating to Title VI

    Sec. 10601. Revisions to limitation on medicare exception to the
                                prohibition on certain physician referrals
                                for hospitals.
    Sec. 10602. Clarifications to patient-centered outcomes research.
    Sec. 10603. Striking provisions relating to individual provider
                                application fees.
    Sec. 10604. Technical correction to section 6405.
    Sec. 10605. Certain other providers permitted to conduct face to face
                                encounter for home health services.
    Sec. 10606. Health care fraud enforcement.
    Sec. 10607. State demonstration programs to evaluate alternatives to
                                current medical tort litigation.
    Sec. 10608. Extension of medical malpractice coverage to free clinics.
    Sec. 10609. Labeling changes.

                 Subtitle G--Provisions Relating to Title VIII

    Sec. 10801. Provisions relating to title VIII.

                  Subtitle H--Provisions Relating to Title IX

    Sec. 10901. Modifications to excise tax on high cost employer-sponsored
                                health coverage.
    Sec. 10902. Inflation adjustment of limitation on health flexible
                                spending arrangements under cafeteria
                                plans.
    Sec. 10903. Modification of limitation on charges by charitable
                                hospitals.
    Sec. 10904. Modification of annual fee on medical device manufacturers
                                and importers.
    Sec. 10905. Modification of annual fee on health insurance providers.
    Sec. 10906. Modifications to additional hospital insurance tax on high-
                                income taxpayers.
    Sec. 10907. Excise tax on indoor tanning services in lieu of elective
                                cosmetic medical procedures.
    Sec. 10908. Exclusion for assistance provided to participants in State
                                student loan repayment programs for certain
                                health professionals.
    Sec. 10909. Expansion of adoption credit and adoption assistance
                                programs.

           TITLE I--QUALITY, AFFORDABLE HEALTH CARE FOR ALL AMERICANS

      Subtitle A--Immediate Improvements in Health Care Coverage for All
                                   Americans

    SEC. 1001. AMENDMENTS TO THE PUBLIC HEALTH SERVICE ACT.

        Part A of title XXVII of the Public Health Service Act (42 U.S.C.
    300gg et seq.) is amended--
                (1) by striking the part heading and inserting the
            following:

                ``PART A--INDIVIDUAL AND GROUP MARKET REFORMS'';

                (2) by redesignating sections 2704 through 2707 as sections
            2725 through 2728, respectively;
                (3) by redesignating sections 2711 through 2713 as sections
            2731 through 2733, respectively;
                (4) by redesignating sections 2721 through 2723 as sections
            2735 through 2737, respectively; and
                (5) by inserting after section 2702, the following:

                        ``Subpart II--Improving Coverage

    ``SEC. 2711. NO LIFETIME OR ANNUAL LIMITS.

        ``(a) In General.--A group health plan and a health insurance
    issuer offering group or individual health insurance coverage may not
    establish--
                ``(1) lifetime limits on the dollar value of benefits for
            any participant or beneficiary; or
                ``(2) unreasonable annual limits (within the meaning of
            section 223 of the Internal Revenue Code of 1986) on the dollar
            value of benefits for any participant or beneficiary.
        ``(b) Per Beneficiary Limits.--Subsection (a) shall not be
    construed to prevent a group health plan or health insurance coverage
    that is not required to provide essential health benefits under section
    1302(b) of the Patient Protection and Affordable Care Act from placing
    annual or lifetime per beneficiary limits on specific covered benefits
    to the extent that such limits are otherwise permitted under Federal or
    State law.

    ``SEC. 2712. PROHIBITION ON RESCISSIONS.

        ``A group health plan and a health insurance issuer offering group
    or individual health insurance coverage shall not rescind such plan or
    coverage with respect to an enrollee once the enrollee is covered under
    such plan or coverage involved, except that this section shall not
    apply to a covered individual who has performed an act or practice that
    constitutes fraud or makes an intentional misrepresentation of material
    fact as prohibited by the terms of the plan or coverage. Such plan or
    coverage may not be cancelled except with prior notice to the enrollee,
    and only as permitted under section 2702(c) or 2742(b).

    ``SEC. 2713. COVERAGE OF PREVENTIVE HEALTH SERVICES.

        ``(a) In General.--A group health plan and a health insurance
    issuer offering group or individual health insurance coverage shall, at
    a minimum provide coverage for and shall not impose any cost sharing
    requirements for--
                ``(1) evidence-based items or services that have in effect
            a rating of `A' or `B' in the current recommendations of the
            United States Preventive Services Task Force;
                ``(2) immunizations that have in effect a recommendation
            from the Advisory Committee on Immunization Practices of the
            Centers for Disease Control and Prevention with respect to the
            individual involved; and
                ``(3) with respect to infants, children, and adolescents,
            evidence-informed preventive care and screenings provided for
            in the comprehensive guidelines supported by the Health
            Resources and Services Administration.
                ``(4) with respect to women, such additional preventive
            care and screenings not described in paragraph (1) as provided
            for in comprehensive guidelines supported by the Health
            Resources and Services Administration for purposes of this
            paragraph.
                ``(5) for the purposes of this Act, and for the purposes of
            any other provision of law, the current recommendations of the
            United States Preventive Service Task Force regarding breast
            cancer screening, mammography, and prevention shall be
            considered the most current other than those issued in or
            around November 2009.
    Nothing in this subsection shall be construed to prohibit a plan or
    issuer from providing coverage for services in addition to those
    recommended by United States Preventive Services Task Force or to deny
    coverage for services that are not recommended by such Task Force.
        ``(b) Interval.--
                ``(1) In general.--The Secretary shall establish a minimum
            interval between the date on which a recommendation described
            in subsection (a)(1) or (a)(2) or a guideline under subsection
            (a)(3) is issued and the plan year with respect to which the
            requirement described in subsection (a) is effective with
            respect to the service described in such recommendation or
            guideline.
                ``(2) Minimum.--The interval described in paragraph (1)
            shall not be less than 1 year.
        ``(c) Value-based Insurance Design.--The Secretary may develop
    guidelines to permit a group health plan and a health insurance issuer
    offering group or individual health insurance coverage to utilize
    value-based insurance designs.

    ``SEC. 2714. EXTENSION OF DEPENDENT COVERAGE.

        ``(a) In General.--A group health plan and a health insurance
    issuer offering group or individual health insurance coverage that
    provides dependent coverage of children shall continue to make such
    coverage available for an adult child (who is not married) until the
    child turns 26 years of age. Nothing in this section shall require a
    health plan or a health insurance issuer described in the preceding
    sentence to make coverage available for a child of a child receiving
    dependent coverage.
        ``(b) Regulations.--The Secretary shall promulgate regulations to
    define the dependents to which coverage shall be made available under
    subsection (a).
        ``(c) Rule of Construction.--Nothing in this section shall be
    construed to modify the definition of `dependent' as used in the
    Internal Revenue Code of 1986 with respect to the tax treatment of the
    cost of coverage.

    ``SEC. 2715. DEVELOPMENT AND UTILIZATION OF UNIFORM EXPLANATION OF
                  COVERAGE DOCUMENTS AND STANDARDIZED DEFINITIONS.

        ``(a) In General.--Not later than 12 months after the date of
    enactment of the Patient Protection and Affordable Care Act, the
    Secretary shall develop standards for use by a group health plan and a
    health insurance issuer offering group or individual health insurance
    coverage, in compiling and providing to enrollees a summary of benefits
    and coverage explanation that accurately describes the benefits and
    coverage under the applicable plan or coverage. In developing such
    standards, the Secretary shall consult with the National Association of
    Insurance Commissioners (referred to in this section as the `NAIC'), a
    working group composed of representatives of health insurance-related
    consumer advocacy organizations, health insurance issuers, health care
    professionals, patient advocates including those representing
    individuals with limited English proficiency, and other qualified
    individuals.
        ``(b) Requirements.--The standards for the summary of benefits and
    coverage developed under subsection (a) shall provide for the
    following:
                ``(1) Appearance.--The standards shall ensure that the
            summary of benefits and coverage is presented in a uniform
            format that does not exceed 4 pages in length and does not
            include print smaller than 12-point font.
                ``(2) Language.--The standards shall ensure that the
            summary is presented in a culturally and linguistically
            appropriate manner and utilizes terminology understandable by
            the average plan enrollee.
                ``(3) Contents.--The standards shall ensure that the
            summary of benefits and coverage includes--
                        ``(A) uniform definitions of standard insurance
                    terms and medical terms (consistent with subsection
                    (g)) so that consumers may compare health insurance
                    coverage and understand the terms of coverage (or
                    exception to such coverage);
                        ``(B) a description of the coverage, including cost
                    sharing for--
                                ``(i) each of the categories of the
                            essential health benefits described in
                            subparagraphs (A) through (J) of section
                            1302(b)(1) of the Patient Protection and
                            Affordable Care Act; and
                                ``(ii) other benefits, as identified by the
                            Secretary;
                        ``(C) the exceptions, reductions, and limitations
                    on coverage;
                        ``(D) the cost-sharing provisions, including
                    deductible, coinsurance, and co-payment obligations;
                        ``(E) the renewability and continuation of coverage
                    provisions;
                        ``(F) a coverage facts label that includes examples
                    to illustrate common benefits scenarios, including
                    pregnancy and serious or chronic medical conditions and
                    related cost sharing, such scenarios to be based on
                    recognized clinical practice guidelines;
                        ``(G) a statement of whether the plan or coverage--
                                ``(i) provides minimum essential coverage
                            (as defined under section 5000A(f) of the
                            Internal Revenue Code 1986); and
                                ``(ii) ensures that the plan or coverage
                            share of the total allowed costs of benefits
                            provided under the plan or coverage is not less
                            than 60 percent of such costs;
                        ``(H) a statement that the outline is a summary of
                    the policy or certificate and that the coverage
                    document itself should be consulted to determine the
                    governing contractual provisions; and
                        ``(I) a contact number for the consumer to call
                    with additional questions and an Internet web address
                    where a copy of the actual individual coverage policy
                    or group certificate of coverage can be reviewed and
                    obtained.
        ``(c) Periodic Review and Updating.--The Secretary shall
    periodically review and update, as appropriate, the standards developed
    under this section.
        ``(d) Requirement To Provide.--
                ``(1) In general.--Not later than 24 months after the date
            of enactment of the Patient Protection and Affordable Care Act,
            each entity described in paragraph (3) shall provide, prior to
            any enrollment restriction, a summary of benefits and coverage
            explanation pursuant    to the standards developed by the
            Secretary under subsection (a) to--
                        ``(A) an applicant at the time of application;
                        ``(B) an enrollee prior to the time of enrollment
                    or reenrollment, as applicable; and
                        ``(C) a policyholder or certificate holder at the
                    time of issuance of the policy or delivery of the
                    certificate.
                ``(2) Compliance.--An entity described in paragraph (3) is
            deemed to be in compliance with this section if the summary of
            benefits and coverage described in subsection (a) is provided
            in paper or electronic form.
                ``(3) Entities in general.--An entity described in this
            paragraph is--
                        ``(A) a health insurance issuer (including a group
                    health plan that is not a self-insured plan) offering
                    health insurance coverage within the United States; or
                        ``(B) in the case of a self-insured group health
                    plan, the plan sponsor or designated administrator of
                    the plan (as such terms are defined in section 3(16) of
                    the Employee Retirement Income Security Act of 1974).
                ``(4) Notice of modifications.--If a group health plan or
            health insurance issuer makes any material modification in any
            of the terms of the plan or coverage involved (as defined for
            purposes of section 102 of the Employee Retirement Income
            Security Act of 1974) that is not reflected in the most
            recently provided summary of benefits and coverage, the plan or
            issuer shall provide notice of such modification to enrollees
            not later than 60 days prior to the date on which such
            modification will become effective.
        ``(e) Preemption.--The standards developed under subsection (a)
    shall preempt any related State standards that require a summary of
    benefits and coverage that provides less information to consumers than
    that required to be provided under this section, as determined by the
    Secretary.
        ``(f) Failure To Provide.--An entity described in subsection (d)(3)
    that willfully fails to provide the information required under this
    section shall be subject to a fine of not more than $1,000 for each
    such failure. Such failure with respect to each enrollee shall
    constitute a separate offense for purposes of this subsection.
        ``(g) Development of Standard Definitions.--
                ``(1) In general.--The Secretary shall, by regulation,
            provide for the development of standards for the definitions of
            terms used in health insurance coverage, including the
            insurance-related terms described in paragraph (2) and the
            medical terms described in paragraph (3).
                ``(2) Insurance-related terms.--The insurance-related terms
            described in this paragraph are premium, deductible, co-
            insurance, co-payment, out-of-pocket limit, preferred provider,
            non-preferred provider, out-of-network co-payments, UCR (usual,
            customary and reasonable) fees, excluded services, grievance
            and appeals, and such other terms as the Secretary determines
            are important to define so that consumers may compare health
            insurance coverage and understand the terms of their coverage.
                ``(3) Medical terms.--The medical terms described in this
            paragraph are hospitalization, hospital outpatient care,
            emergency room care, physician services, prescription drug
            coverage, durable medical equipment, home health care, skilled
            nursing care, rehabilitation services, hospice services,
            emergency medical transportation, and such other terms as the
            Secretary determines are important to define so that consumers
            may compare the medical benefits offered by health insurance
            and understand the extent of those medical benefits (or
            exceptions to those benefits).

    ``SEC. 2716. PROHIBITION OF DISCRIMINATION BASED ON SALARY.

        ``(a) In General.--The plan sponsor of a group health plan (other
    than a self-insured plan) may not establish rules relating to the
    health insurance coverage eligibility (including continued eligibility)
    of any full-time employee under the terms of the plan that are based on
    the total hourly or annual salary of the employee or otherwise
    establish eligibility rules that have the effect of discriminating in
    favor of higher wage employees.
        ``(b) Limitation.--Subsection (a) shall not be construed to
    prohibit a plan sponsor from establishing contribution requirements for
    enrollment in the plan or coverage that provide for the payment by
    employees with lower hourly or annual compensation of a lower dollar or
    percentage contribution than the payment required of similarly situated
    employees with a higher hourly or annual compensation.

    ``SEC. 2717. ENSURING THE QUALITY OF CARE.

        ``(a) Quality Reporting.--
                ``(1) In general.--Not later than 2 years after the date of
            enactment of the Patient Protection and Affordable Care Act,
            the Secretary, in consultation with experts in health care
            quality and stakeholders, shall develop reporting requirements
            for use by a group health plan, and a health insurance issuer
            offering group or individual health insurance coverage, with
            respect to plan or coverage benefits and health care provider
            reimbursement structures that--
                        ``(A) improve health outcomes through the
                    implementation of activities such as quality reporting,
                    effective case management, care coordination, chronic
                    disease management, and medication and care compliance
                    initiatives, including through the use of the medical
                    homes model as defined for purposes of section 3602 of
                    the Patient Protection and Affordable Care Act, for
                    treatment or services under the plan or coverage;
                        ``(B) implement activities to prevent hospital
                    readmissions through a comprehensive program for
                    hospital discharge that includes patient-centered
                    education and counseling, comprehensive discharge
                    planning, and post discharge reinforcement by an
                    appropriate health care professional;
                        ``(C) implement activities to improve patient
                    safety and reduce medical errors through the
                    appropriate use of best clinical practices, evidence
                    based medicine, and health information technology under
                    the plan or coverage; and
                        ``(D) implement wellness and health promotion
                    activities.
                ``(2) Reporting requirements.--
                        ``(A) In general.--A group health plan and a health
                    insurance issuer offering group or individual health
                    insurance coverage shall annually submit to the
                    Secretary, and to enrollees under the plan or coverage,
                    a report on whether the benefits under the plan or
                    coverage satisfy the elements described in
                    subparagraphs (A) through (D) of paragraph (1).
                        ``(B) Timing of reports.--A report under
                    subparagraph (A) shall be made available to an enrollee
                    under the plan or coverage during each open enrollment
                    period.
                        ``(C) Availability of reports.--The Secretary shall
                    make reports submitted under subparagraph (A) available
                    to the public through an Internet website.
                        ``(D) Penalties.--In developing the reporting
                    requirements under paragraph (1), the Secretary may
                    develop and impose appropriate penalties for non-
                    compliance with such requirements.
                        ``(E) Exceptions.--In developing the reporting
                    requirements under paragraph (1), the Secretary may
                    provide for exceptions to such requirements for group
                    health plans and health insurance issuers that
                    substantially meet the goals of this section.
        ``(b) Wellness and Prevention Programs.--For purposes of subsection
    (a)(1)(D), wellness and health promotion activities may include
    personalized wellness and prevention services, which are coordinated,
    maintained or delivered by a health care provider, a wellness and
    prevention plan manager, or a health, wellness or prevention services
    organization that conducts health risk assessments or offers ongoing
    face-to-face, telephonic or web-based intervention efforts for each of
    the program's participants, and which may include the following
    wellness and prevention efforts:
                ``(1) Smoking cessation.
                ``(2) Weight management.
                ``(3) Stress management.
                ``(4) Physical fitness.
                ``(5) Nutrition.
                ``(6) Heart disease prevention.
                ``(7) Healthy lifestyle support.
                ``(8) Diabetes prevention.
        ``(c) Regulations.--Not later than 2 years after the date of
    enactment of the Patient Protection and Affordable Care Act, the
    Secretary shall promulgate regulations that provide criteria for
    determining whether a reimbursement structure is described in
    subsection (a).
        ``(d) Study and Report.--Not later than 180 days after the date on
    which regulations are promulgated under subsection (c), the Government
    Accountability Office shall review such regulations and conduct a study
    and submit to the Committee on Health, Education, Labor, and Pensions
    of the Senate and the Committee on Energy and Commerce of the House of
    Representatives a report regarding the impact the activities under this
    section have had on the quality and cost of health care.

    ``SEC. 2718. BRINGING DOWN THE COST OF HEALTH CARE COVERAGE.

        ``(a) Clear Accounting for Costs.--A health insurance issuer
    offering group or individual health insurance coverage shall, with
    respect to each plan year, submit to the Secretary a report concerning
    the percentage of total premium revenue that such coverage expends--
                ``(1) on reimbursement for clinical services provided to
            enrollees under such coverage;
                ``(2) for activities that improve health care quality; and
                ``(3) on all other non-claims costs, including an
            explanation of the nature of such costs, and excluding State
            taxes and licensing or regulatory fees.
    The Secretary shall make reports received under this section available
    to the public on the Internet website of the Department of Health and
    Human Services.
        ``(b) Ensuring That Consumers Receive Value for Their Premium
    Payments.--
                ``(1) Requirement to provide value for premium payments.--A
            health insurance issuer offering group or individual health
            insurance coverage shall, with respect to each plan year,
            provide an annual rebate to each enrollee under such coverage,
            on a pro rata basis, in an amount that is equal to the amount
            by which premium revenue expended by the issuer on activities
            described in subsection (a)(3) exceeds--
                        ``(A) with respect to a health insurance issuer
                    offering coverage in the group market, 20 percent, or
                    such lower percentage as a State may by regulation
                    determine; or
                        ``(B) with respect to a health insurance issuer
                    offering coverage in the individual market, 25 percent,
                    or such lower percentage as a State may by regulation
                    determine, except that such percentage shall be
                    adjusted to the extent the Secretary determines that
                    the application of such percentage with a State may
                    destabilize the existing individual market in such
                    State.
                ``(2) Consideration in setting percentages.--In determining
            the percentages under paragraph (1), a State shall seek to
            ensure adequate participation by health insurance issuers,
            competition in the health insurance market in the State, and
            value for consumers so that premiums are used for clinical
            services and quality improvements.
                ``(3) Termination.--The provisions of this subsection shall
            have no force or effect after December 31, 2013.
        ``(c) Standard Hospital Charges.--Each hospital operating within
    the United States shall for each year establish (and update) and make
    public (in accordance with guidelines developed by the Secretary) a
    list of the hospital's standard charges for items and services provided
    by the hospital, including for diagnosis-related groups established
    under section 1886(d)(4) of the Social Security Act.
        ``(d) Definitions.--The Secretary, in consultation with the
    National Association of Insurance Commissions, shall establish uniform
    definitions for the activities reported under subsection (a).

    ``SEC. 2719. APPEALS PROCESS.

        ``A group health plan and a health insurance issuer offering group
    or individual health insurance coverage shall implement an effective
    appeals process for appeals of coverage determinations and claims,
    under which the plan or issuer shall, at a minimum--
                ``(1) have in effect an internal claims appeal process;
                ``(2) provide notice to enrollees, in a culturally and
            linguistically appropriate manner, of available internal and
            external appeals processes, and the availability of any
            applicable office of health insurance consumer assistance or
            ombudsman established under section 2793 to assist such
            enrollees with the appeals processes;
                ``(3) allow an enrollee to review their file, to present
            evidence and testimony as part of the appeals process, and to
            receive continued coverage pending the outcome of the appeals
            process; and
                ``(4) provide an external review process for such plans and
            issuers that, at a minimum, includes the consumer protections
            set forth in the Uniform External Review Model Act promulgated
            by the National Association of Insurance Commissioners and is
            binding on such plans.''.

    SEC. 1002. HEALTH INSURANCE CONSUMER INFORMATION.

        Part C of title XXVII of the Public Health Service Act (42 U.S.C.
    300gg-91 et seq.) is amended by adding at the end the following:

    ``SEC. 2793. HEALTH INSURANCE CONSUMER INFORMATION.

        ``(a) In General.--The Secretary shall award grants to States to
    enable such States (or the Exchanges operating in such States) to
    establish, expand, or provide support for--
                ``(1) offices of health insurance consumer assistance; or
                ``(2) health insurance ombudsman programs.
        ``(b) Eligibility.--
                ``(1) In general.--To be eligible to receive a grant, a
            State shall designate an independent office of health insurance
            consumer assistance, or an ombudsman, that, directly or in
            coordination with State health insurance regulators and
            consumer assistance organizations, receives and responds to
            inquiries and complaints concerning health insurance coverage
            with respect to Federal health insurance requirements and under
            State law.
                ``(2) Criteria.--A State that receives a grant under this
            section shall comply with criteria established by the Secretary
            for carrying out activities under such grant.
        ``(c) Duties.--The office of health insurance consumer assistance
    or health insurance ombudsman shall--
                ``(1) assist with the filing of complaints and appeals,
            including filing appeals with the internal appeal or grievance
            process of the group health plan or health insurance issuer
            involved and providing information about the external appeal
            process;
                ``(2) collect, track, and quantify problems and inquiries
            encountered by consumers;
                ``(3) educate consumers on their rights and
            responsibilities with respect to group health plans and health
            insurance coverage;
                ``(4) assist consumers with enrollment in a group health
            plan or health insurance coverage by providing information,
            referral, and assistance; and
                ``(5) resolve problems with obtaining premium tax credits
            under section 36B of the Internal Revenue Code of 1986.
        ``(d) Data Collection.--As a condition of receiving a grant under
    subsection (a), an office of health insurance consumer assistance or
    ombudsman program shall be required to collect and report data to the
    Secretary on the types of problems and inquiries encountered by
    consumers. The Secretary shall utilize such data to identify areas
    where more enforcement action is necessary and shall share such
    information with State insurance regulators, the Secretary of Labor,
    and the Secretary of the Treasury for use in the enforcement activities
    of such agencies.
        ``(e) Funding.--
                ``(1) Initial funding.--There is hereby appropriated to the
            Secretary, out of any funds in the Treasury not otherwise
            appropriated, $30,000,000 for the first fiscal year for which
            this section applies to carry out this section. Such amount
            shall remain available without fiscal year limitation.
                ``(2) Authorization for subsequent years.--There is
            authorized to be appropriated to the Secretary for each fiscal
            year following the fiscal year described in paragraph (1), such
            sums as may be necessary to carry out this section.''.

    SEC. 1003. ENSURING THAT CONSUMERS GET VALUE FOR THEIR DOLLARS.

        Part C of title XXVII of the Public Health Service Act (42 U.S.C.
    300gg-91 et seq.), as amended by section 1002, is further amended by
    adding at the end the following:

    ``SEC. 2794. ENSURING THAT CONSUMERS GET VALUE FOR THEIR DOLLARS.

        ``(a) Initial Premium Review Process.--
                ``(1) In general.--The Secretary, in conjunction with
            States, shall establish a process for the annual review,
            beginning with the 2010 plan year and subject to subsection
            (b)(2)(A), of unreasonable increases in premiums for health
            insurance coverage.
                ``(2) Justification and disclosure.--The process
            established under paragraph (1) shall require health insurance
            issuers to submit to the Secretary and the relevant State a
            justification for an unreasonable premium increase prior to the
            implementation of the increase. Such issuers shall prominently
            post such information on their Internet websites. The Secretary
            shall ensure the public disclosure of information on such
            increases and justifications for all health insurance issuers.
        ``(b) Continuing Premium Review Process.--
                ``(1) Informing secretary of premium increase patterns.--As
            a condition of receiving a grant under subsection (c)(1), a
            State, through its Commissioner of Insurance, shall--
                        ``(A) provide the Secretary with information about
                    trends in premium increases in health insurance
                    coverage in premium rating areas in the State; and
                        ``(B) make recommendations, as appropriate, to the
                    State Exchange about whether particular health
                    insurance issuers should be excluded from participation
                    in the Exchange based on a pattern or practice of
                    excessive or unjustified premium increases.
                ``(2) Monitoring by secretary of premium increases.--
                        ``(A) In general.--Beginning with plan years
                    beginning in 2014, the Secretary, in conjunction with
                    the States and consistent with the provisions of
                    subsection (a)(2), shall monitor premium increases of
                    health insurance coverage offered through an Exchange
                    and outside of an Exchange.
                        ``(B) Consideration in opening exchange.--In
                    determining under section 1312(f)(2)(B) of the Patient
                    Protection and Affordable Care Act whether to offer
                    qualified health plans in the large group market
                    through an Exchange, the State shall take into account
                    any excess of premium growth outside of the Exchange as
                    compared to the rate of such growth inside the
                    Exchange.
        ``(c) Grants in Support of Process.--
                ``(1) Premium review grants during 2010 through 2014.--The
            Secretary shall carry out a program to award grants to States
            during the 5-year period beginning with fiscal year 2010 to
            assist such States in carrying out subsection (a), including--
                        ``(A) in reviewing and, if appropriate under State
                    law, approving premium increases for health insurance
                    coverage; and
                        ``(B) in providing information and recommendations
                    to the Secretary under subsection (b)(1).
                ``(2) Funding.--
                        ``(A) In general.--Out of all funds in the Treasury
                    not otherwise appropriated, there are appropriated to
                    the Secretary $250,000,000, to be available for
                    expenditure for grants under paragraph (1) and
                    subparagraph (B).
                        ``(B) Further availability for insurance reform and
                    consumer protection.--If the amounts appropriated under
                    subparagraph (A) are not fully obligated under grants
                    under paragraph (1) by the end of fiscal year 2014, any
                    remaining funds shall remain available to the Secretary
                    for grants to States for planning and implementing the
                    insurance reforms and consumer protections under part
                    A.
                        ``(C) Allocation.--The Secretary shall establish a
                    formula for determining the amount of any grant to a
                    State under this subsection. Under such formula--
                                ``(i) the Secretary shall consider the
                            number of plans of health insurance coverage
                            offered in each State and the population of the
                            State; and
                                ``(ii) no State qualifying for a grant
                            under paragraph (1) shall receive less than
                            $1,000,000, or more than $5,000,000 for a grant
                            year.''.

    SEC. 1004. EFFECTIVE DATES.

        (a) In General.--Except as provided for in subsection (b), this
    subtitle (and the amendments made by this subtitle) shall become
    effective for plan years beginning on or after the date that is 6
    months after the date of enactment of this Act, except that the
    amendments made by sections 1002 and 1003 shall become effective for
    fiscal years beginning with fiscal year 2010.
        (b) Special Rule.--The amendments made by sections 1002 and 1003
    shall take effect on the date of enactment of this Act.

         Subtitle B--Immediate Actions to Preserve and Expand Coverage

    SEC. 1101. IMMEDIATE ACCESS TO INSURANCE FOR UNINSURED INDIVIDUALS WITH
                  A PREEXISTING CONDITION.

        (a) In General.--Not later than 90 days after the date of enactment
    of this Act, the Secretary shall establish a temporary high risk health
    insurance pool program to provide health insurance coverage for
    eligible individuals during the period beginning on the date on which
    such program is established and ending on January 1, 2014.
        (b) Administration.--
                (1) In general.--The Secretary may carry out the program
            under this section directly or through contracts to eligible
            entities.
                (2) Eligible entities.--To be eligible for a contract under
            paragraph (1), an entity shall--
                        (A) be a State or nonprofit private entity;
                        (B) submit to the Secretary an application at such
                    time, in such manner, and containing such information
                    as the Secretary may require; and
                        (C) agree to utilize contract funding to establish
                    and administer a qualified high risk pool for eligible
                    individuals.
                (3) Maintenance of effort.--To be eligible to enter into a
            contract with the Secretary under this subsection, a State
            shall agree not to reduce the annual amount the State expended
            for the operation of one or more State high risk pools during
            the year preceding the year in which such contract is entered
            into.
        (c) Qualified High Risk Pool.--
                (1) In general.--Amounts made available under this section
            shall be used to establish a qualified high risk pool that
            meets the requirements of paragraph (2).
                (2) Requirements.--A qualified high risk pool meets the
            requirements of this paragraph if such pool--
                        (A) provides to all eligible individuals health
                    insurance coverage that does not impose any preexisting
                    condition exclusion with respect to such coverage;
                        (B) provides health insurance coverage--
                                (i) in which the issuer's share of the
                            total allowed costs of benefits provided under
                            such coverage is not less than 65 percent of
                            such costs; and
                                (ii) that has an out of pocket limit not
                            greater than the applicable amount described in
                            section 223(c)(2) of the Internal Revenue Code
                            of 1986 for the year involved, except that the
                            Secretary may modify such limit if necessary to
                            ensure the pool meets the actuarial value limit
                            under clause (i);
                        (C) ensures that with respect to the premium rate
                    charged for health insurance coverage offered to
                    eligible individuals through the high risk pool, such
                    rate shall--
                                (i) except as provided in clause (ii), vary
                            only as provided for under section 2701 of the
                            Public Health Service Act (as amended by this
                            Act and notwithstanding the date on which such
                            amendments take effect);
                                (ii) vary on the basis of age by a factor
                            of not greater than 4 to 1; and
                                (iii) be established at a standard rate for
                            a standard population; and
                        (D) meets any other requirements determined
                    appropriate by the Secretary.
        (d) Eligible Individual.--An individual shall be deemed to be an
    eligible individual for purposes of this section if such individual--
                (1) is a citizen or national of the United States or is
            lawfully present in the United States (as determined in
            accordance with section 1411);
                (2) has not been covered under creditable coverage (as
            defined in section 2701(c)(1) of the Public Health Service Act
            as in effect on the date of enactment of this Act) during the
            6-month period prior to the date on which such individual is
            applying for coverage through the high risk pool; and
                (3) has a pre-existing condition, as determined in a manner
            consistent with guidance issued by the Secretary.
        (e) Protection Against Dumping Risk by Insurers.--
                (1) In general.--The Secretary shall establish criteria for
            determining whether health insurance issuers and employment-
            based health plans have discouraged an individual from
            remaining enrolled in prior coverage based on that individual's
            health status.
                (2) Sanctions.--An issuer or employment-based health plan
            shall be responsible for reimbursing the program under this
            section for the medical expenses incurred by the program for an
            individual who, based on criteria established by the Secretary,
            the Secretary finds was encouraged by the issuer to disenroll
            from health benefits coverage prior to enrolling in coverage
            through the program. The criteria shall include at least the
            following circumstances:
                        (A) In the case of prior coverage obtained through
                    an employer, the provision by the employer, group
                    health plan, or the issuer of money or other financial
                    consideration for disenrolling from the coverage.
                        (B) In the case of prior coverage obtained directly
                    from an issuer or under an employment-based health
                    plan--
                                (i) the provision by the issuer or plan of
                            money or other financial consideration for
                            disenrolling from the coverage; or
                                (ii) in the case of an individual whose
                            premium for the prior coverage exceeded the
                            premium required by the program (adjusted based
                            on the age factors applied to the prior
                            coverage)--
                                        (I) the prior coverage is a policy
                                    that is no longer being actively
                                    marketed (as defined by the Secretary)
                                    by the issuer; or
                                        (II) the prior coverage is a policy
                                    for which duration of coverage form
                                    issue or health status are factors that
                                    can be considered in determining
                                    premiums at renewal.
                (3) Construction.--Nothing in this subsection shall be
            construed as constituting exclusive remedies for violations of
            criteria established under paragraph (1) or as preventing
            States from applying or enforcing such paragraph or other
            provisions under law with respect to health insurance issuers.
        (f) Oversight.--The Secretary shall establish--
                (1) an appeals process to enable individuals to appeal a
            determination under this section; and
                (2) procedures to protect against waste, fraud, and abuse.
        (g) Funding; Termination of Authority.--
                (1) In general.--There is appropriated to the Secretary,
            out of any moneys in the Treasury not otherwise appropriated,
            $5,000,000,000 to pay claims against (and the administrative
            costs of) the high risk pool under this section that are in
            excess of the amount of premiums collected from eligible
            individuals enrolled in the high risk pool. Such funds shall be
            available without fiscal year limitation.
                (2) Insufficient funds.--If the Secretary estimates for any
            fiscal year that the aggregate amounts available for the
            payment of the expenses of the high risk pool will be less than
            the actual amount of such expenses, the Secretary shall make
            such adjustments as are necessary to eliminate such deficit.
                (3) Termination of authority.--
                        (A) In general.--Except as provided in subparagraph
                    (B), coverage of eligible individuals under a high risk
                    pool in a State shall terminate on January 1, 2014.
                        (B) Transition to exchange.--The Secretary shall
                    develop procedures to provide for the transition of
                    eligible individuals enrolled in health insurance
                    coverage offered through a high risk pool established
                    under this section into qualified health plans offered
                    through an Exchange. Such procedures shall ensure that
                    there is no lapse in coverage with respect to the
                    individual and may extend coverage after the
                    termination of the risk pool involved, if the Secretary
                    determines necessary to avoid such a lapse.
                (4) Limitations.--The Secretary has the authority to stop
            taking applications for participation in the program under this
            section to comply with the funding limitation provided for in
            paragraph (1).
                (5) Relation to state laws.--The standards established
            under this section shall supersede any State law or regulation
            (other than State licensing laws or State laws relating to plan
            solvency) with respect to qualified high risk pools which are
            established in accordance with this section.

    SEC. 1102. REINSURANCE FOR EARLY RETIREES.

        (a) Administration.--
                (1) In general.--Not later than 90 days after the date of
            enactment of this Act, the Secretary shall establish a
            temporary reinsurance program to provide reimbursement to
            participating employment-based plans for a portion of the cost
            of providing health insurance coverage to early retirees (and
            to the eligible spouses, surviving spouses, and dependents of
            such retirees) during the period beginning on the date on which
            such program is established and ending on January 1, 2014.
                (2) Reference.--In this section:
                        (A) Health benefits.--The term ``health benefits''
                    means medical, surgical, hospital, prescription drug,
                    and such other benefits as shall be determined by the
                    Secretary, whether self-funded, or delivered through
                    the purchase of insurance or otherwise.
                        (B) Employment-based plan.--The term ``employment-
                    based plan'' means a group health benefits plan that--
                                (i) is--
                                        (I) maintained by one or more
                                    current or former employers (including
                                    without limitation any State or local
                                    government or political subdivision
                                    thereof), employee organization, a
                                    voluntary employees' beneficiary
                                    association, or a committee or board of
                                    individuals appointed to administer
                                    such plan; or
                                        (II) a multiemployer plan (as
                                    defined in section 3(37) of the
                                    Employee Retirement Income Security Act
                                    of 1974); and
                                (ii) provides health benefits to early
                            retirees.
                        (C) Early retirees.--The term ``early retirees''
                    means individuals who are age 55 and older but are not
                    eligible for coverage under title XVIII of the Social
                    Security Act, and who are not active employees of an
                    employer maintaining, or currently contributing to, the
                    employment-based plan or of any employer that has made
                    substantial contributions to fund such plan.
        (b) Participation.--
                (1) Employment-based plan eligibility.--A participating
            employment-based plan is an employment-based plan that--
                        (A) meets the requirements of paragraph (2) with
                    respect to health benefits provided under the plan; and
                        (B) submits to the Secretary an application for
                    participation in the program, at such time, in such
                    manner, and containing such information as the
                    Secretary shall require.
                (2) Employment-based health benefits.--An employment-based
            plan meets the requirements of this paragraph if the plan--
                        (A) implements programs and procedures to generate
                    cost-savings with respect to participants with chronic
                    and high-cost conditions;
                        (B) provides documentation of the actual cost of
                    medical claims involved; and
                        (C) is certified by the Secretary.
        (c) Payments.--
                (1) Submission of claims.--
                        (A) In general.--A participating employment-based
                    plan shall submit claims for reimbursement to the
                    Secretary which shall contain documentation of the
                    actual costs of the items and services for which each
                    claim is being submitted.
                        (B) Basis for claims.--Claims submitted under
                    subparagraph (A) shall be based on the actual amount
                    expended by the participating employment-based plan
                    involved within the plan year for the health benefits
                    provided to an early retiree or the spouse, surviving
                    spouse, or dependent of such retiree. In determining
                    the amount of a claim for purposes of this subsection,
                    the participating employment-based plan shall take into
                    account any negotiated price concessions (such as
                    discounts, direct or indirect subsidies, rebates, and
                    direct or indirect remunerations) obtained by such plan
                    with respect to such health benefit. For purposes of
                    determining the amount of any such claim, the costs
                    paid by the early retiree or the retiree's spouse,
                    surviving spouse, or dependent in the form of
                    deductibles, co-payments, or co-insurance shall be
                    included in the amounts paid by the participating
                    employment-based plan.
                (2) Program payments.--If the Secretary determines that a
            participating employment-based plan has submitted a valid claim
            under paragraph (1), the Secretary shall reimburse such plan
            for 80 percent of that portion of the costs attributable to
            such claim that exceed $15,000, subject to the limits contained
            in paragraph (3).
                (3) Limit.--To be eligible for reimbursement under the
            program, a claim submitted by a participating employment-based
            plan shall not be less than $15,000 nor greater than $90,000.
            Such amounts shall be adjusted each fiscal year based on the
            percentage increase in the Medical Care Component of the
            Consumer Price Index for all urban consumers (rounded to the
            nearest multiple of $1,000) for the year involved.
                (4) Use of payments.--Amounts paid to a participating
            employment-based plan under this subsection shall be used to
            lower costs for the plan. Such payments may be used to reduce
            premium costs for an entity described in subsection
            (a)(2)(B)(i) or to reduce premium contributions, co-payments,
            deductibles, co-insurance, or other out-of-pocket costs for
            plan participants. Such payments shall not be used as general
            revenues for an entity described in subsection (a)(2)(B)(i).
            The Secretary shall develop a mechanism to monitor the
            appropriate use of such payments by such entities.
                (5) Payments not treated as income.--Payments received
            under this subsection shall not be included in determining the
            gross income of an entity described in subsection (a)(2)(B)(i)
            that is maintaining or currently contributing to a
            participating employment-based plan.
                (6) Appeals.--The Secretary shall establish--
                        (A) an appeals process to permit participating
                    employment-based plans to appeal a determination of the
                    Secretary with respect to claims submitted under this
                    section; and
                        (B) procedures to protect against fraud, waste, and
                    abuse under the program.
        (d) Audits.--The Secretary shall conduct annual audits of claims
    data submitted by participating employment-based plans under this
    section to ensure that such plans are in compliance with the
    requirements of this section.
        (e) Funding.--There is appropriated to the Secretary, out of any
    moneys in the Treasury not otherwise appropriated, $5,000,000,000 to
    carry out the program under this section. Such funds shall be available
    without fiscal year limitation.
        (f) Limitation.--The Secretary has the authority to stop taking
    applications for participation in the program based on the availability
    of funding under subsection (e).

    SEC. 1103. IMMEDIATE INFORMATION THAT ALLOWS CONSUMERS TO IDENTIFY
                  AFFORDABLE COVERAGE OPTIONS.

        (a) Internet Portal to Affordable Coverage Options.--
                (1) Immediate establishment.--Not later than July 1, 2010,
            the Secretary, in consultation with the States, shall establish
            a mechanism, including an Internet website, through which a
            resident of any State may identify affordable health insurance
            coverage options in that State.
                (2) Connecting to affordable coverage.--An Internet website
            established under paragraph (1) shall, to the extent
            practicable, provide ways for residents of any State to receive
            information on at least the following coverage options:
                        (A) Health insurance coverage offered by health
                    insurance issuers, other than coverage that provides
                    reimbursement only for the treatment or mitigation of--
                                (i) a single disease or condition; or
                                (ii) an unreasonably limited set of
                            diseases or conditions (as determined by the
                            Secretary);
                        (B) Medicaid coverage under title XIX of the Social
                    Security Act.
                        (C) Coverage under title XXI of the Social Security
                    Act.
                        (D) A State health benefits high risk pool, to the
                    extent that such high risk pool is offered in such
                    State; and
                        (E) Coverage under a high risk pool under section
                    1101.
        (b) Enhancing Comparative Purchasing Options.--
                (1) In general.--Not later than 60 days after the date of
            enactment of this Act, the Secretary shall develop a
            standardized format to be used for the presentation of
            information relating to the coverage options described in
            subsection (a)(2). Such format shall, at a minimum, require the
            inclusion of information on the percentage of total premium
            revenue expended on nonclinical costs (as reported under
            section 2718(a) of the Public Health Service Act), eligibility,
            availability, premium rates, and cost sharing with respect to
            such coverage options and be consistent with the standards
            adopted for the uniform explanation of coverage as provided for
            in section 2715 of the Public Health Service Act.
                (2) Use of format.--The Secretary shall utilize the format
            developed under paragraph (1) in compiling information
            concerning coverage options on the Internet website established
            under subsection (a).
        (c) Authority To Contract.--The Secretary may carry out this
    section through contracts entered into with qualified entities.

    SEC. 1104. ADMINISTRATIVE SIMPLIFICATION.

        (a) Purpose of Administrative Simplification.--Section 261 of the
    Health Insurance Portability and Accountability Act of 1996 (42 U.S.C.
    1320d note) is amended--
                (1) by inserting ``uniform'' before ``standards''; and
                (2) by inserting ``and to reduce the clerical burden on
            patients, health care providers, and health plans'' before the
            period at the end.
        (b) Operating Rules for Health Information Transactions.--
                (1) Definition of operating rules.--Section 1171 of the
            Social Security Act (42 U.S.C. 1320d) is amended by adding at
            the end the following:
                ``(9) Operating rules.--The term `operating rules' means
            the necessary business rules and guidelines for the electronic
            exchange of information that are not defined by a standard or
            its implementation specifications as adopted for purposes of
            this part.''.
                (2) Transaction standards; operating rules and
            compliance.--Section 1173 of the Social Security Act (42 U.S.C.
            1320d-2) is amended--
                        (A) in subsection (a)(2), by adding at the end the
                    following new subparagraph:
                        ``(J) Electronic funds transfers.'';
                        (B) in subsection (a), by adding at the end the
                    following new paragraph:
                ``(4) Requirements for financial and administrative
            transactions.--
                        ``(A) In general.--The standards and associated
                    operating rules adopted by the Secretary shall--
                                ``(i) to the extent feasible and
                            appropriate, enable determination of an
                            individual's eligibility and financial
                            responsibility for specific services prior to
                            or at the point of care;
                                ``(ii) be comprehensive, requiring minimal
                            augmentation by paper or other communications;
                                ``(iii) provide for timely acknowledgment,
                            response, and status reporting that supports a
                            transparent claims and denial management
                            process (including adjudication and appeals);
                            and
                                ``(iv) describe all data elements
                            (including reason and remark codes) in
                            unambiguous terms, require that such data
                            elements be required or conditioned upon set
                            values in other fields, and prohibit additional
                            conditions (except where necessary to implement
                            State or Federal law, or to protect against
                            fraud and abuse).
                        ``(B) Reduction of clerical burden.--In adopting
                    standards and operating rules for the transactions
                    referred to under paragraph (1), the Secretary shall
                    seek to reduce the number and complexity of forms
                    (including paper and electronic forms) and data entry
                    required by patients and providers.''; and
                        (C) by adding at the end the following new
                    subsections:
        ``(g) Operating Rules.--
                ``(1) In general.--The Secretary shall adopt a single set
            of operating rules for each transaction referred to under
            subsection (a)(1) with the goal of creating as much uniformity
            in the implementation of the electronic standards as possible.
            Such operating rules shall be consensus-based and reflect the
            necessary business rules affecting health plans and health care
            providers and the manner in which they operate pursuant to
            standards issued under Health Insurance Portability and
            Accountability Act of 1996.
                ``(2) Operating rules development.--In adopting operating
            rules under this subsection, the Secretary shall consider
            recommendations for operating rules developed by a qualified
            nonprofit entity that meets the following requirements:
                        ``(A) The entity focuses its mission on
                    administrative simplification.
                        ``(B) The entity demonstrates a multi-stakeholder
                    and consensus-based process for development of
                    operating rules, including representation by or
                    participation from health plans, health care providers,
                    vendors, relevant Federal agencies, and other standard
                    development organizations.
                        ``(C) The entity has a public set of guiding
                    principles that ensure the operating rules and process
                    are open and transparent, and supports
                    nondiscrimination and conflict of interest policies
                    that demonstrate a commitment to open, fair, and
                    nondiscriminatory practices.
                        ``(D) The entity builds on the transaction
                    standards issued under Health Insurance Portability and
                    Accountability Act of 1996.
                        ``(E) The entity allows for public review and
                    updates of the operating rules.
                ``(3) Review and recommendations.--The National Committee
            on Vital and Health Statistics shall--
                        ``(A) advise the Secretary as to whether a
                    nonprofit entity meets the requirements under paragraph
                    (2);
                        ``(B) review the operating rules developed and
                    recommended by such nonprofit entity;
                        ``(C) determine whether such operating rules
                    represent a consensus view of the health care
                    stakeholders and are consistent with and do not
                    conflict with other existing standards;
                        ``(D) evaluate whether such operating rules are
                    consistent with electronic standards adopted for health
                    information technology; and
                        ``(E) submit to the Secretary a recommendation as
                    to whether the Secretary should adopt such operating
                    rules.
                ``(4) Implementation.--
                        ``(A) In general.--The Secretary shall adopt
                    operating rules under this subsection, by regulation in
                    accordance with subparagraph (C), following
                    consideration of the operating rules developed by the
                    non-profit entity described in paragraph (2) and the
                    recommendation submitted by the National Committee on
                    Vital and Health Statistics under paragraph (3)(E) and
                    having ensured consultation with providers.
                        ``(B) Adoption requirements; effective dates.--
                                ``(i) Eligibility for a health plan and
                            health claim status.--The set of operating
                            rules for eligibility for a health plan and
                            health claim status transactions shall be
                            adopted not later than July 1, 2011, in a
                            manner ensuring that such operating rules are
                            effective not later than January 1, 2013, and
                            may allow for the use of a machine readable
                            identification card.
                                ``(ii) Electronic funds transfers and
                            health care payment and remittance advice.--The
                            set of operating rules for electronic funds
                            transfers and health care payment and
                            remittance advice transactions shall--
                                        ``(I) allow for automated
                                    reconciliation of the electronic
                                    payment with the remittance advice; and
                                        ``(II) be adopted not later than
                                    July 1, 2012, in a manner ensuring that
                                    such operating rules are effective not
                                    later than January 1, 2014.
                                ``(iii) Health claims or equivalent
                            encounter information, enrollment and
                            disenrollment in a health plan, health plan
                            premium payments, referral certification and
                            authorization.--The set of operating rules for
                            health claims or equivalent encounter
                            information, enrollment and disenrollment in a
                            health plan, health plan premium payments, and
                            referral certification and authorization
                            transactions shall be adopted not later than
                            July 1, 2014, in a manner ensuring that such
                            operating rules are effective not later than
                            January 1, 2016.
                        ``(C) Expedited rulemaking.--The Secretary shall
                    promulgate an interim final rule applying any standard
                    or operating rule recommended by the National Committee
                    on Vital and Health Statistics pursuant to paragraph
                    (3). The Secretary shall accept and consider public
                    comments on any interim final rule published under this
                    subparagraph for 60 days after the date of such
                    publication.
        ``(h) Compliance.--
                ``(1) Health plan certification.--
                        ``(A) Eligibility for a health plan, health claim
                    status, electronic funds transfers, health care payment
                    and remittance advice.--Not later than December 31,
                    2013, a health plan shall file a statement with the
                    Secretary, in such form as the Secretary may require,
                    certifying that the data and information systems for
                    such plan are in compliance with any applicable
                    standards (as described under paragraph (7) of section
                    1171) and associated operating rules (as described
                    under paragraph (9) of such section) for electronic
                    funds transfers, eligibility for a health plan, health
                    claim status, and health care payment and remittance
                    advice, respectively.
                        ``(B) Health claims or equivalent encounter
                    information, enrollment and disenrollment in a health
                    plan, health plan premium payments, health claims
                    attachments, referral certification and
                    authorization.--Not later than December 31, 2015, a
                    health plan shall file a statement with the Secretary,
                    in such form as the Secretary may require, certifying
                    that the data and information systems for such plan are
                    in compliance with any applicable standards and
                    associated operating rules for health claims or
                    equivalent encounter information, enrollment and
                    disenrollment in a health plan, health plan premium
                    payments, health claims attachments, and referral
                    certification and authorization, respectively. A health
                    plan shall provide the same level of documentation to
                    certify compliance with such transactions as is
                    required to certify compliance with the transactions
                    specified in subparagraph (A).
                ``(2) Documentation of compliance.--A health plan shall
            provide the Secretary, in such form as the Secretary may
            require, with adequate documentation of compliance with the
            standards and operating rules described under paragraph (1). A
            health plan shall not be considered to have provided adequate
            documentation and shall not be certified as being in compliance
            with such standards, unless the health plan--
                        ``(A) demonstrates to the Secretary that the plan
                    conducts the electronic transactions specified in
                    paragraph (1) in a manner that fully complies with the
                    regulations of the Secretary; and
                        ``(B) provides documentation showing that the plan
                    has completed end-to-end testing for such transactions
                    with their partners, such as hospitals and physicians.
                ``(3) Service contracts.--A health plan shall be required
            to ensure that any entities that provide services pursuant to a
            contract with such health plan shall comply with any applicable
            certification and compliance requirements (and provide the
            Secretary with adequate documentation of such compliance) under
            this subsection.
                ``(4) Certification by outside entity.--The Secretary may
            designate independent, outside entities to certify that a
            health plan has complied with the requirements under this
            subsection, provided that the certification standards employed
            by such entities are in accordance with any standards or
            operating rules issued by the Secretary.
                ``(5) Compliance with revised standards and operating
            rules.--
                        ``(A) In general.--A health plan (including
                    entities described under paragraph (3)) shall file a
                    statement with the Secretary, in such form as the
                    Secretary may require, certifying that the data and
                    information systems for such plan are in compliance
                    with any applicable revised standards and associated
                    operating rules under this subsection for any interim
                    final rule promulgated by the Secretary under
                    subsection (i) that--
                                ``(i) amends any standard or operating rule
                            described under paragraph (1) of this
                            subsection; or
                                ``(ii) establishes a standard (as described
                            under subsection (a)(1)(B)) or associated
                            operating rules (as described under subsection
                            (i)(5)) for any other financial and
                            administrative transactions.
                        ``(B) Date of compliance.--A health plan shall
                    comply with such requirements not later than the
                    effective date of the applicable standard or operating
                    rule.
                ``(6) Audits of health plans.--The Secretary shall conduct
            periodic audits to ensure that health plans (including entities
            described under paragraph (3)) are in compliance with any
            standards and operating rules that are described under
            paragraph (1) or subsection (i)(5).
        ``(i) Review and Amendment of Standards and Operating Rules.--
                ``(1) Establishment.--Not later than January 1, 2014, the
            Secretary shall establish a review committee (as described
            under paragraph (4)).
                ``(2) Evaluations and reports.--
                        ``(A) Hearings.--Not later than April 1, 2014, and
                    not less than biennially thereafter, the Secretary,
                    acting through the review committee, shall conduct
                    hearings to evaluate and review the adopted standards
                    and operating rules established under this section.
                        ``(B) Report.--Not later than July 1, 2014, and not
                    less than biennially thereafter, the review committee
                    shall provide recommendations for updating and
                    improving such standards and operating rules. The
                    review committee shall recommend a single set of
                    operating rules per transaction standard and maintain
                    the goal of creating as much uniformity as possible in
                    the implementation of the electronic standards.
                ``(3) Interim final rulemaking.--
                        ``(A) In general.--Any recommendations to amend
                    adopted standards and operating rules that have been
                    approved by the review committee and reported to the
                    Secretary under paragraph (2)(B) shall be adopted by
                    the Secretary through promulgation of an interim final
                    rule not later than 90 days after receipt of the
                    committee's report.
                        ``(B) Public comment.--
                                ``(i) Public comment period.--The Secretary
                            shall accept and consider public comments on
                            any interim final rule published under this
                            paragraph for 60 days after the date of such
                            publication.
                                ``(ii) Effective date.--The effective date
                            of any amendment to existing standards or
                            operating rules that is adopted through an
                            interim final rule published under this
                            paragraph shall be 25 months following the
                            close of such public comment period.
                ``(4) Review committee.--
                        ``(A) Definition.--For the purposes of this
                    subsection, the term `review committee' means a
                    committee chartered by or within the Department of
                    Health and Human services that has been designated by
                    the Secretary to carry out this subsection, including--
                                ``(i) the National Committee on Vital and
                            Health Statistics; or
                                ``(ii) any appropriate committee as
                            determined by the Secretary.
                        ``(B) Coordination of hit standards.--In developing
                    recommendations under this subsection, the review
                    committee shall ensure coordination, as appropriate,
                    with the standards that support the certified
                    electronic health record technology approved by the
                    Office of the National Coordinator for Health
                    Information Technology.
                ``(5) Operating rules for other standards adopted by the
            secretary.--The Secretary shall adopt a single set of operating
            rules (pursuant to the process described under subsection (g))
            for any transaction for which a standard had been adopted
            pursuant to subsection (a)(1)(B).
        ``(j) Penalties.--
                ``(1) Penalty fee.--
                        ``(A) In general.--Not later than April 1, 2014,
                    and annually thereafter, the Secretary shall assess a
                    penalty fee (as determined under subparagraph (B))
                    against a health plan that has failed to meet the
                    requirements under subsection (h) with respect to
                    certification and documentation of compliance with--
                                ``(i) the standards and associated
                            operating rules described under paragraph (1)
                            of such subsection; and
                                ``(ii) a standard (as described under
                            subsection (a)(1)(B)) and associated operating
                            rules (as described under subsection (i)(5))
                            for any other financial and administrative
                            transactions.
                        ``(B) Fee amount.--Subject to subparagraphs (C),
                    (D), and (E), the Secretary shall assess a penalty fee
                    against a health plan in the amount of $1 per covered
                    life until certification is complete. The penalty shall
                    be assessed per person covered by the plan for which
                    its data systems for major medical policies are not in
                    compliance and shall be imposed against the health plan
                    for each day that the plan is not in compliance with
                    the requirements under subsection (h).
                        ``(C) Additional penalty for misrepresentation.--A
                    health plan that knowingly provides inaccurate or
                    incomplete information in a statement of certification
                    or documentation of compliance under subsection (h)
                    shall be subject to a penalty fee that is double the
                    amount that would otherwise be imposed under this
                    subsection.
                        ``(D) Annual fee increase.--The amount of the
                    penalty fee imposed under this subsection shall be
                    increased on an annual basis by the annual percentage
                    increase in total national health care expenditures, as
                    determined by the Secretary.
                        ``(E) Penalty limit.--A penalty fee assessed
                    against a health plan under this subsection shall not
                    exceed, on an annual basis--
                                ``(i) an amount equal to $20 per covered
                            life under such plan; or
                                ``(ii) an amount equal to $40 per covered
                            life under the plan if such plan has knowingly
                            provided inaccurate or incomplete information
                            (as described under subparagraph (C)).
                        ``(F) Determination of covered individuals.--The
                    Secretary shall determine the number of covered lives
                    under a health plan based upon the most recent
                    statements and filings that have been submitted by such
                    plan to the Securities and Exchange Commission.
                ``(2) Notice and dispute procedure.--The Secretary shall
            establish a procedure for assessment of penalty fees under this
            subsection that provides a health plan with reasonable notice
            and a dispute resolution procedure prior to provision of a
            notice of assessment by the Secretary of the Treasury (as
            described under paragraph (4)(B)).
                ``(3) Penalty fee report.--Not later than May 1, 2014, and
            annually thereafter, the Secretary shall provide the Secretary
            of the Treasury with a report identifying those health plans
            that have been assessed a penalty fee under this subsection.
                ``(4) Collection of penalty fee.--
                        ``(A) In general.--The Secretary of the Treasury,
                    acting through the Financial Management Service, shall
                    administer the collection of penalty fees from health
                    plans that have been identified by the Secretary in the
                    penalty fee report provided under paragraph (3).
                        ``(B) Notice.--Not later than August 1, 2014, and
                    annually thereafter, the Secretary of the Treasury
                    shall provide notice to each health plan that has been
                    assessed a penalty fee by the Secretary under this
                    subsection. Such notice shall include the amount of the
                    penalty fee assessed by the Secretary and the due date
                    for payment of such fee to the Secretary of the
                    Treasury (as described in subparagraph (C)).
                        ``(C) Payment due date.--Payment by a health plan
                    for a penalty fee assessed under this subsection shall
                    be made to the Secretary of the Treasury not later than
                    November 1, 2014, and annually thereafter.
                        ``(D) Unpaid penalty fees.--Any amount of a penalty
                    fee assessed against a health plan under this
                    subsection for which payment has not been made by the
                    due date provided under subparagraph (C) shall be--
                                ``(i) increased by the interest accrued on
                            such amount, as determined pursuant to the
                            underpayment rate established under section
                            6621 of the Internal Revenue Code of 1986; and
                                ``(ii) treated as a past-due, legally
                            enforceable debt owed to a Federal agency for
                            purposes of section 6402(d) of the Internal
                            Revenue Code of 1986.
                        ``(E) Administrative fees.--Any fee charged or
                    allocated for collection activities conducted by the
                    Financial Management Service will be passed on to a
                    health plan on a pro-rata basis and added to any
                    penalty fee collected from the plan.''.
        (c) Promulgation of Rules.--
                (1) Unique health plan identifier.--The Secretary shall
            promulgate a final rule to establish a unique health plan
            identifier (as described in section 1173(b) of the Social
            Security Act (42 U.S.C. 1320d-2(b))) based on the input of the
            National Committee on Vital and Health Statistics. The
            Secretary may do so on an interim final basis and such rule
            shall be effective not later than October 1, 2012.
                (2) Electronic funds transfer.--The Secretary shall
            promulgate a final rule to establish a standard for electronic
            funds transfers (as described in section 1173(a)(2)(J) of the
            Social Security Act, as added by subsection (b)(2)(A)). The
            Secretary may do so on an interim final basis and shall adopt
            such standard not later than January 1, 2012, in a manner
            ensuring that such standard is effective not later than January
            1, 2014.
                (3) Health claims attachments.--The Secretary shall
            promulgate a final rule to establish a transaction standard and
            a single set of associated operating rules for health claims
            attachments (as described in section 1173(a)(2)(B) of the
            Social Security Act (42 U.S.C. 1320d-2(a)(2)(B))) that is
            consistent with the X12 Version 5010 transaction standards. The
            Secretary may do so on an interim final basis and shall adopt a
            transaction standard and a single set of associated operating
            rules not later than January 1, 2014, in a manner ensuring that
            such standard is effective not later than January 1, 2016.
        (d) Expansion of Electronic Transactions in Medicare.--Section
    1862(a) of the Social Security Act (42 U.S.C. 1395y(a)) is amended--
                (1) in paragraph (23), by striking the ``or'' at the end;
                (2) in paragraph (24), by striking the period and inserting
            ``; or''; and
                (3) by inserting after paragraph (24) the following new
            paragraph:
                ``(25) not later than January 1, 2014, for which the
            payment is other than by electronic funds transfer (EFT) or an
            electronic remittance in a form as specified in ASC X12 835
            Health Care Payment and Remittance Advice or subsequent
            standard.''.

    SEC. 1105. EFFECTIVE DATE.

        This subtitle shall take effect on the date of enactment of this
    Act.

        Subtitle C--Quality Health Insurance Coverage for All Americans

                    PART I--HEALTH INSURANCE MARKET REFORMS

    SEC. 1201. AMENDMENT TO THE PUBLIC HEALTH SERVICE ACT.

        Part A of title XXVII of the Public Health Service Act (42 U.S.C.
    300gg et seq.), as amended by section 1001, is further amended--
                (1) by striking the heading for subpart 1 and inserting the
            following:

                         ``Subpart I--General Reform'';

                (2)(A) in section 2701 (42 U.S.C. 300gg), by striking the
            section heading and subsection (a) and inserting the following:

    ``SEC. 2704. PROHIBITION OF PREEXISTING CONDITION EXCLUSIONS OR OTHER
                  DISCRIMINATION BASED ON HEALTH STATUS.

        ``(a) In General.--A group health plan and a health insurance
    issuer offering group or individual health insurance coverage may not
    impose any preexisting condition exclusion with respect to such plan or
    coverage.''; and
                (B) by transferring such section (as amended by
            subparagraph (A)) so as to appear after the section 2703 added
            by paragraph (4);
                (3)(A) in section 2702 (42 U.S.C. 300gg-1)--
                        (i) by striking the section heading and all that
                    follows through subsection (a);
                        (ii) in subsection (b)--
                                (I) by striking ``health insurance issuer
                            offering health insurance coverage in
                            connection with a group health plan'' each
                            place that such appears and inserting ``health
                            insurance issuer offering group or individual
                            health insurance coverage''; and
                                (II) in paragraph (2)(A)--
                                        (aa) by inserting ``or individual''
                                    after ``employer''; and
                                        (bb) by inserting ``or individual
                                    health coverage, as the case may be''
                                    before the semicolon; and
                        (iii) in subsection (e)--
                                (I) by striking ``(a)(1)(F)'' and inserting
                            ``(a)(6)'';
                                (II) by striking ``2701'' and inserting
                            ``2704''; and
                                (III) by striking ``2721(a)'' and inserting
                            ``2735(a)''; and
                        (B) by transferring such section (as amended by
                    subparagraph (A)) to appear after section 2705(a) as
                    added by paragraph (4); and
                (4) by inserting after the subpart heading (as added by
            paragraph (1)) the following:

    ``SEC. 2701. FAIR HEALTH INSURANCE PREMIUMS.

        ``(a) Prohibiting Discriminatory Premium Rates.--
                ``(1) In general.--With respect to the premium rate charged
            by a health insurance issuer for health insurance coverage
            offered in the individual or small group market--
                        ``(A) such rate shall vary with respect to the
                    particular plan or coverage involved only by--
                                ``(i) whether such plan or coverage covers
                            an individual or family;
                                ``(ii) rating area, as established in
                            accordance with paragraph (2);
                                ``(iii) age, except that such rate shall
                            not vary by more than 3 to 1 for adults
                            (consistent with section 2707(c)); and
                                ``(iv) tobacco use, except that such rate
                            shall not vary by more than 1.5 to 1; and
                        ``(B) such rate shall not vary with respect to the
                    particular plan or coverage involved by any other
                    factor not described in subparagraph (A).
                ``(2) Rating area.--
                        ``(A) In general.--Each State shall establish 1 or
                    more rating areas within that State for purposes of
                    applying the requirements of this title.
                        ``(B) Secretarial review.--The Secretary shall
                    review the rating areas established by each State under
                    subparagraph (A) to ensure the adequacy of such areas
                    for purposes of carrying out the requirements of this
                    title. If the Secretary determines a State's rating
                    areas are not adequate, or that a State does not
                    establish such areas, the Secretary may establish
                    rating areas for that State.
                ``(3) Permissible age bands.--The Secretary, in
            consultation with the National Association of Insurance
            Commissioners, shall define the permissible age bands for
            rating purposes under paragraph (1)(A)(iii).
                ``(4) Application of variations based on age or tobacco
            use.--With respect to family coverage under a group health plan
            or health insurance coverage, the rating variations permitted
            under clauses (iii) and (iv) of paragraph (1)(A) shall be
            applied based on the portion of the premium that is
            attributable to each family member covered under the plan or
            coverage.
                ``(5) Special rule for large group market.--If a State
            permits health insurance issuers that offer coverage in the
            large group market in the State to offer such coverage through
            the State Exchange (as provided for under section 1312(f)(2)(B)
            of the Patient Protection and Affordable Care Act), the
            provisions of this subsection shall apply to all coverage
            offered in such market in the State.

    ``SEC. 2702. GUARANTEED AVAILABILITY OF COVERAGE.

        ``(a) Guaranteed Issuance of Coverage in the Individual and Group
    Market.--Subject to subsections (b) through (e), each health insurance
    issuer that offers health insurance coverage in the individual or group
    market in a State must accept every employer and individual in the
    State that applies for such coverage.
        ``(b) Enrollment.--
                ``(1) Restriction.--A health insurance issuer described in
            subsection (a) may restrict enrollment in coverage described in
            such subsection to open or special enrollment periods.
                ``(2) Establishment.--A health insurance issuer described
            in subsection (a) shall, in accordance with the regulations
            promulgated under paragraph (3), establish special enrollment
            periods for qualifying events (under section 603 of the
            Employee Retirement Income Security Act of 1974).
                ``(3) Regulations.--The Secretary shall promulgate
            regulations with respect to enrollment periods under paragraphs
            (1) and (2).

    ``SEC. 2703. GUARANTEED RENEWABILITY OF COVERAGE.

        ``(a) In General.--Except as provided in this section, if a health
    insurance issuer offers health insurance coverage in the individual or
    group market, the issuer must renew or continue in force such coverage
    at the option of the plan sponsor or the individual, as applicable.

    ``SEC. 2705. PROHIBITING DISCRIMINATION AGAINST INDIVIDUAL PARTICIPANTS
                  AND BENEFICIARIES BASED ON HEALTH STATUS.

        ``(a) In General.--A group health plan and a health insurance
    issuer offering group or individual health insurance coverage may not
    establish rules for eligibility (including continued eligibility) of
    any individual to enroll under the terms of the plan or coverage based
    on any of the following health status-related factors in relation to
    the individual or a dependent of the individual:
                ``(1) Health status.
                ``(2) Medical condition (including both physical and mental
            illnesses).
                ``(3) Claims experience.
                ``(4) Receipt of health care.
                ``(5) Medical history.
                ``(6) Genetic information.
                ``(7) Evidence of insurability (including conditions
            arising out of acts of domestic violence).
                ``(8) Disability.
                ``(9) Any other health status-related factor determined
            appropriate by the Secretary.
        ``(j) Programs of Health Promotion or Disease Prevention.--
                ``(1) General provisions.--
                        ``(A) General rule.--For purposes of subsection
                    (b)(2)(B), a program of health promotion or disease
                    prevention (referred to in this subsection as a
                    `wellness program') shall be a program offered by an
                    employer that is designed to promote health or prevent
                    disease that meets the applicable requirements of this
                    subsection.
                        ``(B) No conditions based on health status
                    factor.--If none of the conditions for obtaining a
                    premium discount or rebate or other reward for
                    participation in a wellness program is based on an
                    individual satisfying a standard that is related to a
                    health status factor, such wellness program shall not
                    violate this section if participation in the program is
                    made available to all similarly situated individuals
                    and the requirements of paragraph (2) are complied
                    with.
                        ``(C) Conditions based on health status factor.--If
                    any of the conditions for obtaining a premium discount
                    or rebate or other reward for participation in a
                    wellness program is based on an individual satisfying a
                    standard that is related to a health status factor,
                    such wellness program shall not violate this section if
                    the requirements of paragraph (3) are complied with.
                ``(2) Wellness programs not subject to requirements.--If
            none of the conditions for obtaining a premium discount or
            rebate or other reward under a wellness program as described in
            paragraph (1)(B) are based on an individual satisfying a
            standard that is related to a health status factor (or if such
            a wellness program does not provide such a reward), the
            wellness program shall not violate this section if
            participation in the program is made available to all similarly
            situated individuals. The following programs shall not have to
            comply with the requirements of paragraph (3) if participation
            in the program is made available to all similarly situated
            individuals:
                        ``(A) A program that reimburses all or part of the
                    cost for memberships in a fitness center.
                        ``(B) A diagnostic testing program that provides a
                    reward for participation and does not base any part of
                    the reward on outcomes.
                        ``(C) A program that encourages preventive care
                    related to a health condition through the waiver of the
                    copayment or deductible requirement under group health
                    plan for the costs of certain items or services related
                    to a health condition (such as prenatal care or well-
                    baby visits).
                        ``(D) A program that reimburses individuals for the
                    costs of smoking cessation programs without regard to
                    whether the individual quits smoking.
                        ``(E) A program that provides a reward to
                    individuals for attending a periodic health education
                    seminar.
                ``(3) Wellness programs subject to requirements.--If any of
            the conditions for obtaining a premium discount, rebate, or
            reward under a wellness program as described in paragraph
            (1)(C) is based on an individual satisfying a standard that is
            related to a health status factor, the wellness program shall
            not violate this section if the following requirements are
            complied with:
                        ``(A) The reward for the wellness program, together
                    with the reward for other wellness programs with
                    respect to the plan that requires satisfaction of a
                    standard related to a health status factor, shall not
                    exceed 30 percent of the cost of employee-only coverage
                    under the plan. If, in addition to employees or
                    individuals, any class of dependents (such as spouses
                    or spouses and dependent children) may participate
                    fully in the wellness program, such reward shall not
                    exceed 30 percent of the cost of the coverage in which
                    an employee or individual and any dependents are
                    enrolled. For purposes of this paragraph, the cost of
                    coverage shall be determined based on the total amount
                    of employer and employee contributions for the benefit
                    package under which the employee is (or the employee
                    and any dependents are) receiving coverage. A reward
                    may be in the form of a discount or rebate of a premium
                    or contribution, a waiver of all or part of a cost-
                    sharing mechanism (such as deductibles, copayments, or
                    coinsurance), the absence of a surcharge, or the value
                    of a benefit that would otherwise not be provided under
                    the plan. The Secretaries of Labor, Health and Human
                    Services, and the Treasury may increase the reward
                    available under this subparagraph to up to 50 percent
                    of the cost of coverage if the Secretaries determine
                    that such an increase is appropriate.
                        ``(B) The wellness program shall be reasonably
                    designed to promote health or prevent disease. A
                    program complies with the preceding sentence if the
                    program has a reasonable chance of improving the health
                    of, or preventing disease in, participating individuals
                    and it is not overly burdensome, is not a subterfuge
                    for discriminating based on a health status factor, and
                    is not highly suspect in the method chosen to promote
                    health or prevent disease.
                        ``(C) The plan shall give individuals eligible for
                    the program the opportunity to qualify for the reward
                    under the program at least once each year.
                        ``(D) The full reward under the wellness program
                    shall be made available to all similarly situated
                    individuals. For such purpose, among other things:
                                ``(i) The reward is not available to all
                            similarly situated individuals for a period
                            unless the wellness program allows--
                                        ``(I) for a reasonable alternative
                                    standard (or waiver of the otherwise
                                    applicable standard) for obtaining the
                                    reward for any individual for whom, for
                                    that period, it is unreasonably
                                    difficult due to a medical condition to
                                    satisfy the otherwise applicable
                                    standard; and
                                        ``(II) for a reasonable alternative
                                    standard (or waiver of the otherwise
                                    applicable standard) for obtaining the
                                    reward for any individual for whom, for
                                    that period, it is medically
                                    inadvisable to attempt to satisfy the
                                    otherwise applicable standard.
                                ``(ii) If reasonable under the
                            circumstances, the plan or issuer may seek
                            verification, such as a statement from an
                            individual's physician, that a health status
                            factor makes it unreasonably difficult or
                            medically inadvisable for the individual to
                            satisfy or attempt to satisfy the otherwise
                            applicable standard.
                        ``(E) The plan or issuer involved shall disclose in
                    all plan materials describing the terms of the wellness
                    program the availability of a reasonable alternative
                    standard (or the possibility of waiver of the otherwise
                    applicable standard) required under subparagraph (D).
                    If plan materials disclose that such a program is
                    available, without describing its terms, the disclosure
                    under this subparagraph shall not be required.
        ``(k) Existing Programs.--Nothing in this section shall prohibit a
    program of health promotion or disease prevention that was established
    prior to the date of enactment of this section and applied with all
    applicable regulations, and that is operating on such date, from
    continuing to be carried out for as long as such regulations remain in
    effect.
        ``(l) Wellness Program Demonstration Project.--
                ``(1) In general.--Not later than July 1, 2014, the
            Secretary, in consultation with the Secretary of the Treasury
            and the Secretary of Labor, shall establish a 10-State
            demonstration project under which participating States shall
            apply the provisions of subsection (j) to programs of health
            promotion offered by a health insurance issuer that offers
            health insurance coverage in the individual market in such
            State.
                ``(2) Expansion of demonstration project.--If the
            Secretary, in consultation with the Secretary of the Treasury
            and the Secretary of Labor, determines that the demonstration
            project described in paragraph (1) is effective, such
            Secretaries may, beginning on July 1, 2017 expand such
            demonstration project to include additional participating
            States.
                ``(3) Requirements.--
                        ``(A) Maintenance of coverage.--The Secretary, in
                    consultation with the Secretary of the Treasury and the
                    Secretary of Labor, shall not approve the participation
                    of a State in the demonstration project under this
                    section unless the Secretaries determine that the
                    State's project is designed in a manner that--
                                ``(i) will not result in any decrease in
                            coverage; and
                                ``(ii) will not increase the cost to the
                            Federal Government in providing credits under
                            section 36B of the Internal Revenue Code of
                            1986 or cost-sharing assistance under section
                            1402 of the Patient Protection and Affordable
                            Care Act.
                        ``(B) Other requirements.--States that participate
                    in the demonstration project under this subsection--
                                ``(i) may permit premium discounts or
                            rebates or the modification of otherwise
                            applicable copayments or deductibles for
                            adherence to, or participation in, a reasonably
                            designed program of health promotion and
                            disease prevention;
                                ``(ii) shall ensure that requirements of
                            consumer protection are met in programs of
                            health promotion in the individual market;
                                ``(iii) shall require verification from
                            health insurance issuers that offer health
                            insurance coverage in the individual market of
                            such State that premium discounts--
                                        ``(I) do not create undue burdens
                                    for individuals insured in the
                                    individual market;
                                        ``(II) do not lead to cost
                                    shifting; and
                                        ``(III) are not a subterfuge for
                                    discrimination;
                                ``(iv) shall ensure that consumer data is
                            protected in accordance with the requirements
                            of section 264(c) of the Health Insurance
                            Portability and Accountability Act of 1996 (42
                            U.S.C. 1320d-2 note); and
                                ``(v) shall ensure and demonstrate to the
                            satisfaction of the Secretary that the
                            discounts or other rewards provided under the
                            project reflect the expected level of
                            participation in the wellness program involved
                            and the anticipated effect the program will
                            have on utilization or medical claim costs.
        ``(m) Report.--
                ``(1) In general.--Not later than 3 years after the date of
            enactment of the Patient Protection and Affordable Care Act,
            the Secretary, in consultation with the Secretary of the
            Treasury and the Secretary of Labor, shall submit a report to
            the appropriate committees of Congress concerning--
                        ``(A) the effectiveness of wellness programs (as
                    defined in subsection (j)) in promoting health and
                    preventing disease;
                        ``(B) the impact of such wellness programs on the
                    access to care and affordability of coverage for
                    participants and non-participants of such programs;
                        ``(C) the impact of premium-based and cost-sharing
                    incentives on participant behavior and the role of such
                    programs in changing behavior; and
                        ``(D) the effectiveness of different types of
                    rewards.
                ``(2) Data collection.--In preparing the report described
            in paragraph (1), the Secretaries shall gather relevant
            information from employers who provide employees with access to
            wellness programs, including State and Federal agencies.
        ``(n) Regulations.--Nothing in this section shall be construed as
    prohibiting the Secretaries of Labor, Health and Human Services, or the
    Treasury from promulgating regulations in connection with this section.

    ``SEC. 2706. NON-DISCRIMINATION IN HEALTH CARE.

        ``(a) Providers.--A group health plan and a health insurance issuer
    offering group or individual health insurance coverage shall not
    discriminate with respect to participation under the plan or coverage
    against any health care provider who is acting within the scope of that
    provider's license or certification under applicable State law. This
    section shall not require that a group health plan or health insurance
    issuer contract with any health care provider willing to abide by the
    terms and conditions for participation established by the plan or
    issuer. Nothing in this section shall be construed as preventing a
    group health plan, a health insurance issuer, or the Secretary from
    establishing varying reimbursement rates based on quality or
    performance measures.
        ``(b) Individuals.--The provisions of section 1558 of the Patient
    Protection and Affordable Care Act (relating to non-discrimination)
    shall apply with respect to a group health plan or health insurance
    issuer offering group or individual health insurance coverage.

    ``SEC. 2707. COMPREHENSIVE HEALTH INSURANCE COVERAGE.

        ``(a) Coverage for Essential Health Benefits Package.--A health
    insurance issuer that offers health insurance coverage in the
    individual or small group market shall ensure that such coverage
    includes the essential health benefits package required under section
    1302(a) of the Patient Protection and Affordable Care Act.
        ``(b) Cost-sharing Under Group Health Plans.--A group health plan
    shall ensure that any annual cost-sharing imposed under the plan does
    not exceed the limitations provided for under paragraphs (1) and (2) of
    section 1302(c).
        ``(c) Child-only Plans.--If a health insurance issuer offers health
    insurance coverage in any level of coverage specified under section
    1302(d) of the Patient Protection and Affordable Care Act, the issuer
    shall also offer such coverage in that level as a plan in which the
    only enrollees are individuals who, as of the beginning of a plan year,
    have not attained the age of 21.
        ``(d) Dental Only.--This section shall not apply to a plan
    described in section 1302(d)(2)(B)(ii)(I).

    ``SEC. 2708. PROHIBITION ON EXCESSIVE WAITING PERIODS.

        ``A group health plan and a health insurance issuer offering group
    or individual health insurance coverage shall not apply any waiting
    period (as defined in section 2704(b)(4)) that exceeds 90 days.''.

                           PART II--OTHER PROVISIONS

    SEC. 1251. PRESERVATION OF RIGHT TO MAINTAIN EXISTING COVERAGE.

        (a) No Changes to Existing Coverage.--
                (1) In general.--Nothing in this Act (or an amendment made
            by this Act) shall be construed to require that an individual
            terminate coverage under a group health plan or health
            insurance coverage in which such individual was enrolled on the
            date of enactment of this Act.
                (2) Continuation of coverage.--With respect to a group
            health plan or health insurance coverage in which an individual
            was enrolled on the date of enactment of this Act, this
            subtitle and subtitle A (and the amendments made by such
            subtitles) shall not apply to such plan or coverage, regardless
            of whether the individual renews such coverage after such date
            of enactment.
        (b) Allowance for Family Members To Join Current Coverage.--With
    respect to a group health plan or health insurance coverage in which an
    individual was enrolled on the date of enactment of this Act and which
    is renewed after such date, family members of such individual shall be
    permitted to enroll in such plan or coverage if such enrollment is
    permitted under the terms of the plan in effect as of such date of
    enactment.
        (c) Allowance for New Employees To Join Current Plan.--A group
    health plan that provides coverage on the date of enactment of this Act
    may provide for the enrolling of new employees (and their families) in
    such plan, and this subtitle and subtitle A (and the amendments made by
    such subtitles) shall not apply with respect to such plan and such new
    employees (and their families).
        (d) Effect on Collective Bargaining Agreements.--In the case of
    health insurance coverage maintained pursuant to one or more collective
    bargaining agreements between employee representatives and one or more
    employers that was ratified before the date of enactment of this Act,
    the provisions of this subtitle and subtitle A (and the amendments made
    by such subtitles) shall not apply until the date on which the last of
    the collective bargaining agreements relating to the coverage
    terminates. Any coverage amendment made pursuant to a collective
    bargaining agreement relating to the coverage which amends the coverage
    solely to conform to any requirement added by this subtitle or subtitle
    A (or amendments) shall not be treated as a termination of such
    collective bargaining agreement.
        (e) Definition.--In this title, the term ``grandfathered health
    plan'' means any group health plan or health insurance coverage to
    which this section applies.

    SEC. 1252. RATING REFORMS MUST APPLY UNIFORMLY TO ALL HEALTH INSURANCE
                  ISSUERS AND GROUP HEALTH PLANS.

        Any standard or requirement adopted by a State pursuant to this
    title, or any amendment made by this title, shall be applied uniformly
    to all health plans in each insurance market to which the standard and
    requirements apply. The preceding sentence shall also apply to a State
    standard or requirement relating to the standard or requirement
    required by this title (or any such amendment) that is not the same as
    the standard or requirement but that is not preempted under section
    1321(d).

    SEC. 1253. EFFECTIVE DATES.

        This subtitle (and the amendments made by this subtitle) shall
    become effective for plan years beginning on or after January 1, 2014.

            Subtitle D--Available Coverage Choices for All Americans

                PART I--ESTABLISHMENT OF QUALIFIED HEALTH PLANS

    SEC. 1301. QUALIFIED HEALTH PLAN DEFINED.

        (a) Qualified Health Plan.--In this title:
                (1) In general.--The term ``qualified health plan'' means a
            health plan that--
                        (A) has in effect a certification (which may
                    include a seal or other indication of approval) that
                    such plan meets the criteria for certification
                    described in section 1311(c) issued or recognized by
                    each Exchange through which such plan is offered;
                        (B) provides the essential health benefits package
                    described in section 1302(a); and
                        (C) is offered by a health insurance issuer that--
                                (i) is licensed and in good standing to
                            offer health insurance coverage in each State
                            in which such issuer offers health insurance
                            coverage under this title;
                                (ii) agrees to offer at least one qualified
                            health plan in the silver level and at least
                            one plan in the gold level in each such
                            Exchange;
                                (iii) agrees to charge the same premium
                            rate for each qualified health plan of the
                            issuer without regard to whether the plan is
                            offered through an Exchange or whether the plan
                            is offered directly from the issuer or through
                            an agent; and
                                (iv) complies with the regulations
                            developed by the Secretary under section
                            1311(d) and such other requirements as an
                            applicable Exchange may establish.
                (2) Inclusion of co-op plans and community health insurance
            option.--Any reference in this title to a qualified health plan
            shall be deemed to include a qualified health plan offered
            through the CO-OP program under section 1322 or a community
            health insurance option under section 1323, unless specifically
            provided for otherwise.
        (b) Terms Relating to Health Plans.--In this title:
                (1) Health plan.--
                        (A) In general.--The term ``health plan'' means
                    health insurance coverage and a group health plan.
                        (B) Exception for self-insured plans and mewas.--
                    Except to the extent specifically provided by this
                    title, the term ``health plan'' shall not include a
                    group health plan or multiple employer welfare
                    arrangement to the extent the plan or arrangement is
                    not subject to State insurance regulation under section
                    514 of the Employee Retirement Income Security Act of
                    1974.
                (2) Health insurance coverage and issuer.--The terms
            ``health insurance coverage'' and ``health insurance issuer''
            have the meanings given such terms by section 2791(b) of the
            Public Health Service Act.
                (3) Group health plan.--The term ``group health plan'' has
            the meaning given such term by section 2791(a) of the Public
            Health Service Act.

    SEC. 1302. ESSENTIAL HEALTH BENEFITS REQUIREMENTS.

        (a) Essential Health Benefits Package.--In this title, the term
    ``essential health benefits package'' means, with respect to any health
    plan, coverage that--
                (1) provides for the essential health benefits defined by
            the Secretary under subsection (b);
                (2) limits cost-sharing for such coverage in accordance
            with subsection (c); and
                (3) subject to subsection (e), provides either the bronze,
            silver, gold, or platinum level of coverage described in
            subsection (d).
        (b) Essential Health Benefits.--
                (1) In general.--Subject to paragraph (2), the Secretary
            shall define the essential health benefits, except that such
            benefits shall include at least the following general
            categories and the items and services covered within the
            categories:
                        (A) Ambulatory patient services.
                        (B) Emergency services.
                        (C) Hospitalization.
                        (D) Maternity and newborn care.
                        (E) Mental health and substance use disorder
                    services, including behavioral health treatment.
                        (F) Prescription drugs.
                        (G) Rehabilitative and habilitative services and
                    devices.
                        (H) Laboratory services.
                        (I) Preventive and wellness services and chronic
                    disease management.
                        (J) Pediatric services, including oral and vision
                    care.
                (2) Limitation.--
                        (A) In general.--The Secretary shall ensure that
                    the scope of the essential health benefits under
                    paragraph (1) is equal to the scope of benefits
                    provided under a typical employer plan, as determined
                    by the Secretary. To inform this determination, the
                    Secretary of Labor shall conduct a survey of employer-
                    sponsored coverage to determine the benefits typically
                    covered by employers, including multiemployer plans,
                    and provide a report on such survey to the Secretary.
                        (B) Certification.--In defining the essential
                    health benefits described in paragraph (1), and in
                    revising the benefits under paragraph (4)(H), the
                    Secretary shall submit a report to the appropriate
                    committees of Congress containing a certification from
                    the Chief Actuary of the Centers for Medicare &
                    Medicaid Services that such essential health benefits
                    meet the limitation described in paragraph (2).
                (3) Notice and hearing.--In defining the essential health
            benefits described in paragraph (1), and in revising the
            benefits under paragraph (4)(H), the Secretary shall provide
            notice and an opportunity for public comment.
                (4) Required elements for consideration.--In defining the
            essential health benefits under paragraph (1), the Secretary
            shall--
                        (A) ensure that such essential health benefits
                    reflect an appropriate balance among the categories
                    described in such subsection, so that benefits are not
                    unduly weighted toward any category;
                        (B) not make coverage decisions, determine
                    reimbursement rates, establish incentive programs, or
                    design benefits in ways that discriminate against
                    individuals because of their age, disability, or
                    expected length of life;
                        (C) take into account the health care needs of
                    diverse segments of the population, including women,
                    children, persons with disabilities, and other groups;
                        (D) ensure that health benefits established as
                    essential not be subject to denial to individuals
                    against their wishes on the basis of the individuals'
                    age or expected length of life or of the individuals'
                    present or predicted disability, degree of medical
                    dependency, or quality of life;
                        (E) provide that a qualified health plan shall not
                    be treated as providing coverage for the essential
                    health benefits described in paragraph (1) unless the
                    plan provides that--
                                (i) coverage for emergency department
                            services will be provided without imposing any
                            requirement under the plan for prior
                            authorization of services or any limitation on
                            coverage where the provider of services does
                            not have a contractual relationship with the
                            plan for the providing of services that is more
                            restrictive than the requirements or
                            limitations that apply to emergency department
                            services received from providers who do have
                            such a contractual relationship with the plan;
                            and
                                (ii) if such services are provided out-of-
                            network, the cost-sharing requirement
                            (expressed as a copayment amount or coinsurance
                            rate) is the same requirement that would apply
                            if such services were provided in-network;
                        (F) provide that if a plan described in section
                    1311(b)(2)(B)(ii) (relating to stand-alone dental
                    benefits plans) is offered through an Exchange, another
                    health plan offered through such Exchange shall not
                    fail to be treated as a qualified health plan solely
                    because the plan does not offer coverage of benefits
                    offered through the stand-alone plan that are otherwise
                    required under paragraph (1)(J); and
                        (G) periodically review the essential health
                    benefits under paragraph (1), and provide a report to
                    Congress and the public that contains--
                                (i) an assessment of whether enrollees are
                            facing any difficulty accessing needed services
                            for reasons of coverage or cost;
                                (ii) an assessment of whether the essential
                            health benefits needs to be modified or updated
                            to account for changes in medical evidence or
                            scientific advancement;
                                (iii) information on how the essential
                            health benefits will be modified to address any
                            such gaps in access or changes in the evidence
                            base;
                                (iv) an assessment of the potential of
                            additional or expanded benefits to increase
                            costs and the interactions between the addition
                            or expansion of benefits and reductions in
                            existing benefits to meet actuarial limitations
                            described in paragraph (2); and
                        (H) periodically update the essential health
                    benefits under paragraph (1) to address any gaps in
                    access to coverage or changes in the evidence base the
                    Secretary identifies in the review conducted under
                    subparagraph (G).
                (5) Rule of construction.--Nothing in this title shall be
            construed to prohibit a health plan from providing benefits in
            excess of the essential health benefits described in this
            subsection.
        (c) Requirements Relating to Cost-Sharing.--
                (1) Annual limitation on cost-sharing.--
                        (A) 2014.--The cost-sharing incurred under a health
                    plan with respect to self-only coverage or coverage
                    other than self-only coverage for a plan year beginning
                    in 2014 shall not exceed the dollar amounts in effect
                    under section 223(c)(2)(A)(ii) of the Internal Revenue
                    Code of 1986 for self-only and family coverage,
                    respectively, for taxable years beginning in 2014.
                        (B) 2015 and later.--In the case of any plan year
                    beginning in a calendar year after 2014, the limitation
                    under this paragraph shall--
                                (i) in the case of self-only coverage, be
                            equal to the dollar amount under subparagraph
                            (A) for self-only coverage for plan years
                            beginning in 2014, increased by an amount equal
                            to the product of that amount and the premium
                            adjustment percentage under paragraph (4) for
                            the calendar year; and
                                (ii) in the case of other coverage, twice
                            the amount in effect under clause (i).
                    If the amount of any increase under clause (i) is not a
                    multiple of $50, such increase shall be rounded to the
                    next lowest multiple of $50.
                (2) Annual limitation on deductibles for employer-sponsored
            plans.--
                        (A) In general.--In the case of a health plan
                    offered in the small group market, the deductible under
                    the plan shall not exceed--
                                (i) $2,000 in the case of a plan covering a
                            single individual; and
                                (ii) $4,000 in the case of any other plan.
                    The amounts under clauses (i) and (ii) may be increased
                    by the maximum amount of reimbursement which is
                    reasonably available to a participant under a flexible
                    spending arrangement described in section 106(c)(2) of
                    the Internal Revenue Code of 1986 (determined without
                    regard to any salary reduction arrangement).
                        (B) Indexing of limits.--In the case of any plan
                    year beginning in a calendar year after 2014--
                                (i) the dollar amount under subparagraph
                            (A)(i) shall be increased by an amount equal to
                            the product of that amount and the premium
                            adjustment percentage under paragraph (4) for
                            the calendar year; and
                                (ii) the dollar amount under subparagraph
                            (A)(ii) shall be increased to an amount equal
                            to twice the amount in effect under
                            subparagraph (A)(i) for plan years beginning in
                            the calendar year, determined after application
                            of clause (i).
                    If the amount of any increase under clause (i) is not a
                    multiple of $50, such increase shall be rounded to the
                    next lowest multiple of $50.
                        (C) Actuarial value.--The limitation under this
                    paragraph shall be applied in such a manner so as to
                    not affect the actuarial value of any health plan,
                    including a plan in the bronze level.
                        (D) Coordination with preventive limits.--Nothing
                    in this paragraph shall be construed to allow a plan to
                    have a deductible under the plan apply to benefits
                    described in section 2713 of the Public Health Service
                    Act.
                (3) Cost-sharing.--In this title--
                        (A) In general.--The term ``cost-sharing''
                    includes--
                                (i) deductibles, coinsurance, copayments,
                            or similar charges; and
                                (ii) any other expenditure required of an
                            insured individual which is a qualified medical
                            expense (within the meaning of section
                            223(d)(2) of the Internal Revenue Code of 1986)
                            with respect to essential health benefits
                            covered under the plan.
                        (B) Exceptions.--Such term does not include
                    premiums, balance billing amounts for non-network
                    providers, or spending for non-covered services.
                (4) Premium adjustment percentage.--For purposes of
            paragraphs (1)(B)(i) and (2)(B)(i), the premium adjustment
            percentage for any calendar year is the percentage (if any) by
            which the average per capita premium for health insurance
            coverage in the United States for the preceding calendar year
            (as estimated by the Secretary no later than October 1 of such
            preceding calendar year) exceeds such average per capita
            premium for 2013 (as determined by the Secretary).
        (d) Levels of Coverage.--
                (1) Levels of coverage defined.--The levels of coverage
            described in this subsection are as follows:
                        (A) Bronze level.--A plan in the bronze level shall
                    provide a level of coverage that is designed to provide
                    benefits that are actuarially equivalent to 60 percent
                    of the full actuarial value of the benefits provided
                    under the plan.
                        (B) Silver level.--A plan in the silver level shall
                    provide a level of coverage that is designed to provide
                    benefits that are actuarially equivalent to 70 percent
                    of the full actuarial value of the benefits provided
                    under the plan.
                        (C) Gold level.--A plan in the gold level shall
                    provide a level of coverage that is designed to provide
                    benefits that are actuarially equivalent to 80 percent
                    of the full actuarial value of the benefits provided
                    under the plan.
                        (D) Platinum level.--A plan in the platinum level
                    shall provide a level of coverage that is designed to
                    provide benefits that are actuarially equivalent to 90
                    percent of the full actuarial value of the benefits
                    provided under the plan.
                (2) Actuarial value.--
                        (A) In general.--Under regulations issued by the
                    Secretary, the level of coverage of a plan shall be
                    determined on the basis that the essential health
                    benefits described in subsection (b) shall be provided
                    to a standard population (and without regard to the
                    population the plan may actually provide benefits to).
                        (B) Employer contributions.--The Secretary may
                    issue regulations under which employer contributions to
                    a health savings account (within the meaning of section
                    223 of the Internal Revenue Code of 1986) may be taken
                    into account in determining the level of coverage for a
                    plan of the employer.
                        (C) Application.--In determining under this title,
                    the Public Health Service Act, or the Internal Revenue
                    Code of 1986 the percentage of the total allowed costs
                    of benefits provided under a group health plan or
                    health insurance coverage that are provided by such
                    plan or coverage, the rules contained in the
                    regulations under this paragraph shall apply.
                (3) Allowable variance.--The Secretary shall develop
            guidelines to provide for a de minimis variation in the
            actuarial valuations used in determining the level of coverage
            of a plan to account for differences in actuarial estimates.
                (4) Plan reference.--In this title, any reference to a
            bronze, silver, gold, or platinum plan shall be treated as a
            reference to a qualified health plan providing a bronze,
            silver, gold, or platinum level of coverage, as the case may
            be.
        (e) Catastrophic Plan.--
                (1) In general.--A health plan not providing a bronze,
            silver, gold, or platinum level of coverage shall be treated as
            meeting the requirements of subsection (d) with respect to any
            plan year if--
                        (A) the only individuals who are eligible to enroll
                    in the plan are individuals described in paragraph (2);
                    and
                        (B) the plan provides--
                                (i) except as provided in clause (ii), the
                            essential health benefits determined under
                            subsection (b), except that the plan provides
                            no benefits for any plan year until the
                            individual has incurred cost-sharing expenses
                            in an amount equal to the annual limitation in
                            effect under subsection (c)(1) for the plan
                            year (except as provided for in section 2713);
                            and
                                (ii) coverage for at least three primary
                            care visits.
                (2) Individuals eligible for enrollment.--An individual is
            described in this paragraph for any plan year if the
            individual--
                        (A) has not attained the age of 30 before the
                    beginning of the plan year; or
                        (B) has a certification in effect for any plan year
                    under this title that the individual is exempt from the
                    requirement under section 5000A of the Internal Revenue
                    Code of 1986 by reason of--
                                (i) section 5000A(e)(1) of such Code
                            (relating to individuals without affordable
                            coverage); or
                                (ii) section 5000A(e)(5) of such Code
                            (relating to individuals with hardships).
                (3) Restriction to individual market.--If a health
            insurance issuer offers a health plan described in this
            subsection, the issuer may only offer the plan in the
            individual market.
        (f) Child-only Plans.--If a qualified health plan is offered
    through the Exchange in any level of coverage specified under
    subsection (d), the issuer shall also offer that plan through the
    Exchange in that level as a plan in which the only enrollees are
    individuals who, as of the beginning of a plan year, have not attained
    the age of 21, and such plan shall be treated as a qualified health
    plan.

    SEC. 1303. SPECIAL RULES.

        (a) Special Rules Relating to Coverage of Abortion Services.--
                (1) Voluntary choice of coverage of abortion services.--
                        (A) In general.--Notwithstanding any other
                    provision of this title (or any amendment made by this
                    title), and subject to subparagraphs (C) and (D)--
                                (i) nothing in this title (or any amendment
                            made by this title), shall be construed to
                            require a qualified health plan to provide
                            coverage of services described in subparagraph
                            (B)(i) or (B)(ii) as part of its essential
                            health benefits for any plan year; and
                                (ii) the issuer of a qualified health plan
                            shall determine whether or not the plan
                            provides coverage of services described in
                            subparagraph (B)(i) or (B)(ii) as part of such
                            benefits for the plan year.
                        (B) Abortion services.--
                                (i) Abortions for which public funding is
                            prohibited.--The services described in this
                            clause are abortions for which the expenditure
                            of Federal funds appropriated for the
                            Department of Health and Human Services is not
                            permitted, based on the law as in effect as of
                            the date that is 6 months before the beginning
                            of the plan year involved.
                                (ii) Abortions for which public funding is
                            allowed.--The services described in this clause
                            are abortions for which the expenditure of
                            Federal funds appropriated for the Department
                            of Health and Human Services is permitted,
                            based on the law as in effect as of the date
                            that is 6 months before the beginning of the
                            plan year involved.
                        (C) Prohibition on federal funds for abortion
                    services in community health insurance option.--
                                (i) Determination by secretary.--The
                            Secretary may not determine, in accordance with
                            subparagraph (A)(ii), that the community health
                            insurance option established under section 1323
                            shall provide coverage of services described in
                            subparagraph (B)(i) as part of benefits for the
                            plan year unless the Secretary--
                                        (I) assures compliance with the
                                    requirements of paragraph (2);
                                        (II) assures, in accordance with
                                    applicable provisions of generally
                                    accepted accounting requirements,
                                    circulars on funds management of the
                                    Office of Management and Budget, and
                                    guidance on accounting of the
                                    Government Accountability Office, that
                                    no Federal funds are used for such
                                    coverage; and
                                        (III) notwithstanding section
                                    1323(e)(1)(C) or any other provision of
                                    this title, takes all necessary steps
                                    to assure that the United States does
                                    not bear the insurance risk for a
                                    community health insurance option's
                                    coverage of services described in
                                    subparagraph (B)(i).
                                (ii) State requirement.--If a State
                            requires, in addition to the essential health
                            benefits required under section 1323(b)(3) (A),
                            coverage of services described in subparagraph
                            (B)(i) for enrollees of a community health
                            insurance option offered in such State, the
                            State shall assure that no funds flowing
                            through or from the community health insurance
                            option, and no other Federal funds, pay or
                            defray the cost of providing coverage of
                            services described in subparagraph (B)(i). The
                            United States shall not bear the insurance risk
                            for a State's required coverage of services
                            described in subparagraph (B)(i).
                                (iii) Exceptions.--Nothing in this
                            subparagraph shall apply to coverage of
                            services described in subparagraph (B)(ii) by
                            the community health insurance option. Services
                            described in subparagraph (B)(ii) shall be
                            covered to the same extent as such services are
                            covered under title XIX of the Social Security
                            Act.
                        (D) Assured availability of varied coverage through
                    exchanges.--
                                (i) In general.--The Secretary shall assure
                            that with respect to qualified health plans
                            offered in any Exchange established pursuant to
                            this title--
                                        (I) there is at least one such plan
                                    that provides coverage of services
                                    described in clauses (i) and (ii) of
                                    subparagraph (B); and
                                        (II) there is at least one such
                                    plan that does not provide coverage of
                                    services described in subparagraph
                                    (B)(i).
                                (ii) Special rules.--For purposes of clause
                            (i)--
                                        (I) a plan shall be treated as
                                    described in clause (i)(II) if the plan
                                    does not provide coverage of services
                                    described in either subparagraph (B)(i)
                                    or (B)(ii); and
                                        (II) if a State has one Exchange
                                    covering more than 1 insurance market,
                                    the Secretary shall meet the
                                    requirements of clause (i) separately
                                    with respect to each such market.
                (2) Prohibition on the use of federal funds.--
                        (A) In general.--If a qualified health plan
                    provides coverage of services described in paragraph
                    (1)(B)(i), the issuer of the plan shall not use any
                    amount attributable to any of the following for
                    purposes of paying for such services:
                                (i) The credit under section 36B of the
                            Internal Revenue Code of 1986 (and the amount
                            (if any) of the advance payment of the credit
                            under section 1412 of the Patient Protection
                            and Affordable Care Act).
                                (ii) Any cost-sharing reduction under
                            section 1402 of thePatient Protection and
                            Affordable Care Act (and the amount (if any) of
                            the advance payment of the reduction under
                            section 1412 of the Patient Protection and
                            Affordable Care Act).
                        (B) Segregation of funds.--In the case of a plan to
                    which subparagraph (A) applies, the issuer of the plan
                    shall, out of amounts not described in subparagraph
                    (A), segregate an amount equal to the actuarial amounts
                    determined under subparagraph (C) for all enrollees
                    from the amounts described in subparagraph (A).
                        (C) Actuarial value of optional service coverage.--
                                (i) In general.--The Secretary shall
                            estimate the basic per enrollee, per month
                            cost, determined on an average actuarial basis,
                            for including coverage under a qualified health
                            plan of the services described in paragraph
                            (1)(B)(i).
                                (ii) Considerations.--In making such
                            estimate, the Secretary--
                                        (I) may take into account the
                                    impact on overall costs of the
                                    inclusion of such coverage, but may not
                                    take into account any cost reduction
                                    estimated to result from such services,
                                    including prenatal care, delivery, or
                                    postnatal care;
                                        (II) shall estimate such costs as
                                    if such coverage were included for the
                                    entire population covered; and
                                        (III) may not estimate such a cost
                                    at less than $1 per enrollee, per
                                    month.
                (3) Provider conscience protections.--No individual health
            care provider or health care facility may be discriminated
            against because of a willingness or an unwillingness, if doing
            so is contrary to the religious or moral beliefs of the
            provider or facility, to provide, pay for, provide coverage of,
            or refer for abortions.
        (b) Application of State and Federal Laws Regarding Abortion.--
                (1) No preemption of state laws regarding abortion.--
            Nothing in this Act shall be construed to preempt or otherwise
            have any effect on State laws regarding the prohibition of (or
            requirement of) coverage, funding, or procedural requirements
            on abortions, including parental notification or consent for
            the performance of an abortion on a minor.
                (2) No effect on federal laws regarding abortion.--
                        (A) In general.--Nothing in this Act shall be
                    construed to have any effect on Federal laws
                    regarding--
                                (i) conscience protection;
                                (ii) willingness or refusal to provide
                            abortion; and
                                (iii) discrimination on the basis of the
                            willingness or refusal to provide, pay for,
                            cover, or refer for abortion or to provide or
                            participate in training to provide abortion.
                (3) No effect on federal civil rights law.--Nothing in this
            subsection shall alter the rights and obligations of employees
            and employers under title VII of the Civil Rights Act of 1964.
        (c) Application of Emergency Services Laws.--Nothing in this Act
    shall be construed to relieve any health care provider from providing
    emergency services as required by State or Federal law, including
    section 1867 of the Social Security Act (popularly known as
    ``EMTALA'').

    SEC. 1304. RELATED DEFINITIONS.

        (a) Definitions Relating to Markets.--In this title:
                (1) Group market.--The term ``group market'' means the
            health insurance market under which individuals obtain health
            insurance coverage (directly or through any arrangement) on
            behalf of themselves (and their dependents) through a group
            health plan maintained by an employer.
                (2) Individual market.--The term ``individual market''
            means the market for health insurance coverage offered to
            individuals other than in connection with a group health plan.
                (3) Large and small group markets.--The terms ``large group
            market'' and ``small group market'' mean the health insurance
            market under which individuals obtain health insurance coverage
            (directly or through any arrangement) on behalf of themselves
            (and their dependents) through a group health plan maintained
            by a large employer (as defined in subsection (b)(1)) or by a
            small employer (as defined in subsection (b)(2)), respectively.
        (b) Employers.--In this title:
                (1) Large employer.--The term ``large employer'' means, in
            connection with a group health plan with respect to a calendar
            year and a plan year, an employer who employed an average of at
            least 101 employees on business days during the preceding
            calendar year and who employs at least 1 employee on the first
            day of the plan year.
                (2) Small employer.--The term ``small employer'' means, in
            connection with a group health plan with respect to a calendar
            year and a plan year, an employer who employed an average of at
            least 1 but not more than 100 employees on business days during
            the preceding calendar year and who employs at least 1 employee
            on the first day of the plan year.
                (3) State option to treat 50 employees as small.--In the
            case of plan years beginning before January 1, 2016, a State
            may elect to apply this subsection by substituting ``51
            employees'' for ``101 employees'' in paragraph (1) and by
            substituting ``50 employees'' for ``100 employees'' in
            paragraph (2).
                (4) Rules for determining employer size.--For purposes of
            this subsection--
                        (A) Application of aggregation rule for
                    employers.--All persons treated as a single employer
                    under subsection (b), (c), (m), or (o) of section 414
                    of the Internal Revenue Code of 1986 shall be treated
                    as 1 employer.
                        (B) Employers not in existence in preceding year.--
                    In the case of an employer which was not in existence
                    throughout the preceding calendar year, the
                    determination of whether such employer is a small or
                    large employer shall be based on the average number of
                    employees that it is reasonably expected such employer
                    will employ on business days in the current calendar
                    year.
                        (C) Predecessors.--Any reference in this subsection
                    to an employer shall include a reference to any
                    predecessor of such employer.
                        (D) Continuation of participation for growing small
                    employers.--If--
                                (i) a qualified employer that is a small
                            employer makes enrollment in qualified health
                            plans offered in the small group market
                            available to its employees through an Exchange;
                            and
                                (ii) the employer ceases to be a small
                            employer by reason of an increase in the number
                            of employees of such employer;
                    the employer shall continue to be treated as a small
                    employer for purposes of this subtitle for the period
                    beginning with the increase and ending with the first
                    day on which the employer does not make such enrollment
                    available to its employees.
        (c) Secretary.--In this title, the term ``Secretary'' means the
    Secretary of Health and Human Services.
        (d) State.--In this title, the term ``State'' means each of the 50
    States and the District of Columbia.

      PART II--CONSUMER CHOICES AND INSURANCE COMPETITION THROUGH HEALTH
                               BENEFIT EXCHANGES

    SEC. 1311. AFFORDABLE CHOICES OF HEALTH BENEFIT PLANS.

        (a) Assistance to States to Establish American Health Benefit
    Exchanges.--
                (1) Planning and establishment grants.--There shall be
            appropriated to the Secretary, out of any moneys in the
            Treasury not otherwise appropriated, an amount necessary to
            enable the Secretary to make awards, not later than 1 year
            after the date of enactment of this Act, to States in the
            amount specified in paragraph (2) for the uses described in
            paragraph (3).
                (2) Amount specified.--For each fiscal year, the Secretary
            shall determine the total amount that the Secretary will make
            available to each State for grants under this subsection.
                (3) Use of funds.--A State shall use amounts awarded under
            this subsection for activities (including planning activities)
            related to establishing an American Health Benefit Exchange, as
            described in subsection (b).
                (4) Renewability of grant.--
                        (A) In general.--Subject to subsection (d)(4), the
                    Secretary may renew a grant awarded under paragraph (1)
                    if the State recipient of such grant--
                                (i) is making progress, as determined by
                            the Secretary, toward--
                                        (I) establishing an Exchange; and
                                        (II) implementing the reforms
                                    described in subtitles A and C (and the
                                    amendments made by such subtitles); and
                                (ii) is meeting such other benchmarks as
                            the Secretary may establish.
                        (B) Limitation.--No grant shall be awarded under
                    this subsection after January 1, 2015.
                (5) Technical assistance to facilitate participation in
            shop exchanges.--The Secretary shall provide technical
            assistance to States to facilitate the participation of
            qualified small businesses in such States in SHOP Exchanges.
        (b) American Health Benefit Exchanges.--
                (1) In general.--Each State shall, not later than January
            1, 2014, establish an American Health Benefit Exchange
            (referred to in this title as an ``Exchange'') for the State
            that--
                        (A) facilitates the purchase of qualified health
                    plans;
                        (B) provides for the establishment of a Small
                    Business Health Options Program (in this title referred
                    to as a ``SHOP Exchange'') that is designed to assist
                    qualified employers in the State who are small
                    employers in facilitating the enrollment of their
                    employees in qualified health plans offered in the
                    small group market in the State; and
                        (C) meets the requirements of subsection (d).
                (2) Merger of individual and shop exchanges.--A State may
            elect to provide only one Exchange in the State for providing
            both Exchange and SHOP Exchange services to both qualified
            individuals and qualified small employers, but only if the
            Exchange has adequate resources to assist such individuals and
            employers.
        (c) Responsibilities of the Secretary.--
                (1) In general.--The Secretary shall, by regulation,
            establish criteria for the certification of health plans as
            qualified health plans. Such criteria shall require that, to be
            certified, a plan shall, at a minimum--
                        (A) meet marketing requirements, and not employ
                    marketing practices or benefit designs that have the
                    effect of discouraging the enrollment in such plan by
                    individuals with significant health needs;
                        (B) ensure a sufficient choice of providers (in a
                    manner consistent with applicable network adequacy
                    provisions under section 2702(c) of the Public Health
                    Service Act), and provide information to enrollees and
                    prospective enrollees on the availability of in-network
                    and out-of-network providers;
                        (C) include within health insurance plan networks
                    those essential community providers, where available,
                    that serve predominately low-income, medically-
                    underserved individuals, such as health care providers
                    defined in section 340B(a)(4) of the Public Health
                    Service Act and providers described in section
                    1927(c)(1)(D)(i)(IV) of the Social Security Act as set
                    forth by section 221 of Public Law 111-8, except that
                    nothing in this subparagraph shall be construed to
                    require any health plan to provide coverage for any
                    specific medical procedure;
                        (D)(i) be accredited with respect to local
                    performance on clinical quality measures such as the
                    Healthcare Effectiveness Data and Information Set,
                    patient experience ratings on a standardized Consumer
                    Assessment of Healthcare Providers and Systems survey,
                    as well as consumer access, utilization management,
                    quality assurance, provider credentialing, complaints
                    and appeals, network adequacy and access, and patient
                    information programs by any entity recognized by the
                    Secretary for the accreditation of health insurance
                    issuers or plans (so long as any such entity has
                    transparent and rigorous methodological and scoring
                    criteria); or
                        (ii) receive such accreditation within a period
                    established by an Exchange for such accreditation that
                    is applicable to all qualified health plans;
                        (E) implement a quality improvement strategy
                    described in subsection (g)(1);
                        (F) utilize a uniform enrollment form that
                    qualified individuals and qualified employers may use
                    (either electronically or on paper) in enrolling in
                    qualified health plans offered through such Exchange,
                    and that takes into account criteria that the National
                    Association of Insurance Commissioners develops and
                    submits to the Secretary;
                        (G) utilize the standard format established for
                    presenting health benefits plan options; and
                        (H) provide information to enrollees and
                    prospective enrollees, and to each Exchange in which
                    the plan is offered, on any quality measures for health
                    plan performance endorsed under section 399JJ of the
                    Public Health Service Act, as applicable.
                (2) Rule of construction.--Nothing in paragraph (1)(C)
            shall be construed to require a qualified health plan to
            contract with a provider described in such paragraph if such
            provider refuses to accept the generally applicable payment
            rates of such plan.
                (3) Rating system.--The Secretary shall develop a rating
            system that would rate qualified health plans offered through
            an Exchange in each benefits level on the basis of the relative
            quality and price. The Exchange shall include the quality
            rating in the information provided to individuals and employers
            through the Internet portal established under paragraph (4).
                (4) Enrollee satisfaction system.--The Secretary shall
            develop an enrollee satisfaction survey system that would
            evaluate the level of enrollee satisfaction with qualified
            health plans offered through an Exchange, for each such
            qualified health plan that had more than 500 enrollees in the
            previous year. The Exchange shall include enrollee satisfaction
            information in the information provided to individuals and
            employers through the Internet portal established under
            paragraph (5) in a manner that allows individuals to easily
            compare enrollee satisfaction levels between comparable plans.
                (5) Internet portals.--The Secretary shall--
                        (A) continue to operate, maintain, and update the
                    Internet portal developed under section 1103(a) and to
                    assist States in developing and maintaining their own
                    such portal; and
                        (B) make available for use by Exchanges a model
                    template for an Internet portal that may be used to
                    direct qualified individuals and qualified employers to
                    qualified health plans, to assist such individuals and
                    employers in determining whether they are eligible to
                    participate in an Exchange or eligible for a premium
                    tax credit or cost-sharing reduction, and to present
                    standardized information (including quality ratings)
                    regarding qualified health plans offered through an
                    Exchange to assist consumers in making easy health
                    insurance choices.
            Such template shall include, with respect to each qualified
            health plan offered through the Exchange in each rating area,
            access to the uniform outline of coverage the plan is required
            to provide under section 2716 of the Public Health Service Act
            and to a copy of the plan's written policy.
                (6) Enrollment periods.--The Secretary shall require an
            Exchange to provide for--
                        (A) an initial open enrollment, as determined by
                    the Secretary (such determination to be made not later
                    than July 1, 2012);
                        (B) annual open enrollment periods, as determined
                    by the Secretary for calendar years after the initial
                    enrollment period;
                        (C) special enrollment periods specified in section
                    9801 of the Internal Revenue Code of 1986 and other
                    special enrollment periods under circumstances similar
                    to such periods under part D of title XVIII of the
                    Social Security Act; and
                        (D) special monthly enrollment periods for Indians
                    (as defined in section 4 of the Indian Health Care
                    Improvement Act).
        (d) Requirements.--
                (1) In general.--An Exchange shall be a governmental agency
            or nonprofit entity that is established by a State.
                (2) Offering of coverage.--
                        (A) In general.--An Exchange shall make available
                    qualified health plans to qualified individuals and
                    qualified employers.
                        (B) Limitation.--
                                (i) In general.--An Exchange may not make
                            available any health plan that is not a
                            qualified health plan.
                                (ii) Offering of stand-alone dental
                            benefits.--Each Exchange within a State shall
                            allow an issuer of a plan that only provides
                            limited scope dental benefits meeting the
                            requirements of section 9832(c)(2)(A) of the
                            Internal Revenue Code of 1986 to offer the plan
                            through the Exchange (either separately or in
                            conjunction with a qualified health plan) if
                            the plan provides pediatric dental benefits
                            meeting the requirements of section
                            1302(b)(1)(J)).
                (3) Rules relating to additional required benefits.--
                        (A) In general.--Except as provided in subparagraph
                    (B), an Exchange may make available a qualified health
                    plan notwithstanding any provision of law that may
                    require benefits other than the essential health
                    benefits specified under section 1302(b).
                        (B) States may require additional benefits.--
                                (i) In general.--Subject to the
                            requirements of clause (ii), a State may
                            require that a qualified health plan offered in
                            such State offer benefits in addition to the
                            essential health benefits specified under
                            section 1302(b).
                                (ii) State must assume cost.--A State shall
                            make payments to or on behalf of an individual
                            eligible for the premium tax credit under
                            section 36B of the Internal Revenue Code of
                            1986 and any cost-sharing reduction under
                            section 1402 to defray the cost to the
                            individual of any additional benefits described
                            in clause (i) which are not eligible for such
                            credit or reduction under section 36B(b)(3)(D)
                            of such Code and section 1402(c)(4).
                (4) Functions.--An Exchange shall, at a minimum--
                        (A) implement procedures for the certification,
                    recertification, and decertification, consistent with
                    guidelines developed by the Secretary under subsection
                    (c), of health plans as qualified health plans;
                        (B) provide for the operation of a toll-free
                    telephone hotline to respond to requests for
                    assistance;
                        (C) maintain an Internet website through which
                    enrollees and prospective enrollees of qualified health
                    plans may obtain standardized comparative information
                    on such plans;
                        (D) assign a rating to each qualified health plan
                    offered through such Exchange in accordance with the
                    criteria developed by the Secretary under subsection
                    (c)(3);
                        (E) utilize a standardized format for presenting
                    health benefits plan options in the Exchange, including
                    the use of the uniform outline of coverage established
                    under section 2715 of the Public Health Service Act;
                        (F) in accordance with section 1413, inform
                    individuals of eligibility requirements for the
                    medicaid program under title XIX of the Social Security
                    Act, the CHIP program under title XXI of such Act, or
                    any applicable State or local public program and if
                    through screening of the application by the Exchange,
                    the Exchange determines that such individuals are
                    eligible for any such program, enroll such individuals
                    in such program;
                        (G) establish and make available by electronic
                    means a calculator to determine the actual cost of
                    coverage after the application of any premium tax
                    credit under section 36B of the Internal Revenue Code
                    of 1986 and any cost-sharing reduction under section
                    1402;
                        (H) subject to section 1411, grant a certification
                    attesting that, for purposes of the individual
                    responsibility penalty under section 5000A of the
                    Internal Revenue Code of 1986, an individual is exempt
                    from the individual requirement or from the penalty
                    imposed by such section because--
                                (i) there is no affordable qualified health
                            plan available through the Exchange, or the
                            individual's employer, covering the individual;
                            or
                                (ii) the individual meets the requirements
                            for any other such exemption from the
                            individual responsibility requirement or
                            penalty;
                        (I) transfer to the Secretary of the Treasury--
                                (i) a list of the individuals who are
                            issued a certification under subparagraph (H),
                            including the name and taxpayer identification
                            number of each individual;
                                (ii) the name and taxpayer identification
                            number of each individual who was an employee
                            of an employer but who was determined to be
                            eligible for the premium tax credit under
                            section 36B of the Internal Revenue Code of
                            1986 because--
                                        (I) the employer did not provide
                                    minimum essential coverage; or
                                        (II) the employer provided such
                                    minimum essential coverage but it was
                                    determined under section 36B(c)(2)(C)
                                    of such Code to either be unaffordable
                                    to the employee or not provide the
                                    required minimum actuarial value; and
                                (iii) the name and taxpayer identification
                            number of each individual who notifies the
                            Exchange under section 1411(b)(4) that they
                            have changed employers and of each individual
                            who ceases coverage under a qualified health
                            plan during a plan year (and the effective date
                            of such cessation);
                        (J) provide to each employer the name of each
                    employee of the employer described in subparagraph
                    (I)(ii) who ceases coverage under a qualified health
                    plan during a plan year (and the effective date of such
                    cessation); and
                        (K) establish the Navigator program described in
                    subsection (i).
                (5) Funding limitations.--
                        (A) No federal funds for continued operations.--In
                    establishing an Exchange under this section, the State
                    shall ensure that such Exchange is self-sustaining
                    beginning on January 1, 2015, including allowing the
                    Exchange to charge assessments or user fees to
                    participating health insurance issuers, or to otherwise
                    generate funding, to support its operations.
                        (B) Prohibiting wasteful use of funds.--In carrying
                    out activities under this subsection, an Exchange shall
                    not utilize any funds intended for the administrative
                    and operational expenses of the Exchange for staff
                    retreats, promotional giveaways, excessive executive
                    compensation, or promotion of Federal or State
                    legislative and regulatory modifications.
                (6) Consultation.--An Exchange shall consult with
            stakeholders relevant to carrying out the activities under this
            section, including--
                        (A) health care consumers who are enrollees in
                    qualified health plans;
                        (B) individuals and entities with experience in
                    facilitating enrollment in qualified health plans;
                        (C) representatives of small businesses and self-
                    employed individuals;
                        (D) State Medicaid offices; and
                        (E) advocates for enrolling hard to reach
                    populations.
                (7) Publication of costs.--An Exchange shall publish the
            average costs of licensing, regulatory fees, and any other
            payments required by the Exchange, and the administrative costs
            of such Exchange, on an Internet website to educate consumers
            on such costs. Such information shall also include monies lost
            to waste, fraud, and abuse.
        (e) Certification.--
                (1) In general.--An Exchange may certify a health plan as a
            qualified health plan if--
                        (A) such health plan meets the requirements for
                    certification as promulgated by the Secretary under
                    subsection (c)(1); and
                        (B) the Exchange determines that making available
                    such health plan through such Exchange is in the
                    interests of qualified individuals and qualified
                    employers in the State or States in which such Exchange
                    operates, except that the Exchange may not exclude a
                    health plan--
                                (i) on the basis that such plan is a fee-
                            for-service plan;
                                (ii) through the imposition of premium
                            price controls; or
                                (iii) on the basis that the plan provides
                            treatments necessary to prevent patients'
                            deaths in circumstances the Exchange determines
                            are inappropriate or too costly.
                (2) Premium considerations.--The Exchange shall require
            health plans seeking certification as qualified health plans to
            submit a justification for any premium increase prior to
            implementation of the increase. Such plans shall prominently
            post such information on their websites. The Exchange may take
            this information, and the information and the recommendations
            provided to the Exchange by the State under section 2794(b)(1)
            of the Public Health Service Act (relating to patterns or
            practices of excessive or unjustified premium increases), into
            consideration when determining whether to make such health plan
            available through the Exchange. The Exchange shall take into
            account any excess of premium growth outside the Exchange as
            compared to the rate of such growth inside the Exchange,
            including information reported by the States.
        (f) Flexibility.--
                (1) Regional or other interstate exchanges.--An Exchange
            may operate in more than one State if--
                        (A) each State in which such Exchange operates
                    permits such operation; and
                        (B) the Secretary approves such regional or
                    interstate Exchange.
                (2) Subsidiary exchanges.--A State may establish one or
            more subsidiary Exchanges if--
                        (A) each such Exchange serves a geographically
                    distinct area; and
                        (B) the area served by each such Exchange is at
                    least as large as a rating area described in section
                    2701(a) of the Public Health Service Act.
                (3) Authority to contract.--
                        (A) In general.--A State may elect to authorize an
                    Exchange established by the State under this section to
                    enter into an agreement with an eligible entity to
                    carry out 1 or more responsibilities of the Exchange.
                        (B) Eligible entity.--In this paragraph, the term
                    ``eligible entity'' means--
                                (i) a person--
                                        (I) incorporated under, and subject
                                    to the laws of, 1 or more States;
                                        (II) that has demonstrated
                                    experience on a State or regional basis
                                    in the individual and small group
                                    health insurance markets and in
                                    benefits coverage; and
                                        (III) that is not a health
                                    insurance issuer or that is treated
                                    under subsection (a) or (b) of section
                                    52 of the Internal Revenue Code of 1986
                                    as a member of the same controlled
                                    group of corporations (or under common
                                    control with) as a health insurance
                                    issuer; or
                                (ii) the State medicaid agency under title
                            XIX of the Social Security Act.
        (g) Rewarding Quality Through Market-Based Incentives.--
                (1) Strategy described.--A strategy described in this
            paragraph is a payment structure that provides increased
            reimbursement or other incentives for--
                        (A) improving health outcomes through the
                    implementation of activities that shall include quality
                    reporting, effective case management, care
                    coordination, chronic disease management, medication
                    and care compliance initiatives, including through the
                    use of the medical home model, for treatment or
                    services under the plan or coverage;
                        (B) the implementation of activities to prevent
                    hospital readmissions through a comprehensive program
                    for hospital discharge that includes patient-centered
                    education and counseling, comprehensive discharge
                    planning, and post discharge reinforcement by an
                    appropriate health care professional;
                        (C) the implementation of activities to improve
                    patient safety and reduce medical errors through the
                    appropriate use of best clinical practices, evidence
                    based medicine, and health information technology under
                    the plan or coverage; and
                        (D) the implementation of wellness and health
                    promotion activities.
                (2) Guidelines.--The Secretary, in consultation with
            experts in health care quality and stakeholders, shall develop
            guidelines concerning the matters described in paragraph (1).
                (3) Requirements.--The guidelines developed under paragraph
            (2) shall require the periodic reporting to the applicable
            Exchange of the activities that a qualified health plan has
            conducted to implement a strategy described in paragraph (1).
        (h) Quality Improvement.--
                (1) Enhancing patient safety.--Beginning on January 1,
            2015, a qualified health plan may contract with--
                        (A) a hospital with greater than 50 beds only if
                    such hospital--
                                (i) utilizes a patient safety evaluation
                            system as described in part C of title IX of
                            the Public Health Service Act; and
                                (ii) implements a mechanism to ensure that
                            each patient receives a comprehensive program
                            for hospital discharge that includes patient-
                            centered education and counseling,
                            comprehensive discharge planning, and post
                            discharge reinforcement by an appropriate
                            health care professional; or
                        (B) a health care provider only if such provider
                    implements such mechanisms to improve health care
                    quality as the Secretary may by regulation require.
                (2) Exceptions.--The Secretary may establish reasonable
            exceptions to the requirements described in paragraph (1).
                (3) Adjustment.--The Secretary may by regulation adjust the
            number of beds described in paragraph (1)(A).
        (i) Navigators.--
                (1) In general.--An Exchange shall establish a program
            under which it awards grants to entities described in paragraph
            (2) to carry out the duties described in paragraph (3).
                (2) Eligibility.--
                        (A) In general.--To be eligible to receive a grant
                    under paragraph (1), an entity shall demonstrate to the
                    Exchange involved that the entity has existing
                    relationships, or could readily establish
                    relationships, with employers and employees, consumers
                    (including uninsured and underinsured consumers), or
                    self-employed individuals likely to be qualified to
                    enroll in a qualified health plan.
                        (B) Types.--Entities described in subparagraph (A)
                    may include trade, industry, and professional
                    associations, commercial fishing industry
                    organizations, ranching and farming organizations,
                    community and consumer-focused nonprofit groups,
                    chambers of commerce, unions, small business
                    development centers, other licensed insurance agents
                    and brokers, and other entities that--
                                (i) are capable of carrying out the duties
                            described in paragraph (3);
                                (ii) meet the standards described in
                            paragraph (4); and
                                (iii) provide information consistent with
                            the standards developed under paragraph (5).
                (3) Duties.--An entity that serves as a navigator under a
            grant under this subsection shall--
                        (A) conduct public education activities to raise
                    awareness of the availability of qualified health
                    plans;
                        (B) distribute fair and impartial information
                    concerning enrollment in qualified health plans, and
                    the availability of premium tax credits under section
                    36B of the Internal Revenue Code of 1986 and cost-
                    sharing reductions under section 1402;
                        (C) facilitate enrollment in qualified health
                    plans;
                        (D) provide referrals to any applicable office of
                    health insurance consumer assistance or health
                    insurance ombudsman established under section 2793 of
                    the Public Health Service Act, or any other appropriate
                    State agency or agencies, for any enrollee with a
                    grievance, complaint, or question regarding their
                    health plan, coverage, or a determination under such
                    plan or coverage; and
                        (E) provide information in a manner that is
                    culturally and linguistically appropriate to the needs
                    of the population being served by the Exchange or
                    Exchanges.
                (4) Standards.--
                        (A) In general.--The Secretary shall establish
                    standards for navigators under this subsection,
                    including provisions to ensure that any private or
                    public entity that is selected as a navigator is
                    qualified, and licensed if appropriate, to engage in
                    the navigator activities described in this subsection
                    and to avoid conflicts of interest. Under such
                    standards, a navigator shall not--
                                (i) be a health insurance issuer; or
                                (ii) receive any consideration directly or
                            indirectly from any health insurance issuer in
                            connection with the enrollment of any qualified
                            individuals or employees of a qualified
                            employer in a qualified health plan.
                (5) Fair and impartial information and services.--The
            Secretary, in collaboration with States, shall develop
            standards to ensure that information made available by
            navigators is fair, accurate, and impartial.
                (6) Funding.--Grants under this subsection shall be made
            from the operational funds of the Exchange and not Federal
            funds received by the State to establish the Exchange.
        (j) Applicability of Mental Health Parity.--Section 2726 of the
    Public Health Service Act shall apply to qualified health plans in the
    same manner and to the same extent as such section applies to health
    insurance issuers and group health plans.
        (k) Conflict.--An Exchange may not establish rules that conflict
    with or prevent the application of regulations promulgated by the
    Secretary under this subtitle.

    SEC. 1312. CONSUMER CHOICE.

        (a) Choice.--
                (1) Qualified individuals.--A qualified individual may
            enroll in any qualified health plan available to such
            individual.
                (2) Qualified employers.--
                        (A) Employer may specify level.--A qualified
                    employer may provide support for coverage of employees
                    under a qualified health plan by selecting any level of
                    coverage under section 1302(d) to be made available to
                    employees through an Exchange.
                        (B) Employee may choose plans within a level.--Each
                    employee of a qualified employer that elects a level of
                    coverage under subparagraph (A) may choose to enroll in
                    a qualified health plan that offers coverage at that
                    level.
        (b) Payment of Premiums by Qualified Individuals.--A qualified
    individual enrolled in any qualified health plan may pay any applicable
    premium owed by such individual to the health insurance issuer issuing
    such qualified health plan.
        (c) Single Risk Pool.--
                (1) Individual market.--A health insurance issuer shall
            consider all enrollees in all health plans (other than
            grandfathered health plans) offered by such issuer in the
            individual market, including those enrollees who do not enroll
            in such plans through the Exchange, to be members of a single
            risk pool.
                (2) Small group market.--A health insurance issuer shall
            consider all enrollees in all health plans (other than
            grandfathered health plans) offered by such issuer in the small
            group market, including those enrollees who do not enroll in
            such plans through the Exchange, to be members of a single risk
            pool.
                (3) Merger of markets.--A State may require the individual
            and small group insurance markets within a State to be merged
            if the State determines appropriate.
                (4) State law.--A State law requiring grandfathered health
            plans to be included in a pool described in paragraph (1) or
            (2) shall not apply.
        (d) Empowering Consumer Choice.--
                (1) Continued operation of market outside exchanges.--
            Nothing in this title shall be construed to prohibit--
                        (A) a health insurance issuer from offering outside
                    of an Exchange a health plan to a qualified individual
                    or qualified employer; and
                        (B) a qualified individual from enrolling in, or a
                    qualified employer from selecting for its employees, a
                    health plan offered outside of an Exchange.
                (2) Continued operation of state benefit requirements.--
            Nothing in this title shall be construed to terminate, abridge,
            or limit the operation of any requirement under State law with
            respect to any policy or plan that is offered outside of an
            Exchange to offer benefits.
                (3) Voluntary nature of an exchange.--
                        (A) Choice to enroll or not to enroll.--Nothing in
                    this title shall be construed to restrict the choice of
                    a qualified individual to enroll or not to enroll in a
                    qualified health plan or to participate in an Exchange.
                        (B) Prohibition against compelled enrollment.--
                    Nothing in this title shall be construed to compel an
                    individual to enroll in a qualified health plan or to
                    participate in an Exchange.
                        (C) Individuals allowed to enroll in any plan.--A
                    qualified individual may enroll in any qualified health
                    plan, except that in the case of a catastrophic plan
                    described in section 1302(e), a qualified individual
                    may enroll in the plan only if the individual is
                    eligible to enroll in the plan under section
                    1302(e)(2).
                        (D) Members of congress in the exchange.--
                                (i) Requirement.--Notwithstanding any other
                            provision of law, after the effective date of
                            this subtitle, the only health plans that the
                            Federal Government may make available to
                            Members of Congress and congressional staff
                            with respect to their service as a Member of
                            Congress or congressional staff shall be health
                            plans that are--
                                        (I) created under this Act (or an
                                    amendment made by this Act); or
                                        (II) offered through an Exchange
                                    established under this Act (or an
                                    amendment made by this Act).
                                (ii) Definitions.--In this section:
                                        (I) Member of congress.--The term
                                    ``Member of Congress'' means any member
                                    of the House of Representatives or the
                                    Senate.
                                        (II) Congressional staff.--The term
                                    ``congressional staff'' means all full-
                                    time and part-time employees employed
                                    by the official office of a Member of
                                    Congress, whether in Washington, DC or
                                    outside of Washington, DC.
                (4) No penalty for transferring to minimum essential
            coverage outside exchange.--An Exchange, or a qualified health
            plan offered through an Exchange, shall not impose any penalty
            or other fee on an individual who cancels enrollment in a plan
            because the individual becomes eligible for minimum essential
            coverage (as defined in section 5000A(f) of the Internal
            Revenue Code of 1986 without regard to paragraph (1)(C) or (D)
            thereof) or such coverage becomes affordable (within the
            meaning of section 36B(c)(2)(C) of such Code).
        (e) Enrollment Through Agents or Brokers.--The Secretary shall
    establish procedures under which a State may allow agents or brokers--
                (1) to enroll individuals in any qualified health plans in
            the individual or small group market as soon as the plan is
            offered through an Exchange in the State; and
                (2) to assist individuals in applying for premium tax
            credits and cost-sharing reductions for plans sold through an
            Exchange.
    Such procedures may include the establishment of rate schedules for
    broker commissions paid by health benefits plans offered through an
    exchange.
        (f) Qualified Individuals and Employers; Access Limited to Citizens
    and Lawful Residents.--
                (1) Qualified individuals.--In this title:
                        (A) In general.--The term ``qualified individual''
                    means, with respect to an Exchange, an individual who--
                                (i) is seeking to enroll in a qualified
                            health plan in the individual market offered
                            through the Exchange; and
                                (ii) resides in the State that established
                            the Exchange (except with respect to
                            territorial agreements under section 1312(f)).
                        (B) Incarcerated individuals excluded.--An
                    individual shall not be treated as a qualified
                    individual if, at the time of enrollment, the
                    individual is incarcerated, other than incarceration
                    pending the disposition of charges.
                (2) Qualified employer.--In this title:
                        (A) In general.--The term ``qualified employer''
                    means a small employer that elects to make all full-
                    time employees of such employer eligible for 1 or more
                    qualified health plans offered in the small group
                    market through an Exchange that offers qualified health
                    plans.
                        (B) Extension to large groups.--
                                (i) In general.--Beginning in 2017, each
                            State may allow issuers of health insurance
                            coverage in the large group market in the State
                            to offer qualified health plans in such market
                            through an Exchange. Nothing in this
                            subparagraph shall be construed as requiring
                            the issuer to offer such plans through an
                            Exchange.
                                (ii) Large employers eligible.--If a State
                            under clause (i) allows issuers to offer
                            qualified health plans in the large group
                            market through an Exchange, the term
                            ``qualified employer'' shall include a large
                            employer that elects to make all full-time
                            employees of such employer eligible for 1 or
                            more qualified health plans offered in the
                            large group market through the Exchange.
                (3) Access limited to lawful residents.--If an individual
            is not, or is not reasonably expected to be for the entire
            period for which enrollment is sought, a citizen or national of
            the United States or an alien lawfully present in the United
            States, the individual shall not be treated as a qualified
            individual and may not be covered under a qualified health plan
            in the individual market that is offered through an Exchange.

    SEC. 1313. FINANCIAL INTEGRITY.

        (a) Accounting for Expenditures.--
                (1) In general.--An Exchange shall keep an accurate
            accounting of all activities, receipts, and expenditures and
            shall annually submit to the Secretary a report concerning such
            accountings.
                (2) Investigations.--The Secretary, in coordination with
            the Inspector General of the Department of Health and Human
            Services, may investigate the affairs of an Exchange, may
            examine the properties and records of an Exchange, and may
            require periodic reports in relation to activities undertaken
            by an Exchange. An Exchange shall fully cooperate in any
            investigation conducted under this paragraph.
                (3) Audits.--An Exchange shall be subject to annual audits
            by the Secretary.
                (4) Pattern of abuse.--If the Secretary determines that an
            Exchange or a State has engaged in serious misconduct with
            respect to compliance with the requirements of, or carrying out
            of activities required under, this title, the Secretary may
            rescind from payments otherwise due to such State involved
            under this or any other Act administered by the Secretary an
            amount not to exceed 1 percent of such payments per year until
            corrective actions are taken by the State that are determined
            to be adequate by the Secretary.
                (5) Protections against fraud and abuse.--With respect to
            activities carried out under this title, the Secretary shall
            provide for the efficient and non-discriminatory administration
            of Exchange activities and implement any measure or procedure
            that--
                        (A) the Secretary determines is appropriate to
                    reduce fraud and abuse in the administration of this
                    title; and
                        (B) the Secretary has authority to implement under
                    this title or any other Act.
                (6) Application of the false claims act.--
                        (A) In general.--Payments made by, through, or in
                    connection with an Exchange are subject to the False
                    Claims Act (31 U.S.C. 3729 et seq.) if those payments
                    include any Federal funds. Compliance with the
                    requirements of this Act concerning eligibility for a
                    health insurance issuer to participate in the Exchange
                    shall be a material condition of an issuer's
                    entitlement to receive payments, including payments of
                    premium tax credits and cost-sharing reductions,
                    through the Exchange.
                        (B) Damages.--Notwithstanding paragraph (1) of
                    section 3729(a) of title 31, United States Code, and
                    subject to paragraph (2) of such section, the civil
                    penalty assessed under the False Claims Act on any
                    person found liable under such Act as described in
                    subparagraph (A) shall be increased by not less than 3
                    times and not more than 6 times the amount of damages
                    which the Government sustains because of the act of
                    that person.
        (b) GAO Oversight.--Not later than 5 years after the first date on
    which Exchanges are required to be operational under this title, the
    Comptroller General shall conduct an ongoing study of Exchange
    activities and the enrollees in qualified health plans offered through
    Exchanges. Such study shall review--
                (1) the operations and administration of Exchanges,
            including surveys and reports of qualified health plans offered
            through Exchanges and on the experience of such plans
            (including data on enrollees in Exchanges and individuals
            purchasing health insurance coverage outside of Exchanges), the
            expenses of Exchanges, claims statistics relating to qualified
            health plans, complaints data relating to such plans, and the
            manner in which Exchanges meet their goals;
                (2) any significant observations regarding the utilization
            and adoption of Exchanges;
                (3) where appropriate, recommendations for improvements in
            the operations or policies of Exchanges; and
                (4) how many physicians, by area and specialty, are not
            taking or accepting new patients enrolled in Federal Government
            health care programs, and the adequacy of provider networks of
            Federal Government health care programs.

               PART III--STATE FLEXIBILITY RELATING TO EXCHANGES

    SEC. 1321. STATE FLEXIBILITY IN OPERATION AND ENFORCEMENT OF EXCHANGES
                  AND RELATED REQUIREMENTS.

        (a) Establishment of Standards.--
                (1) In general.--The Secretary shall, as soon as
            practicable after the date of enactment of this Act, issue
            regulations setting standards for meeting the requirements
            under this title, and the amendments made by this title, with
            respect to--
                        (A) the establishment and operation of Exchanges
                    (including SHOP Exchanges);
                        (B) the offering of qualified health plans through
                    such Exchanges;
                        (C) the establishment of the reinsurance and risk
                    adjustment programs under part V; and
                        (D) such other requirements as the Secretary
                    determines appropriate.
            The preceding sentence shall not apply to standards for
            requirements under subtitles A and C (and the amendments made
            by such subtitles) for which the Secretary issues regulations
            under the Public Health Service Act.
                (2) Consultation.--In issuing the regulations under
            paragraph (1), the Secretary shall consult with the National
            Association of Insurance Commissioners and its members and with
            health insurance issuers, consumer organizations, and such
            other individuals as the Secretary selects in a manner designed
            to ensure balanced representation among interested parties.
        (b) State Action.--Each State that elects, at such time and in such
    manner as the Secretary may prescribe, to apply the requirements
    described in subsection (a) shall, not later than January 1, 2014,
    adopt and have in effect--
                (1) the Federal standards established under subsection (a);
            or
                (2) a State law or regulation that the Secretary determines
            implements the standards within the State.
        (c) Failure To Establish Exchange or Implement Requirements.--
                (1) In general.--If--
                        (A) a State is not an electing State under
                    subsection (b); or
                        (B) the Secretary determines, on or before January
                    1, 2013, that an electing State--
                                (i) will not have any required Exchange
                            operational by January 1, 2014; or
                                (ii) has not taken the actions the
                            Secretary determines necessary to implement--
                                        (I) the other requirements set
                                    forth in the standards under subsection
                                    (a); or
                                        (II) the requirements set forth in
                                    subtitles A and C and the amendments
                                    made by such subtitles;
            the Secretary shall (directly or through agreement with a not-
            for-profit entity) establish and operate such Exchange within
            the State and the Secretary shall take such actions as are
            necessary to implement such other requirements.
                (2) Enforcement authority.--The provisions of section
            2736(b) of the Public Health Services Act shall apply to the
            enforcement under paragraph (1) of requirements of subsection
            (a)(1) (without regard to any limitation on the application of
            those provisions to group health plans).
        (d) No Interference With State Regulatory Authority.--Nothing in
    this title shall be construed to preempt any State law that does not
    prevent the application of the provisions of this title.
        (e) Presumption for Certain State-Operated Exchanges.--
                (1) In general.--In the case of a State operating an
            Exchange before January 1, 2010, and which has insured a
            percentage of its population not less than the percentage of
            the population projected to be covered nationally after the
            implementation of this Act, that seeks to operate an Exchange
            under this section, the Secretary shall presume that such
            Exchange meets the standards under this section unless the
            Secretary determines, after completion of the process
            established under paragraph (2), that the Exchange does not
            comply with such standards.
                (2) Process.--The Secretary shall establish a process to
            work with a State described in paragraph (1) to provide
            assistance necessary to assist the State's Exchange in coming
            into compliance with the standards for approval under this
            section.

    SEC. 1322. FEDERAL PROGRAM TO ASSIST ESTABLISHMENT AND OPERATION OF
                  NONPROFIT, MEMBER-RUN HEALTH INSURANCE ISSUERS.

        (a) Establishment of Program.--
                (1) In general.--The Secretary shall establish a program to
            carry out the purposes of this section to be known as the
            Consumer Operated and Oriented Plan (CO-OP) program.
                (2) Purpose.--It is the purpose of the CO-OP program to
            foster the creation of qualified nonprofit health insurance
            issuers to offer qualified health plans in the individual and
            small group markets in the States in which the issuers are
            licensed to offer such plans.
        (b) Loans and Grants Under the CO-OP Program.--
                (1) In general.--The Secretary shall provide through the
            CO-OP program for the awarding to persons applying to become
            qualified nonprofit health insurance issuers of--
                        (A) loans to provide assistance to such person in
                    meeting its start-up costs; and
                        (B) grants to provide assistance to such person in
                    meeting any solvency requirements of States in which
                    the person seeks to be licensed to issue qualified
                    health plans.
                (2) Requirements for awarding loans and grants.--
                        (A) In general.--In awarding loans and grants under
                    the CO-OP program, the Secretary shall--
                                (i) take into account the recommendations
                            of the advisory board established under
                            paragraph (3);
                                (ii) give priority to applicants that will
                            offer qualified health plans on a Statewide
                            basis, will utilize integrated care models, and
                            have significant private support; and
                                (iii) ensure that there is sufficient
                            funding to establish at least 1 qualified
                            nonprofit health insurance issuer in each
                            State, except that nothing in this clause shall
                            prohibit the Secretary from funding the
                            establishment of multiple qualified nonprofit
                            health insurance issuers in any State if the
                            funding is sufficient to do so.
                        (B) States without issuers in program.--If no
                    health insurance issuer applies to be a qualified
                    nonprofit health insurance issuer within a State, the
                    Secretary may use amounts appropriated under this
                    section for the awarding of grants to encourage the
                    establishment of a qualified nonprofit health insurance
                    issuer within the State or the expansion of a qualified
                    nonprofit health insurance issuer from another State to
                    the State.
                        (C) Agreement.--
                                (i) In general.--The Secretary shall
                            require any person receiving a loan or grant
                            under the CO-OP program to enter into an
                            agreement with the Secretary which requires
                            such person to meet (and to continue to meet)--
                                        (I) any requirement under this
                                    section for such person to be treated
                                    as a qualified nonprofit health
                                    insurance issuer; and
                                        (II) any requirements contained in
                                    the agreement for such person to
                                    receive such loan or grant.
                                (ii) Restrictions on use of federal
                            funds.--The agreement shall include a
                            requirement that no portion of the funds made
                            available by any loan or grant under this
                            section may be used--
                                        (I) for carrying on propaganda, or
                                    otherwise attempting, to influence
                                    legislation; or
                                        (II) for marketing.
                            Nothing in this clause shall be construed to
                            allow a person to take any action prohibited by
                            section 501(c)(29) of the Internal Revenue Code
                            of 1986.
                                (iii) Failure to meet requirements.--If the
                            Secretary determines that a person has failed
                            to meet any requirement described in clause (i)
                            or (ii) and has failed to correct such failure
                            within a reasonable period of time of when the
                            person first knows (or reasonably should have
                            known) of such failure, such person shall repay
                            to the Secretary an amount equal to the sum
                            of--
                                        (I) 110 percent of the aggregate
                                    amount of loans and grants received
                                    under this section; plus
                                        (II) interest on the aggregate
                                    amount of loans and grants received
                                    under this section for the period the
                                    loans or grants were outstanding.
                            The Secretary shall notify the Secretary of the
                            Treasury of any determination under this
                            section of a failure that results in the
                            termination of an issuer's tax-exempt status
                            under section 501(c)(29) of such Code.
                        (D) Time for awarding loans and grants.--The
                    Secretary shall not later than July 1, 2013, award the
                    loans and grants under the CO-OP program and begin the
                    distribution of amounts awarded under such loans and
                    grants.
                (3) Advisory board.--
                        (A) In general.--The advisory board under this
                    paragraph shall consist of 15 members appointed by the
                    Comptroller General of the United States from among
                    individuals with qualifications described in section
                    1805(c)(2) of the Social Security Act.
                        (B) Rules relating to appointments.--
                                (i) Standards.--Any individual appointed
                            under subparagraph (A) shall meet ethics and
                            conflict of interest standards protecting
                            against insurance industry involvement and
                            interference.
                                (ii) Original appointments.--The original
                            appointment of board members under subparagraph
                            (A)(ii) shall be made no later than 3 months
                            after the date of enactment of this Act.
                        (C) Vacancy.--Any vacancy on the advisory board
                    shall be filled in the same manner as the original
                    appointment.
                        (D) Pay and reimbursement.--
                                (i) No compensation for members of advisory
                            board.--Except as provided in clause (ii), a
                            member of the advisory board may not receive
                            pay, allowances, or benefits by reason of their
                            service on the board.
                                (ii) Travel expenses.--Each member shall
                            receive travel expenses, including per diem in
                            lieu of subsistence under subchapter I of
                            chapter 57 of title 5, United States Code.
                        (E) Application of faca.--The Federal Advisory
                    Committee Act (5 U.S.C. App.) shall apply to the
                    advisory board, except that section 14 of such Act
                    shall not apply.
                        (F) Termination.--The advisory board shall
                    terminate on the earlier of the date that it completes
                    its duties under this section or December 31, 2015.
        (c) Qualified Nonprofit Health Insurance Issuer.--For purposes of
    this section--
                (1) In general.--The term ``qualified nonprofit health
            insurance issuer'' means a health insurance issuer that is an
            organization--
                        (A) that is organized under State law as a
                    nonprofit, member corporation;
                        (B) substantially all of the activities of which
                    consist of the issuance of qualified health plans in
                    the individual and small group markets in each State in
                    which it is licensed to issue such plans; and
                        (C) that meets the other requirements of this
                    subsection.
                (2) Certain organizations prohibited.--An organization
            shall not be treated as a qualified nonprofit health insurance
            issuer if--
                        (A) the organization or a related entity (or any
                    predecessor of either) was a health insurance issuer on
                    July 16, 2009; or
                        (B) the organization is sponsored by a State or
                    local government, any political subdivision thereof, or
                    any instrumentality of such government or political
                    subdivision.
                (3) Governance requirements.--An organization shall not be
            treated as a qualified nonprofit health insurance issuer
            unless--
                        (A) the governance of the organization is subject
                    to a majority vote of its members;
                        (B) its governing documents incorporate ethics and
                    conflict of interest standards protecting against
                    insurance industry involvement and interference; and
                        (C) as provided in regulations promulgated by the
                    Secretary, the organization is required to operate with
                    a strong consumer focus, including timeliness,
                    responsiveness, and accountability to members.
                (4) Profits inure to benefit of members.--An organization
            shall not be treated as a qualified nonprofit health insurance
            issuer unless any profits made by the organization are required
            to be used to lower premiums, to improve benefits, or for other
            programs intended to improve the quality of health care
            delivered to its members.
                (5) Compliance with state insurance laws.--An organization
            shall not be treated as a qualified nonprofit health insurance
            issuer unless the organization meets all the requirements that
            other issuers of qualified health plans are required to meet in
            any State where the issuer offers a qualified health plan,
            including solvency and licensure requirements, rules on
            payments to providers, and compliance with network adequacy
            rules, rate and form filing rules, any applicable State premium
            assessments and any other State law described in section
            1324(b).
                (6) Coordination with state insurance reforms.--An
            organization shall not be treated as a qualified nonprofit
            health insurance issuer unless the organization does not offer
            a health plan in a State until that State has in effect (or the
            Secretary has implemented for the State) the market reforms
            required by part A of title XXVII of the Public Health Service
            Act (as amended by subtitles A and C of this Act).
        (d) Establishment of Private Purchasing Council.--
                (1) In general.--Qualified nonprofit health insurance
            issuers participating in the CO-OP program under this section
            may establish a private purchasing council to enter into
            collective purchasing arrangements for items and services that
            increase administrative and other cost efficiencies, including
            claims administration, administrative services, health
            information technology, and actuarial services.
                (2) Council may not set payment rates.--The private
            purchasing council established under paragraph (1) shall not
            set payment rates for health care facilities or providers
            participating in health insurance coverage provided by
            qualified nonprofit health insurance issuers.
                (3) Continued application of antitrust laws.--
                        (A) In general.--Nothing in this section shall be
                    construed to limit the application of the antitrust
                    laws to any private purchasing council (whether or not
                    established under this subsection) or to any qualified
                    nonprofit health insurance issuer participating in such
                    a council.
                        (B) Antitrust laws.--For purposes of this
                    subparagraph, the term ``antitrust laws'' has the
                    meaning given the term in subsection (a) of the first
                    section of the Clayton Act (15 U.S.C. 12(a)). Such term
                    also includes section 5 of the Federal Trade Commission
                    Act (15 U.S.C. 45) to the extent that such section 5
                    applies to unfair methods of competition.
        (e) Limitation on Participation.--No representative of any Federal,
    State, or local government (or of any political subdivision or
    instrumentality thereof), and no representative of a person described
    in subsection (c)(2)(A), may serve on the board of directors of a
    qualified nonprofit health insurance issuer or with a private
    purchasing council established under subsection (d).
        (f) Limitations on Secretary.--
                (1) In general.--The Secretary shall not--
                        (A) participate in any negotiations between 1 or
                    more qualified nonprofit health insurance issuers (or a
                    private purchasing council established under subsection
                    (d)) and any health care facilities or providers,
                    including any drug manufacturer, pharmacy, or hospital;
                    and
                        (B) establish or maintain a price structure for
                    reimbursement of any health benefits covered by such
                    issuers.
                (2) Competition.--Nothing in this section shall be
            construed as authorizing the Secretary to interfere with the
            competitive nature of providing health benefits through
            qualified nonprofit health insurance issuers.
        (g) Appropriations.--There are hereby appropriated, out of any
    funds in the Treasury not otherwise appropriated, $6,000,000,000 to
    carry out this section.
        (h) Tax Exemption for Qualified Nonprofit Health Insurance
    Issuer.--
                (1) In general.--Section 501(c) of the Internal Revenue
            Code of 1986 (relating to list of exempt organizations) is
            amended by adding at the end the following:
                ``(29) CO-OP health insurance issuers.--
                        ``(A) In general.--A qualified nonprofit health
                    insurance issuer (within the meaning of section 1322 of
                    the Patient Protection and Affordable Care Act) which
                    has received a loan or grant under the CO-OP program
                    under such section, but only with respect to periods
                    for which the issuer is in compliance with the
                    requirements of such section and any agreement with
                    respect to the loan or grant.
                        ``(B) Conditions for exemption.--Subparagraph (A)
                    shall apply to an organization only if--
                                ``(i) the organization has given notice to
                            the Secretary, in such manner as the Secretary
                            may by regulations prescribe, that it is
                            applying for recognition of its status under
                            this paragraph,
                                ``(ii) except as provided in section
                            1322(c)(4) of the Patient Protection and
                            Affordable Care Act, no part of the net
                            earnings of which inures to the benefit of any
                            private shareholder or individual,
                                ``(iii) no substantial part of the
                            activities of which is carrying on propaganda,
                            or otherwise attempting, to influence
                            legislation, and
                                ``(iv) the organization does not
                            participate in, or intervene in (including the
                            publishing or distributing of statements), any
                            political campaign on behalf of (or in
                            opposition to) any candidate for public
                            office.''.
                (2) Additional reporting requirement.--Section 6033 of such
            Code (relating to returns by exempt organizations) is amended
            by redesignating subsection (m) as subsection (n) and by
            inserting after subsection (l) the following:
        ``(m) Additional Information Required From CO-OP Insurers.--An
    organization described in section 501(c)(29) shall include on the
    return required under subsection (a) the following information:
                ``(1) The amount of the reserves required by each State in
            which the organization is licensed to issue qualified health
            plans.
                ``(2) The amount of reserves on hand.''.
                (3) Application of tax on excess benefit transactions.--
            Section 4958(e)(1) of such Code (defining applicable tax-exempt
            organization) is amended by striking ``paragraph (3) or (4)''
            and inserting ``paragraph (3), (4), or (29)''.
        (i) GAO Study and Report.--
                (1) Study.--The Comptroller General of the General
            Accountability Office shall conduct an ongoing study on
            competition and market concentration in the health insurance
            market in the United States after the implementation of the
            reforms in such market under the provisions of, and the
            amendments made by, this Act. Such study shall include an
            analysis of new issuers of health insurance in such market.
                (2) Report.--The Comptroller General shall, not later than
            December 31 of each even-numbered year (beginning with 2014),
            report to the appropriate committees of the Congress the
            results of the study conducted under paragraph (1), including
            any recommendations for administrative or legislative changes
            the Comptroller General determines necessary or appropriate to
            increase competition in the health insurance market.

    SEC. 1323. COMMUNITY HEALTH INSURANCE OPTION.

        (a) Voluntary Nature.--
                (1) No requirement for health care providers to
            participate.--Nothing in this section shall be construed to
            require a health care provider to participate in a community
            health insurance option, or to impose any penalty for non-
            participation.
                (2) No requirement for individuals to join.--Nothing in
            this section shall be construed to require an individual to
            participate in a community health insurance option, or to
            impose any penalty for non-participation.
                (3) State opt out.--
                        (A) In general.--A State may elect to prohibit
                    Exchanges in such State from offering a community
                    health insurance option if such State enacts a law to
                    provide for such prohibition.
                        (B) Termination of opt out.--A State may repeal a
                    law described in subparagraph (A) and provide for the
                    offering of such an option through the Exchange.
        (b) Establishment of Community Health Insurance Option.--
                (1) Establishment.--The Secretary shall establish a
            community health insurance option to offer, through the
            Exchanges established under this title (other than Exchanges in
            States that elect to opt out as provided for in subsection
            (a)(3)), health care coverage that provides value, choice,
            competition, and stability of affordable, high quality coverage
            throughout the United States.
                (2) Community health insurance option.--In this section,
            the term ``community health insurance option'' means health
            insurance coverage that--
                        (A) except as specifically provided for in this
                    section, complies with the requirements for being a
                    qualified health plan;
                        (B) provides high value for the premium charged;
                        (C) reduces administrative costs and promotes
                    administrative simplification for beneficiaries;
                        (D) promotes high quality clinical care;
                        (E) provides high quality customer service to
                    beneficiaries;
                        (F) offers a sufficient choice of providers; and
                        (G) complies with State laws (if any), except as
                    otherwise provided for in this title, relating to the
                    laws described in section 1324(b).
                (3) Essential health benefits.--
                        (A) General rule.--Except as provided in
                    subparagraph (B), a community health insurance option
                    offered under this section shall provide coverage only
                    for the essential health benefits described in section
                    1302(b).
                        (B) States may offer additional benefits.--Nothing
                    in this section shall preclude a State from requiring
                    that benefits in addition to the essential health
                    benefits required under subparagraph (A) be provided to
                    enrollees of a community health insurance option
                    offered in such State.
                        (C) Credits.--
                                (i) In general.--An individual enrolled in
                            a community health insurance option under this
                            section shall be eligible for credits under
                            section 36B of the Internal Revenue Code of
                            1986 in the same manner as an individual who is
                            enrolled in a qualified health plan.
                                (ii) No additional federal cost.--A
                            requirement by a State under subparagraph (B)
                            that benefits in addition to the essential
                            health benefits required under subparagraph (A)
                            be provided to enrollees of a community health
                            insurance option shall not affect the amount of
                            a premium tax credit provided under section 36B
                            of the Internal Revenue Code of 1986 with
                            respect to such plan.
                        (D) State must assume cost.--A State shall make
                    payments to or on behalf of an eligible individual to
                    defray the cost of any additional benefits described in
                    subparagraph (B).
                        (E) Ensuring access to all services.--Nothing in
                    this Act shall prohibit an individual enrolled in a
                    community health insurance option from paying out-of-
                    pocket the full cost of any item or service not
                    included as an essential health benefit or otherwise
                    covered as a benefit by a health plan. Nothing in
                    subparagraph (B) shall prohibit any type of medical
                    provider from accepting an out-of-pocket payment from
                    an individual enrolled in a community health insurance
                    option for a service otherwise not included as an
                    essential health benefit.
                        (F) Protecting access to end of life care.--A
                    community health insurance option offered under this
                    section shall be prohibited from limiting access to end
                    of life care.
                (4) Cost sharing.--A community health insurance option
            shall offer coverage at each of the levels of coverage
            described in section 1302(d).
                (5) Premiums.--
                        (A) Premiums sufficient to cover costs.--The
                    Secretary shall establish geographically adjusted
                    premium rates in an amount sufficient to cover expected
                    costs (including claims and administrative costs) using
                    methods in general use by qualified health plans.
                        (B) Applicable rules.--The provisions of title
                    XXVII of the Public Health Service Act relating to
                    premiums shall apply to community health insurance
                    options under this section, including modified
                    community rating provisions under section 2701 of such
                    Act.
                        (C) Collection of data.--The Secretary shall
                    collect data as necessary to set premium rates under
                    subparagraph (A).
                        (D) National pooling.--Notwithstanding any other
                    provision of law, the Secretary may treat all enrollees
                    in community health insurance options as members of a
                    single pool.
                        (E) Contingency margin.--In establishing premium
                    rates under subparagraph (A), the Secretary shall
                    include an appropriate amount for a contingency margin.
                (6) Reimbursement rates.--
                        (A) Negotiated rates.--The Secretary shall
                    negotiate rates for the reimbursement of health care
                    providers for benefits covered under a community health
                    insurance option.
                        (B) Limitation.--The rates described in
                    subparagraph (A) shall not be higher, in aggregate,
                    than the average reimbursement rates paid by health
                    insurance issuers offering qualified health plans
                    through the Exchange.
                        (C) Innovation.--Subject to the limits contained in
                    subparagraph (A), a State Advisory Council established
                    or designated under subsection (d) may develop or
                    encourage the use of innovative payment policies that
                    promote quality, efficiency and savings to consumers.
                (7) Solvency and consumer protection.--
                        (A) Solvency.--The Secretary shall establish a
                    Federal solvency standard to be applied with respect to
                    a community health insurance option. A community health
                    insurance option shall also be subject to the solvency
                    standard of each State in which such community health
                    insurance option is offered.
                        (B) Minimum required.--In establishing the standard
                    described under subparagraph (A), the Secretary shall
                    require a reserve fund that shall be equal to at least
                    the dollar value of the incurred but not reported
                    claims of a community health insurance option.
                        (C) Consumer protections.--The consumer protection
                    laws of a State shall apply to a community health
                    insurance option.
                (8) Requirements established in partnership with insurance
            commissioners.--
                        (A) In general.--The Secretary, in collaboration
                    with the National Association of Insurance
                    Commissioners (in this paragraph referred to as the
                    ``NAIC''), may promulgate regulations to establish
                    additional requirements for a community health
                    insurance option.
                        (B) Applicability.--Any requirement promulgated
                    under subparagraph (A) shall be applicable to such
                    option beginning 90 days after the date on which the
                    regulation involved becomes final.
        (c) Start-up Fund.--
                (1) Establishment of fund.--
                        (A) In general.--There is established in the
                    Treasury of the United States a trust fund to be known
                    as the ``Health Benefit Plan Start-Up Fund'' (referred
                    to in this section as the ``Start-Up Fund''), that
                    shall consist of such amounts as may be appropriated or
                    credited to the Start-Up Fund as provided for in this
                    subsection to provide loans for the initial operations
                    of a community health insurance option. Such amounts
                    shall remain available until expended.
                        (B) Funding.--There is hereby appropriated to the
                    Start-Up Fund, out of any moneys in the Treasury not
                    otherwise appropriated an amount requested by the
                    Secretary of Health and Human Services as necessary
                    to--
                                (i) pay the start-up costs associated with
                            the initial operations of a community health
                            insurance option; and
                                (ii) pay the costs of making payments on
                            claims submitted during the period that is not
                            more than 90 days from the date on which such
                            option is offered.
                (2) Use of start-up fund.--The Secretary shall use amounts
            contained in the Start-Up Fund to make payments (subject to the
            repayment requirements in paragraph (4)) for the purposes
            described in paragraph (1)(B).
                (3) Pass through of rebates.--The Secretary may establish
            procedures for reducing the amount of payments to a contracting
            administrator to take into account any rebates or price
            concessions.
                (4) Repayment.--
                        (A) In general.--A community health insurance
                    option shall be required to repay the Secretary of the
                    Treasury (on such terms as the Secretary may require)
                    for any payments made under paragraph (1)(B) by the
                    date that is not later than 9 years after the date on
                    which the payment is made. The Secretary may require
                    the payment of interest with respect to such repayments
                    at rates that do not exceed the market interest rate
                    (as determined by the Secretary).
                        (B) Sanctions in case of for-profit conversion.--In
                    any case in which the Secretary enters into a contract
                    with a qualified entity for the offering of a community
                    health insurance option and such entity is determined
                    to be a for-profit entity by the Secretary, such entity
                    shall be--
                                (i) immediately liable to the Secretary for
                            any payments received by such entity from the
                            Start-Up Fund; and
                                (ii) permanently ineligible to offer a
                            qualified health plan.
        (d) State Advisory Council.--
                (1) Establishment.--A State (other than a State that elects
            to opt out as provided for in subsection (a)(3)) shall
            establish or designate a public or non-profit private entity to
            serve as the State Advisory Council to provide recommendations
            to the Secretary on the operations and policies of a community
            health insurance option in the State. Such Council shall
            provide recommendations on at least the following:
                        (A) policies and procedures to integrate quality
                    improvement and cost containment mechanisms into the
                    health care delivery system;
                        (B) mechanisms to facilitate public awareness of
                    the availability of a community health insurance
                    option; and
                        (C) alternative payment structures under a
                    community health insurance option for health care
                    providers that encourage quality improvement and cost
                    control.
                (2) Members.--The members of the State Advisory Council
            shall be representatives of the public and shall include health
            care consumers and providers.
                (3) Applicability of recommendations.--The Secretary may
            apply the recommendations of a State Advisory Council to a
            community health insurance option in that State, in any other
            State, or in all States.
        (e) Authority To Contract; Terms of Contract.--
                (1) Authority.--
                        (A) In general.--The Secretary may enter into a
                    contract or contracts with one or more qualified
                    entities for the purpose of performing administrative
                    functions (including functions described in subsection
                    (a)(4) of section 1874A of the Social Security Act)
                    with respect to a community health insurance option in
                    the same manner as the Secretary may enter into
                    contracts under subsection (a)(1) of such section. The
                    Secretary shall have the same authority with respect to
                    a community health insurance option under this section
                    as the Secretary has under subsections (a)(1) and (b)
                    of section 1874A of the Social Security Act with
                    respect to title XVIII of such Act.
                        (B) Requirements apply.--If the Secretary enters
                    into a contract with a qualified entity to offer a
                    community health insurance option, under such contract
                    such entity--
                                (i) shall meet the criteria established
                            under paragraph (2); and
                                (ii) shall receive an administrative fee
                            under paragraph (7).
                        (C) Limitation.--Contracts under this subsection
                    shall not involve the transfer of insurance risk to the
                    contracting administrator.
                        (D) Reference.--An entity with which the Secretary
                    has entered into a contract under this paragraph shall
                    be referred to as a ``contracting administrator''.
                (2) Qualified entity.--To be qualified to be selected by
            the Secretary to offer a community health insurance option, an
            entity shall--
                        (A) meet the criteria established under section
                    1874A(a)(2) of the Social Security Act;
                        (B) be a nonprofit entity for purposes of offering
                    such option;
                        (C) meet the solvency standards applicable under
                    subsection (b)(7);
                        (D) be eligible to offer health insurance or health
                    benefits coverage;
                        (E) meet quality standards specified by the
                    Secretary;
                        (F) have in place effective procedures to control
                    fraud, abuse, and waste; and
                        (G) meet such other requirements as the Secretary
                    may impose.
            Procedures described under subparagraph (F) shall include the
            implementation of procedures to use beneficiary identifiers to
            identify individuals entitled to benefits so that such an
            individual's social security account number is not used, and
            shall also include procedures for the use of technology
            (including front-end, prepayment intelligent data-matching
            technology similar to that used by hedge funds, investment
            funds, and banks) to provide real-time data analysis of claims
            for payment under this title to identify and investigate
            unusual billing or order practices under this title that could
            indicate fraud or abuse.
                (3) Term.--A contract provided for under paragraph (1)
            shall be for a term of at least 5 years but not more than 10
            years, as determined by the Secretary. At the end of each such
            term, the Secretary shall conduct a competitive bidding process
            for the purposes of renewing existing contracts or selecting
            new qualified entities with which to enter into contracts under
            such paragraph.
                (4) Limitation.--A contract may not be renewed under this
            subsection unless the Secretary determines that the contracting
            administrator has met performance requirements established by
            the Secretary in the areas described in paragraph (7)(B).
                (5) Audits.--The Inspector General shall conduct periodic
            audits with respect to contracting administrators under this
            subsection to ensure that the administrator involved is in
            compliance with this section.
                (6) Revocation.--A contract awarded under this subsection
            shall be revoked by the Secretary, upon the recommendation of
            the Inspector General, only after notice to the contracting
            administrator involved and an opportunity for a hearing. The
            Secretary may revoke such contract if the Secretary determines
            that such administrator has engaged in fraud, deception, waste,
            abuse of power, negligence, mismanagement of taxpayer dollars,
            or gross mismanagement. An entity that has had a contract
            revoked under this paragraph shall not be qualified to enter
            into a subsequent contract under this subsection.
                (7) Fee for administration.--
                        (A) In general.--The Secretary shall pay the
                    contracting administrator a fee for the management,
                    administration, and delivery of the benefits under this
                    section.
                        (B) Requirement for high quality administration.--
                    The Secretary may increase the fee described in
                    subparagraph (A) by not more than 10 percent, or reduce
                    the fee described in subparagraph (A) by not more than
                    50 percent, based on the extent to which the
                    contracting administrator, in the determination of the
                    Secretary, meets performance requirements established
                    by the Secretary, in at least the following areas:
                                (i) Maintaining low premium costs and low
                            cost sharing requirements, provided that such
                            requirements are consistent with section 1302.
                                (ii) Reducing administrative costs and
                            promoting administrative simplification for
                            beneficiaries.
                                (iii) Promoting high quality clinical care.
                                (iv) Providing high quality customer
                            service to beneficiaries.
                        (C) Non-renewal.--The Secretary may not renew a
                    contract to offer a community health insurance option
                    under this section with any contracting entity that has
                    been assessed more than one reduction under
                    subparagraph (B) during the contract period.
                (8) Limitation.--Notwithstanding the terms of a contract
            under this subsection, the Secretary shall negotiate the
            reimbursement rates for purposes of subsection (b)(6).
        (f) Report by HHS and Insolvency Warnings.--
                (1) In general.--On an annual basis, the Secretary shall
            conduct a study on the solvency of a community health insurance
            option and submit to Congress a report describing the results
            of such study.
                (2) Result.--If, in any year, the result of the study under
            paragraph (1) is that a community health insurance option is
            insolvent, such result shall be treated as a community health
            insurance option solvency warning.
                (3) Submission of plan and procedure.--
                        (A) In general.--If there is a community health
                    insurance option solvency warning under paragraph (2)
                    made in a year, the President shall submit to Congress,
                    within the 15-day period beginning on the date of the
                    budget submission to Congress under section 1105(a) of
                    title 31, United States Code, for the succeeding year,
                    proposed legislation to respond to such warning.
                        (B) Procedure.--In the case of a legislative
                    proposal submitted by the President pursuant to
                    subparagraph (A), such proposal shall be considered by
                    Congress using the same procedures described under
                    sections 803 and 804 of the Medicare Prescription Drug,
                    Improvement, and Modernization Act of 2003 that shall
                    be used for a medicare funding warning.
        (g) Marketing Parity.--In a facility controlled by the Federal
    Government, or by a State, where marketing or promotional materials
    related to a community health insurance option are made available to
    the public, making available marketing or promotional materials
    relating to private health insurance plans shall not be prohibited.
    Such materials include informational pamphlets, guidebooks, enrollment
    forms, or other materials determined reasonable for display.
        (h) Authorization of Appropriations.--There is authorized to be
    appropriated such sums as may be necessary to carry out this section.

    SEC. 1324. LEVEL PLAYING FIELD.

        (a) In General.--Notwithstanding any other provision of law, any
    health insurance coverage offered by a private health insurance issuer
    shall not be subject to any Federal or State law described in
    subsection (b) if a qualified health plan offered under the Consumer
    Operated and Oriented Plan program under section 1322, a community
    health insurance option under section 1323, or a nationwide qualified
    health plan under section 1333(b), is not subject to such law.
        (b) Laws Described.--The Federal and State laws described in this
    subsection are those Federal and State laws relating to--
                (1) guaranteed renewal;
                (2) rating;
                (3) preexisting conditions;
                (4) non-discrimination;
                (5) quality improvement and reporting;
                (6) fraud and abuse;
                (7) solvency and financial requirements;
                (8) market conduct;
                (9) prompt payment;
                (10) appeals and grievances;
                (11) privacy and confidentiality;
                (12) licensure; and
                (13) benefit plan material or information.

          PART IV--STATE FLEXIBILITY TO ESTABLISH ALTERNATIVE PROGRAMS

    SEC. 1331. STATE FLEXIBILITY TO ESTABLISH BASIC HEALTH PROGRAMS FOR
                  LOW-INCOME INDIVIDUALS NOT ELIGIBLE FOR MEDICAID.

        (a) Establishment of Program.--
                (1) In general.--The Secretary shall establish a basic
            health program meeting the requirements of this section under
            which a State may enter into contracts to offer 1 or more
            standard health plans providing at least the essential health
            benefits described in section 1302(b) to eligible individuals
            in lieu of offering such individuals coverage through an
            Exchange.
                (2) Certifications as to benefit coverage and costs.--Such
            program shall provide that a State may not establish a basic
            health program under this section unless the State establishes
            to the satisfaction of the Secretary, and the Secretary
            certifies, that--
                        (A) in the case of an eligible individual enrolled
                    in a standard health plan offered through the program,
                    the State provides--
                                (i) that the amount of the monthly premium
                            an eligible individual is required to pay for
                            coverage under the standard health plan for the
                            individual and the individual's dependents does
                            not exceed the amount of the monthly premium
                            that the eligible individual would have been
                            required to pay (in the rating area in which
                            the individual resides) if the individual had
                            enrolled in the applicable second lowest cost
                            silver plan (as defined in section 36B(b)(3)(B)
                            of the Internal Revenue Code of 1986) offered
                            to the individual through an Exchange; and
                                (ii) that the cost-sharing an eligible
                            individual is required to pay under the
                            standard health plan does not exceed--
                                        (I) the cost-sharing required under
                                    a platinum plan in the case of an
                                    eligible individual with household
                                    income not in excess of 150 percent of
                                    the poverty line for the size of the
                                    family involved; and
                                        (II) the cost-sharing required
                                    under a gold plan in the case of an
                                    eligible individual not described in
                                    subclause (I); and
                        (B) the benefits provided under the standard health
                    plans offered through the program cover at least the
                    essential health benefits described in section 1302(b).
            For purposes of subparagraph (A)(i), the amount of the monthly
            premium an individual is required to pay under either the
            standard health plan or the applicable second lowest cost
            silver plan shall be determined after reduction for any premium
            tax credits and cost-sharing reductions allowable with respect
            to either plan.
        (b) Standard Health Plan.--In this section, the term ``standard
    heath plan'' means a health benefits plan that the State contracts with
    under this section--
                (1) under which the only individuals eligible to enroll are
            eligible individuals;
                (2) that provides at least the essential health benefits
            described in section 1302(b); and
                (3) in the case of a plan that provides health insurance
            coverage offered by a health insurance issuer, that has a
            medical loss ratio of at least 85 percent.
        (c) Contracting Process.--
                (1) In general.--A State basic health program shall
            establish a competitive process for entering into contracts
            with standard health plans under subsection (a), including
            negotiation of premiums and cost-sharing and negotiation of
            benefits in addition to the essential health benefits described
            in section 1302(b).
                (2) Specific items to be considered.--A State shall, as
            part of its competitive process under paragraph (1), include at
            least the following:
                        (A) Innovation.--Negotiation with offerors of a
                    standard health plan for the inclusion of innovative
                    features in the plan, including--
                                (i) care coordination and care management
                            for enrollees, especially for those with
                            chronic health conditions;
                                (ii) incentives for use of preventive
                            services; and
                                (iii) the establishment of relationships
                            between providers and patients that maximize
                            patient involvement in health care decision-
                            making, including providing incentives for
                            appropriate utilization under the plan.
                        (B) Health and resource differences.--Consideration
                    of, and the making of suitable allowances for,
                    differences in health care needs of enrollees and
                    differences in local availability of, and access to,
                    health care providers. Nothing in this subparagraph
                    shall be construed as allowing discrimination on the
                    basis of pre-existing conditions or other health
                    status-related factors.
                        (C) Managed care.--Contracting with managed care
                    systems, or with systems that offer as many of the
                    attributes of managed care as are feasible in the local
                    health care market.
                        (D) Performance measures.--Establishing specific
                    performance measures and standards for issuers of
                    standard health plans that focus on quality of care and
                    improved health outcomes, requiring such plans to
                    report to the State with respect to the measures and
                    standards, and making the performance and quality
                    information available to enrollees in a useful form.
                (3) Enhanced availability.--
                        (A) Multiple plans.--A State shall, to the maximum
                    extent feasible, seek to make multiple standard health
                    plans available to eligible individuals within a State
                    to ensure individuals have a choice of such plans.
                        (B) Regional compacts.--A State may negotiate a
                    regional compact with other States to include coverage
                    of eligible individuals in all such States in
                    agreements with issuers of standard health plans.
                (4) Coordination with other state programs.--A State shall
            seek to coordinate the administration of, and provision of
            benefits under, its program under this section with the State
            medicaid program under title XIX of the Social Security Act,
            the State child health plan under title XXI of such Act, and
            other State-administered health programs to maximize the
            efficiency of such programs and to improve the continuity of
            care.
        (d) Transfer of Funds to States.--
                (1) In general.--If the Secretary determines that a State
            electing the application of this section meets the requirements
            of the program established under subsection (a), the Secretary
            shall transfer to the State for each fiscal year for which 1 or
            more standard health plans are operating within the State the
            amount determined under paragraph (3).
                (2) Use of funds.--A State shall establish a trust for the
            deposit of the amounts received under paragraph (1) and amounts
            in the trust fund shall only be used to reduce the premiums and
            cost-sharing of, or to provide additional benefits for,
            eligible individuals enrolled in standard health plans within
            the State. Amounts in the trust fund, and expenditures of such
            amounts, shall not be included in determining the amount of any
            non-Federal funds for purposes of meeting any matching or
            expenditure requirement of any federally-funded program.
                (3) Amount of payment.--
                        (A) Secretarial determination.--
                                (i) In general.--The amount determined
                            under this paragraph for any fiscal year is the
                            amount the Secretary determines is equal to 85
                            percent of the premium tax credits under
                            section 36B of the Internal Revenue Code of
                            1986, and the cost-sharing reductions under
                            section 1402, that would have been provided for
                            the fiscal year to eligible individuals
                            enrolled in standard health plans in the State
                            if such eligible individuals were allowed to
                            enroll in qualified health plans through an
                            Exchange established under this subtitle.
                                (ii) Specific requirements.--The Secretary
                            shall make the determination under clause (i)
                            on a per enrollee basis and shall take into
                            account all relevant factors necessary to
                            determine the value of the premium tax credits
                            and cost-sharing reductions that would have
                            been provided to eligible individuals described
                            in clause (i), including the age and income of
                            the enrollee, whether the enrollment is for
                            self-only or family coverage, geographic
                            differences in average spending for health care
                            across rating areas, the health status of the
                            enrollee for purposes of determining risk
                            adjustment payments and reinsurance payments
                            that would have been made if the enrollee had
                            enrolled in a qualified health plan through an
                            Exchange, and whether any reconciliation of the
                            credit or cost-sharing reductions would have
                            occurred if the enrollee had been so enrolled.
                            This determination shall take into
                            consideration the experience of other States
                            with respect to participation in an Exchange
                            and such credits and reductions provided to
                            residents of the other States, with a special
                            focus on enrollees with income below 200
                            percent of poverty.
                                (iii) Certification.--The Chief Actuary of
                            the Centers for Medicare & Medicaid Services,
                            in consultation with the Office of Tax Analysis
                            of the Department of the Treasury, shall
                            certify whether the methodology used to make
                            determinations under this subparagraph, and
                            such determinations, meet the requirements of
                            clause (ii). Such certifications shall be based
                            on sufficient data from the State and from
                            comparable States about their experience with
                            programs created by this Act.
                        (B) Corrections.--The Secretary shall adjust the
                    payment for any fiscal year to reflect any error in the
                    determinations under subparagraph (A) for any preceding
                    fiscal year.
                (4) Application of special rules.--The provisions of
            section 1303 shall apply to a State basic health program, and
            to standard health plans offered through such program, in the
            same manner as such rules apply to qualified health plans.
        (e) Eligible Individual.--
                (1) In general.--In this section, the term ``eligible
            individual'' means, with respect to any State, an individual--
                        (A) who a resident of the State who is not eligible
                    to enroll in the State's medicaid program under title
                    XIX of the Social Security Act for benefits that at a
                    minimum consist of the essential health benefits
                    described in section 1302(b);
                        (B) whose household income exceeds 133 percent but
                    does not exceed 200 percent of the poverty line for the
                    size of the family involved;
                        (C) who is not eligible for minimum essential
                    coverage (as defined in section 5000A(f) of the
                    Internal Revenue Code of 1986) or is eligible for an
                    employer-sponsored plan that is not affordable coverage
                    (as determined under section 5000A(e)(2) of such Code);
                    and
                        (D) who has not attained age 65 as of the beginning
                    of the plan year.
            Such term shall not include any individual who is not a
            qualified individual under section 1312 who is eligible to be
            covered by a qualified health plan offered through an Exchange.
                (2) Eligible individuals may not use exchange.--An eligible
            individual shall not be treated as a qualified individual under
            section 1312 eligible for enrollment in a qualified health plan
            offered through an Exchange established under section 1311.
        (f) Secretarial Oversight.--The Secretary shall each year conduct a
    review of each State program to ensure compliance with the requirements
    of this section, including ensuring that the State program meets--
                (1) eligibility verification requirements for participation
            in the program;
                (2) the requirements for use of Federal funds received by
            the program; and
                (3) the quality and performance standards under this
            section.
        (g) Standard Health Plan Offerors.--A State may provide that
    persons eligible to offer standard health plans under a basic health
    program established under this section may include a licensed health
    maintenance organization, a licensed health insurance insurer, or a
    network of health care providers established to offer services under
    the program.
        (h) Definitions.--Any term used in this section which is also used
    in section 36B of the Internal Revenue Code of 1986 shall have the
    meaning given such term by such section.

    SEC. 1332. WAIVER FOR STATE INNOVATION.

        (a) Application.--
                (1) In general.--A State may apply to the Secretary for the
            waiver of all or any requirements described in paragraph (2)
            with respect to health insurance coverage within that State for
            plan years beginning on or after January 1, 2017. Such
            application shall--
                        (A) be filed at such time and in such manner as the
                    Secretary may require;
                        (B) contain such information as the Secretary may
                    require, including--
                                (i) a comprehensive description of the
                            State legislation and program to implement a
                            plan meeting the requirements for a waiver
                            under this section; and
                                (ii) a 10-year budget plan for such plan
                            that is budget neutral for the Federal
                            Government; and
                        (C) provide an assurance that the State has enacted
                    the law described in subsection (b)(2).
                (2) Requirements.--The requirements described in this
            paragraph with respect to health insurance coverage within the
            State for plan years beginning on or after January 1, 2014, are
            as follows:
                        (A) Part I of subtitle D.
                        (B) Part II of subtitle D.
                        (C) Section 1402.
                        (D) Sections 36B, 4980H, and 5000A of the Internal
                    Revenue Code of 1986.
                (3) Pass through of funding.--With respect to a State
            waiver under paragraph (1), under which, due to the structure
            of the State plan, individuals and small employers in the State
            would not qualify for the premium tax credits, cost-sharing
            reductions, or small business credits under sections 36B of the
            Internal Revenue Code of 1986 or under part I of subtitle E for
            which they would otherwise be eligible, the Secretary shall
            provide for an alternative means by which the aggregate amount
            of such credits or reductions that would have been paid on
            behalf of participants in the Exchanges established under this
            title had the State not received such waiver, shall be paid to
            the State for purposes of implementing the State plan under the
            waiver. Such amount shall be determined annually by the
            Secretary, taking into consideration the experience of other
            States with respect to participation in an Exchange and credits
            and reductions provided under such provisions to residents of
            the other States.
                (4) Waiver consideration and transparency.--
                        (A) In general.--An application for a waiver under
                    this section shall be considered by the Secretary in
                    accordance with the regulations described in
                    subparagraph (B).
                        (B) Regulations.--Not later than 180 days after the
                    date of enactment of this Act, the Secretary shall
                    promulgate regulations relating to waivers under this
                    section that provide--
                                (i) a process for public notice and comment
                            at the State level, including public hearings,
                            sufficient to ensure a meaningful level of
                            public input;
                                (ii) a process for the submission of an
                            application that ensures the disclosure of--
                                        (I) the provisions of law that the
                                    State involved seeks to waive; and
                                        (II) the specific plans of the
                                    State to ensure that the waiver will be
                                    in compliance with subsection (b);
                                (iii) a process for providing public notice
                            and comment after the application is received
                            by the Secretary, that is sufficient to ensure
                            a meaningful level of public input and that
                            does not impose requirements that are in
                            addition to, or duplicative of, requirements
                            imposed under the Administrative Procedures
                            Act, or requirements that are unreasonable or
                            unnecessarily burdensome with respect to State
                            compliance;
                                (iv) a process for the submission to the
                            Secretary of periodic reports by the State
                            concerning the implementation of the program
                            under the waiver; and
                                (v) a process for the periodic evaluation
                            by the Secretary of the program under the
                            waiver.
                        (C) Report.--The Secretary shall annually report to
                    Congress concerning actions taken by the Secretary with
                    respect to applications for waivers under this section.
                (5) Coordinated waiver process.--The Secretary shall
            develop a process for coordinating and consolidating the State
            waiver processes applicable under the provisions of this
            section, and the existing waiver processes applicable under
            titles XVIII, XIX, and XXI of the Social Security Act, and any
            other Federal law relating to the provision of health care
            items or services. Such process shall permit a State to submit
            a single application for a waiver under any or all of such
            provisions.
                (6) Definition.--In this section, the term ``Secretary''
            means--
                        (A) the Secretary of Health and Human Services with
                    respect to waivers relating to the provisions described
                    in subparagraph (A) through (C) of paragraph (2); and
                        (B) the Secretary of the Treasury with respect to
                    waivers relating to the provisions described in
                    paragraph (2)(D).
        (b) Granting of Waivers.--
                (1) In general.--The Secretary may grant a request for a
            waiver under subsection (a)(1) only if the Secretary determines
            that the State plan--
                        (A) will provide coverage that is at least as
                    comprehensive as the coverage defined in section
                    1302(b) and offered through Exchanges established under
                    this title as certified by Office of the Actuary of the
                    Centers for Medicare & Medicaid Services based on
                    sufficient data from the State and from comparable
                    States about their experience with programs created by
                    this Act and the provisions of this Act that would be
                    waived;
                        (B) will provide coverage and cost sharing
                    protections against excessive out-of-pocket spending
                    that are at least as affordable as the provisions of
                    this title would provide;
                        (C) will provide coverage to at least a comparable
                    number of its residents as the provisions of this title
                    would provide; and
                        (D) will not increase the Federal deficit.
                (2) Requirement to enact a law.--
                        (A) In general.--A law described in this paragraph
                    is a State law that provides for State actions under a
                    waiver under this section, including the implementation
                    of the State plan under subsection (a)(1)(B).
                        (B) Termination of opt out.--A State may repeal a
                    law described in subparagraph (A) and terminate the
                    authority provided under the waiver with respect to the
                    State.
        (c) Scope of Waiver.--
                (1) In general.--The Secretary shall determine the scope of
            a waiver of a requirement described in subsection (a)(2)
            granted to a State under subsection (a)(1).
                (2) Limitation.--The Secretary may not waive under this
            section any Federal law or requirement that is not within the
            authority of the Secretary.
        (d) Determinations by Secretary.--
                (1) Time for determination.--The Secretary shall make a
            determination under subsection (a)(1) not later than 180 days
            after the receipt of an application from a State under such
            subsection.
                (2) Effect of determination.--
                        (A) Granting of waivers.--If the Secretary
                    determines to grant a waiver under subsection (a)(1),
                    the Secretary shall notify the State involved of such
                    determination and the terms and effectiveness of such
                    waiver.
                        (B) Denial of waiver.--If the Secretary determines
                    a waiver should not be granted under subsection (a)(1),
                    the Secretary shall notify the State involved, and the
                    appropriate committees of Congress of such
                    determination and the reasons therefore.
        (e) Term of Waiver.--No waiver under this section may extend over a
    period of longer than 5 years unless the State requests continuation of
    such waiver, and such request shall be deemed granted unless the
    Secretary, within 90 days after the date of its submission to the
    Secretary, either denies such request in writing or informs the State
    in writing with respect to any additional information which is needed
    in order to make a final determination with respect to the request.

    SEC. 1333. PROVISIONS RELATING TO OFFERING OF PLANS IN MORE THAN ONE
                  STATE.

        (a) Health Care Choice Compacts.--
                (1) In general.--Not later than July 1, 2013, the Secretary
            shall, in consultation with the National Association of
            Insurance Commissioners, issue regulations for the creation of
            health care choice compacts under which 2 or more States may
            enter into an agreement under which--
                        (A) 1 or more qualified health plans could be
                    offered in the individual markets in all such States
                    but, except as provided in subparagraph (B), only be
                    subject to the laws and regulations of the State in
                    which the plan was written or issued;
                        (B) the issuer of any qualified health plan to
                    which the compact applies--
                                (i) would continue to be subject to market
                            conduct, unfair trade practices, network
                            adequacy, and consumer protection standards
                            (including standards relating to rating),
                            including addressing disputes as to the
                            performance of the contract, of the State in
                            which the purchaser resides;
                                (ii) would be required to be licensed in
                            each State in which it offers the plan under
                            the compact or to submit to the jurisdiction of
                            each such State with regard to the standards
                            described in clause (i) (including allowing
                            access to records as if the insurer were
                            licensed in the State); and
                                (iii) must clearly notify consumers that
                            the policy may not be subject to all the laws
                            and regulations of the State in which the
                            purchaser resides.
                (2) State authority.--A State may not enter into an
            agreement under this subsection unless the State enacts a law
            after the date of the enactment of this title that specifically
            authorizes the State to enter into such agreements.
                (3) Approval of compacts.--The Secretary may approve
            interstate health care choice compacts under paragraph (1) only
            if the Secretary determines that such health care choice
            compact--
                        (A) will provide coverage that is at least as
                    comprehensive as the coverage defined in section
                    1302(b) and offered through Exchanges established under
                    this title;
                        (B) will provide coverage and cost sharing
                    protections against excessive out-of-pocket spending
                    that are at least as affordable as the provisions of
                    this title would provide;
                        (C) will provide coverage to at least a comparable
                    number of its residents as the provisions of this title
                    would provide;
                        (D) will not increase the Federal deficit; and
                        (E) will not weaken enforcement of laws and
                    regulations described in paragraph (1)(B)(i) in any
                    State that is included in such compact.
                (4) Effective date.--A health care choice compact described
            in paragraph (1) shall not take effect before January 1, 2016.
        (b) Authority for Nationwide Plans.--
                (1) In general.--Except as provided in paragraph (2), if an
            issuer (including a group of health insurance issuers
            affiliated either by common ownership and control or by the
            common use of a nationally licensed service mark) of a
            qualified health plan in the individual or small group market
            meets the requirements of this subsection (in this subsection a
            ``nationwide qualified health plan'')--
                        (A) the issuer of the plan may offer the nationwide
                    qualified health plan in the individual or small group
                    market in more than 1 State; and
                        (B) with respect to State laws mandating benefit
                    coverage by a health plan, only the State laws of the
                    State in which such plan is written or issued shall
                    apply to the nationwide qualified health plan.
                (2) State opt-out.--A State may, by specific reference in a
            law enacted after the date of enactment of this title, provide
            that this subsection shall not apply to that State. Such opt-
            out shall be effective until such time as the State by law
            revokes it.
                (3) Plan requirements.--An issuer meets the requirements of
            this subsection with respect to a nationwide qualified health
            plan if, in the determination of the Secretary--
                        (A) the plan offers a benefits package that is
                    uniform in each State in which the plan is offered and
                    meets the requirements set forth in paragraphs (4)
                    through (6);
                        (B) the issuer is licensed in each State in which
                    it offers the plan and is subject to all requirements
                    of State law not inconsistent with this section,
                    including but not limited to, the standards and
                    requirements that a State imposes that do not prevent
                    the application of a requirement of part A of title
                    XXVII of the Public Health Service Act or a requirement
                    of this title;
                        (C) the issuer meets all requirements of this title
                    with respect to a qualified health plan, including the
                    requirement to offer the silver and gold levels of the
                    plan in each Exchange in the State for the market in
                    which the plan is offered;
                        (D) the issuer determines the premiums for the plan
                    in any State on the basis of the rating rules in effect
                    in that State for the rating areas in which it is
                    offered;
                        (E) the issuer offers the nationwide qualified
                    health plan in at least 60 percent of the participating
                    States in the first year in which the plan is offered,
                    65 percent of such States in the second year, 70
                    percent of such States in the third year, 75 percent of
                    such States in the fourth year, and 80 percent of such
                    States in the fifth and subsequent years;
                        (F) the issuer shall offer the plan in
                    participating States across the country, in all
                    geographic regions, and in all States that have adopted
                    adjusted community rating before the date of enactment
                    of this Act; and
                        (G) the issuer clearly notifies consumers that the
                    policy may not contain some benefits otherwise mandated
                    for plans in the State in which the purchaser resides
                    and provides a detailed statement of the benefits
                    offered and the benefit differences in that State, in
                    accordance with rules promulgated by the Secretary.
                (4) Form review for nationwide plans.--Notwithstanding any
            contrary provision of State law, at least 3 months before any
            nationwide qualified health plan is offered, the issuer shall
            file all nationwide qualified health plan forms with the
            regulator in each participating State in which the plan will be
            offered. An issuer may appeal the disapproval of a nationwide
            qualified health plan form to the Secretary.
                (5) Applicable rules.--The Secretary shall, in consultation
            with the National Association of Insurance Commissioners, issue
            rules for the offering of nationwide qualified health plans
            under this subsection. Nationwide qualified health plans may be
            offered only after such rules have taken effect.
                (6) Coverage.--The Secretary shall provide that the health
            benefits coverage provided to an individual through a
            nationwide qualified health plan under this subsection shall
            include at least the essential benefits package described in
            section 1302.
                (7) State law mandating benefit coverage by a health
            benefits plan.--For the purposes of this subsection, a State
            law mandating benefit coverage by a health plan is a law that
            mandates health insurance coverage or the offer of health
            insurance coverage for specific health services or specific
            diseases. A law that mandates health insurance coverage or
            reimbursement for services provided by certain classes of
            providers of health care services, or a law that mandates that
            certain classes of individuals must be covered as a group or as
            dependents, is not a State law mandating benefit coverage by a
            health benefits plan.

                    PART V--REINSURANCE AND RISK ADJUSTMENT

    SEC. 1341. TRANSITIONAL REINSURANCE PROGRAM FOR INDIVIDUAL AND SMALL
                  GROUP MARKETS IN EACH STATE.

        (a) In General.--Each State shall, not later than January 1, 2014--
                (1) include in the Federal standards or State law or
            regulation the State adopts and has in effect under section
            1321(b) the provisions described in subsection (b); and
                (2) establish (or enter into a contract with) 1 or more
            applicable reinsurance entities to carry out the reinsurance
            program under this section.
        (b) Model Regulation.--
                (1) In general.--In establishing the Federal standards
            under section 1321(a), the Secretary, in consultation with the
            National Association of Insurance Commissioners (the ``NAIC''),
            shall include provisions that enable States to establish and
            maintain a program under which--
                        (A) health insurance issuers, and third party
                    administrators on behalf of group health plans, are
                    required to make payments to an applicable reinsurance
                    entity for any plan year beginning in the 3-year period
                    beginning January 1, 2014 (as specified in paragraph
                    (3); and
                        (B) the applicable reinsurance entity collects
                    payments under subparagraph (A) and uses amounts so
                    collected to make reinsurance payments to health
                    insurance issuers described in subparagraph (A) that
                    cover high risk individuals in the individual market
                    (excluding grandfathered health plans) for any plan
                    year beginning in such 3-year period.
                (2) High-risk individual; payment amounts.--The Secretary
            shall include the following in the provisions under paragraph
            (1):
                        (A) Determination of high-risk individuals.--The
                    method by which individuals will be identified as high
                    risk individuals for purposes of the reinsurance
                    program established under this section. Such method
                    shall provide for identification of individuals as
                    high-risk individuals on the basis of--
                                (i) a list of at least 50 but not more than
                            100 medical conditions that are identified as
                            high-risk conditions and that may be based on
                            the identification of diagnostic and procedure
                            codes that are indicative of individuals with
                            pre-existing, high-risk conditions; or
                                (ii) any other comparable objective method
                            of identification recommended by the American
                            Academy of Actuaries.
                        (B) Payment amount.--The formula for determining
                    the amount of payments that will be paid to health
                    insurance issuers described in paragraph (1)(A) that
                    insure high-risk individuals. Such formula shall
                    provide for the equitable allocation of available funds
                    through reconciliation and may be designed--
                                (i) to provide a schedule of payments that
                            specifies the amount that will be paid for each
                            of the conditions identified under subparagraph
                            (A); or
                                (ii) to use any other comparable method for
                            determining payment amounts that is recommended
                            by the American Academy of Actuaries and that
                            encourages the use of care coordination and
                            care management programs for high risk
                            conditions.
                (3) Determination of required contributions.--
                        (A) In general.--The Secretary shall include in the
                    provisions under paragraph (1) the method for
                    determining the amount each health insurance issuer and
                    group health plan described in paragraph (1)(A)
                    contributing to the reinsurance program under this
                    section is required to contribute under such paragraph
                    for each plan year beginning in the 36-month period
                    beginning January 1, 2014. The contribution amount for
                    any plan year may be based on the percentage of revenue
                    of each issuer and the total costs of providing
                    benefits to enrollees in self-insured plans or on a
                    specified amount per enrollee and may be required to be
                    paid in advance or periodically throughout the plan
                    year.
                        (B) Specific requirements.--The method under this
                    paragraph shall be designed so that--
                                (i) the contribution amount for each issuer
                            proportionally reflects each issuer's fully
                            insured commercial book of business for all
                            major medical products and the total value of
                            all fees charged by the issuer and the costs of
                            coverage administered by the issuer as a third
                            party administrator;
                                (ii) the contribution amount can include an
                            additional amount to fund the administrative
                            expenses of the applicable reinsurance entity;
                                (iii) the aggregate contribution amounts
                            for all States shall, based on the best
                            estimates of the NAIC and without regard to
                            amounts described in clause (ii), equal
                            $10,000,000,000 for plan years beginning in
                            2014, $6,000,000,000 for plan years beginning
                            2015, and $4,000,000,000 for plan years
                            beginning in 2016; and
                                (iv) in addition to the aggregate
                            contribution amounts under clause (iii), each
                            issuer's contribution amount for any calendar
                            year under clause (iii) reflects its
                            proportionate share of an additional
                            $2,000,000,000 for 2014, an additional
                            $2,000,000,000 for 2015, and an additional
                            $1,000,000,000 for 2016.
                    Nothing in this subparagraph shall be construed to
                    preclude a State from collecting additional amounts
                    from issuers on a voluntary basis.
                (4) Expenditure of funds.--The provisions under paragraph
            (1) shall provide that--
                        (A) the contribution amounts collected for any
                    calendar year may be allocated and used in any of the
                    three calendar years for which amounts are collected
                    based on the reinsurance needs of a particular period
                    or to reflect experience in a prior period; and
                        (B) amounts remaining unexpended as of December,
                    2016, may be used to make payments under any
                    reinsurance program of a State in the individual market
                    in effect in the 2-year period beginning on January 1,
                    2017.
            Notwithstanding the preceding sentence, any contribution
            amounts described in paragraph (3)(B)(iv) shall be deposited
            into the general fund of the Treasury of the United States and
            may not be used for the program established under this section.
        (c) Applicable Reinsurance Entity.--For purposes of this section--
                (1) In general.--The term ``applicable reinsurance entity''
            means a not-for-profit organization--
                        (A) the purpose of which is to help stabilize
                    premiums for coverage in the individual and small group
                    markets in a State during the first 3 years of
                    operation of an Exchange for such markets within the
                    State when the risk of adverse selection related to new
                    rating rules and market changes is greatest; and
                        (B) the duties of which shall be to carry out the
                    reinsurance program under this section by coordinating
                    the funding and operation of the risk-spreading
                    mechanisms designed to implement the reinsurance
                    program.
                (2) State discretion.--A State may have more than 1
            applicable reinsurance entity to carry out the reinsurance
            program under this section within the State and 2 or more
            States may enter into agreements to provide for an applicable
            reinsurance entity to carry out such program in all such
            States.
                (3) Entities are tax-exempt.--An applicable reinsurance
            entity established under this section shall be exempt from
            taxation under chapter 1 of the Internal Revenue Code of 1986.
            The preceding sentence shall not apply to the tax imposed by
            section 511 such Code (relating to tax on unrelated business
            taxable income of an exempt organization).
        (d) Coordination With State High-risk Pools.--The State shall
    eliminate or modify any State high-risk pool to the extent necessary to
    carry out the reinsurance program established under this section. The
    State may coordinate the State high-risk pool with such program to the
    extent not inconsistent with the provisions of this section.

    SEC. 1342. ESTABLISHMENT OF RISK CORRIDORS FOR PLANS IN INDIVIDUAL AND
                  SMALL GROUP MARKETS.

        (a) In General.--The Secretary shall establish and administer a
    program of risk corridors for calendar years 2014, 2015, and 2016 under
    which a qualified health plan offered in the individual or small group
    market shall participate in a payment adjustment system based on the
    ratio of the allowable costs of the plan to the plan's aggregate
    premiums. Such program shall be based on the program for regional
    participating provider organizations under part D of title XVIII of the
    Social Security Act.
        (b) Payment Methodology.--
                (1) Payments out.--The Secretary shall provide under the
            program established under subsection (a) that if--
                        (A) a participating plan's allowable costs for any
                    plan year are more than 103 percent but not more than
                    108 percent of the target amount, the Secretary shall
                    pay to the plan an amount equal to 50 percent of the
                    target amount in excess of 103 percent of the target
                    amount; and
                        (B) a participating plan's allowable costs for any
                    plan year are more than 108 percent of the target
                    amount, the Secretary shall pay to the plan an amount
                    equal to the sum of 2.5 percent of the target amount
                    plus 80 percent of allowable costs in excess of 108
                    percent of the target amount.
                (2) Payments in.--The Secretary shall provide under the
            program established under subsection (a) that if--
                        (A) a participating plan's allowable costs for any
                    plan year are less than 97 percent but not less than 92
                    percent of the target amount, the plan shall pay to the
                    Secretary an amount equal to 50 percent of the excess
                    of 97 percent of the target amount over the allowable
                    costs; and
                        (B) a participating plan's allowable costs for any
                    plan year are less than 92 percent of the target
                    amount, the plan shall pay to the Secretary an amount
                    equal to the sum of 2.5 percent of the target amount
                    plus 80 percent of the excess of 92 percent of the
                    target amount over the allowable costs.
        (c) Definitions.--In this section:
                (1) Allowable costs.--
                        (A) In general.--The amount of allowable costs of a
                    plan for any year is an amount equal to the total costs
                    (other than administrative costs) of the plan in
                    providing benefits covered by the plan.
                        (B) Reduction for risk adjustment and reinsurance
                    payments.--Allowable costs shall reduced by any risk
                    adjustment and reinsurance payments received under
                    section 1341 and 1343.
                (2) Target amount.--The target amount of a plan for any
            year is an amount equal to the total premiums (including any
            premium subsidies under any governmental program), reduced by
            the administrative costs of the plan.

    SEC. 1343. RISK ADJUSTMENT.

        (a) In General.--
                (1) Low actuarial risk plans.--Using the criteria and
            methods developed under subsection (b), each State shall assess
            a charge on health plans and health insurance issuers (with
            respect to health insurance coverage) described in subsection
            (c) if the actuarial risk of the enrollees of such plans or
            coverage for a year is less than the average actuarial risk of
            all enrollees in all plans or coverage in such State for such
            year that are not self-insured group health plans (which are
            subject to the provisions of the Employee Retirement Income
            Security Act of 1974).
                (2) High actuarial risk plans.--Using the criteria and
            methods developed under subsection (b), each State shall
            provide a payment to health plans and health insurance issuers
            (with respect to health insurance coverage) described in
            subsection (c) if the actuarial risk of the enrollees of such
            plans or coverage for a year is greater than the average
            actuarial risk of all enrollees in all plans and coverage in
            such State for such year that are not self-insured group health
            plans (which are subject to the provisions of the Employee
            Retirement Income Security Act of 1974).
        (b) Criteria and Methods.--The Secretary, in consultation with
    States, shall establish criteria and methods to be used in carrying out
    the risk adjustment activities under this section. The Secretary may
    utilize criteria and methods similar to the criteria and methods
    utilized under part C or D of title XVIII of the Social Security Act.
    Such criteria and methods shall be included in the standards and
    requirements the Secretary prescribes under section 1321.
        (c) Scope.--A health plan or a health insurance issuer is described
    in this subsection if such health plan or health insurance issuer
    provides coverage in the individual or small group market within the
    State. This subsection shall not apply to a grandfathered health plan
    or the issuer of a grandfathered health plan with respect to that plan.

           Subtitle E--Affordable Coverage Choices for All Americans

            PART I--PREMIUM TAX CREDITS AND COST-SHARING REDUCTIONS

           Subpart A--Premium Tax Credits and Cost-sharing Reductions

    SEC. 1401. REFUNDABLE TAX CREDIT PROVIDING PREMIUM ASSISTANCE FOR
                  COVERAGE UNDER A QUALIFIED HEALTH PLAN.

        (a) In General.--Subpart C of part IV of subchapter A of chapter 1
    of the Internal Revenue Code of 1986 (relating to refundable credits)
    is amended by inserting after section 36A the following new section:

    ``SEC. 36B. REFUNDABLE CREDIT FOR COVERAGE UNDER A QUALIFIED HEALTH
                  PLAN.

        ``(a) In General.--In the case of an applicable taxpayer, there
    shall be allowed as a credit against the tax imposed by this subtitle
    for any taxable year an amount equal to the premium assistance credit
    amount of the taxpayer for the taxable year.
        ``(b) Premium Assistance Credit Amount.--For purposes of this
    section--
                ``(1) In general.--The term `premium assistance credit
            amount' means, with respect to any taxable year, the sum of the
            premium assistance amounts determined under paragraph (2) with
            respect to all coverage months of the taxpayer occurring during
            the taxable year.
                ``(2) Premium assistance amount.--The premium assistance
            amount determined under this subsection with respect to any
            coverage month is the amount equal to the lesser of--
                        ``(A) the monthly premiums for such month for 1 or
                    more qualified health plans offered in the individual
                    market within a State which cover the taxpayer, the
                    taxpayer's spouse, or any dependent (as defined in
                    section 152) of the taxpayer and which were enrolled in
                    through an Exchange established by the State under 1311
                    of the Patient Protection and Affordable Care Act, or
                        ``(B) the excess (if any) of--
                                ``(i) the adjusted monthly premium for such
                            month for the applicable second lowest cost
                            silver plan with respect to the taxpayer, over
                                ``(ii) an amount equal to 1/12 of the
                            product of the applicable percentage and the
                            taxpayer's household income for the taxable
                            year.
                ``(3) Other terms and rules relating to premium assistance
            amounts.--For purposes of paragraph (2)--
                        ``(A) Applicable percentage.--
                                ``(i) In general.--Except as provided in
                            clause (ii), the applicable percentage with
                            respect to any taxpayer for any taxable year is
                            equal to 2.8 percent, increased by the number
                            of percentage points (not greater than 7) which
                            bears the same ratio to 7 percentage points
                            as--
                                        ``(I) the taxpayer's household
                                    income for the taxable year in excess
                                    of 100 percent of the poverty line for
                                    a family of the size involved, bears to
                                        ``(II) an amount equal to 200
                                    percent of the poverty line for a
                                    family of the size involved.
                                ``(ii) Special rule for taxpayers under 133
                            percent of poverty line.--If a taxpayer's
                            household income for the taxable year is in
                            excess of 100 percent, but not more than 133
                            percent, of the poverty line for a family of
                            the size involved, the taxpayer's applicable
                            percentage shall be 2 percent.
                                ``(iii) Indexing.--In the case of taxable
                            years beginning in any calendar year after
                            2014, the Secretary shall adjust the initial
                            and final applicable percentages under clause
                            (i), and the 2 percent under clause (ii), for
                            the calendar year to reflect the excess of the
                            rate of premium growth between the preceding
                            calendar year and 2013 over the rate of income
                            growth for such period.
                        ``(B) Applicable second lowest cost silver plan.--
                    The applicable second lowest cost silver plan with
                    respect to any applicable taxpayer is the second lowest
                    cost silver plan of the individual market in the rating
                    area in which the taxpayer resides which--
                                ``(i) is offered through the same Exchange
                            through which the qualified health plans taken
                            into account under paragraph (2)(A) were
                            offered, and
                                ``(ii) provides--
                                        ``(I) self-only coverage in the
                                    case of an applicable taxpayer--
                                                ``(aa) whose tax for the
                                            taxable year is determined
                                            under section 1(c) (relating to
                                            unmarried individuals other
                                            than surviving spouses and
                                            heads of households) and who is
                                            not allowed a deduction under
                                            section 151 for the taxable
                                            year with respect to a
                                            dependent, or
                                                ``(bb) who is not described
                                            in item (aa) but who purchases
                                            only self-only coverage, and
                                        ``(II) family coverage in the case
                                    of any other applicable taxpayer.
                    If a taxpayer files a joint return and no credit is
                    allowed under this section with respect to 1 of the
                    spouses by reason of subsection (e), the taxpayer shall
                    be treated as described in clause (ii)(I) unless a
                    deduction is allowed under section 151 for the taxable
                    year with respect to a dependent other than either
                    spouse and subsection (e) does not apply to the
                    dependent.
                        ``(C) Adjusted monthly premium.--The adjusted
                    monthly premium for an applicable second lowest cost
                    silver plan is the monthly premium which would have
                    been charged (for the rating area with respect to which
                    the premiums under paragraph (2)(A) were determined)
                    for the plan if each individual covered under a
                    qualified health plan taken into account under
                    paragraph (2)(A) were covered by such silver plan and
                    the premium was adjusted only for the age of each such
                    individual in the manner allowed under section 2701 of
                    the Public Health Service Act. In the case of a State
                    participating in the wellness discount demonstration
                    project under section 2705(d) of the Public Health
                    Service Act, the adjusted monthly premium shall be
                    determined without regard to any premium discount or
                    rebate under such project.
                        ``(D) Additional benefits.--If--
                                ``(i) a qualified health plan under section
                            1302(b)(5) of the Patient Protection and
                            Affordable Care Act offers benefits in addition
                            to the essential health benefits required to be
                            provided by the plan, or
                                ``(ii) a State requires a qualified health
                            plan under section 1311(d)(3)(B) of such Act to
                            cover benefits in addition to the essential
                            health benefits required to be provided by the
                            plan,
                    the portion of the premium for the plan properly
                    allocable (under rules prescribed by the Secretary of
                    Health and Human Services) to such additional benefits
                    shall not be taken into account in determining either
                    the monthly premium or the adjusted monthly premium
                    under paragraph (2).
                        ``(E) Special rule for pediatric dental coverage.--
                    For purposes of determining the amount of any monthly
                    premium, if an individual enrolls in both a qualified
                    health plan and a plan described in section
                    1311(d)(2)(B)(ii)(I) of the Patient Protection and
                    Affordable Care Act for any plan year, the portion of
                    the premium for the plan described in such section that
                    (under regulations prescribed by the Secretary) is
                    properly allocable to pediatric dental benefits which
                    are included in the essential health benefits required
                    to be provided by a qualified health plan under section
                    1302(b)(1)(J) of such Act shall be treated as a premium
                    payable for a qualified health plan.
        ``(c) Definition and Rules Relating to Applicable Taxpayers,
    Coverage Months, and Qualified Health Plan.--For purposes of this
    section--
                ``(1) Applicable taxpayer.--
                        ``(A) In general.--The term `applicable taxpayer'
                    means, with respect to any taxable year, a taxpayer
                    whose household income for the taxable year exceeds 100
                    percent but does not exceed 400 percent of an amount
                    equal to the poverty line for a family of the size
                    involved.
                        ``(B) Special rule for certain individuals lawfully
                    present in the united states.--If--
                                ``(i) a taxpayer has a household income
                            which is not greater than 100 percent of an
                            amount equal to the poverty line for a family
                            of the size involved, and
                                ``(ii) the taxpayer is an alien lawfully
                            present in the United States, but is not
                            eligible for the medicaid program under title
                            XIX of the Social Security Act by reason of
                            such alien status,
                    the taxpayer shall, for purposes of the credit under
                    this section, be treated as an applicable taxpayer with
                    a household income which is equal to 100 percent of the
                    poverty line for a family of the size involved.
                        ``(C) Married couples must file joint return.--If
                    the taxpayer is married (within the meaning of section
                    7703) at the close of the taxable year, the taxpayer
                    shall be treated as an applicable taxpayer only if the
                    taxpayer and the taxpayer's spouse file a joint return
                    for the taxable year.
                        ``(D) Denial of credit to dependents.--No credit
                    shall be allowed under this section to any individual
                    with respect to whom a deduction under section 151 is
                    allowable to another taxpayer for a taxable year
                    beginning in the calendar year in which such
                    individual's taxable year begins.
                ``(2) Coverage month.--For purposes of this subsection--
                        ``(A) In general.--The term `coverage month' means,
                    with respect to an applicable taxpayer, any month if--
                                ``(i) as of the first day of such month the
                            taxpayer, the taxpayer's spouse, or any
                            dependent of the taxpayer is covered by a
                            qualified health plan described in subsection
                            (b)(2)(A) that was enrolled in through an
                            Exchange established by the State under section
                            1311 of the Patient Protection and Affordable
                            Care Act, and
                                ``(ii) the premium for coverage under such
                            plan for such month is paid by the taxpayer (or
                            through advance payment of the credit under
                            subsection (a) under section 1412 of the
                            Patient Protection and Affordable Care Act).
                        ``(B) Exception for minimum essential coverage.--
                                ``(i) In general.--The term `coverage
                            month' shall not include any month with respect
                            to an individual if for such month the
                            individual is eligible for minimum essential
                            coverage other than eligibility for coverage
                            described in section 5000A(f)(1)(C) (relating
                            to coverage in the individual market).
                                ``(ii) Minimum essential coverage.--The
                            term `minimum essential coverage' has the
                            meaning given such term by section 5000A(f).
                        ``(C) Special rule for employer-sponsored minimum
                    essential coverage.--For purposes of subparagraph (B)--
                                ``(i) Coverage must be affordable.--Except
                            as provided in clause (iii), an employee shall
                            not be treated as eligible for minimum
                            essential coverage if such coverage--
                                        ``(I) consists of an eligible
                                    employer-sponsored plan (as defined in
                                    section 5000A(f)(2)), and
                                        ``(II) the employee's required
                                    contribution (within the meaning of
                                    section 5000A(e)(1)(B)) with respect to
                                    the plan exceeds 9.8 percent of the
                                    applicable taxpayer's household income.
                            This clause shall also apply to an individual
                            who is eligible to enroll in the plan by reason
                            of a relationship the individual bears to the
                            employee.
                                ``(ii) Coverage must provide minimum
                            value.--Except as provided in clause (iii), an
                            employee shall not be treated as eligible for
                            minimum essential coverage if such coverage
                            consists of an eligible employer-sponsored plan
                            (as defined in section 5000A(f)(2)) and the
                            plan's share of the total allowed costs of
                            benefits provided under the plan is less than
                            60 percent of such costs.
                                ``(iii) Employee or family must not be
                            covered under employer plan.--Clauses (i) and
                            (ii) shall not apply if the employee (or any
                            individual described in the last sentence of
                            clause (i)) is covered under the eligible
                            employer-sponsored plan or the grandfathered
                            health plan.
                                ``(iv) Indexing.--In the case of plan years
                            beginning in any calendar year after 2014, the
                            Secretary shall adjust the 9.8 percent under
                            clause (i)(II) in the same manner as the
                            percentages are adjusted under subsection
                            (b)(3)(A)(ii).
                ``(3) Definitions and other rules.--
                        ``(A) Qualified health plan.--The term `qualified
                    health plan' has the meaning given such term by section
                    1301(a) of the Patient Protection and Affordable Care
                    Act, except that such term shall not include a
                    qualified health plan which is a catastrophic plan
                    described in section 1302(e) of such Act.
                        ``(B) Grandfathered health plan.--The term
                    `grandfathered health plan' has the meaning given such
                    term by section 1251 of the Patient Protection and
                    Affordable Care Act.
        ``(d) Terms Relating to Income and Families.--For purposes of this
    section--
                ``(1) Family size.--The family size involved with respect
            to any taxpayer shall be equal to the number of individuals for
            whom the taxpayer is allowed a deduction under section 151
            (relating to allowance of deduction for personal exemptions)
            for the taxable year.
                ``(2) Household income.--
                        ``(A) Household income.--The term `household
                    income' means, with respect to any taxpayer, an amount
                    equal to the sum of--
                                ``(i) the modified gross income of the
                            taxpayer, plus
                                ``(ii) the aggregate modified gross incomes
                            of all other individuals who--
                                        ``(I) were taken into account in
                                    determining the taxpayer's family size
                                    under paragraph (1), and
                                        ``(II) were required to file a
                                    return of tax imposed by section 1 for
                                    the taxable year.
                        ``(B) Modified gross income.--The term `modified
                    gross income' means gross income--
                                ``(i) decreased by the amount of any
                            deduction allowable under paragraph (1), (3),
                            (4), or (10) of section 62(a),
                                ``(ii) increased by the amount of interest
                            received or accrued during the taxable year
                            which is exempt from tax imposed by this
                            chapter, and
                                ``(iii) determined without regard to
                            sections 911, 931, and 933.
                ``(3) Poverty line.--
                        ``(A) In general.--The term `poverty line' has the
                    meaning given that term in section 2110(c)(5) of the
                    Social Security Act (42 U.S.C. 1397jj(c)(5)).
                        ``(B) Poverty line used.--In the case of any
                    qualified health plan offered through an Exchange for
                    coverage during a taxable year beginning in a calendar
                    year, the poverty line used shall be the most recently
                    published poverty line as of the 1st day of the regular
                    enrollment period for coverage during such calendar
                    year.
        ``(e) Rules for Individuals Not Lawfully Present.--
                ``(1) In general.--If 1 or more individuals for whom a
            taxpayer is allowed a deduction under section 151 (relating to
            allowance of deduction for personal exemptions) for the taxable
            year (including the taxpayer or his spouse) are individuals who
            are not lawfully present--
                        ``(A) the aggregate amount of premiums otherwise
                    taken into account under clauses (i) and (ii) of
                    subsection (b)(2)(A) shall be reduced by the portion
                    (if any) of such premiums which is attributable to such
                    individuals, and
                        ``(B) for purposes of applying this section, the
                    determination as to what percentage a taxpayer's
                    household income bears to the poverty level for a
                    family of the size involved shall be made under one of
                    the following methods:
                                ``(i) A method under which--
                                        ``(I) the taxpayer's family size is
                                    determined by not taking such
                                    individuals into account, and
                                        ``(II) the taxpayer's household
                                    income is equal to the product of the
                                    taxpayer's household income (determined
                                    without regard to this subsection) and
                                    a fraction--
                                                ``(aa) the numerator of
                                            which is the poverty line for
                                            the taxpayer's family size
                                            determined after application of
                                            subclause (I), and
                                                ``(bb) the denominator of
                                            which is the poverty line for
                                            the taxpayer's family size
                                            determined without regard to
                                            subclause (I).
                                ``(ii) A comparable method reaching the
                            same result as the method under clause (i).
                ``(2) Lawfully present.--For purposes of this section, an
            individual shall be treated as lawfully present only if the
            individual is, and is reasonably expected to be for the entire
            period of enrollment for which the credit under this section is
            being claimed, a citizen or national of the United States or an
            alien lawfully present in the United States.
                ``(3) Secretarial authority.--The Secretary of Health and
            Human Services, in consultation with the Secretary, shall
            prescribe rules setting forth the methods by which calculations
            of family size and household income are made for purposes of
            this subsection. Such rules shall be designed to ensure that
            the least burden is placed on individuals enrolling in
            qualified health plans through an Exchange and taxpayers
            eligible for the credit allowable under this section.
        ``(f) Reconciliation of Credit and Advance Credit.--
                ``(1) In general.--The amount of the credit allowed under
            this section for any taxable year shall be reduced (but not
            below zero) by the amount of any advance payment of such credit
            under section 1412 of the Patient Protection and Affordable
            Care Act.
                ``(2) Excess advance payments.--
                        ``(A) In general.--If the advance payments to a
                    taxpayer under section 1412 of the Patient Protection
                    and Affordable Care Act for a taxable year exceed the
                    credit allowed by this section (determined without
                    regard to paragraph (1)), the tax imposed by this
                    chapter for the taxable year shall be increased by the
                    amount of such excess.
                        ``(B) Limitation on increase where income less than
                    400 percent of poverty line.--
                                ``(i) In general.--In the case of an
                            applicable taxpayer whose household income is
                            less than 400 percent of the poverty line for
                            the size of the family involved for the taxable
                            year, the amount of the increase under
                            subparagraph (A) shall in no event exceed $400
                            ($250 in the case of a taxpayer whose tax is
                            determined under section 1(c) for the taxable
                            year).
                                ``(ii) Indexing of amount.--In the case of
                            any calendar year beginning after 2014, each of
                            the dollar amounts under clause (i) shall be
                            increased by an amount equal to--
                                        ``(I) such dollar amount,
                                    multiplied by
                                        ``(II) the cost-of-living
                                    adjustment determined under section
                                    1(f)(3) for the calendar year,
                                    determined by substituting `calendar
                                    year 2013' for `calendar year 1992' in
                                    subparagraph (B) thereof.
                            If the amount of any increase under clause (i)
                            is not a multiple of $50, such increase shall
                            be rounded to the next lowest multiple of $50.
        ``(g) Regulations.--The Secretary shall prescribe such regulations
    as may be necessary to carry out the provisions of this section,
    including regulations which provide for--
                ``(1) the coordination of the credit allowed under this
            section with the program for advance payment of the credit
            under section 1412 of the Patient Protection and Affordable
            Care Act, and
                ``(2) the application of subsection (f) where the filing
            status of the taxpayer for a taxable year is different from
            such status used for determining the advance payment of the
            credit.''.
        (b) Disallowance of Deduction.--Section 280C of the Internal
    Revenue Code of 1986 is amended by adding at the end the following new
    subsection:
        ``(g) Credit for Health Insurance Premiums.--No deduction shall be
    allowed for the portion of the premiums paid by the taxpayer for
    coverage of 1 or more individuals under a qualified health plan which
    is equal to the amount of the credit determined for the taxable year
    under section 36B(a) with respect to such premiums.''.
        (c) Study on Affordable Coverage.--
                (1) Study and report.--
                        (A) In general.--Not later than 5 years after the
                    date of the enactment of this Act, the Comptroller
                    General shall conduct a study on the affordability of
                    health insurance coverage, including--
                                (i) the impact of the tax credit for
                            qualified health insurance coverage of
                            individuals under section 36B of the Internal
                            Revenue Code of 1986 and the tax credit for
                            employee health insurance expenses of small
                            employers under section 45R of such Code on
                            maintaining and expanding the health insurance
                            coverage of individuals;
                                (ii) the availability of affordable health
                            benefits plans, including a study of whether
                            the percentage of household income used for
                            purposes of section 36B(c)(2)(C) of the
                            Internal Revenue Code of 1986 (as added by this
                            section) is the appropriate level for
                            determining whether employer-provided coverage
                            is affordable for an employee and whether such
                            level may be lowered without significantly
                            increasing the costs to the Federal Government
                            and reducing employer-provided coverage; and
                                (iii) the ability of individuals to
                            maintain essential health benefits coverage (as
                            defined in section 5000A(f) of the Internal
                            Revenue Code of 1986).
                        (B) Report.--The Comptroller General shall submit
                    to the appropriate committees of Congress a report on
                    the study conducted under subparagraph (A), together
                    with legislative recommendations relating to the
                    matters studied under such subparagraph.
                (2) Appropriate committees of congress.--In this
            subsection, the term ``appropriate committees of Congress''
            means the Committee on Ways and Means, the Committee on
            Education and Labor, and the Committee on Energy and Commerce
            of the House of Representatives and the Committee on Finance
            and the Committee on Health, Education, Labor and Pensions of
            the Senate.
        (d) Conforming Amendments.--
                (1) Paragraph (2) of section 1324(b) of title 31, United
            States Code, is amended by inserting ``36B,'' after ``36A,''.
                (2) The table of sections for subpart C of part IV of
            subchapter A of chapter 1 of the Internal Revenue Code of 1986
            is amended by inserting after the item relating to section 36A
            the following new item:

    ``Sec. 36B. Refundable credit for coverage under a qualified health
                                plan.''.
        (e) Effective Date.--The amendments made by this section shall
    apply to taxable years ending after December 31, 2013.

    SEC. 1402. REDUCED COST-SHARING FOR INDIVIDUALS ENROLLING IN QUALIFIED
                  HEALTH PLANS.

        (a) In General.--In the case of an eligible insured enrolled in a
    qualified health plan--
                (1) the Secretary shall notify the issuer of the plan of
            such eligibility; and
                (2) the issuer shall reduce the cost-sharing under the plan
            at the level and in the manner specified in subsection (c).
        (b) Eligible Insured.--In this section, the term ``eligible
    insured'' means an individual--
                (1) who enrolls in a qualified health plan in the silver
            level of coverage in the individual market offered through an
            Exchange; and
                (2) whose household income exceeds 100 percent but does not
            exceed 400 percent of the poverty line for a family of the size
            involved.
    In the case of an individual described in section 36B(c)(1)(B) of the
    Internal Revenue Code of 1986, the individual shall be treated as
    having household income equal to 100 percent for purposes of applying
    this section.
        (c) Determination of Reduction in Cost-sharing.--
                (1) Reduction in out-of-pocket limit.--
                        (A) In general.--The reduction in cost-sharing
                    under this subsection shall first be achieved by
                    reducing the applicable out-of pocket limit under
                    section 1302(c)(1) in the case of--
                                (i) an eligible insured whose household
                            income is more than 100 percent but not more
                            than 200 percent of the poverty line for a
                            family of the size involved, by two-thirds;
                                (ii) an eligible insured whose household
                            income is more than 200 percent but not more
                            than 300 percent of the poverty line for a
                            family of the size involved, by one-half; and
                                (iii) an eligible insured whose household
                            income is more than 300 percent but not more
                            than 400 percent of the poverty line for a
                            family of the size involved, by one-third.
                        (B) Coordination with actuarial value limits.--
                                (i) In general.--The Secretary shall ensure
                            the reduction under this paragraph shall not
                            result in an increase in the plan's share of
                            the total allowed costs of benefits provided
                            under the plan above--
                                        (I) 90 percent in the case of an
                                    eligible insured described in paragraph
                                    (2)(A);
                                        (II) 80 percent in the case of an
                                    eligible insured described in paragraph
                                    (2)(B); and
                                        (III) 70 percent in the case of an
                                    eligible insured described in clause
                                    (ii) or (iii) of subparagraph (A).
                                (ii) Adjustment.--The Secretary shall
                            adjust the out-of pocket limits under paragraph
                            (1) if necessary to ensure that such limits do
                            not cause the respective actuarial values to
                            exceed the levels specified in clause (i).
                (2) Additional reduction for lower income insureds.--The
            Secretary shall establish procedures under which the issuer of
            a qualified health plan to which this section applies shall
            further reduce cost-sharing under the plan in a manner
            sufficient to--
                        (A) in the case of an eligible insured whose
                    household income is not less than 100 percent but not
                    more than 150 percent of the poverty line for a family
                    of the size involved, increase the plan's share of the
                    total allowed costs of benefits provided under the plan
                    to 90 percent of such costs; and
                        (B) in the case of an eligible insured whose
                    household income is more than 150 percent but not more
                    than 200 percent of the poverty line for a family of
                    the size involved, increase the plan's share of the
                    total allowed costs of benefits provided under the plan
                    to 80 percent of such costs.
                (3) Methods for reducing cost-sharing.--
                        (A) In general.--An issuer of a qualified health
                    plan making reductions under this subsection shall
                    notify the Secretary of such reductions and the
                    Secretary shall make periodic and timely payments to
                    the issuer equal to the value of the reductions.
                        (B) Capitated payments.--The Secretary may
                    establish a capitated payment system to carry out the
                    payment of cost-sharing reductions under this section.
                    Any such system shall take into account the value of
                    the reductions and make appropriate risk adjustments to
                    such payments.
                (4) Additional benefits.--If a qualified health plan under
            section 1302(b)(5) offers benefits in addition to the essential
            health benefits required to be provided by the plan, or a State
            requires a qualified health plan under section 1311(d)(3)(B) to
            cover benefits in addition to the essential health benefits
            required to be provided by the plan, the reductions in cost-
            sharing under this section shall not apply to such additional
            benefits.
                (5) Special rule for pediatric dental plans.--If an
            individual enrolls in both a qualified health plan and a plan
            described in section 1311(d)(2)(B)(ii)(I) for any plan year,
            subsection (a) shall not apply to that portion of any reduction
            in cost-sharing under subsection (c) that (under regulations
            prescribed by the Secretary) is properly allocable to pediatric
            dental benefits which are included in the essential health
            benefits required to be provided by a qualified health plan
            under section 1302(b)(1)(J).
        (d) Special Rules for Indians.--
                (1) Indians under 300 percent of poverty.--If an individual
            enrolled in any qualified health plan in the individual market
            through an Exchange is an Indian (as defined in section 4(d) of
            the Indian Self-Determination and Education Assistance Act (25
            U.S.C. 450b(d))) whose household income is not more than 300
            percent of the poverty line for a family of the size involved,
            then, for purposes of this section--
                        (A) such individual shall be treated as an eligible
                    insured; and
                        (B) the issuer of the plan shall eliminate any
                    cost-sharing under the plan.
                (2) Items or services furnished through indian health
            providers.--If an Indian (as so defined) enrolled in a
            qualified health plan is furnished an item or service directly
            by the Indian Health Service, an Indian Tribe, Tribal
            Organization, or Urban Indian Organization or through referral
            under contract health services--
                        (A) no cost-sharing under the plan shall be imposed
                    under the plan for such item or service; and
                        (B) the issuer of the plan shall not reduce the
                    payment to any such entity for such item or service by
                    the amount of any cost-sharing that would be due from
                    the Indian but for subparagraph (A).
                (3) Payment.--The Secretary shall pay to the issuer of a
            qualified health plan the amount necessary to reflect the
            increase in actuarial value of the plan required by reason of
            this subsection.
        (e) Rules for Individuals Not Lawfully Present.--
                (1) In general.--If an individual who is an eligible
            insured is not lawfully present--
                        (A) no cost-sharing reduction under this section
                    shall apply with respect to the individual; and
                        (B) for purposes of applying this section, the
                    determination as to what percentage a taxpayer's
                    household income bears to the poverty level for a
                    family of the size involved shall be made under one of
                    the following methods:
                                (i) A method under which--
                                        (I) the taxpayer's family size is
                                    determined by not taking such
                                    individuals into account, and
                                        (II) the taxpayer's household
                                    income is equal to the product of the
                                    taxpayer's household income (determined
                                    without regard to this subsection) and
                                    a fraction--
                                                (aa) the numerator of which
                                            is the poverty line for the
                                            taxpayer's family size
                                            determined after application of
                                            subclause (I), and
                                                (bb) the denominator of
                                            which is the poverty line for
                                            the taxpayer's family size
                                            determined without regard to
                                            subclause (I).
                                (ii) A comparable method reaching the same
                            result as the method under clause (i).
                (2) Lawfully present.--For purposes of this section, an
            individual shall be treated as lawfully present only if the
            individual is, and is reasonably expected to be for the entire
            period of enrollment for which the cost-sharing reduction under
            this section is being claimed, a citizen or national of the
            United States or an alien lawfully present in the United
            States.
                (3) Secretarial authority.--The Secretary, in consultation
            with the Secretary of the Treasury, shall prescribe rules
            setting forth the methods by which calculations of family size
            and household income are made for purposes of this subsection.
            Such rules shall be designed to ensure that the least burden is
            placed on individuals enrolling in qualified health plans
            through an Exchange and taxpayers eligible for the credit
            allowable under this section.
        (f) Definitions and Special Rules.--In this section:
                (1) In general.--Any term used in this section which is
            also used in section 36B of the Internal Revenue Code of 1986
            shall have the meaning given such term by such section.
                (2) Limitations on reduction.--No cost-sharing reduction
            shall be allowed under this section with respect to coverage
            for any month unless the month is a coverage month with respect
            to which a credit is allowed to the insured (or an applicable
            taxpayer on behalf of the insured) under section 36B of such
            Code.
                (3) Data used for eligibility.--Any determination under
            this section shall be made on the basis of the taxable year for
            which the advance determination is made under section 1412 and
            not the taxable year for which the credit under section 36B of
            such Code is allowed.

                     Subpart B--Eligibility Determinations

    SEC. 1411. PROCEDURES FOR DETERMINING ELIGIBILITY FOR EXCHANGE
                  PARTICIPATION, PREMIUM TAX CREDITS AND REDUCED COST-
                  SHARING, AND INDIVIDUAL RESPONSIBILITY EXEMPTIONS.

        (a) Establishment of Program.--The Secretary shall establish a
    program meeting the requirements of this section for determining--
                (1) whether an individual who is to be covered in the
            individual market by a qualified health plan offered through an
            Exchange, or who is claiming a premium tax credit or reduced
            cost-sharing, meets the requirements of sections 1312(f)(3),
            1402(e), and 1412(d) of this title and section 36B(e) of the
            Internal Revenue Code of 1986 that the individual be a citizen
            or national of the United States or an alien lawfully present
            in the United States;
                (2) in the case of an individual claiming a premium tax
            credit or reduced cost-sharing under section 36B of such Code
            or section 1402--
                        (A) whether the individual meets the income and
                    coverage requirements of such sections; and
                        (B) the amount of the tax credit or reduced cost-
                    sharing;
                (3) whether an individual's coverage under an employer-
            sponsored health benefits plan is treated as unaffordable under
            sections 36B(c)(2)(C) and 5000A(e)(2); and
                (4) whether to grant a certification under section
            1311(d)(4)(H) attesting that, for purposes of the individual
            responsibility requirement under section 5000A of the Internal
            Revenue Code of 1986, an individual is entitled to an exemption
            from either the individual responsibility requirement or the
            penalty imposed by such section.
        (b) Information Required To Be Provided by Applicants.--
                (1) In general.--An applicant for enrollment in a qualified
            health plan offered through an Exchange in the individual
            market shall provide--
                        (A) the name, address, and date of birth of each
                    individual who is to be covered by the plan (in this
                    subsection referred to as an ``enrollee''); and
                        (B) the information required by any of the
                    following paragraphs that is applicable to an enrollee.
                (2) Citizenship or immigration status.--The following
            information shall be provided with respect to every enrollee:
                        (A) In the case of an enrollee whose eligibility is
                    based on an attestation of citizenship of the enrollee,
                    the enrollee's social security number.
                        (B) In the case of an individual whose eligibility
                    is based on an attestation of the enrollee's
                    immigration status, the enrollee's social security
                    number (if applicable) and such identifying information
                    with respect to the enrollee's immigration status as
                    the Secretary, after consultation with the Secretary of
                    Homeland Security, determines appropriate.
                (3) Eligibility and amount of tax credit or reduced cost-
            sharing.--In the case of an enrollee with respect to whom a
            premium tax credit or reduced cost-sharing under section 36B of
            such Code or section 1402 is being claimed, the following
            information:
                        (A) Information regarding income and family size.--
                    The information described in section 6103(l)(21) for
                    the taxable year ending with or within the second
                    calendar year preceding the calendar year in which the
                    plan year begins.
                        (B) Changes in circumstances.--The information
                    described in section 1412(b)(2), including information
                    with respect to individuals who were not required to
                    file an income tax return for the taxable year
                    described in subparagraph (A) or individuals who
                    experienced changes in marital status or family size or
                    significant reductions in income.
                (4) Employer-sponsored coverage.--In the case of an
            enrollee with respect to whom eligibility for a premium tax
            credit under section 36B of such Code or cost-sharing reduction
            under section 1402 is being established on the basis that the
            enrollee's (or related individual's) employer is not treated
            under section 36B(c)(2)(C) of such Code as providing minimum
            essential coverage or affordable minimum essential coverage,
            the following information:
                        (A) The name, address, and employer identification
                    number (if available) of the employer.
                        (B) Whether the enrollee or individual is a full-
                    time employee and whether the employer provides such
                    minimum essential coverage.
                        (C) If the employer provides such minimum essential
                    coverage, the lowest cost option for the enrollee's or
                    individual's enrollment status and the enrollee's or
                    individual's required contribution (within the meaning
                    of section 5000A(e)(1)(B) of such Code) under the
                    employer-sponsored plan.
                        (D) If an enrollee claims an employer's minimum
                    essential coverage is unaffordable, the information
                    described in paragraph (3).
            If an enrollee changes employment or obtains additional
            employment while enrolled in a qualified health plan for which
            such credit or reduction is allowed, the enrollee shall notify
            the Exchange of such change or additional employment and
            provide the information described in this paragraph with
            respect to the new employer.
                (5) Exemptions from individual responsibility
            requirements.--In the case of an individual who is seeking an
            exemption certificate under section 1311(d)(4)(H) from any
            requirement or penalty imposed by section 5000A, the following
            information:
                        (A) In the case of an individual seeking exemption
                    based on the individual's status as a member of an
                    exempt religious sect or division, as a member of a
                    health care sharing ministry, as an Indian, or as an
                    individual eligible for a hardship exemption, such
                    information as the Secretary shall prescribe.
                        (B) In the case of an individual seeking exemption
                    based on the lack of affordable coverage or the
                    individual's status as a taxpayer with household income
                    less than 100 percent of the poverty line, the
                    information described in paragraphs (3) and (4), as
                    applicable.
        (c) Verification of Information Contained in Records of Specific
    Federal Officials.--
                (1) Information transferred to secretary.--An Exchange
            shall submit the information provided by an applicant under
            subsection (b) to the Secretary for verification in accordance
            with the requirements of this subsection and subsection (d).
                (2) Citizenship or immigration status.--
                        (A) Commissioner of social security.--The Secretary
                    shall submit to the Commissioner of Social Security the
                    following information for a determination as to whether
                    the information provided is consistent with the
                    information in the records of the Commissioner:
                                (i) The name, date of birth, and social
                            security number of each individual for whom
                            such information was provided under subsection
                            (b)(2).
                                (ii) The attestation of an individual that
                            the individual is a citizen.
                        (B) Secretary of homeland security.--
                                (i) In general.--In the case of an
                            individual--
                                        (I) who attests that the individual
                                    is an alien lawfully present in the
                                    United States; or
                                        (II) who attests that the
                                    individual is a citizen but with
                                    respect to whom the Commissioner of
                                    Social Security has notified the
                                    Secretary under subsection (e)(3) that
                                    the attestation is inconsistent with
                                    information in the records maintained
                                    by the Commissioner;
                            the Secretary shall submit to the Secretary of
                            Homeland Security the information described in
                            clause (ii) for a determination as to whether
                            the information provided is consistent with the
                            information in the records of the Secretary of
                            Homeland Security.
                                (ii) Information.--The information
                            described in clause (ii) is the following:
                                        (I) The name, date of birth, and
                                    any identifying information with
                                    respect to the individual's immigration
                                    status provided under subsection
                                    (b)(2).
                                        (II) The attestation that the
                                    individual is an alien lawfully present
                                    in the United States or in the case of
                                    an individual described in clause
                                    (i)(II), the attestation that the
                                    individual is a citizen.
                (3) Eligibility for tax credit and cost-sharing
            reduction.--The Secretary shall submit the information
            described in subsection (b)(3)(A) provided under paragraph (3),
            (4), or (5) of subsection (b) to the Secretary of the Treasury
            for verification of household income and family size for
            purposes of eligibility.
                (4) Methods.--
                        (A) In general.--The Secretary, in consultation
                    with the Secretary of the Treasury, the Secretary of
                    Homeland Security, and the Commissioner of Social
                    Security, shall provide that verifications and
                    determinations under this subsection shall be done--
                                (i) through use of an on-line system or
                            otherwise for the electronic submission of, and
                            response to, the information submitted under
                            this subsection with respect to an applicant;
                            or
                                (ii) by determining the consistency of the
                            information submitted with the information
                            maintained in the records of the Secretary of
                            the Treasury, the Secretary of Homeland
                            Security, or the Commissioner of Social
                            Security through such other method as is
                            approved by the Secretary.
                        (B) Flexibility.--The Secretary may modify the
                    methods used under the program established by this
                    section for the Exchange and verification of
                    information if the Secretary determines such
                    modifications would reduce the administrative costs and
                    burdens on the applicant, including allowing an
                    applicant to request the Secretary of the Treasury to
                    provide the information described in paragraph (3)
                    directly to the Exchange or to the Secretary. The
                    Secretary shall not make any such modification unless
                    the Secretary determines that any applicable
                    requirements under this section and section 6103 of the
                    Internal Revenue Code of 1986 with respect to the
                    confidentiality, disclosure, maintenance, or use of
                    information will be met.
        (d) Verification by Secretary.--In the case of information provided
    under subsection (b) that is not required under subsection (c) to be
    submitted to another person for verification, the Secretary shall
    verify the accuracy of such information in such manner as the Secretary
    determines appropriate, including delegating responsibility for
    verification to the Exchange.
        (e) Actions Relating to Verification.--
                (1) In general.--Each person to whom the Secretary provided
            information under subsection (c) shall report to the Secretary
            under the method established under subsection (c)(4) the
            results of its verification and the Secretary shall notify the
            Exchange of such results. Each person to whom the Secretary
            provided information under subsection (d) shall report to the
            Secretary in such manner as the Secretary determines
            appropriate.
                (2) Verification.--
                        (A) Eligibility for enrollment and premium tax
                    credits and cost-sharing reductions.--If information
                    provided by an applicant under paragraphs (1), (2),
                    (3), and (4) of subsection (b) is verified under
                    subsections (c) and (d)--
                                (i) the individual's eligibility to enroll
                            through the Exchange and to apply for premium
                            tax credits and cost-sharing reductions shall
                            be satisfied; and
                                (ii) the Secretary shall, if applicable,
                            notify the Secretary of the Treasury under
                            section 1412(c) of the amount of any advance
                            payment to be made.
                        (B) Exemption from individual responsibility.--If
                    information provided by an applicant under subsection
                    (b)(5) is verified under subsections (c) and (d), the
                    Secretary shall issue the certification of exemption
                    described in section 1311(d)(4)(H).
                (3) Inconsistencies involving attestation of citizenship or
            lawful presence.--If the information provided by any applicant
            under subsection (b)(2) is inconsistent with information in the
            records maintained by the Commissioner of Social Security or
            Secretary of Homeland Security, whichever is applicable, the
            applicant's eligibility will be determined in the same manner
            as an individual's eligibility under the medicaid program is
            determined under section 1902(ee) of the Social Security Act
            (as in effect on January 1, 2010).
                (4) Inconsistencies involving other information.--
                        (A) In general.--If the information provided by an
                    applicant under subsection (b) (other than subsection
                    (b)(2)) is inconsistent with information in the records
                    maintained by persons under subsection (c) or is not
                    verified under subsection (d), the Secretary shall
                    notify the Exchange and the Exchange shall take the
                    following actions:
                                (i) Reasonable effort.--The Exchange shall
                            make a reasonable effort to identify and
                            address the causes of such inconsistency,
                            including through typographical or other
                            clerical errors, by contacting the applicant to
                            confirm the accuracy of the information, and by
                            taking such additional actions as the
                            Secretary, through regulation or other
                            guidance, may identify.
                                (ii) Notice and opportunity to correct.--In
                            the case the inconsistency or inability to
                            verify is not resolved under subparagraph (A),
                            the Exchange shall--
                                        (I) notify the applicant of such
                                    fact;
                                        (II) provide the applicant an
                                    opportunity to either present
                                    satisfactory documentary evidence or
                                    resolve the inconsistency with the
                                    person verifying the information under
                                    subsection (c) or (d) during the 90-day
                                    period beginning the date on which the
                                    notice required under subclause (I) is
                                    sent to the applicant.
                            The Secretary may extend the 90-day period
                            under subclause (II) for enrollments occurring
                            during 2014.
                        (B) Specific actions not involving citizenship or
                    lawful presence.--
                                (i) In general.--Except as provided in
                            paragraph (3), the Exchange shall, during any
                            period before the close of the period under
                            subparagraph (A)(ii)(II), make any
                            determination under paragraphs (2), (3), and
                            (4) of subsection (a) on the basis of the
                            information contained on the application.
                                (ii) Eligibility or amount of credit or
                            reduction.--If an inconsistency involving the
                            eligibility for, or amount of, any premium tax
                            credit or cost-sharing reduction is unresolved
                            under this subsection as of the close of the
                            period under subparagraph (A)(ii)(II), the
                            Exchange shall notify the applicant of the
                            amount (if any) of the credit or reduction that
                            is determined on the basis of the records
                            maintained by persons under subsection (c).
                                (iii) Employer affordability.--If the
                            Secretary notifies an Exchange that an enrollee
                            is eligible for a premium tax credit under
                            section 36B of such Code or cost-sharing
                            reduction under section 1402 because the
                            enrollee's (or related individual's) employer
                            does not provide minimum essential coverage
                            through an employer-sponsored plan or that the
                            employer does provide that coverage but it is
                            not affordable coverage, the Exchange shall
                            notify the employer of such fact and that the
                            employer may be liable for the payment assessed
                            under section 4980H of such Code.
                                (iv) Exemption.--In any case where the
                            inconsistency involving, or inability to
                            verify, information provided under subsection
                            (b)(5) is not resolved as of the close of the
                            period under subparagraph (A)(ii)(II), the
                            Exchange shall notify an applicant that no
                            certification of exemption from any requirement
                            or payment under section 5000A of such Code
                            will be issued.
                        (C) Appeals process.--The Exchange shall also
                    notify each person receiving notice under this
                    paragraph of the appeals processes established under
                    subsection (f).
        (f) Appeals and Redeterminations.--
                (1) In general.--The Secretary, in consultation with the
            Secretary of the Treasury, the Secretary of Homeland Security,
            and the Commissioner of Social Security, shall establish
            procedures by which the Secretary or one of such other Federal
            officers--
                        (A) hears and makes decisions with respect to
                    appeals of any determination under subsection (e); and
                        (B) redetermines eligibility on a periodic basis in
                    appropriate circumstances.
                (2) Employer liability.--
                        (A) In general.--The Secretary shall establish a
                    separate appeals process for employers who are notified
                    under subsection (e)(4)(C) that the employer may be
                    liable for a tax imposed by section 4980H of the
                    Internal Revenue Code of 1986 with respect to an
                    employee because of a determination that the employer
                    does not provide minimum essential coverage through an
                    employer-sponsored plan or that the employer does
                    provide that coverage but it is not affordable coverage
                    with respect to an employee. Such process shall provide
                    an employer the opportunity to--
                                (i) present information to the Exchange for
                            review of the determination either by the
                            Exchange or the person making the
                            determination, including evidence of the
                            employer-sponsored plan and employer
                            contributions to the plan; and
                                (ii) have access to the data used to make
                            the determination to the extent allowable by
                            law.
                    Such process shall be in addition to any rights of
                    appeal the employer may have under subtitle F of such
                    Code.
                        (B) Confidentiality.--Notwithstanding any provision
                    of this title (or the amendments made by this title) or
                    section 6103 of the Internal Revenue Code of 1986, an
                    employer shall not be entitled to any taxpayer return
                    information with respect to an employee for purposes of
                    determining whether the employer is subject to the
                    penalty under section 4980H of such Code with respect
                    to the employee, except that--
                                (i) the employer may be notified as to the
                            name of an employee and whether or not the
                            employee's income is above or below the
                            threshold by which the affordability of an
                            employer's health insurance coverage is
                            measured; and
                                (ii) this subparagraph shall not apply to
                            an employee who provides a waiver (at such time
                            and in such manner as the Secretary may
                            prescribe) authorizing an employer to have
                            access to the employee's taxpayer return
                            information.
        (g) Confidentiality of Applicant Information.--
                (1) In general.--An applicant for insurance coverage or for
            a premium tax credit or cost-sharing reduction shall be
            required to provide only the information strictly necessary to
            authenticate identity, determine eligibility, and determine the
            amount of the credit or reduction.
                (2) Receipt of information.--Any person who receives
            information provided by an applicant under subsection (b)
            (whether directly or by another person at the request of the
            applicant), or receives information from a Federal agency under
            subsection (c), (d), or (e), shall--
                        (A) use the information only for the purposes of,
                    and to the extent necessary in, ensuring the efficient
                    operation of the Exchange, including verifying the
                    eligibility of an individual to enroll through an
                    Exchange or to claim a premium tax credit or cost-
                    sharing reduction or the amount of the credit or
                    reduction; and
                        (B) not disclose the information to any other
                    person except as provided in this section.
        (h) Penalties.--
                (1) False or fraudulent information.--
                        (A) Civil penalty.--
                                (i) In general.--If--
                                        (I) any person fails to provides
                                    correct information under subsection
                                    (b); and
                                        (II) such failure is attributable
                                    to negligence or disregard of any rules
                                    or regulations of the Secretary,
                            such person shall be subject, in addition to
                            any other penalties that may be prescribed by
                            law, to a civil penalty of not more than
                            $25,000 with respect to any failures involving
                            an application for a plan year. For purposes of
                            this subparagraph, the terms ``negligence'' and
                            ``disregard'' shall have the same meanings as
                            when used in section 6662 of the Internal
                            Revenue Code of 1986.
                                (ii) Reasonable cause exception.--No
                            penalty shall be imposed under clause (i) if
                            the Secretary determines that there was a
                            reasonable cause for the failure and that the
                            person acted in good faith.
                        (B) Knowing and willful violations.--Any person who
                    knowingly and willfully provides false or fraudulent
                    information under subsection (b) shall be subject, in
                    addition to any other penalties that may be prescribed
                    by law, to a civil penalty of not more than $250,000.
                (2) Improper use or disclosure of information.--Any person
            who knowingly and willfully uses or discloses information in
            violation of subsection (g) shall be subject, in addition to
            any other penalties that may be prescribed by law, to a civil
            penalty of not more than $25,000.
                (3) Limitations on liens and levies.--The Secretary (or, if
            applicable, the Attorney General of the United States) shall
            not--
                        (A) file notice of lien with respect to any
                    property of a person by reason of any failure to pay
                    the penalty imposed by this subsection; or
                        (B) levy on any such property with respect to such
                    failure.
        (i) Study of Administration of Employer Responsibility.--
                (1) In general.--The Secretary of Health and Human Services
            shall, in consultation with the Secretary of the Treasury,
            conduct a study of the procedures that are necessary to ensure
            that in the administration of this title and section 4980H of
            the Internal Revenue Code of 1986 (as added by section 1513)
            that the following rights are protected:
                        (A) The rights of employees to preserve their right
                    to confidentiality of their taxpayer return information
                    and their right to enroll in a qualified health plan
                    through an Exchange if an employer does not provide
                    affordable coverage.
                        (B) The rights of employers to adequate due process
                    and access to information necessary to accurately
                    determine any payment assessed on employers.
                (2) Report.--Not later than January 1, 2013, the Secretary
            of Health and Human Services shall report the results of the
            study conducted under paragraph (1), including any
            recommendations for legislative changes, to the Committees on
            Finance and Health, Education, Labor and Pensions of the Senate
            and the Committees of Education and Labor and Ways and Means of
            the House of Representatives.

    SEC. 1412. ADVANCE DETERMINATION AND PAYMENT OF PREMIUM TAX CREDITS AND
                  COST-SHARING REDUCTIONS.

        (a) In General.--The Secretary, in consultation with the Secretary
    of the Treasury, shall establish a program under which--
                (1) upon request of an Exchange, advance determinations are
            made under section 1411 with respect to the income eligibility
            of individuals enrolling in a qualified health plan in the
            individual market through the Exchange for the premium tax
            credit allowable under section 36B of the Internal Revenue Code
            of 1986 and the cost-sharing reductions under section 1402;
                (2) the Secretary notifies--
                        (A) the Exchange and the Secretary of the Treasury
                    of the advance determinations; and
                        (B) the Secretary of the Treasury of the name and
                    employer identification number of each employer with
                    respect to whom 1 or more employee of the employer were
                    determined to be eligible for the premium tax credit
                    under section 36B of the Internal Revenue Code of 1986
                    and the cost-sharing reductions under section 1402
                    because--
                                (i) the employer did not provide minimum
                            essential coverage; or
                                (ii) the employer provided such minimum
                            essential coverage but it was determined under
                            section 36B(c)(2)(C) of such Code to either be
                            unaffordable to the employee or not provide the
                            required minimum actuarial value; and
                (3) the Secretary of the Treasury makes advance payments of
            such credit or reductions to the issuers of the qualified
            health plans in order to reduce the premiums payable by
            individuals eligible for such credit.
        (b) Advance Determinations.--
                (1) In general.--The Secretary shall provide under the
            program established under subsection (a) that advance
            determination of eligibility with respect to any individual
            shall be made--
                        (A) during the annual open enrollment period
                    applicable to the individual (or such other enrollment
                    period as may be specified by the Secretary); and
                        (B) on the basis of the individual's household
                    income for the most recent taxable year for which the
                    Secretary, after consultation with the Secretary of the
                    Treasury, determines information is available.
                (2) Changes in circumstances.--The Secretary shall provide
            procedures for making advance determinations on the basis of
            information other than that described in paragraph (1)(B) in
            cases where information included with an application form
            demonstrates substantial changes in income, changes in family
            size or other household circumstances, change in filing status,
            the filing of an application for unemployment benefits, or
            other significant changes affecting eligibility, including--
                        (A) allowing an individual claiming a decrease of
                    20 percent or more in income, or filing an application
                    for unemployment benefits, to have eligibility for the
                    credit determined on the basis of household income for
                    a later period or on the basis of the individual's
                    estimate of such income for the taxable year; and
                        (B) the determination of household income in cases
                    where the taxpayer was not required to file a return of
                    tax imposed by this chapter for the second preceding
                    taxable year.
        (c) Payment of Premium Tax Credits and Cost-sharing Reductions.--
                (1) In general.--The Secretary shall notify the Secretary
            of the Treasury and the Exchange through which the individual
            is enrolling of the advance determination under section 1411.
                (2) Premium tax credit.--
                        (A) In general.--The Secretary of the Treasury
                    shall make the advance payment under this section of
                    any premium tax credit allowed under section 36B of the
                    Internal Revenue Code of 1986 to the issuer of a
                    qualified health plan on a monthly basis (or such other
                    periodic basis as the Secretary may provide).
                        (B) Issuer responsibilities.--An issuer of a
                    qualified health plan receiving an advance payment with
                    respect to an individual enrolled in the plan shall--
                                (i) reduce the premium charged the insured
                            for any period by the amount of the advance
                            payment for the period;
                                (ii) notify the Exchange and the Secretary
                            of such reduction;
                                (iii) include with each billing statement
                            the amount by which the premium for the plan
                            has been reduced by reason of the advance
                            payment; and
                                (iv) in the case of any nonpayment of
                            premiums by the insured--
                                        (I) notify the Secretary of such
                                    nonpayment; and
                                        (II) allow a 3-month grace period
                                    for nonpayment of premiums before
                                    discontinuing coverage.
                (3) Cost-sharing reductions.--The Secretary shall also
            notify the Secretary of the Treasury and the Exchange under
            paragraph (1) if an advance payment of the cost-sharing
            reductions under section 1402 is to be made to the issuer of
            any qualified health plan with respect to any individual
            enrolled in the plan. The Secretary of the Treasury shall make
            such advance payment at such time and in such amount as the
            Secretary specifies in the notice.
        (d) No Federal Payments for Individuals Not Lawfully Present.--
    Nothing in this subtitle or the amendments made by this subtitle allows
    Federal payments, credits, or cost-sharing reductions for individuals
    who are not lawfully present in the United States.
        (e) State Flexibility.--Nothing in this subtitle or the amendments
    made by this subtitle shall be construed to prohibit a State from
    making payments to or on behalf of an individual for coverage under a
    qualified health plan offered through an Exchange that are in addition
    to any credits or cost-sharing reductions allowable to the individual
    under this subtitle and such amendments.

    SEC. 1413. STREAMLINING OF PROCEDURES FOR ENROLLMENT THROUGH AN
                  EXCHANGE AND STATE MEDICAID, CHIP, AND HEALTH SUBSIDY
                  PROGRAMS.

        (a) In General.--The Secretary shall establish a system meeting the
    requirements of this section under which residents of each State may
    apply for enrollment in, receive a determination of eligibility for
    participation in, and continue participation in, applicable State
    health subsidy programs. Such system shall ensure that if an individual
    applying to an Exchange is found through screening to be eligible for
    medical assistance under the State medicaid plan under title XIX, or
    eligible for enrollment under a State children's health insurance
    program (CHIP) under title XXI of such Act, the individual is enrolled
    for assistance under such plan or program.
        (b) Requirements Relating to Forms and Notice.--
                (1) Requirements relating to forms.--
                        (A) In general.--The Secretary shall develop and
                    provide to each State a single, streamlined form that--
                                (i) may be used to apply for all applicable
                            State health subsidy programs within the State;
                                (ii) may be filed online, in person, by
                            mail, or by telephone;
                                (iii) may be filed with an Exchange or with
                            State officials operating one of the other
                            applicable State health subsidy programs; and
                                (iv) is structured to maximize an
                            applicant's ability to complete the form
                            satisfactorily, taking into account the
                            characteristics of individuals who qualify for
                            applicable State health subsidy programs.
                        (B) State authority to establish form.--A State may
                    develop and use its own single, streamlined form as an
                    alternative to the form developed under subparagraph
                    (A) if the alternative form is consistent with
                    standards promulgated by the Secretary under this
                    section.
                        (C) Supplemental eligibility forms.--The Secretary
                    may allow a State to use a supplemental or alternative
                    form in the case of individuals who apply for
                    eligibility that is not determined on the basis of the
                    household income (as defined in section 36B of the
                    Internal Revenue Code of 1986).
                (2) Notice.--The Secretary shall provide that an applicant
            filing a form under paragraph (1) shall receive notice of
            eligibility for an applicable State health subsidy program
            without any need to provide additional information or paperwork
            unless such information or paperwork is specifically required
            by law when information provided on the form is inconsistent
            with data used for the electronic verification under paragraph
            (3) or is otherwise insufficient to determine eligibility.
        (c) Requirements Relating to Eligibility Based on Data Exchanges.--
                (1) Development of secure interfaces.--Each State shall
            develop for all applicable State health subsidy programs a
            secure, electronic interface allowing an exchange of data
            (including information contained in the application forms
            described in subsection (b)) that allows a determination of
            eligibility for all such programs based on a single
            application. Such interface shall be compatible with the method
            established for data verification under section 1411(c)(4).
                (2) Data matching program.--Each applicable State health
            subsidy program shall participate in a data matching
            arrangement for determining eligibility for participation in
            the program under paragraph (3) that--
                        (A) provides access to data described in paragraph
                    (3);
                        (B) applies only to individuals who--
                                (i) receive assistance from an applicable
                            State health subsidy program; or
                                (ii) apply for such assistance--
                                        (I) by filing a form described in
                                    subsection (b); or
                                        (II) by requesting a determination
                                    of eligibility and authorizing
                                    disclosure of the information described
                                    in paragraph (3) to applicable State
                                    health coverage subsidy programs for
                                    purposes of determining and
                                    establishing eligibility; and
                        (C) consistent with standards promulgated by the
                    Secretary, including the privacy and data security
                    safeguards described in section 1942 of the Social
                    Security Act or that are otherwise applicable to such
                    programs.
                (3) Determination of eligibility.--
                        (A) In general.--Each applicable State health
                    subsidy program shall, to the maximum extent
                    practicable--
                                (i) establish, verify, and update
                            eligibility for participation in the program
                            using the data matching arrangement under
                            paragraph (2); and
                                (ii) determine such eligibility on the
                            basis of reliable, third party data, including
                            information described in sections 1137, 453(i),
                            and 1942(a) of the Social Security Act,
                            obtained through such arrangement.
                        (B) Exception.--This paragraph shall not apply in
                    circumstances with respect to which the Secretary
                    determines that the administrative and other costs of
                    use of the data matching arrangement under paragraph
                    (2) outweigh its expected gains in accuracy,
                    efficiency, and program participation.
                (4) Secretarial standards.--The Secretary shall, after
            consultation with persons in possession of the data to be
            matched and representatives of applicable State health subsidy
            programs, promulgate standards governing the timing, contents,
            and procedures for data matching described in this subsection.
            Such standards shall take into account administrative and other
            costs and the value of data matching to the establishment,
            verification, and updating of eligibility for applicable State
            health subsidy programs.
        (d) Administrative Authority.--
                (1) Agreements.--Subject to section 1411 and section
            6103(l)(21) of the Internal Revenue Code of 1986 and any other
            requirement providing safeguards of privacy and data integrity,
            the Secretary may establish model agreements, and enter into
            agreements, for the sharing of data under this section.
                (2) Authority of exchange to contract out.--Nothing in this
            section shall be construed to--
                        (A) prohibit contractual arrangements through which
                    a State medicaid agency determines eligibility for all
                    applicable State health subsidy programs, but only if
                    such agency complies with the Secretary's requirements
                    ensuring reduced administrative costs, eligibility
                    errors, and disruptions in coverage; or
                        (B) change any requirement under title XIX that
                    eligibility for participation in a State's medicaid
                    program must be determined by a public agency.
        (e) Applicable State Health Subsidy Program.--In this section, the
    term ``applicable State health subsidy program'' means--
                (1) the program under this title for the enrollment in
            qualified health plans offered through an Exchange, including
            the premium tax credits under section 36B of the Internal
            Revenue Code of 1986 and cost-sharing reductions under section
            1402;
                (2) a State medicaid program under title XIX of the Social
            Security Act;
                (3) a State children's health insurance program (CHIP)
            under title XXI of such Act; and
                (4) a State program under section 1331 establishing
            qualified basic health plans.

    SEC. 1414. DISCLOSURES TO CARRY OUT ELIGIBILITY REQUIREMENTS FOR
                  CERTAIN PROGRAMS.

        (a) Disclosure of Taxpayer Return Information and Social Security
    Numbers.--
                (1) Taxpayer return information.--Subsection (l) of section
            6103 of the Internal Revenue Code of 1986 is amended by adding
            at the end the following new paragraph:
                ``(21) Disclosure of return information to carry out
            eligibility requirements for certain programs.--
                        ``(A) In general.--The Secretary, upon written
                    request from the Secretary of Health and Human
                    Services, shall disclose to officers, employees, and
                    contractors of the Department of Health and Human
                    Services return information of any taxpayer whose
                    income is relevant in determining any premium tax
                    credit under section 36B or any cost-sharing reduction
                    under section 1402 of the Patient Protection and
                    Affordable Care Act or eligibility for participation in
                    a State medicaid program under title XIX of the Social
                    Security Act, a State's children's health insurance
                    program under title XXI of the Social Security Act, or
                    a basic health program under section 1331 of Patient
                    Protection and Affordable Care Act. Such return
                    information shall be limited to--
                                ``(i) taxpayer identity information with
                            respect to such taxpayer,
                                ``(ii) the filing status of such taxpayer,
                                ``(iii) the number of individuals for whom
                            a deduction is allowed under section 151 with
                            respect to the taxpayer (including the taxpayer
                            and the taxpayer's spouse),
                                ``(iv) the modified gross income (as
                            defined in section 36B) of such taxpayer and
                            each of the other individuals included under
                            clause (iii) who are required to file a return
                            of tax imposed by chapter 1 for the taxable
                            year,
                                ``(v) such other information as is
                            prescribed by the Secretary by regulation as
                            might indicate whether the taxpayer is eligible
                            for such credit or reduction (and the amount
                            thereof), and
                                ``(vi) the taxable year with respect to
                            which the preceding information relates or, if
                            applicable, the fact that such information is
                            not available.
                        ``(B) Information to exchange and state agencies.--
                    The Secretary of Health and Human Services may disclose
                    to an Exchange established under the Patient Protection
                    and Affordable Care Act or its contractors, or to a
                    State agency administering a State program described in
                    subparagraph (A) or its contractors, any inconsistency
                    between the information provided by the Exchange or
                    State agency to the Secretary and the information
                    provided to the Secretary under subparagraph (A).
                        ``(C) Restriction on use of disclosed
                    information.--Return information disclosed under
                    subparagraph (A) or (B) may be used by officers,
                    employees, and contractors of the Department of Health
                    and Human Services, an Exchange, or a State agency only
                    for the purposes of, and to the extent necessary in--
                                ``(i) establishing eligibility for
                            participation in the Exchange, and verifying
                            the appropriate amount of, any credit or
                            reduction described in subparagraph (A),
                                ``(ii) determining eligibility for
                            participation in the State programs described
                            in subparagraph (A).''.
                (2) Social security numbers.--Section 205(c)(2)(C) of the
            Social Security Act is amended by adding at the end the
            following new clause:
                                ``(x) The Secretary of Health and Human
                            Services, and the Exchanges established under
                            section 1311 of the Patient Protection and
                            Affordable Care Act, are authorized to collect
                            and use the names and social security account
                            numbers of individuals as required to
                            administer the provisions of, and the
                            amendments made by, the such Act.''.
        (b) Confidentiality and Disclosure.--Paragraph (3) of section
    6103(a) of such Code is amended by striking ``or (20)'' and inserting
    ``(20), or (21)''.
        (c) Procedures and Recordkeeping Related to Disclosures.--Paragraph
    (4) of section 6103(p) of such Code is amended--
                (1) by inserting ``, or any entity described in subsection
            (l)(21),'' after ``or (20)'' in the matter preceding
            subparagraph (A),
                (2) by inserting ``or any entity described in subsection
            (l)(21),'' after ``or (o)(1)(A)'' in subparagraph (F)(ii), and
                (3) by inserting ``or any entity described in subsection
            (l)(21),'' after ``or (20)'' both places it appears in the
            matter after subparagraph (F).
        (d) Unauthorized Disclosure or Inspection.--Paragraph (2) of
    section 7213(a) of such Code is amended by striking ``or (20)'' and
    inserting ``(20), or (21)''.

    SEC. 1415. PREMIUM TAX CREDIT AND COST-SHARING REDUCTION PAYMENTS
                  DISREGARDED FOR FEDERAL AND FEDERALLY-ASSISTED PROGRAMS.

        For purposes of determining the eligibility of any individual for
    benefits or assistance, or the amount or extent of benefits or
    assistance, under any Federal program or under any State or local
    program financed in whole or in part with Federal funds--
                (1) any credit or refund allowed or made to any individual
            by reason of section 36B of the Internal Revenue Code of 1986
            (as added by section 1401) shall not be taken into account as
            income and shall not be taken into account as resources for the
            month of receipt and the following 2 months; and
                (2) any cost-sharing reduction payment or advance payment
            of the credit allowed under such section 36B that is made under
            section 1402 or 1412 shall be treated as made to the qualified
            health plan in which an individual is enrolled and not to that
            individual.

                       PART II--SMALL BUSINESS TAX CREDIT

    SEC. 1421. CREDIT FOR EMPLOYEE HEALTH INSURANCE EXPENSES OF SMALL
                  BUSINESSES.

        (a) In General.--Subpart D of part IV of subchapter A of chapter 1
    of the Internal Revenue Code of 1986 (relating to business-related
    credits) is amended by inserting after section 45Q the following:

    ``SEC. 45R. EMPLOYEE HEALTH INSURANCE EXPENSES OF SMALL EMPLOYERS.

        ``(a) General Rule.--For purposes of section 38, in the case of an
    eligible small employer, the small employer health insurance credit
    determined under this section for any taxable year in the credit period
    is the amount determined under subsection (b).
        ``(b) Health Insurance Credit Amount.--Subject to subsection (c),
    the amount determined under this subsection with respect to any
    eligible small employer is equal to 50 percent (35 percent in the case
    of a tax-exempt eligible small employer) of the lesser of--
                ``(1) the aggregate amount of nonelective contributions the
            employer made on behalf of its employees during the taxable
            year under the arrangement described in subsection (d)(4) for
            premiums for qualified health plans offered by the employer to
            its employees through an Exchange, or
                ``(2) the aggregate amount of nonelective contributions
            which the employer would have made during the taxable year
            under the arrangement if each employee taken into account under
            paragraph (1) had enrolled in a qualified health plan which had
            a premium equal to the average premium (as determined by the
            Secretary of Health and Human Services) for the small group
            market in the rating area in which the employee enrolls for
            coverage.
        ``(c) Phaseout of Credit Amount Based on Number of Employees and
    Average Wages.--The amount of the credit determined under subsection
    (b) without regard to this subsection shall be reduced (but not below
    zero) by the sum of the following amounts:
                ``(1) Such amount multiplied by a fraction the numerator of
            which is the total number of full-time equivalent employees of
            the employer in excess of 10 and the denominator of which is
            15.
                ``(2) Such amount multiplied by a fraction the numerator of
            which is the average annual wages of the employer in excess of
            the dollar amount in effect under subsection (d)(3)(B) and the
            denominator of which is such dollar amount.
        ``(d) Eligible Small Employer.--For purposes of this section--
                ``(1) In general.--The term `eligible small employer'
            means, with respect to any taxable year, an employer--
                        ``(A) which has no more than 25 full-time
                    equivalent employees for the taxable year,
                        ``(B) the average annual wages of which do not
                    exceed an amount equal to twice the dollar amount in
                    effect under paragraph (3)(B) for the taxable year, and
                        ``(C) which has in effect an arrangement described
                    in paragraph (4).
                ``(2) Full-time equivalent employees.--
                        ``(A) In general.--The term `full-time equivalent
                    employees' means a number of employees equal to the
                    number determined by dividing--
                                ``(i) the total number of hours of service
                            for which wages were paid by the employer to
                            employees during the taxable year, by
                                ``(ii) 2,080.
                    Such number shall be rounded to the next lowest whole
                    number if not otherwise a whole number.
                        ``(B) Excess hours not counted.--If an employee
                    works in excess of 2,080 hours of service during any
                    taxable year, such excess shall not be taken into
                    account under subparagraph (A).
                        ``(C) Hours of service.--The Secretary, in
                    consultation with the Secretary of Labor, shall
                    prescribe such regulations, rules, and guidance as may
                    be necessary to determine the hours of service of an
                    employee, including rules for the application of this
                    paragraph to employees who are not compensated on an
                    hourly basis.
                ``(3) Average annual wages.--
                        ``(A) In general.--The average annual wages of an
                    eligible small employer for any taxable year is the
                    amount determined by dividing--
                                ``(i) the aggregate amount of wages which
                            were paid by the employer to employees during
                            the taxable year, by
                                ``(ii) the number of full-time equivalent
                            employees of the employee determined under
                            paragraph (2) for the taxable year.
                    Such amount shall be rounded to the next lowest
                    multiple of $1,000 if not otherwise such a multiple.
                        ``(B) Dollar amount.--For purposes of paragraph
                    (1)(B)--
                                ``(i) 2011, 2012, and 2013.--The dollar
                            amount in effect under this paragraph for
                            taxable years beginning in 2011, 2012, or 2013
                            is $20,000.
                                ``(ii) Subsequent years.--In the case of a
                            taxable year beginning in a calendar year after
                            2013, the dollar amount in effect under this
                            paragraph shall be equal to $20,000, multiplied
                            by the cost-of-living adjustment determined
                            under section 1(f)(3) for the calendar year,
                            determined by substituting `calendar year 2012'
                            for `calendar year 1992' in subparagraph (B)
                            thereof.
                ``(4) Contribution arrangement.--An arrangement is
            described in this paragraph if it requires an eligible small
            employer to make a nonelective contribution on behalf of each
            employee who enrolls in a qualified health plan offered to
            employees by the employer through an exchange in an amount
            equal to a uniform percentage (not less than 50 percent) of the
            premium cost of the qualified health plan.
                ``(5) Seasonal worker hours and wages not counted.--For
            purposes of this subsection--
                        ``(A) In general.--The number of hours of service
                    worked by, and wages paid to, a seasonal worker of an
                    employer shall not be taken into account in determining
                    the full-time equivalent employees and average annual
                    wages of the employer unless the worker works for the
                    employer on more than 120 days during the taxable year.
                        ``(B) Definition of seasonal worker.--The term
                    `seasonal worker' means a worker who performs labor or
                    services on a seasonal basis as defined by the
                    Secretary of Labor, including workers covered by
                    section 500.20(s)(1) of title 29, Code of Federal
                    Regulations and retail workers employed exclusively
                    during holiday seasons.
        ``(e) Other Rules and Definitions.--For purposes of this section--
                ``(1) Employee.--
                        ``(A) Certain employees excluded.--The term
                    `employee' shall not include--
                                ``(i) an employee within the meaning of
                            section 401(c)(1),
                                ``(ii) any 2-percent shareholder (as
                            defined in section 1372(b)) of an eligible
                            small business which is an S corporation,
                                ``(iii) any 5-percent owner (as defined in
                            section 416(i)(1)(B)(i)) of an eligible small
                            business, or
                                ``(iv) any individual who bears any of the
                            relationships described in subparagraphs (A)
                            through (G) of section 152(d)(2) to, or is a
                            dependent described in section 152(d)(2)(H) of,
                            an individual described in clause (i), (ii), or
                            (iii).
                        ``(B) Leased employees.--The term `employee' shall
                    include a leased employee within the meaning of section
                    414(n).
                ``(2) Credit period.--The term `credit period' means, with
            respect to any eligible small employer, the 2-consecutive-
            taxable year period beginning with the 1st taxable year in
            which the employer (or any predecessor) offers 1 or more
            qualified health plans to its employees through an Exchange.
                ``(3) Nonelective contribution.--The term `nonelective
            contribution' means an employer contribution other than an
            employer contribution pursuant to a salary reduction
            arrangement.
                ``(4) Wages.--The term `wages' has the meaning given such
            term by section 3121(a) (determined without regard to any
            dollar limitation contained in such section).
                ``(5) Aggregation and other rules made applicable.--
                        ``(A) Aggregation rules.--All employers treated as
                    a single employer under subsection (b), (c), (m), or
                    (o) of section 414 shall be treated as a single
                    employer for purposes of this section.
                        ``(B) Other rules.--Rules similar to the rules of
                    subsections (c), (d), and (e) of section 52 shall
                    apply.
        ``(f) Credit Made Available to Tax-exempt Eligible Small
    Employers.--
                ``(1) In general.--In the case of a tax-exempt eligible
            small employer, there shall be treated as a credit allowable
            under subpart C (and not allowable under this subpart) the
            lesser of--
                        ``(A) the amount of the credit determined under
                    this section with respect to such employer, or
                        ``(B) the amount of the payroll taxes of the
                    employer during the calendar year in which the taxable
                    year begins.
                ``(2) Tax-exempt eligible small employer.--For purposes of
            this section, the term `tax-exempt eligible small employer'
            means an eligible small employer which is any organization
            described in section 501(c) which is exempt from taxation under
            section 501(a).
                ``(3) Payroll taxes.--For purposes of this subsection--
                        ``(A) In general.--The term `payroll taxes' means--
                                ``(i) amounts required to be withheld from
                            the employees of the tax-exempt eligible small
                            employer under section 3401(a),
                                ``(ii) amounts required to be withheld from
                            such employees under section 3101(b), and
                                ``(iii) amounts of the taxes imposed on the
                            tax-exempt eligible small employer under
                            section 3111(b).
                        ``(B) Special rule.--A rule similar to the rule of
                    section 24(d)(2)(C) shall apply for purposes of
                    subparagraph (A).
        ``(g) Application of Section for Calendar Years 2011, 2012, and
    2013.--In the case of any taxable year beginning in 2011, 2012, or
    2013, the following modifications to this section shall apply in
    determining the amount of the credit under subsection (a):
                ``(1) No credit period required.--The credit shall be
            determined without regard to whether the taxable year is in a
            credit period and for purposes of applying this section to
            taxable years beginning after 2013, no credit period shall be
            treated as beginning with a taxable year beginning before 2014.
                ``(2) Amount of credit.--The amount of the credit
            determined under subsection (b) shall be determined--
                        ``(A) by substituting `35 percent (25 percent in
                    the case of a tax-exempt eligible small employer)' for
                    `50 percent (35 percent in the case of a tax-exempt
                    eligible small employer)',
                        ``(B) by reference to an eligible small employer's
                    nonelective contributions for premiums paid for health
                    insurance coverage (within the meaning of section
                    9832(b)(1)) of an employee, and
                        ``(C) by substituting for the average premium
                    determined under subsection (b)(2) the amount the
                    Secretary of Health and Human Services determines is
                    the average premium for the small group market in the
                    State in which the employer is offering health
                    insurance coverage (or for such area within the State
                    as is specified by the Secretary).
                ``(3) Contribution arrangement.--An arrangement shall not
            fail to meet the requirements of subsection (d)(4) solely
            because it provides for the offering of insurance outside of an
            Exchange.
        ``(h) Insurance Definitions.--Any term used in this section which
    is also used in the Public Health Service Act or subtitle A of title I
    of the Patient Protection and Affordable Care Act shall have the
    meaning given such term by such Act or subtitle.
        ``(i) Regulations.--The Secretary shall prescribe such regulations
    as may be necessary to carry out the provisions of this section,
    including regulations to prevent the avoidance of the 2-year limit on
    the credit period through the use of successor entities and the
    avoidance of the limitations under subsection (c) through the use of
    multiple entities.''.
        (b) Credit To Be Part of General Business Credit.--Section 38(b) of
    the Internal Revenue Code of 1986 (relating to current year business
    credit) is amended by striking ``plus'' at the end of paragraph (34),
    by striking the period at the end of paragraph (35) and inserting ``,
    plus'', and by inserting after paragraph (35) the following:
                ``(36) the small employer health insurance credit
            determined under section 45R.''.
        (c) Credit Allowed Against Alternative Minimum Tax.--Section
    38(c)(4)(B) of the Internal Revenue Code of 1986 (defining specified
    credits) is amended by redesignating clauses (vi), (vii), and (viii) as
    clauses (vii), (viii), and (ix), respectively, and by inserting after
    clause (v) the following new clause:
                                ``(vi) the credit determined under section
                            45R,''.
        (d) Disallowance of Deduction for Certain Expenses for Which Credit
    Allowed.--
                (1) In general.--Section 280C of the Internal Revenue Code
            of 1986 (relating to disallowance of deduction for certain
            expenses for which credit allowed), as amended by section
            1401(b), is amended by adding at the end the following new
            subsection:
        ``(h) Credit for Employee Health Insurance Expenses of Small
    Employers.--No deduction shall be allowed for that portion of the
    premiums for qualified health plans (as defined in section 1301(a) of
    the Patient Protection and Affordable Care Act), or for health
    insurance coverage in the case of taxable years beginning in 2011,
    2012, or 2013, paid by an employer which is equal to the amount of the
    credit determined under section 45R(a) with respect to the premiums.''.
                (2) Deduction for expiring credits.--Section 196(c) of such
            Code is amended by striking ``and'' at the end of paragraph
            (12), by striking the period at the end of paragraph (13) and
            inserting ``, and'', and by adding at the end the following new
            paragraph:
                ``(14) the small employer health insurance credit
            determined under section 45R(a).''.
        (e) Clerical Amendment.--The table of sections for subpart D of
    part IV of subchapter A of chapter 1 of the Internal Revenue Code of
    1986 is amended by adding at the end the following:

    ``Sec. 45R. Employee health insurance expenses of small employers.''.
        (f) Effective Dates.--
                (1) In general.--The amendments made by this section shall
            apply to amounts paid or incurred in taxable years beginning
            after December 31, 2010.
                (2) Minimum tax.--The amendments made by subsection (c)
            shall apply to credits determined under section 45R of the
            Internal Revenue Code of 1986 in taxable years beginning after
            December 31, 2010, and to carrybacks of such credits.

               Subtitle F--Shared Responsibility for Health Care

                       PART I--INDIVIDUAL RESPONSIBILITY

    SEC. 1501. REQUIREMENT TO MAINTAIN MINIMUM ESSENTIAL COVERAGE.

        (a) Findings.--Congress makes the following findings:
                (1) In general.--The individual responsibility requirement
            provided for in this section (in this subsection referred to as
            the ``requirement'') is commercial and economic in nature, and
            substantially affects interstate commerce, as a result of the
            effects described in paragraph (2).
                (2) Effects on the national economy and interstate
            commerce.--The effects described in this paragraph are the
            following:
                        (A) The requirement regulates activity that is
                    commercial and economic in nature: economic and
                    financial decisions about how and when health care is
                    paid for, and when health insurance is purchased.
                        (B) Health insurance and health care services are a
                    significant part of the national economy. National
                    health spending is projected to increase from
                    $2,500,000,000,000, or 17.6 percent of the economy, in
                    2009 to $4,700,000,000,000 in 2019. Private health
                    insurance spending is projected to be $854,000,000,000
                    in 2009, and pays for medical supplies, drugs, and
                    equipment that are shipped in interstate commerce.
                    Since most health insurance is sold by national or
                    regional health insurance companies, health insurance
                    is sold in interstate commerce and claims payments flow
                    through interstate commerce.
                        (C) The requirement, together with the other
                    provisions of this Act, will add millions of new
                    consumers to the health insurance market, increasing
                    the supply of, and demand for, health care services.
                    According to the Congressional Budget Office, the
                    requirement will increase the number and share of
                    Americans who are insured.
                        (D) The requirement achieves near-universal
                    coverage by building upon and strengthening the private
                    employer-based health insurance system, which covers
                    176,000,000 Americans nationwide. In Massachusetts, a
                    similar requirement has strengthened private employer-
                    based coverage: despite the economic downturn, the
                    number of workers offered employer-based coverage has
                    actually increased.
                        (E) Half of all personal bankruptcies are caused in
                    part by medical expenses. By significantly increasing
                    health insurance coverage, the requirement, together
                    with the other provisions of this Act, will improve
                    financial security for families.
                        (F) Under the Employee Retirement Income Security
                    Act of 1974 (29 U.S.C. 1001 et seq.), the Public Health
                    Service Act (42 U.S.C. 201 et seq.), and this Act, the
                    Federal Government has a significant role in regulating
                    health insurance which is in interstate commerce.
                        (G) Under sections 2704 and 2705 of the Public
                    Health Service Act (as added by section 1201 of this
                    Act), if there were no requirement, many individuals
                    would wait to purchase health insurance until they
                    needed care. By significantly increasing health
                    insurance coverage, the requirement, together with the
                    other provisions of this Act, will minimize this
                    adverse selection and broaden the health insurance risk
                    pool to include healthy individuals, which will lower
                    health insurance premiums. The requirement is essential
                    to creating effective health insurance markets in which
                    improved health insurance products that are guaranteed
                    issue and do not exclude coverage of pre-existing
                    conditions can be sold.
                        (H) Administrative costs for private health
                    insurance, which were $90,000,000,000 in 2006, are 26
                    to 30 percent of premiums in the current individual and
                    small group markets. By significantly increasing health
                    insurance coverage and the size of purchasing pools,
                    which will increase economies of scale, the
                    requirement, together with the other provisions of this
                    Act, will significantly reduce administrative costs and
                    lower health insurance premiums. The requirement is
                    essential to creating effective health insurance
                    markets that do not require underwriting and eliminate
                    its associated administrative costs.
                (3) Supreme court ruling.--In United States v. South-
            Eastern Underwriters Association (322 U.S. 533 (1944)), the
            Supreme Court of the United States ruled that insurance is
            interstate commerce subject to Federal regulation.
        (b) In General.--Subtitle D of the Internal Revenue Code of 1986 is
    amended by adding at the end the following new chapter:

            ``CHAPTER 48--MAINTENANCE OF MINIMUM ESSENTIAL COVERAGE

    ``Sec. 5000A. Requirement to maintain minimum essential coverage.

    ``SEC. 5000A. REQUIREMENT TO MAINTAIN MINIMUM ESSENTIAL COVERAGE.

        ``(a) Requirement To Maintain Minimum Essential Coverage.--An
    applicable individual shall for each month beginning after 2013 ensure
    that the individual, and any dependent of the individual who is an
    applicable individual, is covered under minimum essential coverage for
    such month.
        ``(b) Shared Responsibility Payment.--
                ``(1) In general.--If an applicable individual fails to
            meet the requirement of subsection (a) for 1 or more months
            during any calendar year beginning after 2013, then, except as
            provided in subsection (d), there is hereby imposed a penalty
            with respect to the individual in the amount determined under
            subsection (c).
                ``(2) Inclusion with return.--Any penalty imposed by this
            section with respect to any month shall be included with a
            taxpayer's return under chapter 1 for the taxable year which
            includes such month.
                ``(3) Payment of penalty.--If an individual with respect to
            whom a penalty is imposed by this section for any month--
                        ``(A) is a dependent (as defined in section 152) of
                    another taxpayer for the other taxpayer's taxable year
                    including such month, such other taxpayer shall be
                    liable for such penalty, or
                        ``(B) files a joint return for the taxable year
                    including such month, such individual and the spouse of
                    such individual shall be jointly liable for such
                    penalty.
        ``(c) Amount of Penalty.--
                ``(1) In general.--The penalty determined under this
            subsection for any month with respect to any individual is an
            amount equal to \1/12\ of the applicable dollar amount for the
            calendar year.
                ``(2) Dollar limitation.--The amount of the penalty imposed
            by this section on any taxpayer for any taxable year with
            respect to all individuals for whom the taxpayer is liable
            under subsection (b)(3) shall not exceed an amount equal to 300
            percent the applicable dollar amount (determined without regard
            to paragraph (3)(C)) for the calendar year with or within which
            the taxable year ends.
                ``(3) Applicable dollar amount.--For purposes of paragraph
            (1)--
                        ``(A) In general.--Except as provided in
                    subparagraphs (B) and (C), the applicable dollar amount
                    is $750.
                        ``(B) Phase in.--The applicable dollar amount is
                    $95 for 2014 and $350 for 2015.
                        ``(C) Special rule for individuals under age 18.--
                    If an applicable individual has not attained the age of
                    18 as of the beginning of a month, the applicable
                    dollar amount with respect to such individual for the
                    month shall be equal to one-half of the applicable
                    dollar amount for the calendar year in which the month
                    occurs.
                        ``(D) Indexing of amount.--In the case of any
                    calendar year beginning after 2016, the applicable
                    dollar amount shall be equal to $750, increased by an
                    amount equal to--
                                ``(i) $750, multiplied by
                                ``(ii) the cost-of-living adjustment
                            determined under section 1(f)(3) for the
                            calendar year, determined by substituting
                            `calendar year 2015' for `calendar year 1992'
                            in subparagraph (B) thereof.
                    If the amount of any increase under clause (i) is not a
                    multiple of $50, such increase shall be rounded to the
                    next lowest multiple of $50.
                ``(4) Terms relating to income and families.--For purposes
            of this section--
                        ``(A) Family size.--The family size involved with
                    respect to any taxpayer shall be equal to the number of
                    individuals for whom the taxpayer is allowed a
                    deduction under section 151 (relating to allowance of
                    deduction for personal exemptions) for the taxable
                    year.
                        ``(B) Household income.--The term `household
                    income' means, with respect to any taxpayer for any
                    taxable year, an amount equal to the sum of--
                                ``(i) the modified gross income of the
                            taxpayer, plus
                                ``(ii) the aggregate modified gross incomes
                            of all other individuals who--
                                        ``(I) were taken into account in
                                    determining the taxpayer's family size
                                    under paragraph (1), and
                                        ``(II) were required to file a
                                    return of tax imposed by section 1 for
                                    the taxable year.
                        ``(C) Modified gross income.--The term `modified
                    gross income' means gross income--
                                ``(i) decreased by the amount of any
                            deduction allowable under paragraph (1), (3),
                            (4), or (10) of section 62(a),
                                ``(ii) increased by the amount of interest
                            received or accrued during the taxable year
                            which is exempt from tax imposed by this
                            chapter, and
                                ``(iii) determined without regard to
                            sections 911, 931, and 933.
                        ``(D) Poverty line.--
                                ``(i) In general.--The term `poverty line'
                            has the meaning given that term in section
                            2110(c)(5) of the Social Security Act (42
                            U.S.C. 1397jj(c)(5)).
                                ``(ii) Poverty line used.--In the case of
                            any taxable year ending with or within a
                            calendar year, the poverty line used shall be
                            the most recently published poverty line as of
                            the 1st day of such calendar year.
        ``(d) Applicable Individual.--For purposes of this section--
                ``(1) In general.--The term `applicable individual' means,
            with respect to any month, an individual other than an
            individual described in paragraph (2), (3), or (4).
                ``(2) Religious exemptions.--
                        ``(A) Religious conscience exemption.--Such term
                    shall not include any individual for any month if such
                    individual has in effect an exemption under section
                    1311(d)(4)(H) of the Patient Protection and Affordable
                    Care Act which certifies that such individual is a
                    member of a recognized religious sect or division
                    thereof described in section 1402(g)(1) and an adherent
                    of established tenets or teachings of such sect or
                    division as described in such section.
                        ``(B) Health care sharing ministry.--
                                ``(i) In general.--Such term shall not
                            include any individual for any month if such
                            individual is a member of a health care sharing
                            ministry for the month.
                                ``(ii) Health care sharing ministry.--The
                            term `health care sharing ministry' means an
                            organization--
                                        ``(I) which is described in section
                                    501(c)(3) and is exempt from taxation
                                    under section 501(a),
                                        ``(II) members of which share a
                                    common set of ethical or religious
                                    beliefs and share medical expenses
                                    among members in accordance with those
                                    beliefs and without regard to the State
                                    in which a member resides or is
                                    employed,
                                        ``(III) members of which retain
                                    membership even after they develop a
                                    medical condition,
                                        ``(IV) which (or a predecessor of
                                    which) has been in existence at all
                                    times since December 31, 1999, and
                                    medical expenses of its members have
                                    been shared continuously and without
                                    interruption since at least December
                                    31, 1999, and
                                        ``(V) which conducts an annual
                                    audit which is performed by an
                                    independent certified public accounting
                                    firm in accordance with generally
                                    accepted accounting principles and
                                    which is made available to the public
                                    upon request.
                ``(3) Individuals not lawfully present.--Such term shall
            not include an individual for any month if for the month the
            individual is not a citizen or national of the United States or
            an alien lawfully present in the United States.
                ``(4) Incarcerated individuals.--Such term shall not
            include an individual for any month if for the month the
            individual is incarcerated, other than incarceration pending
            the disposition of charges.
        ``(e) Exemptions.--No penalty shall be imposed under subsection (a)
    with respect to--
                ``(1) Individuals who cannot afford coverage.--
                        ``(A) In general.--Any applicable individual for
                    any month if the applicable individual's required
                    contribution (determined on an annual basis) for
                    coverage for the month exceeds 8 percent of such
                    individual's household income for the taxable year
                    described in section 1412(b)(1)(B) of the Patient
                    Protection and Affordable Care Act. For purposes of
                    applying this subparagraph, the taxpayer's household
                    income shall be increased by any exclusion from gross
                    income for any portion of the required contribution
                    made through a salary reduction arrangement.
                        ``(B) Required contribution.--For purposes of this
                    paragraph, the term `required contribution' means--
                                ``(i) in the case of an individual eligible
                            to purchase minimum essential coverage
                            consisting of coverage through an eligible-
                            employer-sponsored plan, the portion of the
                            annual premium which would be paid by the
                            individual (without regard to whether paid
                            through salary reduction or otherwise) for
                            self-only coverage, or
                                ``(ii) in the case of an individual
                            eligible only to purchase minimum essential
                            coverage described in subsection (f)(1)(C), the
                            annual premium for the lowest cost bronze plan
                            available in the individual market through the
                            Exchange in the State in the rating area in
                            which the individual resides (without regard to
                            whether the individual purchased a qualified
                            health plan through the Exchange), reduced by
                            the amount of the credit allowable under
                            section 36B for the taxable year (determined as
                            if the individual was covered by a qualified
                            health plan offered through the Exchange for
                            the entire taxable year).
                        ``(C) Special rules for individuals related to
                    employees.--For purposes of subparagraph (B)(i), if an
                    applicable individual is eligible for minimum essential
                    coverage through an employer by reason of a
                    relationship to an employee, the determination shall be
                    made by reference to the affordability of the coverage
                    to the employee.
                        ``(D) Indexing.--In the case of plan years
                    beginning in any calendar year after 2014, subparagraph
                    (A) shall be applied by substituting for `8 percent'
                    the percentage the Secretary of Health and Human
                    Services determines reflects the excess of the rate of
                    premium growth between the preceding calendar year and
                    2013 over the rate of income growth for such period.
                ``(2) Taxpayers with income under 100 percent of poverty
            line.--Any applicable individual for any month during a
            calendar year if the individual's household income for the
            taxable year described in section 1412(b)(1)(B) of the Patient
            Protection and Affordable Care Act is less than 100 percent of
            the poverty line for the size of the family involved
            (determined in the same manner as under subsection (b)(4)).
                ``(3) Members of indian tribes.--Any applicable individual
            for any month during which the individual is a member of an
            Indian tribe (as defined in section 45A(c)(6)).
                ``(4) Months during short coverage gaps.--
                        ``(A) In general.--Any month the last day of which
                    occurred during a period in which the applicable
                    individual was not covered by minimum essential
                    coverage for a continuous period of less than 3 months.
                        ``(B) Special rules.--For purposes of applying this
                    paragraph--
                                ``(i) the length of a continuous period
                            shall be determined without regard to the
                            calendar years in which months in such period
                            occur,
                                ``(ii) if a continuous period is greater
                            than the period allowed under subparagraph (A),
                            no exception shall be provided under this
                            paragraph for any month in the period, and
                                ``(iii) if there is more than 1 continuous
                            period described in subparagraph (A) covering
                            months in a calendar year, the exception
                            provided by this paragraph shall only apply to
                            months in the first of such periods.
                    The Secretary shall prescribe rules for the collection
                    of the penalty imposed by this section in cases where
                    continuous periods include months in more than 1
                    taxable year.
                ``(5) Hardships.--Any applicable individual who for any
            month is determined by the Secretary of Health and Human
            Services under section 1311(d)(4)(H) to have suffered a
            hardship with respect to the capability to obtain coverage
            under a qualified health plan.
        ``(f) Minimum Essential Coverage.--For purposes of this section--
                ``(1) In general.--The term `minimum essential coverage'
            means any of the following:
                        ``(A) Government sponsored programs.--Coverage
                    under--
                                ``(i) the Medicare program under part A of
                            title XVIII of the Social Security Act,
                                ``(ii) the Medicaid program under title XIX
                            of the Social Security Act,
                                ``(iii) the CHIP program under title XXI of
                            the Social Security Act,
                                ``(iv) the TRICARE for Life program,
                                ``(v) the veteran's health care program
                            under chapter 17 of title 38, United States
                            Code, or
                                ``(vi) a health plan under section 2504(e)
                            of title 22, United States Code (relating to
                            Peace Corps volunteers).
                        ``(B) Employer-sponsored plan.--Coverage under an
                    eligible employer-sponsored plan.
                        ``(C) Plans in the individual market.--Coverage
                    under a health plan offered in the individual market
                    within a State.
                        ``(D) Grandfathered health plan.--Coverage under a
                    grandfathered health plan.
                        ``(E) Other coverage.--Such other health benefits
                    coverage, such as a State health benefits risk pool, as
                    the Secretary of Health and Human Services, in
                    coordination with the Secretary, recognizes for
                    purposes of this subsection.
                ``(2) Eligible employer-sponsored plan.--The term `eligible
            employer-sponsored plan' means, with respect to any employee, a
            group health plan or group health insurance coverage offered by
            an employer to the employee which is--
                        ``(A) a governmental plan (within the meaning of
                    section 2791(d)(8) of the Public Health Service Act),
                    or
                        ``(B) any other plan or coverage offered in the
                    small or large group market within a State.
            Such term shall include a grandfathered health plan described
            in paragraph (1)(D) offered in a group market.
                ``(3) Excepted benefits not treated as minimum essential
            coverage.--The term `minimum essential coverage' shall not
            include health insurance coverage which consists of coverage of
            excepted benefits--
                        ``(A) described in paragraph (1) of subsection (c)
                    of section 2791 of the Public Health Service Act; or
                        ``(B) described in paragraph (2), (3), or (4) of
                    such subsection if the benefits are provided under a
                    separate policy, certificate, or contract of insurance.
                ``(4) Individuals residing outside united states or
            residents of territories.--Any applicable individual shall be
            treated as having minimum essential coverage for any month--
                        ``(A) if such month occurs during any period
                    described in subparagraph (A) or (B) of section
                    911(d)(1) which is applicable to the individual, or
                        ``(B) if such individual is a bona fide resident of
                    any possession of the United States (as determined
                    under section 937(a)) for such month.
                ``(5) Insurance-related terms.--Any term used in this
            section which is also used in title I of the Patient Protection
            and Affordable Care Act shall have the same meaning as when
            used in such title.
        ``(g) Administration and Procedure.--
                ``(1) In general.--The penalty provided by this section
            shall be paid upon notice and demand by the Secretary, and
            except as provided in paragraph (2), shall be assessed and
            collected in the same manner as an assessable penalty under
            subchapter B of chapter 68.
                ``(2) Special rules.--Notwithstanding any other provision
            of law--
                        ``(A) Waiver of criminal penalties.--In the case of
                    any failure by a taxpayer to timely pay any penalty
                    imposed by this section, such taxpayer shall not be
                    subject to any criminal prosecution or penalty with
                    respect to such failure.
                        ``(B) Limitations on liens and levies.--The
                    Secretary shall not--
                                ``(i) file notice of lien with respect to
                            any property of a taxpayer by reason of any
                            failure to pay the penalty imposed by this
                            section, or
                                ``(ii) levy on any such property with
                            respect to such failure.''.
        (c) Clerical Amendment.--The table of chapters for subtitle D of
    the Internal Revenue Code of 1986 is amended by inserting after the
    item relating to chapter 47 the following new item:

          ``Chapter 48--Maintenance of Minimum Essential Coverage.''.

        (d) Effective Date.--The amendments made by this section shall
    apply to taxable years ending after December 31, 2013.

    SEC. 1502. REPORTING OF HEALTH INSURANCE COVERAGE.

        (a) In General.--Part III of subchapter A of chapter 61 of the
    Internal Revenue Code of 1986 is amended by inserting after subpart C
    the following new subpart:

          ``Subpart D--Information Regarding Health Insurance Coverage

    ``Sec. 6055. Reporting of health insurance coverage.

    ``SEC. 6055. REPORTING OF HEALTH INSURANCE COVERAGE.

        ``(a) In General.--Every person who provides minimum essential
    coverage to an individual during a calendar year shall, at such time as
    the Secretary may prescribe, make a return described in subsection (b).
        ``(b) Form and Manner of Return.--
                ``(1) In general.--A return is described in this subsection
            if such return--
                        ``(A) is in such form as the Secretary may
                    prescribe, and
                        ``(B) contains--
                                ``(i) the name, address and TIN of the
                            primary insured and the name and TIN of each
                            other individual obtaining coverage under the
                            policy,
                                ``(ii) the dates during which such
                            individual was covered under minimum essential
                            coverage during the calendar year,
                                ``(iii) in the case of minimum essential
                            coverage which consists of health insurance
                            coverage, information concerning--
                                        ``(I) whether or not the coverage
                                    is a qualified health plan offered
                                    through an Exchange established under
                                    section 1311 of the Patient Protection
                                    and Affordable Care Act, and
                                        ``(II) in the case of a qualified
                                    health plan, the amount (if any) of any
                                    advance payment under section 1412 of
                                    the Patient Protection and Affordable
                                    Care Act of any cost-sharing reduction
                                    under section 1402 of such Act or of
                                    any premium tax credit under section
                                    36B with respect to such coverage, and
                                ``(iv) such other information as the
                            Secretary may require.
                ``(2) Information relating to employer-provided coverage.--
            If minimum essential coverage provided to an individual under
            subsection (a) consists of health insurance coverage of a
            health insurance issuer provided through a group health plan of
            an employer, a return described in this subsection shall
            include--
                        ``(A) the name, address, and employer
                    identification number of the employer maintaining the
                    plan,
                        ``(B) the portion of the premium (if any) required
                    to be paid by the employer, and
                        ``(C) if the health insurance coverage is a
                    qualified health plan in the small group market offered
                    through an Exchange, such other information as the
                    Secretary may require for administration of the credit
                    under section 45R (relating to credit for employee
                    health insurance expenses of small employers).
        ``(c) Statements To Be Furnished to Individuals With Respect to
    Whom Information Is Reported.--
                ``(1) In general.--Every person required to make a return
            under subsection (a) shall furnish to each individual whose
            name is required to be set forth in such return a written
            statement showing--
                        ``(A) the name and address of the person required
                    to make such return and the phone number of the
                    information contact for such person, and
                        ``(B) the information required to be shown on the
                    return with respect to such individual.
                ``(2) Time for furnishing statements.--The written
            statement required under paragraph (1) shall be furnished on or
            before January 31 of the year following the calendar year for
            which the return under subsection (a) was required to be made.
        ``(d) Coverage Provided by Governmental Units.--In the case of
    coverage provided by any governmental unit or any agency or
    instrumentality thereof, the officer or employee who enters into the
    agreement to provide such coverage (or the person appropriately
    designated for purposes of this section) shall make the returns and
    statements required by this section.
        ``(e) Minimum Essential Coverage.--For purposes of this section,
    the term `minimum essential coverage' has the meaning given such term
    by section 5000A(f).''.
        (b) Assessable Penalties.--
                (1) Subparagraph (B) of section 6724(d)(1) of the Internal
            Revenue Code of 1986 (relating to definitions) is amended by
            striking ``or'' at the end of clause (xxii), by striking
            ``and'' at the end of clause (xxiii) and inserting ``or'', and
            by inserting after clause (xxiii) the following new clause:
                                ``(xxiv) section 6055 (relating to returns
                            relating to information regarding health
                            insurance coverage), and''.
                (2) Paragraph (2) of section 6724(d) of such Code is
            amended by striking ``or'' at the end of subparagraph (EE), by
            striking the period at the end of subparagraph (FF) and
            inserting ``, or'' and by inserting after subparagraph (FF) the
            following new subparagraph:
                        ``(GG) section 6055(c) (relating to statements
                    relating to information regarding health insurance
                    coverage).''.
        (c) Notification of Nonenrollment.--Not later than June 30 of each
    year, the Secretary of the Treasury, acting through the Internal
    Revenue Service and in consultation with the Secretary of Health and
    Human Services, shall send a notification to each individual who files
    an individual income tax return and who is not enrolled in minimum
    essential coverage (as defined in section 5000A of the Internal Revenue
    Code of 1986). Such notification shall contain information on the
    services available through the Exchange operating in the State in which
    such individual resides.
        (d) Conforming Amendment.--The table of subparts for part III of
    subchapter A of chapter 61 of such Code is amended by inserting after
    the item relating to subpart C the following new item:

        ``subpart d--information regarding health insurance coverage''.

        (e) Effective Date.--The amendments made by this section shall
    apply to calendar years beginning after 2013.

                       PART II--EMPLOYER RESPONSIBILITIES

    SEC. 1511. AUTOMATIC ENROLLMENT FOR EMPLOYEES OF LARGE EMPLOYERS.

        The Fair Labor Standards Act of 1938 is amended by inserting after
    section 18 (29 U.S.C. 218) the following:

    ``SEC. 18A. AUTOMATIC ENROLLMENT FOR EMPLOYEES OF LARGE EMPLOYERS.

        ``In accordance with regulations promulgated by the Secretary, an
    employer to which this Act applies that has more than 200 full-time
    employees and that offers employees enrollment in 1 or more health
    benefits plans shall automatically enroll new full-time employees in
    one of the plans offered (subject to any waiting period authorized by
    law) and to continue the enrollment of current employees in a health
    benefits plan offered through the employer. Any automatic enrollment
    program shall include adequate notice and the opportunity for an
    employee to opt out of any coverage the individual or employee were
    automatically enrolled in. Nothing in this section shall be construed
    to supersede any State law which establishes, implements, or continues
    in effect any standard or requirement relating to employers in
    connection with payroll except to the extent that such standard or
    requirement prevents an employer from instituting the automatic
    enrollment program under this section.''.

    SEC. 1512. EMPLOYER REQUIREMENT TO INFORM EMPLOYEES OF COVERAGE
                  OPTIONS.

        The Fair Labor Standards Act of 1938 is amended by inserting after
    section 18A (as added by section 1513) the following:

    ``SEC. 18B. NOTICE TO EMPLOYEES.

        ``(a) In General.--In accordance with regulations promulgated by
    the Secretary, an employer to which this Act applies, shall provide to
    each employee at the time of hiring (or with respect to current
    employees, not later than March 1, 2013), written notice--
                ``(1) informing the employee of the existence of an
            Exchange, including a description of the services provided by
            such Exchange, and the manner in which the employee may contact
            the Exchange to request assistance;
                ``(2) if the employer plan's share of the total allowed
            costs of benefits provided under the plan is less than 60
            percent of such costs, that the employee may be eligible for a
            premium tax credit under section 36B of the Internal Revenue
            Code of 1986 and a cost sharing reduction under section 1402 of
            the Patient Protection and Affordable Care Act if the employee
            purchases a qualified health plan through the Exchange; and
                ``(3) if the employee purchases a qualified health plan
            through the Exchange, the employee will lose the employer
            contribution (if any) to any health benefits plan offered by
            the employer and that all or a portion of such contribution may
            be excludable from income for Federal income tax purposes.
        ``(b) Effective Date.--Subsection (a) shall take effect with
    respect to employers in a State beginning on March 1, 2013.''.

    SEC. 1513. SHARED RESPONSIBILITY FOR EMPLOYERS.

        (a) In General.--Chapter 43 of the Internal Revenue Code of 1986 is
    amended by adding at the end the following:

    ``SEC. 4980H. SHARED RESPONSIBILITY FOR EMPLOYERS REGARDING HEALTH
                  COVERAGE.

        ``(a) Large Employers Not Offering Health Coverage.--If--
                ``(1) any applicable large employer fails to offer to its
            full-time employees (and their dependents) the opportunity to
            enroll in minimum essential coverage under an eligible
            employer-sponsored plan (as defined in section 5000A(f)(2)) for
            any month, and
                ``(2) at least one full-time employee of the applicable
            large employer has been certified to the employer under section
            1411 of the Patient Protection and Affordable Care Act as
            having enrolled for such month in a qualified health plan with
            respect to which an applicable premium tax credit or cost-
            sharing reduction is allowed or paid with respect to the
            employee,
    then there is hereby imposed on the employer an assessable payment
    equal to the product of the applicable payment amount and the number of
    individuals employed by the employer as full-time employees during such
    month.
        ``(b) Large Employers With Waiting Periods Exceeding 30 Days.--
                ``(1) In general.--In the case of any applicable large
            employer which requires an extended waiting period to enroll in
            any minimum essential coverage under an employer-sponsored plan
            (as defined in section 5000A(f)(2)), there is hereby imposed on
            the employer an assessable payment, in the amount specified in
            paragraph (2), for each full-time employee of the employer to
            whom the extended waiting period applies.
                ``(2) Amount.--For purposes of paragraph (1), the amount
            specified in this paragraph for a full-time employee is--
                        ``(A) in the case of an extended waiting period
                    which exceeds 30 days but does not exceed 60 days,
                    $400, and
                        ``(B) in the case of an extended waiting period
                    which exceeds 60 days, $600.
                ``(3) Extended waiting period.--The term `extended waiting
            period' means any waiting period (as defined in section
            2701(b)(4) of the Public Health Service Act) which exceeds 30
            days.
        ``(c) Large Employers Offering Coverage With Employees Who Qualify
    for Premium Tax Credits or Cost-sharing Reductions.--
                ``(1) In general.--If--
                        ``(A) an applicable large employer offers to its
                    full-time employees (and their dependents) the
                    opportunity to enroll in minimum essential coverage
                    under an eligible employer-sponsored plan (as defined
                    in section 5000A(f)(2)) for any month, and
                        ``(B) 1 or more full-time employees of the
                    applicable large employer has been certified to the
                    employer under section 1411 of the Patient Protection
                    and Affordable Care Act as having enrolled for such
                    month in a qualified health plan with respect to which
                    an applicable premium tax credit or cost-sharing
                    reduction is allowed or paid with respect to the
                    employee,
            then there is hereby imposed on the employer an assessable
            payment equal to the product of the number of full-time
            employees of the applicable large employer described in
            subparagraph (B) for such month and 400 percent of the
            applicable payment amount.
                ``(2) Overall limitation.--The aggregate amount of tax
            determined under paragraph (1) with respect to all employees of
            an applicable large employer for any month shall not exceed the
            product of the applicable payment amount and the number of
            individuals employed by the employer as full-time employees
            during such month.
        ``(d) Definitions and Special Rules.--For purposes of this
    section--
                ``(1) Applicable payment amount.--The term `applicable
            payment amount' means, with respect to any month, \1/12\ of
            $750.
                ``(2) Applicable large employer.--
                        ``(A) In general.--The term `applicable large
                    employer' means, with respect to a calendar year, an
                    employer who employed an average of at least 50 full-
                    time employees on business days during the preceding
                    calendar year.
                        ``(B) Exemption for certain employers.--
                                ``(i) In general.--An employer shall not be
                            considered to employ more than 50 full-time
                            employees if--
                                        ``(I) the employer's workforce
                                    exceeds 50 full-time employees for 120
                                    days or fewer during the calendar year,
                                    and
                                        ``(II) the employees in excess of
                                    50 employed during such 120-day period
                                    were seasonal workers.
                                ``(ii) Definition of seasonal workers.--The
                            term `seasonal worker' means a worker who
                            performs labor or services on a seasonal basis
                            as defined by the Secretary of Labor, including
                            workers covered by section 500.20(s)(1) of
                            title 29, Code of Federal Regulations and
                            retail workers employed exclusively during
                            holiday seasons.
                        ``(C) Rules for determining employer size.--For
                    purposes of this paragraph--
                                ``(i) Application of aggregation rule for
                            employers.--All persons treated as a single
                            employer under subsection (b), (c), (m), or (o)
                            of section 414 of the Internal Revenue Code of
                            1986 shall be treated as 1 employer.
                                ``(ii) Employers not in existence in
                            preceding year.--In the case of an employer
                            which was not in existence throughout the
                            preceding calendar year, the determination of
                            whether such employer is an applicable large
                            employer shall be based on the average number
                            of employees that it is reasonably expected
                            such employer will employ on business days in
                            the current calendar year.
                                ``(iii) Predecessors.--Any reference in
                            this subsection to an employer shall include a
                            reference to any predecessor of such employer.
                ``(3) Applicable premium tax credit and cost-sharing
            reduction.--The term `applicable premium tax credit and cost-
            sharing reduction' means--
                        ``(A) any premium tax credit allowed under section
                    36B,
                        ``(B) any cost-sharing reduction under section 1402
                    of the Patient Protection and Affordable Care Act, and
                        ``(C) any advance payment of such credit or
                    reduction under section 1412 of such Act.
                ``(4) Full-time employee.--
                        ``(A) In general.--The term `full-time employee'
                    means an employee who is employed on average at least
                    30 hours of service per week.
                        ``(B) Hours of service.--The Secretary, in
                    consultation with the Secretary of Labor, shall
                    prescribe such regulations, rules, and guidance as may
                    be necessary to determine the hours of service of an
                    employee, including rules for the application of this
                    paragraph to employees who are not compensated on an
                    hourly basis.
                ``(5) Inflation adjustment.--
                        ``(A) In general.--In the case of any calendar year
                    after 2014, each of the dollar amounts in subsection
                    (b)(2) and (d)(1) shall be increased by an amount equal
                    to the product of--
                                ``(i) such dollar amount, and
                                ``(ii) the premium adjustment percentage
                            (as defined in section 1302(c)(4) of the
                            Patient Protection and Affordable Care Act) for
                            the calendar year.
                        ``(B) Rounding.--If the amount of any increase
                    under subparagraph (A) is not a multiple of $10, such
                    increase shall be rounded to the next lowest multiple
                    of $10.
                ``(6) Other definitions.--Any term used in this section
            which is also used in the Patient Protection and Affordable
            Care Act shall have the same meaning as when used in such Act.
                ``(7) Tax nondeductible.--For denial of deduction for the
            tax imposed by this section, see section 275(a)(6).
        ``(e) Administration and Procedure.--
                ``(1) In general.--Any assessable payment provided by this
            section shall be paid upon notice and demand by the Secretary,
            and shall be assessed and collected in the same manner as an
            assessable penalty under subchapter B of chapter 68.
                ``(2) Time for payment.--The Secretary may provide for the
            payment of any assessable payment provided by this section on
            an annual, monthly, or other periodic basis as the Secretary
            may prescribe.
                ``(3) Coordination with credits, etc..--The Secretary shall
            prescribe rules, regulations, or guidance for the repayment of
            any assessable payment (including interest) if such payment is
            based on the allowance or payment of an applicable premium tax
            credit or cost-sharing reduction with respect to an employee,
            such allowance or payment is subsequently disallowed, and the
            assessable payment would not have been required to be made but
            for such allowance or payment.''.
        (b) Clerical Amendment.--The table of sections for chapter 43 of
    such Code is amended by adding at the end the following new item:

    ``Sec. 4980H. Shared responsibility for employers regarding health
                                coverage.''.
        (c) Study and Report of Effect of Tax on Workers' Wages.--
                (1) In general.--The Secretary of Labor shall conduct a
            study to determine whether employees' wages are reduced by
            reason of the application of the assessable payments under
            section 4980H of the Internal Revenue Code of 1986 (as added by
            the amendments made by this section). The Secretary shall make
            such determination on the basis of the National Compensation
            Survey published by the Bureau of Labor Statistics.
                (2) Report.--The Secretary shall report the results of the
            study under paragraph (1) to the Committee on Ways and Means of
            the House of Representatives and to the Committee on Finance of
            the Senate.
        (d) Effective Date.--The amendments made by this section shall
    apply to months beginning after December 31, 2013.

    SEC. 1514. REPORTING OF EMPLOYER HEALTH INSURANCE COVERAGE.

        (a) In General.--Subpart D of part III of subchapter A of chapter
    61 of the Internal Revenue Code of 1986, as added by section 1502, is
    amended by inserting after section 6055 the following new section:

    ``SEC. 6056. LARGE EMPLOYERS REQUIRED TO REPORT ON HEALTH INSURANCE
                  COVERAGE.

        ``(a) In General.--Every applicable large employer required to meet
    the requirements of section 4980H with respect to its full-time
    employees during a calendar year shall, at such time as the Secretary
    may prescribe, make a return described in subsection (b).
        ``(b) Form and Manner of Return.--A return is described in this
    subsection if such return--
                ``(1) is in such form as the Secretary may prescribe, and
                ``(2) contains--
                        ``(A) the name, date, and employer identification
                    number of the employer,
                        ``(B) a certification as to whether the employer
                    offers to its full-time employees (and their
                    dependents) the opportunity to enroll in minimum
                    essential coverage under an eligible employer-sponsored
                    plan (as defined in section 5000A(f)(2)),
                        ``(C) if the employer certifies that the employer
                    did offer to its full-time employees (and their
                    dependents) the opportunity to so enroll--
                                ``(i) the length of any waiting period (as
                            defined in section 2701(b)(4) of the Public
                            Health Service Act) with respect to such
                            coverage,
                                ``(ii) the months during the calendar year
                            for which coverage under the plan was
                            available,
                                ``(iii) the monthly premium for the lowest
                            cost option in each of the enrollment
                            categories under the plan, and
                                ``(iv) the applicable large employer's
                            share of the total allowed costs of benefits
                            provided under the plan,
                        ``(D) the number of full-time employees for each
                    month during the calendar year,
                        ``(E) the name, address, and TIN of each full-time
                    employee during the calendar year and the months (if
                    any) during which such employee (and any dependents)
                    were covered under any such health benefits plans, and
                        ``(F) such other information as the Secretary may
                    require.
        ``(c) Statements To Be Furnished to Individuals With Respect to
    Whom Information Is Reported.--
                ``(1) In general.--Every person required to make a return
            under subsection (a) shall furnish to each full-time employee
            whose name is required to be set forth in such return under
            subsection (b)(2)(E) a written statement showing--
                        ``(A) the name and address of the person required
                    to make such return and the phone number of the
                    information contact for such person, and
                        ``(B) the information required to be shown on the
                    return with respect to such individual.
                ``(2) Time for furnishing statements.--The written
            statement required under paragraph (1) shall be furnished on or
            before January 31 of the year following the calendar year for
            which the return under subsection (a) was required to be made.
        ``(d) Coordination With Other Requirements.--To the maximum extent
    feasible, the Secretary may provide that--
                ``(1) any return or statement required to be provided under
            this section may be provided as part of any return or statement
            required under section 6051 or 6055, and
                ``(2) in the case of an applicable large employer offering
            health insurance coverage of a health insurance issuer, the
            employer may enter into an agreement with the issuer to include
            information required under this section with the return and
            statement required to be provided by the issuer under section
            6055.
        ``(e) Coverage Provided by Governmental Units.--In the case of any
    applicable large employer which is a governmental unit or any agency or
    instrumentality thereof, the person appropriately designated for
    purposes of this section shall make the returns and statements required
    by this section.
        ``(f) Definitions.--For purposes of this section, any term used in
    this section which is also used in section 4980H shall have the meaning
    given such term by section 4980H.''.
        (b) Assessable Penalties.--
                (1) Subparagraph (B) of section 6724(d)(1) of the Internal
            Revenue Code of 1986 (relating to definitions), as amended by
            section 1502, is amended by striking ``or'' at the end of
            clause (xxiii), by striking ``and'' at the end of clause (xxiv)
            and inserting ``or'', and by inserting after clause (xxiv) the
            following new clause:
                                ``(xxv) section 6056 (relating to returns
                            relating to large employers required to report
                            on health insurance coverage), and''.
                (2) Paragraph (2) of section 6724(d) of such Code, as so
            amended, is amended by striking ``or'' at the end of
            subparagraph (FF), by striking the period at the end of
            subparagraph (GG) and inserting ``, or'' and by inserting after
            subparagraph (GG) the following new subparagraph:
                        ``(HH) section 6056(c) (relating to statements
                    relating to large employers required to report on
                    health insurance coverage).''.
        (c) Conforming Amendment.--The table of sections for subpart D of
    part III of subchapter A of chapter 61 of such Code, as added by
    section 1502, is amended by adding at the end the following new item:

    ``Sec. 6056. Large employers required to report on health insurance
                                coverage.''.
        (d) Effective Date.--The amendments made by this section shall
    apply to periods beginning after December 31, 2013.

    SEC. 1515. OFFERING OF EXCHANGE-PARTICIPATING QUALIFIED HEALTH PLANS
                  THROUGH CAFETERIA PLANS.

        (a) In General.--Subsection (f) of section 125 of the Internal
    Revenue Code of 1986 is amended by adding at the end the following new
    paragraph:
                ``(3) Certain exchange-participating qualified health plans
            not qualified.--
                        ``(A) In general.--The term `qualified benefit'
                    shall not include any qualified health plan (as defined
                    in section 1301(a) of the Patient Protection and
                    Affordable Care Act) offered through an Exchange
                    established under section 1311 of such Act.
                        ``(B) Exception for exchange-eligible employers.--
                    Subparagraph (A) shall not apply with respect to any
                    employee if such employee's employer is a qualified
                    employer (as defined in section 1312(f)(2) of the
                    Patient Protection and Affordable Care Act) offering
                    the employee the opportunity to enroll through such an
                    Exchange in a qualified health plan in a group
                    market.''.
        (b) Conforming Amendments.--Subsection (f) of section 125 of such
    Code is amended--
                (1) by striking ``For purposes of this section, the term''
            and inserting ``For purposes of this section--
        ``(1) In General.--The term'', and
                (2) by striking ``Such term shall not include'' and
            inserting the following:
                ``(2) Long-term care insurance not qualified.--The term
            `qualified benefit' shall not include''.
        (c) Effective Date.--The amendments made by this section shall
    apply to taxable years beginning after December 31, 2013.

                      Subtitle G--Miscellaneous Provisions

    SEC. 1551. DEFINITIONS.

        Unless specifically provided for otherwise, the definitions
    contained in section 2791 of the Public Health Service Act (42 U.S.C.
    300gg-91) shall apply with respect to this title.

    SEC. 1552. TRANSPARENCY IN GOVERNMENT.

        Not later than 30 days after the date of enactment of this Act, the
    Secretary of Health and Human Services shall publish on the Internet
    website of the Department of Health and Human Services, a list of all
    of the authorities provided to the Secretary under this Act (and the
    amendments made by this Act).

    SEC. 1553. PROHIBITION AGAINST DISCRIMINATION ON ASSISTED SUICIDE.

        (a) In General.--The Federal Government, and any State or local
    government or health care provider that receives Federal financial
    assistance under this Act (or under an amendment made by this Act) or
    any health plan created under this Act (or under an amendment made by
    this Act), may not subject an individual or institutional health care
    entity to discrimination on the basis that the entity does not provide
    any health care item or service furnished for the purpose of causing,
    or for the purpose of assisting in causing, the death of any
    individual, such as by assisted suicide, euthanasia, or mercy killing.
        (b) Definition.--In this section, the term ``health care entity''
    includes an individual physician or other health care professional, a
    hospital, a provider-sponsored organization, a health maintenance
    organization, a health insurance plan, or any other kind of health care
    facility, organization, or plan.
        (c) Construction and Treatment of Certain Services.--Nothing in
    subsection (a) shall be construed to apply to, or to affect, any
    limitation relating to--
                (1) the withholding or withdrawing of medical treatment or
            medical care;
                (2) the withholding or withdrawing of nutrition or
            hydration;
                (3) abortion; or
                (4) the use of an item, good, benefit, or service furnished
            for the purpose of alleviating pain or discomfort, even if such
            use may increase the risk of death, so long as such item, good,
            benefit, or service is not also furnished for the purpose of
            causing, or the purpose of assisting in causing, death, for any
            reason.
        (d) Administration.--The Office for Civil Rights of the Department
    of Health and Human Services is designated to receive complaints of
    discrimination based on this section.

    SEC. 1554. ACCESS TO THERAPIES.

        Notwithstanding any other provision of this Act, the Secretary of
    Health and Human Services shall not promulgate any regulation that--
                (1) creates any unreasonable barriers to the ability of
            individuals to obtain appropriate medical care;
                (2) impedes timely access to health care services;
                (3) interferes with communications regarding a full range
            of treatment options between the patient and the provider;
                (4) restricts the ability of health care providers to
            provide full disclosure of all relevant information to patients
            making health care decisions;
                (5) violates the principles of informed consent and the
            ethical standards of health care professionals; or
                (6) limits the availability of health care treatment for
            the full duration of a patient's medical needs.

    SEC. 1555. FREEDOM NOT TO PARTICIPATE IN FEDERAL HEALTH INSURANCE
                  PROGRAMS.

        No individual, company, business, nonprofit entity, or health
    insurance issuer offering group or individual health insurance coverage
    shall be required to participate in any Federal health insurance
    program created under this Act (or any amendments made by this Act), or
    in any Federal health insurance program expanded by this Act (or any
    such amendments), and there shall be no penalty or fine imposed upon
    any such issuer for choosing not to participate in such programs.

    SEC. 1556. EQUITY FOR CERTAIN ELIGIBLE SURVIVORS.

        (a) Rebuttable Presumption.--Section 411(c)(4) of the Black Lung
    Benefits Act (30 U.S.C. 921(c)(4)) is amended by striking the last
    sentence.
        (b) Continuation of Benefits.--Section 422(l) of the Black Lung
    Benefits Act (30 U.S.C. 932(l)) is amended by striking ``, except with
    respect to a claim filed under this part on or after the effective date
    of the Black Lung Benefits Amendments of 1981''.
        (c) Effective Date.--The amendments made by this section shall
    apply with respect to claims filed under part B or part C of the Black
    Lung Benefits Act (30 U.S.C. 921 et seq., 931 et seq.) after January 1,
    2005, that are pending on or after the date of enactment of this Act.

    SEC. 1557. NONDISCRIMINATION.

        (a) In General.--Except as otherwise provided for in this title (or
    an amendment made by this title), an individual shall not, on the
    ground prohibited under title VI of the Civil Rights Act of 1964 (42
    U.S.C. 2000d et seq.), title IX of the Education Amendments of 1972 (20
    U.S.C. 1681 et seq.), the Age Discrimination Act of 1975 (42 U.S.C.
    6101 et seq.), or section 504 of the Rehabilitation Act of 1973 (29
    U.S.C. 794), be excluded from participation in, be denied the benefits
    of, or be subjected to discrimination under, any health program or
    activity, any part of which is receiving Federal financial assistance,
    including credits, subsidies, or contracts of insurance, or under any
    program or activity that is administered by an Executive Agency or any
    entity established under this title (or amendments). The enforcement
    mechanisms provided for and available under such title VI, title IX,
    section 504, or such Age Discrimination Act shall apply for purposes of
    violations of this subsection.
        (b) Continued Application of Laws.--Nothing in this title (or an
    amendment made by this title) shall be construed to invalidate or limit
    the rights, remedies, procedures, or legal standards available to
    individuals aggrieved under title VI of the Civil Rights Act of 1964
    (42 U.S.C. 2000d et seq.), title VII of the Civil Rights Act of 1964
    (42 U.S.C. 2000e et seq.), title IX of the Education Amendments of 1972
    (20 U.S.C. 1681 et seq.), section 504 of the Rehabilitation Act of 1973
    (29 U.S.C. 794), or the Age Discrimination Act of 1975 (42 U.S.C. 611
    et seq.), or to supersede State laws that provide additional
    protections against discrimination on any basis described in subsection
    (a).
        (c) Regulations.--The Secretary may promulgate regulations to
    implement this section.

    SEC. 1558. PROTECTIONS FOR EMPLOYEES.

        The Fair Labor Standards Act of 1938 is amended by inserting after
    section 18B (as added by section 1512) the following:

    ``SEC. 18C. PROTECTIONS FOR EMPLOYEES.

        ``(a) Prohibition.--No employer shall discharge or in any manner
    discriminate against any employee with respect to his or her
    compensation, terms, conditions, or other privileges of employment
    because the employee (or an individual acting at the request of the
    employee) has--
                ``(1) received a credit under section 36B of the Internal
            Revenue Code of 1986 or a subsidy under section 1402 of this
            Act;
                ``(2) provided, caused to be provided, or is about to
            provide or cause to be provided to the employer, the Federal
            Government, or the attorney general of a State information
            relating to any violation of, or any act or omission the
            employee reasonably believes to be a violation of, any
            provision of this title (or an amendment made by this title);
                ``(3) testified or is about to testify in a proceeding
            concerning such violation;
                ``(4) assisted or participated, or is about to assist or
            participate, in such a proceeding; or
                ``(5) objected to, or refused to participate in, any
            activity, policy, practice, or assigned task that the employee
            (or other such person) reasonably believed to be in violation
            of any provision of this title (or amendment), or any order,
            rule, regulation, standard, or ban under this title (or
            amendment).
        ``(b) Complaint Procedure.--
                ``(1) In general.--An employee who believes that he or she
            has been discharged or otherwise discriminated against by any
            employer in violation of this section may seek relief in
            accordance with the procedures, notifications, burdens of
            proof, remedies, and statutes of limitation set forth in
            section 2087(b) of title 15, United States Code.
                ``(2) No limitation on rights.--Nothing in this section
            shall be deemed to diminish the rights, privileges, or remedies
            of any employee under any Federal or State law or under any
            collective bargaining agreement. The rights and remedies in
            this section may not be waived by any agreement, policy, form,
            or condition of employment.''.

    SEC. 1559. OVERSIGHT.

        The Inspector General of the Department of Health and Human
    Services shall have oversight authority with respect to the
    administration and implementation of this title as it relates to such
    Department.

    SEC. 1560. RULES OF CONSTRUCTION.

        (a) No Effect on Antitrust Laws.--Nothing in this title (or an
    amendment made by this title) shall be construed to modify, impair, or
    supersede the operation of any of the antitrust laws. For the purposes
    of this section, the term ``antitrust laws'' has the meaning given such
    term in subsection (a) of the first section of the Clayton Act, except
    that such term includes section 5 of the Federal Trade Commission Act
    to the extent that such section 5 applies to unfair methods of
    competition.
        (b) Rule of Construction Regarding Hawaii's Prepaid Health Care
    Act.--Nothing in this title (or an amendment made by this title) shall
    be construed to modify or limit the application of the exemption for
    Hawaii's Prepaid Health Care Act (Haw. Rev. Stat. Sec. Sec.  393-1 et
    seq.) as provided for under section 514(b)(5) of the Employee
    Retirement Income Security Act of 1974 (29 U.S.C. 1144(b)(5)).
        (c) Student Health Insurance Plans.--Nothing in this title (or an
    amendment made by this title) shall be construed to prohibit an
    institution of higher education (as such term is defined for purposes
    of the Higher Education Act of 1965) from offering a student health
    insurance plan, to the extent that such requirement is otherwise
    permitted under applicable Federal, State or local law.
        (d) No Effect on Existing Requirements.--Nothing in this title (or
    an amendment made by this title, unless specified by direct statutory
    reference) shall be construed to modify any existing Federal
    requirement concerning the State agency responsible for determining
    eligibility for programs identified in section 1413.

    SEC. 1561. HEALTH INFORMATION TECHNOLOGY ENROLLMENT STANDARDS AND
                  PROTOCOLS.

        Title XXX of the Public Health Service Act (42 U.S.C. 300jj et
    seq.) is amended by adding at the end the following:

                         ``Subtitle C--Other Provisions

    ``SEC. 3021. HEALTH INFORMATION TECHNOLOGY ENROLLMENT STANDARDS AND
                  PROTOCOLS.

        ``(a) In General.--
                ``(1) Standards and protocols.--Not later than 180 days
            after the date of enactment of this title, the Secretary, in
            consultation with the HIT Policy Committee and the HIT
            Standards Committee, shall develop interoperable and secure
            standards and protocols that facilitate enrollment of
            individuals in Federal and State health and human services
            programs, as determined by the Secretary.
                ``(2) Methods.--The Secretary shall facilitate enrollment
            in such programs through methods determined appropriate by the
            Secretary, which shall include providing individuals and third
            parties authorized by such individuals and their designees
            notification of eligibility and verification of eligibility
            required under such programs.
        ``(b) Content.--The standards and protocols for electronic
    enrollment in the Federal and State programs described in subsection
    (a) shall allow for the following:
                ``(1) Electronic matching against existing Federal and
            State data, including vital records, employment history,
            enrollment systems, tax records, and other data determined
            appropriate by the Secretary to serve as evidence of
            eligibility and in lieu of paper-based documentation.
                ``(2) Simplification and submission of electronic
            documentation, digitization of documents, and systems
            verification of eligibility.
                ``(3) Reuse of stored eligibility information (including
            documentation) to assist with retention of eligible
            individuals.
                ``(4) Capability for individuals to apply, recertify and
            manage their eligibility information online, including at home,
            at points of service, and other community-based locations.
                ``(5) Ability to expand the enrollment system to integrate
            new programs, rules, and functionalities, to operate at
            increased volume, and to apply streamlined verification and
            eligibility processes to other Federal and State programs, as
            appropriate.
                ``(6) Notification of eligibility, recertification, and
            other needed communication regarding eligibility, which may
            include communication via email and cellular phones.
                ``(7) Other functionalities necessary to provide eligibles
            with streamlined enrollment process.
        ``(c) Approval and Notification.--With respect to any standard or
    protocol developed under subsection (a) that has been approved by the
    HIT Policy Committee and the HIT Standards Committee, the Secretary--
                ``(1) shall notify States of such standards or protocols;
            and
                ``(2) may require, as a condition of receiving Federal
            funds for the health information technology investments, that
            States or other entities incorporate such standards and
            protocols into such investments.
        ``(d) Grants for Implementation of Appropriate Enrollment HIT.--
                ``(1) In general.--The Secretary shall award grant to
            eligible entities to develop new, and adapt existing,
            technology systems to implement the HIT enrollment standards
            and protocols developed under subsection (a) (referred to in
            this subsection as `appropriate HIT technology').
                ``(2) Eligible entities.--To be eligible for a grant under
            this subsection, an entity shall--
                        ``(A) be a State, political subdivision of a State,
                    or a local governmental entity; and
                        ``(B) submit to the Secretary an application at
                    such time, in such manner, and containing--
                                ``(i) a plan to adopt and implement
                            appropriate enrollment technology that
                            includes--
                                        ``(I) proposed reduction in
                                    maintenance costs of technology
                                    systems;
                                        ``(II) elimination or updating of
                                    legacy systems; and
                                        ``(III) demonstrated collaboration
                                    with other entities that may receive a
                                    grant under this section that are
                                    located in the same State, political
                                    subdivision, or locality;
                                ``(ii) an assurance that the entity will
                            share such appropriate enrollment technology in
                            accordance with paragraph (4); and
                                ``(iii) such other information as the
                            Secretary may require.
                ``(3) Sharing.--
                        ``(A) In general.--The Secretary shall ensure that
                    appropriate enrollment HIT adopted under grants under
                    this subsection is made available to other qualified
                    State, qualified political subdivisions of a State, or
                    other appropriate qualified entities (as described in
                    subparagraph (B)) at no cost.
                        ``(B) Qualified entities.--The Secretary shall
                    determine what entities are qualified to receive
                    enrollment HIT under subparagraph (A), taking into
                    consideration the recommendations of the HIT Policy
                    Committee and the HIT Standards Committee.''.

    SEC. 1562. CONFORMING AMENDMENTS.

        (a) Applicability.--Section 2735 of the Public Health Service Act
    (42 U.S.C. 300gg-21), as so redesignated by section 1001(4), is
    amended--
                (1) by striking subsection (a);
                (2) in subsection (b)--
                        (A) in paragraph (1), by striking ``1 through 3''
                    and inserting ``1 and 2''; and
                        (B) in paragraph (2)--
                                (i) in subparagraph (A), by striking
                            ``subparagraph (D)'' and inserting
                            ``subparagraph (D) or (E)'';
                                (ii) by striking ``1 through 3'' and
                            inserting ``1 and 2''; and
                                (iii) by adding at the end the following:
                        ``(E) Election not applicable.--The election
                    described in subparagraph (A) shall not be available
                    with respect to the provisions of subpart 1.'';
                (3) in subsection (c), by striking ``1 through 3 shall not
            apply to any group'' and inserting ``1 and 2 shall not apply to
            any individual coverage or any group''; and
                (4) in subsection (d)--
                        (A) in paragraph (1), by striking ``1 through 3
                    shall not apply to any group'' and inserting ``1 and 2
                    shall not apply to any individual coverage or any
                    group'';
                        (B) in paragraph (2)--
                                (i) in the matter preceding subparagraph
                            (A), by striking ``1 through 3 shall not apply
                            to any group'' and inserting ``1 and 2 shall
                            not apply to any individual coverage or any
                            group''; and
                                (ii) in subparagraph (C), by inserting
                            ``or, with respect to individual coverage,
                            under any health insurance coverage maintained
                            by the same health insurance issuer''; and
                        (C) in paragraph (3), by striking ``any group'' and
                    inserting ``any individual coverage or any group''.
        (b) Definitions.--Section 2791(d) of the Public Health Service Act
    (42 U.S.C. 300gg-91(d)) is amended by adding at the end the following:
                ``(20) Qualified health plan.--The term `qualified health
            plan' has the meaning given such term in section 1301(a) of the
            Patient Protection and Affordable Care Act.
                ``(21) Exchange.--The term `Exchange' means an American
            Health Benefit Exchange established under section 1311 of the
            Patient Protection and Affordable Care Act.''.
        (c) Technical and Conforming Amendments.--Title XXVII of the Public
    Health Service Act (42 U.S.C. 300gg et seq.) is amended--
                (1) in section 2704 (42 U.S.C. 300gg), as so redesignated
            by section 1201(2)--
                        (A) in subsection (c)--
                                (i) in paragraph (2), by striking ``group
                            health plan'' each place that such term appears
                            and inserting ``group or individual health
                            plan''; and
                                (ii) in paragraph (3)--
                                        (I) by striking ``group health
                                    insurance'' each place that such term
                                    appears and inserting ``group or
                                    individual health insurance''; and
                                        (II) in subparagraph (D), by
                                    striking ``small or large'' and
                                    inserting ``individual or group'';
                        (B) in subsection (d), by striking ``group health
                    insurance'' each place that such term appears and
                    inserting ``group or individual health insurance''; and
                        (C) in subsection (e)(1)(A), by striking ``group
                    health insurance'' and inserting ``group or individual
                    health insurance'';
                (2) by striking the second heading for subpart 2 of part A
            (relating to other requirements);
                (3) in section 2725 (42 U.S.C. 300gg-4), as so redesignated
            by section 1001(2)--
                        (A) in subsection (a), by striking ``health
                    insurance issuer offering group health insurance
                    coverage'' and inserting ``health insurance issuer
                    offering group or individual health insurance
                    coverage'';
                        (B) in subsection (b)--
                                (i) by striking ``health insurance issuer
                            offering group health insurance coverage in
                            connection with a group health plan'' in the
                            matter preceding paragraph (1) and inserting
                            ``health insurance issuer offering group or
                            individual health insurance coverage''; and
                                (ii) in paragraph (1), by striking ``plan''
                            and inserting ``plan or coverage'';
                        (C) in subsection (c)--
                                (i) in paragraph (2), by striking ``group
                            health insurance coverage offered by a health
                            insurance issuer'' and inserting ``health
                            insurance issuer offering group or individual
                            health insurance coverage''; and
                                (ii) in paragraph (3), by striking
                            ``issuer'' and inserting ``health insurance
                            issuer''; and
                        (D) in subsection (e), by striking ``health
                    insurance issuer offering group health insurance
                    coverage'' and inserting ``health insurance issuer
                    offering group or individual health insurance
                    coverage'';
                (4) in section 2726 (42 U.S.C. 300gg-5), as so redesignated
            by section 1001(2)--
                        (A) in subsection (a), by striking ``(or health
                    insurance coverage offered in connection with such a
                    plan)'' each place that such term appears and inserting
                    ``or a health insurance issuer offering group or
                    individual health insurance coverage'';
                        (B) in subsection (b), by striking ``(or health
                    insurance coverage offered in connection with such a
                    plan)'' each place that such term appears and inserting
                    ``or a health insurance issuer offering group or
                    individual health insurance coverage''; and
                        (C) in subsection (c)--
                                (i) in paragraph (1), by striking ``(and
                            group health insurance coverage offered in
                            connection with a group health plan)'' and
                            inserting ``and a health insurance issuer
                            offering group or individual health insurance
                            coverage'';
                                (ii) in paragraph (2), by striking ``(or
                            health insurance coverage offered in connection
                            with such a plan)'' each place that such term
                            appears and inserting ``or a health insurance
                            issuer offering group or individual health
                            insurance coverage'';
                (5) in section 2727 (42 U.S.C. 300gg-6), as so redesignated
            by section 1001(2), by striking ``health insurance issuers
            providing health insurance coverage in connection with group
            health plans'' and inserting ``and health insurance issuers
            offering group or individual health insurance coverage'';
                (6) in section 2728 (42 U.S.C. 300gg-7), as so redesignated
            by section 1001(2)--
                        (A) in subsection (a), by striking ``health
                    insurance coverage offered in connection with such
                    plan'' and inserting ``individual health insurance
                    coverage'';
                        (B) in subsection (b)--
                                (i) in paragraph (1), by striking ``or a
                            health insurance issuer that provides health
                            insurance coverage in connection with a group
                            health plan'' and inserting ``or a health
                            insurance issuer that offers group or
                            individual health insurance coverage'';
                                (ii) in paragraph (2), by striking ``health
                            insurance coverage offered in connection with
                            the plan'' and inserting ``individual health
                            insurance coverage''; and
                                (iii) in paragraph (3), by striking
                            ``health insurance coverage offered by an
                            issuer in connection with such plan'' and
                            inserting ``individual health insurance
                            coverage'';
                        (C) in subsection (c), by striking ``health
                    insurance issuer providing health insurance coverage in
                    connection with a group health plan'' and inserting
                    ``health insurance issuer that offers group or
                    individual health insurance coverage''; and
                        (D) in subsection (e)(1), by striking ``health
                    insurance coverage offered in connection with such a
                    plan'' and inserting ``individual health insurance
                    coverage'';
                (7) by striking the heading for subpart 3;
                (8) in section 2731 (42 U.S.C. 300gg-11), as so
            redesignated by section 1001(3)--
                        (A) by striking the section heading and all that
                    follows through subsection (b);
                        (B) in subsection (c)--
                                (i) in paragraph (1)--
                                        (I) in the matter preceding
                                    subparagraph (A), by striking ``small
                                    group'' and inserting ``group and
                                    individual''; and
                                        (II) in subparagraph (B)--
                                                (aa) in the matter
                                            preceding clause (i), by
                                            inserting ``and individuals''
                                            after ``employers'';
                                                (bb) in clause (i), by
                                            inserting ``or any additional
                                            individuals'' after
                                            ``additional groups''; and
                                                (cc) in clause (ii), by
                                            striking ``without regard to
                                            the claims experience of those
                                            employers and their employees
                                            (and their dependents) or any
                                            health status-related factor
                                            relating to such'' and
                                            inserting ``and individuals
                                            without regard to the claims
                                            experience of those
                                            individuals, employers and
                                            their employees (and their
                                            dependents) or any health
                                            status-related factor relating
                                            to such individuals''; and
                                (ii) in paragraph (2), by striking ``small
                            group'' and inserting ``group or individual'';
                        (C) in subsection (d)--
                                (i) by striking ``small group'' each place
                            that such appears and inserting ``group or
                            individual''; and
                                (ii) in paragraph (1)(B)--
                                        (I) by striking ``all employers''
                                    and inserting ``all employers and
                                    individuals'';
                                        (II) by striking ``those
                                    employers'' and inserting ``those
                                    individuals, employers''; and
                                        (III) by striking ``such
                                    employees'' and inserting ``such
                                    individuals, employees'';
                        (D) by striking subsection (e);
                        (E) by striking subsection (f); and
                        (F) by transferring such section (as amended by
                    this paragraph) to appear at the end of section 2702
                    (as added by section 1001(4));
                (9) in section 2732 (42 U.S.C. 300gg-12), as so
            redesignated by section 1001(3)--
                        (A) by striking the section heading and all that
                    follows through subsection (a);
                        (B) in subsection (b)--
                                (i) in the matter preceding paragraph (1),
                            by striking ``group health plan in the small or
                            large group market'' and inserting ``health
                            insurance coverage offered in the group or
                            individual market'';
                                (ii) in paragraph (1), by inserting ``, or
                            individual, as applicable,'' after ``plan
                            sponsor'';
                                (iii) in paragraph (2), by inserting ``, or
                            individual, as applicable,'' after ``plan
                            sponsor''; and
                                (iv) by striking paragraph (3) and
                            inserting the following:
                ``(3) Violation of participation or contribution rates.--In
            the case of a group health plan, the plan sponsor has failed to
            comply with a material plan provision relating to employer
            contribution or group participation rules, pursuant to
            applicable State law.'';
                        (C) in subsection (c)--
                                (i) in paragraph (1)--
                                        (I) in the matter preceding
                                    subparagraph (A), by striking ``group
                                    health insurance coverage offered in
                                    the small or large group market'' and
                                    inserting ``group or individual health
                                    insurance coverage'';
                                        (II) in subparagraph (A), by
                                    inserting ``or individual, as
                                    applicable,'' after ``plan sponsor'';
                                        (III) in subparagraph (B)--
                                                (aa) by inserting ``or
                                            individual, as applicable,''
                                            after ``plan sponsor''; and
                                                (bb) by inserting ``or
                                            individual health insurance
                                            coverage''; and
                                        (IV) in subparagraph (C), by
                                    inserting ``or individuals, as
                                    applicable,'' after ``those sponsors'';
                                    and
                                (ii) in paragraph (2)(A)--
                                        (I) in the matter preceding clause
                                    (i), by striking ``small group market
                                    or the large group market, or both
                                    markets,'' and inserting ``individual
                                    or group market, or all markets,''; and
                                        (II) in clause (i), by inserting
                                    ``or individual, as applicable,'' after
                                    ``plan sponsor''; and
                        (D) by transferring such section (as amended by
                    this paragraph) to appear at the end of section 2703
                    (as added by section 1001(4));
                (10) in section 2733 (42 U.S.C. 300gg-13), as so
            redesignated by section 1001(4)--
                        (A) in subsection (a)--
                                (i) in the matter preceding paragraph (1),
                            by striking ``small employer'' and inserting
                            ``small employer or an individual'';
                                (ii) in paragraph (1), by inserting ``, or
                            individual, as applicable,'' after ``employer''
                            each place that such appears; and
                                (iii) in paragraph (2), by striking ``small
                            employer'' and inserting ``employer, or
                            individual, as applicable,'';
                        (B) in subsection (b)--
                                (i) in paragraph (1)--
                                        (I) in the matter preceding
                                    subparagraph (A), by striking ``small
                                    employer'' and inserting ``employer, or
                                    individual, as applicable,'';
                                        (II) in subparagraph (A), by adding
                                    ``and'' at the end;
                                        (III) by striking subparagraphs (B)
                                    and (C); and
                                        (IV) in subparagraph (D)--
                                                (aa) by inserting ``, or
                                            individual, as applicable,''
                                            after ``employer''; and
                                                (bb) by redesignating such
                                            subparagraph as subparagraph
                                            (B);
                                (ii) in paragraph (2)--
                                        (I) by striking ``small employers''
                                    each place that such term appears and
                                    inserting ``employers, or individuals,
                                    as applicable,''; and
                                        (II) by striking ``small employer''
                                    and inserting ``employer, or
                                    individual, as applicable,''; and
                        (C) by redesignating such section (as amended by
                    this paragraph) as section 2709 and transferring such
                    section to appear after section 2708 (as added by
                    section 1001(5));
                (11) by redesignating subpart 4 as subpart 2;
                (12) in section 2735 (42 U.S.C. 300gg-21), as so
            redesignated by section 1001(4)--
                        (A) by striking subsection (a);
                        (B) by striking ``subparts 1 through 3'' each place
                    that such appears and inserting ``subpart 1'';
                        (C) by redesignating subsections (b) through (e) as
                    subsections (a) through (d), respectively; and
                        (D) by redesignating such section (as amended by
                    this paragraph) as section 2722;
                (13) in section 2736 (42 U.S.C. 300gg-22), as so
            redesignated by section 1001(4)--
                        (A) in subsection (a)--
                                (i) in paragraph (1), by striking ``small
                            or large group markets'' and inserting
                            ``individual or group market''; and
                                (ii) in paragraph (2), by inserting ``or
                            individual health insurance coverage'' after
                            ``group health plans'';
                        (B) in subsection (b)(1)(B), by inserting
                    ``individual health insurance coverage or'' after
                    ``respect to''; and
                        (C) by redesignating such section (as amended by
                    this paragraph) as section 2723;
                (14) in section 2737(a)(1) (42 U.S.C. 300gg-23), as so
            redesignated by section 1001(4)--
                        (A) by inserting ``individual or'' before ``group
                    health insurance''; and
                        (B) by redesignating such section(as amended by
                    this paragraph) as section 2724;
                (15) in section 2762 (42 U.S.C. 300gg-62)--
                        (A) in the section heading by inserting ``and
                    application'' before the period; and
                        (B) by adding at the end the following:
        ``(c) Application of Part A Provisions.--
                ``(1) In general.--The provisions of part A shall apply to
            health insurance issuers providing health insurance coverage in
            the individual market in a State as provided for in such part.
                ``(2) Clarification.--To the extent that any provision of
            this part conflicts with a provision of part A with respect to
            health insurance issuers providing health insurance coverage in
            the individual market in a State, the provisions of such part A
            shall apply.''; and
                (16) in section 2791(e) (42 U.S.C. 300gg-91(e))--
                        (A) in paragraph (2), by striking ``51'' and
                    inserting ``101''; and
                        (B) in paragraph (4)--
                                (i) by striking ``at least 2'' each place
                            that such appears and inserting ``at least 1'';
                            and
                                (ii) by striking ``50'' and inserting
                            ``100''.
        (d) Application.--Notwithstanding any other provision of the
    Patient Protection and Affordable Care Act, nothing in such Act (or an
    amendment made by such Act) shall be construed to--
                (1) prohibit (or authorize the Secretary of Health and
            Human Services to promulgate regulations that prohibit) a group
            health plan or health insurance issuer from carrying out
            utilization management techniques that are commonly used as of
            the date of enactment of this Act; or
                (2) restrict the application of the amendments made by this
            subtitle.
        (e) Technical Amendment to the Employee Retirement Income Security
    Act of 1974.--Subpart B of part 7 of subtitle A of title I of the
    Employee Retirement Income Security Act of 1974 (29 U.S.C. 1181 et.
    seq.) is amended, by adding at the end the following:

    ``SEC. 715. ADDITIONAL MARKET REFORMS.

        ``(a) General Rule.--Except as provided in subsection (b)--
                ``(1) the provisions of part A of title XXVII of the Public
            Health Service Act (as amended by the Patient Protection and
            Affordable Care Act) shall apply to group health plans, and
            health insurance issuers providing health insurance coverage in
            connection with group health plans, as if included in this
            subpart; and
                ``(2) to the extent that any provision of this part
            conflicts with a provision of such part A with respect to group
            health plans, or health insurance issuers providing health
            insurance coverage in connection with group health plans, the
            provisions of such part A shall apply.
        ``(b) Exception.--Notwithstanding subsection (a), the provisions of
    sections 2716 and 2718 of title XXVII of the Public Health Service Act
    (as amended by the Patient Protection and Affordable Care Act) shall
    not apply with respect to self-insured group health plans, and the
    provisions of this part shall continue to apply to such plans as if
    such sections of the Public Health Service Act (as so amended) had not
    been enacted.''.
        (f) Technical Amendment to the Internal Revenue Code of 1986.--
    Subchapter B of chapter 100 of the Internal Revenue Code of 1986 is
    amended by adding at the end the following:

    ``SEC. 9815. ADDITIONAL MARKET REFORMS.

        ``(a) General Rule.--Except as provided in subsection (b)--
                ``(1) the provisions of part A of title XXVII of the Public
            Health Service Act (as amended by the Patient Protection and
            Affordable Care Act) shall apply to group health plans, and
            health insurance issuers providing health insurance coverage in
            connection with group health plans, as if included in this
            subchapter; and
                ``(2) to the extent that any provision of this subchapter
            conflicts with a provision of such part A with respect to group
            health plans, or health insurance issuers providing health
            insurance coverage in connection with group health plans, the
            provisions of such part A shall apply.
        ``(b) Exception.--Notwithstanding subsection (a), the provisions of
    sections 2716 and 2718 of title XXVII of the Public Health Service Act
    (as amended by the Patient Protection and Affordable Care Act) shall
    not apply with respect to self-insured group health plans, and the
    provisions of this subchapter shall continue to apply to such plans as
    if such sections of the Public Health Service Act (as so amended) had
    not been enacted.''.

    SEC. 1563. SENSE OF THE SENATE PROMOTING FISCAL RESPONSIBILITY.

        (a) Findings.--The Senate makes the following findings:
                (1) Based on Congressional Budget Office (CBO) estimates,
            this Act will reduce the Federal deficit between 2010 and 2019.
                (2) CBO projects this Act will continue to reduce budget
            deficits after 2019.
                (3) Based on CBO estimates, this Act will extend the
            solvency of the Medicare HI Trust Fund.
                (4) This Act will increase the surplus in the Social
            Security Trust Fund, which should be reserved to strengthen the
            finances of Social Security.
                (5) The initial net savings generated by the Community
            Living Assistance Services and Supports (CLASS) program are
            necessary to ensure the long-term solvency of that program.
        (b) Sense of the Senate.--It is the sense of the Senate that--
                (1) the additional surplus in the Social Security Trust
            Fund generated by this Act should be reserved for Social
            Security and not spent in this Act for other purposes; and
                (2) the net savings generated by the CLASS program should
            be reserved for the CLASS program and not spent in this Act for
            other purposes.

                       TITLE II--ROLE OF PUBLIC PROGRAMS

                    Subtitle A--Improved Access to Medicaid

    SEC. 2001. MEDICAID COVERAGE FOR THE LOWEST INCOME POPULATIONS.

        (a) Coverage for Individuals With Income at or Below 133 Percent of
    the Poverty Line.--
                (1) Beginning 2014.--Section 1902(a)(10)(A)(i) of the
            Social Security Act (42 U.S.C. 1396a) is amended--
                        (A) by striking ``or'' at the end of subclause
                    (VI);
                        (B) by adding ``or'' at the end of subclause (VII);
                    and
                        (C) by inserting after subclause (VII) the
                    following:
                                        ``(VIII) beginning January 1, 2014,
                                    who are under 65 years of age, not
                                    pregnant, not entitled to, or enrolled
                                    for, benefits under part A of title
                                    XVIII, or enrolled for benefits under
                                    part B of title XVIII, and are not
                                    described in a previous subclause of
                                    this clause, and whose income (as
                                    determined under subsection (e)(14))
                                    does not exceed 133 percent of the
                                    poverty line (as defined in section
                                    2110(c)(5)) applicable to a family of
                                    the size involved, subject to
                                    subsection (k);''.
                (2) Provision of at least minimum essential coverage.--
                        (A) In general.--Section 1902 of such Act (42
                    U.S.C. 1396a) is amended by inserting after subsection
                    (j) the following:
        ``(k)(1) The medical assistance provided to an individual described
    in subclause (VIII) of subsection (a)(10)(A)(i) shall consist of
    benchmark coverage described in section 1937(b)(1) or benchmark
    equivalent coverage described in section 1937(b)(2). Such medical
    assistance shall be provided subject to the requirements of section
    1937, without regard to whether a State otherwise has elected the
    option to provide medical assistance through coverage under that
    section, unless an individual described in subclause (VIII) of
    subsection (a)(10)(A)(i) is also an individual for whom, under
    subparagraph (B) of section 1937(a)(2), the State may not require
    enrollment in benchmark coverage described in subsection (b)(1) of
    section 1937 or benchmark equivalent coverage described in subsection
    (b)(2) of that section.''.
                        (B) Conforming amendment.--Section 1903(i) of the
                    Social Security Act, as amended by section 6402(c), is
                    amended--
                                (i) in paragraph (24), by striking ``or''
                            at the end;
                                (ii) in paragraph (25), by striking the
                            period and inserting ``; or''; and
                                (iii) by adding at the end the following:
                ``(26) with respect to any amounts expended for medical
            assistance for individuals described in subclause (VIII) of
            subsection (a)(10)(A)(i) other than medical assistance provided
            through benchmark coverage described in section 1937(b)(1) or
            benchmark equivalent coverage described in section
            1937(b)(2).''.
                (3) Federal funding for cost of covering newly eligible
            individuals.--Section 1905 of the Social Security Act (42
            U.S.C. 1396d), is amended--
                        (A) in subsection (b), in the first sentence, by
                    inserting ``subsection (y) and'' before ``section
                    1933(d)''; and
                        (B) by adding at the end the following new
                    subsection:
        ``(y) Increased FMAP for Medical Assistance for Newly Eligible
    Mandatory Individuals.--
                ``(1) Amount of increase.--
                        ``(A) 100 percent fmap.--During the period that
                    begins on January 1, 2014, and ends on December 31,
                    2016, notwithstanding subsection (b), the Federal
                    medical assistance percentage determined for a State
                    that is one of the 50 States or the District of
                    Columbia for each fiscal year occurring during that
                    period with respect to amounts expended for medical
                    assistance for newly eligible individuals described in
                    subclause (VIII) of section 1902(a)(10)(A)(i) shall be
                    equal to 100 percent.
                        ``(B) 2017 and 2018.--
                                ``(i) In general.--During the period that
                            begins on January 1, 2017, and ends on December
                            31, 2018, notwithstanding subsection (b) and
                            subject to subparagraph (D), the Federal
                            medical assistance percentage determined for a
                            State that is one of the 50 States or the
                            District of Columbia for each fiscal year
                            occurring during that period with respect to
                            amounts expended for medical assistance for
                            newly eligible individuals described in
                            subclause (VIII) of section 1902(a)(10)(A)(i),
                            shall be increased by the applicable percentage
                            point increase specified in clause (ii) for the
                            quarter and the State.
                                ``(ii) Applicable percentage point
                            increase.--
                                        ``(I) In general.--For purposes of
                                    clause (i), the applicable percentage
                                    point increase for a quarter is the
                                    following:

    ----------------------------------------------------------------------------------------------------------------
                                           If the State is an expansion State,    If the State is not an expansion
        ``For any fiscal year quarter        the applicable percentage point      State, the applicable percentage
       occurring in the calendar year:                increase is:                       point increase is:
    ----------------------------------------------------------------------------------------------------------------
    2017                                  30.3                                  34.3
    ----------------------------------------------------------------------------------------------------------------
    2018                                  31.3                                  33.3
    ----------------------------------------------------------------------------------------------------------------

                                        ``(II) Expansion state defined.--
                                    For purposes of the table in subclause
                                    (I), a State is an expansion State if,
                                    on the date of the enactment of the
                                    Patient Protection and Affordable Care
                                    Act, the State offers health benefits
                                    coverage statewide to parents and
                                    nonpregnant, childless adults whose
                                    income is at least 100 percent of the
                                    poverty line, that is not dependent on
                                    access to employer coverage, employer
                                    contribution, or employment and is not
                                    limited to premium assistance,
                                    hospital-only benefits, a high
                                    deductible health plan, or alternative
                                    benefits under a demonstration program
                                    authorized under section 1938. A State
                                    that offers health benefits coverage to
                                    only parents or only nonpregnant
                                    childless adults described in the
                                    preceding sentence shall not be
                                    considered to be an expansion State.
                        ``(C) 2019 and succeeding years.--Beginning January
                    1, 2019, notwithstanding subsection (b) but subject to
                    subparagraph (D), the Federal medical assistance
                    percentage determined for a State that is one of the 50
                    States or the District of Columbia for each fiscal year
                    quarter occurring during that period with respect to
                    amounts expended for medical assistance for newly
                    eligible individuals described in subclause (VIII) of
                    section 1902(a)(10)(A)(i), shall be increased by 32.3
                    percentage points.
                        ``(D) Limitation.--The Federal medical assistance
                    percentage determined for a State under subparagraph
                    (B) or (C) shall in no case be more than 95 percent.
                ``(2) Definitions.--In this subsection:
                        ``(A) Newly eligible.--The term `newly eligible'
                    means, with respect to an individual described in
                    subclause (VIII) of section 1902(a)(10)(A)(i), an
                    individual who is not under 19 years of age (or such
                    higher age as the State may have elected) and who, on
                    the date of enactment of the Patient Protection and
                    Affordable Care Act, is not eligible under the State
                    plan or under a waiver of the plan for full benefits or
                    for benchmark coverage described in subparagraph (A),
                    (B), or (C) of section 1937(b)(1) or benchmark
                    equivalent coverage described in section 1937(b)(2)
                    that has an aggregate actuarial value that is at least
                    actuarially equivalent to benchmark coverage described
                    in subparagraph (A), (B), or (C) of section 1937(b)(1),
                    or is eligible but not enrolled (or is on a waiting
                    list) for such benefits or coverage through a waiver
                    under the plan that has a capped or limited enrollment
                    that is full.
                        ``(B) Full benefits.--The term `full benefits'
                    means, with respect to an individual, medical
                    assistance for all services covered under the State
                    plan under this title that is not less in amount,
                    duration, or scope, or is determined by the Secretary
                    to be substantially equivalent, to the medical
                    assistance available for an individual described in
                    section 1902(a)(10)(A)(i).''.
                (4) State options to offer coverage earlier and presumptive
            eligibility; children required to have coverage for parents to
            be eligible.--
                        (A) In general.--Subsection (k) of section 1902 of
                    the Social Security Act (as added by paragraph (2)), is
                    amended by inserting after paragraph (1) the following:
        ``(2) Beginning with the first day of any fiscal year quarter that
    begins on or after January 1, 2011, and before January 1, 2014, a State
    may elect through a State plan amendment to provide medical assistance
    to individuals who would be described in subclause (VIII) of subsection
    (a)(10)(A)(i) if that subclause were effective before January 1, 2014.
    A State may elect to phase-in the extension of eligibility for medical
    assistance to such individuals based on income, so long as the State
    does not extend such eligibility to individuals described in such
    subclause with higher income before making individuals described in
    such subclause with lower income eligible for medical assistance.
        ``(3) If an individual described in subclause (VIII) of subsection
    (a)(10)(A)(i) is the parent of a child who is under 19 years of age (or
    such higher age as the State may have elected) who is eligible for
    medical assistance under the State plan or under a waiver of such plan
    (under that subclause or under a State plan amendment under paragraph
    (2), the individual may not be enrolled under the State plan unless the
    individual's child is enrolled under the State plan or under a waiver
    of the plan or is enrolled in other health insurance coverage. For
    purposes of the preceding sentence, the term `parent' includes an
    individual treated as a caretaker relative for purposes of carrying out
    section 1931.''.
                        (B) Presumptive eligibility.--Section 1920 of the
                    Social Security Act (42 U.S.C. 1396r-1) is amended by
                    adding at the end the following:
        ``(e) If the State has elected the option to provide a presumptive
    eligibility period under this section or section 1920A, the State may
    elect to provide a presumptive eligibility period (as defined in
    subsection (b)(1)) for individuals who are eligible for medical
    assistance under clause (i)(VIII) of subsection (a)(10)(A) or section
    1931 in the same manner as the State provides for such a period under
    this section or section 1920A, subject to such guidance as the
    Secretary shall establish.''.
                (5) Conforming amendments.--
                        (A) Section 1902(a)(10) of such Act (42 U.S.C.
                    1396a(a)(10)) is amended in the matter following
                    subparagraph (G), by striking ``and (XIV)'' and
                    inserting ``(XIV)'' and by inserting ``and (XV) the
                    medical assistance made available to an individual
                    described in subparagraph (A)(i)(VIII) shall be limited
                    to medical assistance described in subsection (k)(1)''
                    before the semicolon.
                        (B) Section 1902(l)(2)(C) of such Act (42 U.S.C.
                    1396a(l)(2)(C)) is amended by striking ``100'' and
                    inserting ``133''.
                        (C) Section 1905(a) of such Act (42 U.S.C.
                    1396d(a)) is amended in the matter preceding paragraph
                    (1)--
                                (i) by striking ``or'' at the end of clause
                            (xii);
                                (ii) by inserting ``or'' at the end of
                            clause (xiii); and
                                (iii) by inserting after clause (xiii) the
                            following:
                ``(xiv) individuals described in section
            1902(a)(10)(A)(i)(VIII),''.
                        (D) Section 1903(f)(4) of such Act (42 U.S.C.
                    1396b(f)(4)) is amended by inserting
                    ``1902(a)(10)(A)(i)(VIII),'' after
                    ``1902(a)(10)(A)(i)(VII),''.
                        (E) Section 1937(a)(1)(B) of such Act (42 U.S.C.
                    1396u-7(a)(1)(B)) is amended by inserting ``subclause
                    (VIII) of section 1902(a)(10)(A)(i) or under'' after
                    ``eligible under''.
        (b) Maintenance of Medicaid Income Eligibility.--Section 1902 of
    the Social Security Act (42 U.S.C. 1396a) is amended--
                (1) in subsection (a)--
                        (A) by striking ``and'' at the end of paragraph
                    (72);
                        (B) by striking the period at the end of paragraph
                    (73) and inserting ``; and''; and
                        (C) by inserting after paragraph (73) the following
                    new paragraph:
                ``(74) provide for maintenance of effort under the State
            plan or under any waiver of the plan in accordance with
            subsection (gg).''; and
                (2) by adding at the end the following new subsection:
        ``(gg) Maintenance of Effort.--
                ``(1) General requirement to maintain eligibility standards
            until state exchange is fully operational.--Subject to the
            succeeding paragraphs of this subsection, during the period
            that begins on the date of enactment of the Patient Protection
            and Affordable Care Act and ends on the date on which the
            Secretary determines that an Exchange established by the State
            under section 1311 of the Patient Protection and Affordable
            Care Act is fully operational, as a condition for receiving any
            Federal payments under section 1903(a) for calendar quarters
            occurring during such period, a State shall not have in effect
            eligibility standards, methodologies, or procedures under the
            State plan under this title or under any waiver of such plan
            that is in effect during that period, that are more restrictive
            than the eligibility standards, methodologies, or procedures,
            respectively, under the plan or waiver that are in effect on
            the date of enactment of the Patient Protection and Affordable
            Care Act.
                ``(2) Continuation of eligibility standards for children
            until october 1, 2019.--The requirement under paragraph (1)
            shall continue to apply to a State through September 30, 2019,
            with respect to the eligibility standards, methodologies, and
            procedures under the State plan under this title or under any
            waiver of such plan that are applicable to determining the
            eligibility for medical assistance of any child who is under 19
            years of age (or such higher age as the State may have
            elected).
                ``(3) Nonapplication.--During the period that begins on
            January 1, 2011, and ends on December 31, 2013, the requirement
            under paragraph (1) shall not apply to a State with respect to
            nonpregnant, nondisabled adults who are eligible for medical
            assistance under the State plan or under a waiver of the plan
            at the option of the State and whose income exceeds 133 percent
            of the poverty line (as defined in section 2110(c)(5))
            applicable to a family of the size involved if, on or after
            December 31, 2010, the State certifies to the Secretary that,
            with respect to the State fiscal year during which the
            certification is made, the State has a budget deficit, or with
            respect to the succeeding State fiscal year, the State is
            projected to have a budget deficit. Upon submission of such a
            certification to the Secretary, the requirement under paragraph
            (1) shall not apply to the State with respect to any remaining
            portion of the period described in the preceding sentence.
                ``(4) Determination of compliance.--
                        ``(A) States shall apply modified gross income.--A
                    State's determination of income in accordance with
                    subsection (e)(14) shall not be considered to be
                    eligibility standards, methodologies, or procedures
                    that are more restrictive than the standards,
                    methodologies, or procedures in effect under the State
                    plan or under a waiver of the plan on the date of
                    enactment of the Patient Protection and Affordable Care
                    Act for purposes of determining compliance with the
                    requirements of paragraph (1), (2), or (3).
                        ``(B) States may expand eligibility or move
                    waivered populations into coverage under the state
                    plan.--With respect to any period applicable under
                    paragraph (1), (2), or (3), a State that applies
                    eligibility standards, methodologies, or procedures
                    under the State plan under this title or under any
                    waiver of the plan that are less restrictive than the
                    eligibility standards, methodologies, or procedures,
                    applied under the State plan or under a waiver of the
                    plan on the date of enactment of the Patient Protection
                    and Affordable Care Act, or that makes individuals who,
                    on such date of enactment, are eligible for medical
                    assistance under a waiver of the State plan, after such
                    date of enactment eligible for medical assistance
                    through a State plan amendment with an income
                    eligibility level that is not less than the income
                    eligibility level that applied under the waiver, or as
                    a result of the application of subclause (VIII) of
                    section 1902(a)(10)(A)(i), shall not be considered to
                    have in effect eligibility standards, methodologies, or
                    procedures that are more restrictive than the
                    standards, methodologies, or procedures in effect under
                    the State plan or under a waiver of the plan on the
                    date of enactment of the Patient Protection and
                    Affordable Care Act for purposes of determining
                    compliance with the requirements of paragraph (1), (2),
                    or (3).''.
        (c) Medicaid Benchmark Benefits Must Consist of at Least Minimum
    Essential Coverage.--Section 1937(b) of such Act (42 U.S.C. 1396u-7(b))
    is amended--
                (1) in paragraph (1), in the matter preceding subparagraph
            (A), by inserting ``subject to paragraphs (5) and (6),'' before
            ``each'';
                (2) in paragraph (2)--
                        (A) in the matter preceding subparagraph (A), by
                    inserting ``subject to paragraphs (5) and (6)'' after
                    ``subsection (a)(1),'';
                        (B) in subparagraph (A)--
                                (i) by redesignating clauses (iv) and (v)
                            as clauses (vi) and (vii), respectively; and
                                (ii) by inserting after clause (iii), the
                            following:
                                ``(iv) Coverage of prescription drugs.
                                ``(v) Mental health services.''; and
                        (C) in subparagraph (C)--
                                (i) by striking clauses (i) and (ii); and
                                (ii) by redesignating clauses (iii) and
                            (iv) as clauses (i) and (ii), respectively; and
                (3) by adding at the end the following new paragraphs:
                ``(5) Minimum standards.--Effective January 1, 2014, any
            benchmark benefit package under paragraph (1) or benchmark
            equivalent coverage under paragraph (2) must provide at least
            essential health benefits as described in section 1302(b) of
            the Patient Protection and Affordable Care Act.
                ``(6) Mental health services parity.--
                        ``(A) In general.--In the case of any benchmark
                    benefit package under paragraph (1) or benchmark
                    equivalent coverage under paragraph (2) that is offered
                    by an entity that is not a medicaid managed care
                    organization and that provides both medical and
                    surgical benefits and mental health or substance use
                    disorder benefits, the entity shall ensure that the
                    financial requirements and treatment limitations
                    applicable to such mental health or substance use
                    disorder benefits comply with the requirements of
                    section 2705(a) of the Public Health Service Act in the
                    same manner as such requirements apply to a group
                    health plan.
                        ``(B) Deemed compliance.--Coverage provided with
                    respect to an individual described in section
                    1905(a)(4)(B) and covered under the State plan under
                    section 1902(a)(10)(A) of the services described in
                    section 1905(a)(4)(B) (relating to early and periodic
                    screening, diagnostic, and treatment services defined
                    in section 1905(r)) and provided in accordance with
                    section 1902(a)(43), shall be deemed to satisfy the
                    requirements of subparagraph (A).''.
        (d) Annual Reports on Medicaid Enrollment.--
                (1) State reports.--Section 1902(a) of the Social Security
            Act (42 U.S.C. 1396a(a)), as amended by subsection (b), is
            amended--
                        (A) by striking ``and'' at the end of paragraph
                    (73);
                        (B) by striking the period at the end of paragraph
                    (74) and inserting ``; and''; and
                        (C) by inserting after paragraph (74) the following
                    new paragraph:
                ``(75) provide that, beginning January 2015, and annually
            thereafter, the State shall submit a report to the Secretary
            that contains--
                        ``(A) the total number of enrolled and newly
                    enrolled individuals in the State plan or under a
                    waiver of the plan for the fiscal year ending on
                    September 30 of the preceding calendar year,
                    disaggregated by population, including children,
                    parents, nonpregnant childless adults, disabled
                    individuals, elderly individuals, and such other
                    categories or sub-categories of individuals eligible
                    for medical assistance under the State plan or under a
                    waiver of the plan as the Secretary may require;
                        ``(B) a description, which may be specified by
                    population, of the outreach and enrollment processes
                    used by the State during such fiscal year; and
                        ``(C) any other data reporting determined necessary
                    by the Secretary to monitor enrollment and retention of
                    individuals eligible for medical assistance under the
                    State plan or under a waiver of the plan.''.
                (2) Reports to congress.--Beginning April 2015, and
            annually thereafter, the Secretary of Health and Human Services
            shall submit a report to the appropriate committees of Congress
            on the total enrollment and new enrollment in Medicaid for the
            fiscal year ending on September 30 of the preceding calendar
            year on a national and State-by-State basis, and shall include
            in each such report such recommendations for administrative or
            legislative changes to improve enrollment in the Medicaid
            program as the Secretary determines appropriate.
        (e) State Option for Coverage for Individuals With Income That
    Exceeds 133 Percent of the Poverty Line.--
                (1) Coverage as optional categorically needy group.--
            Section 1902 of the Social Security Act (42 U.S.C. 1396a) is
            amended--
                        (A) in subsection (a)(10)(A)(ii)--
                                (i) in subclause (XVIII), by striking
                            ``or'' at the end;
                                (ii) in subclause (XIX), by adding ``or''
                            at the end; and
                                (iii) by adding at the end the following
                            new subclause:
                                        ``(XX) beginning January 1, 2014,
                                    who are under 65 years of age and are
                                    not described in or enrolled under a
                                    previous subclause of this clause, and
                                    whose income (as determined under
                                    subsection (e)(14)) exceeds 133 percent
                                    of the poverty line (as defined in
                                    section 2110(c)(5)) applicable to a
                                    family of the size involved but does
                                    not exceed the highest income
                                    eligibility level established under the
                                    State plan or under a waiver of the
                                    plan, subject to subsection (hh);'' and
                        (B) by adding at the end the following new
                    subsection:
        ``(hh)(1) A State may elect to phase-in the extension of
    eligibility for medical assistance to individuals described in
    subclause (XX) of subsection (a)(10)(A)(ii) based on the categorical
    group (including nonpregnant childless adults) or income, so long as
    the State does not extend such eligibility to individuals described in
    such subclause with higher income before making individuals described
    in such subclause with lower income eligible for medical assistance.
        ``(2) If an individual described in subclause (XX) of subsection
    (a)(10)(A)(ii) is the parent of a child who is under 19 years of age
    (or such higher age as the State may have elected) who is eligible for
    medical assistance under the State plan or under a waiver of such plan,
    the individual may not be enrolled under the State plan unless the
    individual's child is enrolled under the State plan or under a waiver
    of the plan or is enrolled in other health insurance coverage. For
    purposes of the preceding sentence, the term `parent' includes an
    individual treated as a caretaker relative for purposes of carrying out
    section 1931.''.
                (2) Conforming amendments.--
                        (A) Section 1905(a) of such Act (42 U.S.C.
                    1396d(a)), as amended by subsection (a)(5)(C), is
                    amended in the matter preceding paragraph (1)--
                                (i) by striking ``or'' at the end of clause
                            (xiii);
                                (ii) by inserting ``or'' at the end of
                            clause (xiv); and
                                (iii) by inserting after clause (xiv) the
                            following:
                ``(xv) individuals described in section
            1902(a)(10)(A)(ii)(XX),''.
                        (B) Section 1903(f)(4) of such Act (42 U.S.C.
                    1396b(f)(4)) is amended by inserting
                    ``1902(a)(10)(A)(ii)(XX),'' after
                    ``1902(a)(10)(A)(ii)(XIX),''.
                        (C) Section 1920(e) of such Act (42 U.S.C. 1396r-
                    1(e)), as added by subsection (a)(4)(B), is amended by
                    inserting ``or clause (ii)(XX)'' after ``clause
                    (i)(VIII)''.

    SEC. 2002. INCOME ELIGIBILITY FOR NONELDERLY DETERMINED USING MODIFIED
                  GROSS INCOME.

        (a) In General.--Section 1902(e) of the Social Security Act (42
    U.S.C. 1396a(e)) is amended by adding at the end the following:
                ``(14) Income determined using modified gross income.--
                        ``(A) In general.--Notwithstanding subsection (r)
                    or any other provision of this title, except as
                    provided in subparagraph (D), for purposes of
                    determining income eligibility for medical assistance
                    under the State plan or under any waiver of such plan
                    and for any other purpose applicable under the plan or
                    waiver for which a determination of income is required,
                    including with respect to the imposition of premiums
                    and cost-sharing, a State shall use the modified gross
                    income of an individual and, in the case of an
                    individual in a family greater than 1, the household
                    income of such family. A State shall establish income
                    eligibility thresholds for populations to be eligible
                    for medical assistance under the State plan or a waiver
                    of the plan using modified gross income and household
                    income that are not less than the effective income
                    eligibility levels that applied under the State plan or
                    waiver on the date of enactment of the Patient
                    Protection and Affordable Care Act. For purposes of
                    complying with the maintenance of effort requirements
                    under subsection (gg) during the transition to modified
                    gross income and household income, a State shall,
                    working with the Secretary, establish an equivalent
                    income test that ensures individuals eligible for
                    medical assistance under the State plan or under a
                    waiver of the plan on the date of enactment of the
                    Patient Protection and Affordable Care Act, do not lose
                    coverage under the State plan or under a waiver of the
                    plan. The Secretary may waive such provisions of this
                    title and title XXI as are necessary to ensure that
                    States establish income and eligibility determination
                    systems that protect beneficiaries.
                        ``(B) No income or expense disregards.--No type of
                    expense, block, or other income disregard shall be
                    applied by a State to determine income eligibility for
                    medical assistance under the State plan or under any
                    waiver of such plan or for any other purpose applicable
                    under the plan or waiver for which a determination of
                    income is required.
                        ``(C) No assets test.--A State shall not apply any
                    assets or resources test for purposes of determining
                    eligibility for medical assistance under the State plan
                    or under a waiver of the plan.
                        ``(D) Exceptions.--
                                ``(i) Individuals eligible because of other
                            aid or assistance, elderly individuals,
                            medically needy individuals, and individuals
                            eligible for medicare cost-sharing.--
                            Subparagraphs (A), (B), and (C) shall not apply
                            to the determination of eligibility under the
                            State plan or under a waiver for medical
                            assistance for the following:
                                        ``(I) Individuals who are eligible
                                    for medical assistance under the State
                                    plan or under a waiver of the plan on a
                                    basis that does not require a
                                    determination of income by the State
                                    agency administering the State plan or
                                    waiver, including as a result of
                                    eligibility for, or receipt of, other
                                    Federal or State aid or assistance,
                                    individuals who are eligible on the
                                    basis of receiving (or being treated as
                                    if receiving) supplemental security
                                    income benefits under title XVI, and
                                    individuals who are eligible as a
                                    result of being or being deemed to be a
                                    child in foster care under the
                                    responsibility of the State.
                                        ``(II) Individuals who have
                                    attained age 65.
                                        ``(III) Individuals who qualify for
                                    medical assistance under the State plan
                                    or under any waiver of such plan on the
                                    basis of being blind or disabled (or
                                    being treated as being blind or
                                    disabled) without regard to whether the
                                    individual is eligible for supplemental
                                    security income benefits under title
                                    XVI on the basis of being blind or
                                    disabled and including an individual
                                    who is eligible for medical assistance
                                    on the basis of section 1902(e)(3).
                                        ``(IV) Individuals described in
                                    subsection (a)(10)(C).
                                        ``(V) Individuals described in any
                                    clause of subsection (a)(10)(E).
                                ``(ii) Express lane agency findings.--In
                            the case of a State that elects the Express
                            Lane option under paragraph (13),
                            notwithstanding subparagraphs (A), (B), and
                            (C), the State may rely on a finding made by an
                            Express Lane agency in accordance with that
                            paragraph relating to the income of an
                            individual for purposes of determining the
                            individual's eligibility for medical assistance
                            under the State plan or under a waiver of the
                            plan.
                                ``(iii) Medicare prescription drug
                            subsidies determinations.--Subparagraphs (A),
                            (B), and (C) shall not apply to any
                            determinations of eligibility for premium and
                            cost-sharing subsidies under and in accordance
                            with section 1860D-14 made by the State
                            pursuant to section 1935(a)(2).
                                ``(iv) Long-term care.--Subparagraphs (A),
                            (B), and (C) shall not apply to any
                            determinations of eligibility of individuals
                            for purposes of medical assistance for nursing
                            facility services, a level of care in any
                            institution equivalent to that of nursing
                            facility services, home or community-based
                            services furnished under a waiver or State plan
                            amendment under section 1915 or a waiver under
                            section 1115, and services described in section
                            1917(c)(1)(C)(ii).
                                ``(v) Grandfather of current enrollees
                            until date of next regular redetermination.--An
                            individual who, on January 1, 2014, is enrolled
                            in the State plan or under a waiver of the plan
                            and who would be determined ineligible for
                            medical assistance solely because of the
                            application of the modified gross income or
                            household income standard described in
                            subparagraph (A), shall remain eligible for
                            medical assistance under the State plan or
                            waiver (and subject to the same premiums and
                            cost-sharing as applied to the individual on
                            that date) through March 31, 2014, or the date
                            on which the individual's next regularly
                            scheduled redetermination of eligibility is to
                            occur, whichever is later.
                        ``(E) Transition planning and oversight.--Each
                    State shall submit to the Secretary for the Secretary's
                    approval the income eligibility thresholds proposed to
                    be established using modified gross income and
                    household income, the methodologies and procedures to
                    be used to determine income eligibility using modified
                    gross income and household income and, if applicable, a
                    State plan amendment establishing an optional
                    eligibility category under subsection
                    (a)(10)(A)(ii)(XX). To the extent practicable, the
                    State shall use the same methodologies and procedures
                    for purposes of making such determinations as the State
                    used on the date of enactment of the Patient Protection
                    and Affordable Care Act. The Secretary shall ensure
                    that the income eligibility thresholds proposed to be
                    established using modified gross income and household
                    income, including under the eligibility category
                    established under subsection (a)(10)(A)(ii)(XX), and
                    the methodologies and procedures proposed to be used to
                    determine income eligibility, will not result in
                    children who would have been eligible for medical
                    assistance under the State plan or under a waiver of
                    the plan on the date of enactment of the Patient
                    Protection and Affordable Care Act no longer being
                    eligible for such assistance.
                        ``(F) Limitation on secretarial authority.--The
                    Secretary shall not waive compliance with the
                    requirements of this paragraph except to the extent
                    necessary to permit a State to coordinate eligibility
                    requirements for dual eligible individuals (as defined
                    in section 1915(h)(2)(B)) under the State plan or under
                    a waiver of the plan and under title XVIII and
                    individuals who require the level of care provided in a
                    hospital, a nursing facility, or an intermediate care
                    facility for the mentally retarded.
                        ``(G) Definitions of modified gross income and
                    household income.--In this paragraph, the terms
                    `modified gross income' and `household income' have the
                    meanings given such terms in section 36B(d)(2) of the
                    Internal Revenue Code of 1986.
                        ``(H) Continued application of medicaid rules
                    regarding point-in-time income and sources of income.--
                    The requirement under this paragraph for States to use
                    modified gross income and household income to determine
                    income eligibility for medical assistance under the
                    State plan or under any waiver of such plan and for any
                    other purpose applicable under the plan or waiver for
                    which a determination of income is required shall not
                    be construed as affecting or limiting the application
                    of--
                                ``(i) the requirement under this title and
                            under the State plan or a waiver of the plan to
                            determine an individual's income as of the
                            point in time at which an application for
                            medical assistance under the State plan or a
                            waiver of the plan is processed; or
                                ``(ii) any rules established under this
                            title or under the State plan or a waiver of
                            the plan regarding sources of countable
                            income.''.
        (b) Conforming Amendment.--Section 1902(a)(17) of such Act (42
    U.S.C. 1396a(a)(17)) is amended by inserting ``(e)(14),'' before
    ``(l)(3)''.
        (c) Effective Date.--The amendments made by subsections (a) and (b)
    take effect on January 1, 2014.

    SEC. 2003. REQUIREMENT TO OFFER PREMIUM ASSISTANCE FOR EMPLOYER-
                  SPONSORED INSURANCE.

        (a) In General.--Section 1906A of such Act (42 U.S.C. 1396e-1) is
    amended--
                (1) in subsection (a)--
                        (A) by striking ``may elect to'' and inserting
                    ``shall'';
                        (B) by striking ``under age 19''; and
                        (C) by inserting ``, in the case of an individual
                    under age 19,'' after ``(and'';
                (2) in subsection (c), in the first sentence, by striking
            ``under age 19''; and
                (3) in subsection (d)--
                        (A) in paragraph (2)--
                                (i) in the first sentence, by striking
                            ``under age 19''; and
                                (ii) by striking the third sentence and
                            inserting ``A State may not require, as a
                            condition of an individual (or the individual's
                            parent) being or remaining eligible for medical
                            assistance under this title, that the
                            individual (or the individual's parent) apply
                            for enrollment in qualified employer-sponsored
                            coverage under this section.''; and
                        (B) in paragraph (3), by striking ``the parent of
                    an individual under age 19'' and inserting ``an
                    individual (or the parent of an individual)''; and
                (4) in subsection (e), by striking ``under age 19'' each
            place it appears.
        (b) Conforming Amendment.--The heading for section 1906A of such
    Act (42 U.S.C. 1396e-1) is amended by striking ``option for children''.
        (c) Effective Date.--The amendments made by this section take
    effect on January 1, 2014.

    SEC. 2004. MEDICAID COVERAGE FOR FORMER FOSTER CARE CHILDREN.

        (a) In General.--Section 1902(a)(10)(A)(i) of the Social Security
    Act (42 U.S.C. 1396a), as amended by section 2001(a)(1), is amended--
                (1) by striking ``or'' at the end of subclause (VII);
                (2) by adding ``or'' at the end of subclause (VIII); and
                (3) by inserting after subclause (VIII) the following:
                                        ``(IX) who were in foster care
                                    under the responsibility of a State for
                                    more than 6 months (whether or not
                                    consecutive) but are no longer in such
                                    care, who are not described in any of
                                    subclauses (I) through (VII) of this
                                    clause, and who are under 25 years of
                                    age;''.
        (b) Option To Provide Presumptive Eligibility.--Section 1920(e) of
    such Act (42 U.S.C. 1396r-1(e)), as added by section 2001(a)(4)(B) and
    amended by section 2001(e)(2)(C), is amended by inserting ``, clause
    (i)(IX),'' after ``clause (i)(VIII)''.
        (c) Conforming Amendments.--
                (1) Section 1903(f)(4) of such Act (42 U.S.C. 1396b(f)(4)),
            as amended by section 2001(a)(5)(D), is amended by inserting
            ``1902(a)(10)(A)(i)(IX),'' after ``1902(a)(10)(A)(i)(VIII),''.
                (2) Section 1937(a)(2)(B)(viii) of such Act (42 U.S.C.
            1396u-7(a)(2)(B)(viii)) is amended by inserting ``, or the
            individual qualifies for medical assistance on the basis of
            section 1902(a)(10)(A)(i)(IX)'' before the period.
        (d) Effective Date.--The amendments made by this section take
    effect on January 1, 2019.

    SEC. 2005. PAYMENTS TO TERRITORIES.

        (a) Increase in Limit on Payments.--Section 1108(g) of the Social
    Security Act (42 U.S.C. 1308(g)) is amended--
                (1) in paragraph (2), in the matter preceding subparagraph
            (A), by striking ``paragraph (3)'' and inserting ``paragraphs
            (3) and (5)'';
                (2) in paragraph (4), by striking ``and (3)'' and inserting
            ``(3), and (4)''; and
                (3) by adding at the end the following paragraph:
                ``(5) Fiscal year 2011 and thereafter.--The amounts
            otherwise determined under this subsection for Puerto Rico, the
            Virgin Islands, Guam, the Northern Mariana Islands, and
            American Samoa for the second, third, and fourth quarters of
            fiscal year 2011, and for each fiscal year after fiscal year
            2011 (after the application of subsection (f) and the preceding
            paragraphs of this subsection), shall be increased by 30
            percent.''.
        (b) Disregard of Payments for Mandatory Expanded Enrollment.--
    Section 1108(g)(4) of such Act (42 U.S.C. 1308(g)(4)) is amended--
                (1) by striking ``to fiscal years beginning'' and inserting
            ``to--
                        ``(A) fiscal years beginning'';
                (2) by striking the period at the end and inserting ``;
            and''; and
                (3) by adding at the end the following:
                        ``(B) fiscal years beginning with fiscal year 2014,
                    payments made to Puerto Rico, the Virgin Islands, Guam,
                    the Northern Mariana Islands, or American Samoa with
                    respect to amounts expended for medical assistance for
                    newly eligible (as defined in section 1905(y)(2))
                    nonpregnant childless adults who are eligible under
                    subclause (VIII) of section 1902(a)(10)(A)(i) and whose
                    income (as determined under section 1902(e)(14)) does
                    not exceed (in the case of each such commonwealth and
                    territory respectively) the income eligibility level in
                    effect for that population under title XIX or under a
                    waiver on the date of enactment of the Patient
                    Protection and Affordable Care Act, shall not be taken
                    into account in applying subsection (f) (as increased
                    in accordance with paragraphs (1), (2), (3), and (5) of
                    this subsection) to such commonwealth or territory for
                    such fiscal year.''.
        (c) Increased FMAP.--
                (1) In general.--The first sentence of section 1905(b) of
            the Social Security Act (42 U.S.C. 1396d(b)) is amended by
            striking ``shall be 50 per centum'' and inserting ``shall be 55
            percent''.
                (2) Effective date.--The amendment made by paragraph (1)
            takes effect on January 1, 2011.

    SEC. 2006. SPECIAL ADJUSTMENT TO FMAP DETERMINATION FOR CERTAIN STATES
                  RECOVERING FROM A MAJOR DISASTER.

        Section 1905 of the Social Security Act (42 U.S.C. 1396d), as
    amended by sections 2001(a)(3) and 2001(b)(2), is amended--
                (1) in subsection (b), in the first sentence, by striking
            ``subsection (y)'' and inserting ``subsections (y) and (aa)'';
            and
                (2) by adding at the end the following new subsection:
        ``(aa)(1) Notwithstanding subsection (b), beginning January 1,
    2011, the Federal medical assistance percentage for a fiscal year for a
    disaster-recovery FMAP adjustment State shall be equal to the
    following:
                ``(A) In the case of the first fiscal year (or part of a
            fiscal year) for which this subsection applies to the State,
            the Federal medical assistance percentage determined for the
            fiscal year without regard to this subsection and subsection
            (y), increased by 50 percent of the number of percentage points
            by which the Federal medical assistance percentage determined
            for the State for the fiscal year without regard to this
            subsection and subsection (y), is less than the Federal medical
            assistance percentage determined for the State for the
            preceding fiscal year after the application of only subsection
            (a) of section 5001 of Public Law 111-5 (if applicable to the
            preceding fiscal year) and without regard to this subsection,
            subsection (y), and subsections (b) and (c) of section 5001 of
            Public Law 111-5.
                ``(B) In the case of the second or any succeeding fiscal
            year for which this subsection applies to the State, the
            Federal medical assistance percentage determined for the
            preceding fiscal year under this subsection for the State,
            increased by 25 percent of the number of percentage points by
            which the Federal medical assistance percentage determined for
            the State for the fiscal year without regard to this subsection
            and subsection (y), is less than the Federal medical assistance
            percentage determined for the State for the preceding fiscal
            year under this subsection.
        ``(2) In this subsection, the term `disaster-recovery FMAP
    adjustment State' means a State that is one of the 50 States or the
    District of Columbia, for which, at any time during the preceding 7
    fiscal years, the President has declared a major disaster under section
    401 of the Robert T. Stafford Disaster Relief and Emergency Assistance
    Act and determined as a result of such disaster that every county or
    parish in the State warrant individual and public assistance or public
    assistance from the Federal Government under such Act and for which--
                ``(A) in the case of the first fiscal year (or part of a
            fiscal year) for which this subsection applies to the State,
            the Federal medical assistance percentage determined for the
            State for the fiscal year without regard to this subsection and
            subsection (y), is less than the Federal medical assistance
            percentage determined for the State for the preceding fiscal
            year after the application of only subsection (a) of section
            5001 of Public Law 111-5 (if applicable to the preceding fiscal
            year) and without regard to this subsection, subsection (y),
            and subsections (b) and (c) of section 5001 of Public Law 111-
            5, by at least 3 percentage points; and
                ``(B) in the case of the second or any succeeding fiscal
            year for which this subsection applies to the State, the
            Federal medical assistance percentage determined for the State
            for the fiscal year without regard to this subsection and
            subsection (y), is less than the Federal medical assistance
            percentage determined for the State for the preceding fiscal
            year under this subsection by at least 3 percentage points.
        ``(3) The Federal medical assistance percentage determined for a
    disaster-recovery FMAP adjustment State under paragraph (1) shall apply
    for purposes of this title (other than with respect to disproportionate
    share hospital payments described in section 1923 and payments under
    this title that are based on the enhanced FMAP described in 2105(b))
    and shall not apply with respect to payments under title IV (other than
    under part E of title IV) or payments under title XXI.''.

    SEC. 2007. MEDICAID IMPROVEMENT FUND RESCISSION.

        (a) Rescission.--Any amounts available to the Medicaid Improvement
    Fund established under section 1941 of the Social Security Act (42
    U.S.C. 1396w-1) for any of fiscal years 2014 through 2018 that are
    available for expenditure from the Fund and that are not so obligated
    as of the date of the enactment of this Act are rescinded.
        (b) Conforming Amendments.--Section 1941(b)(1) of the Social
    Security Act (42 U.S.C. 1396w-1(b)(1)) is amended--
                (1) in subparagraph (A), by striking ``$100,000,000'' and
            inserting ``$0''; and
                (2) in subparagraph (B), by striking ``$150,000,000'' and
            inserting ``$0''.

       Subtitle B--Enhanced Support for the Children's Health Insurance
                                    Program

    SEC. 2101. ADDITIONAL FEDERAL FINANCIAL PARTICIPATION FOR CHIP.

        (a) In General.--Section 2105(b) of the Social Security Act (42
    U.S.C. 1397ee(b)) is amended by adding at the end the following:
    ``Notwithstanding the preceding sentence, during the period that begins
    on October 1, 2013, and ends on September 30, 2019, the enhanced FMAP
    determined for a State for a fiscal year (or for any portion of a
    fiscal year occurring during such period) shall be increased by 23
    percentage points, but in no case shall exceed 100 percent. The
    increase in the enhanced FMAP under the preceding sentence shall not
    apply with respect to determining the payment to a State under
    subsection (a)(1) for expenditures described in subparagraph (D)(iv),
    paragraphs (8), (9), (11) of subsection (c), or clause (4) of the first
    sentence of section 1905(b).''.
        (b) Maintenance of Effort.--
                (1) In general.--Section 2105(d) of the Social Security Act
            (42 U.S.C. 1397ee(d)) is amended by adding at the end the
            following:
                ``(3) Continuation of eligibility standards for children
            until october 1, 2019.--
                        ``(A) In general.--During the period that begins on
                    the date of enactment of the Patient Protection and
                    Affordable Care Act and ends on September 30, 2019, a
                    State shall not have in effect eligibility standards,
                    methodologies, or procedures under its State child
                    health plan (including any waiver under such plan) for
                    children (including children provided medical
                    assistance for which payment is made under section
                    2105(a)(1)(A)) that are more restrictive than the
                    eligibility standards, methodologies, or procedures,
                    respectively, under such plan (or waiver) as in effect
                    on the date of enactment of that Act. The preceding
                    sentence shall not be construed as preventing a State
                    during such period from--
                                ``(i) applying eligibility standards,
                            methodologies, or procedures for children under
                            the State child health plan or under any waiver
                            of the plan that are less restrictive than the
                            eligibility standards, methodologies, or
                            procedures, respectively, for children under
                            the plan or waiver that are in effect on the
                            date of enactment of such Act; or
                                ``(ii) imposing a limitation described in
                            section 2112(b)(7) for a fiscal year in order
                            to limit expenditures under the State child
                            health plan to those for which Federal
                            financial participation is available under this
                            section for the fiscal year.
                        ``(B) Assurance of exchange coverage for targeted
                    low-income children unable to be provided child health
                    assistance as a result of funding shortfalls.--In the
                    event that allotments provided under section 2104 are
                    insufficient to provide coverage to all children who
                    are eligible to be targeted low-income children under
                    the State child health plan under this title, a State
                    shall establish procedures to ensure that such children
                    are provided coverage through an Exchange established
                    by the State under section 1311 of the Patient
                    Protection and Affordable Care Act.''.
                (2) Conforming amendment to title xxi medicaid maintenance
            of effort.--Section 2105(d)(1) of the Social Security Act (42
            U.S.C. 1397ee(d)(1)) is amended by adding before the period ``,
            except as required under section 1902(e)(14)''.
        (c) No Enrollment Bonus Payments for Children Enrolled After Fiscal
    Year 2013.--Section 2105(a)(3)(F)(iii) of the Social Security Act (42
    U.S.C. 1397ee(a)(3)(F)(iii)) is amended by inserting ``or any children
    enrolled on or after October 1, 2013'' before the period.
        (d) Income Eligibility Determined Using Modified Gross Income.--
                (1) State plan requirement.--Section 2102(b)(1)(B) of the
            Social Security Act (42 U.S.C. 1397bb(b)(1)(B)) is amended--
                        (A) in clause (iii), by striking ``and'' after the
                    semicolon;
                        (B) in clause (iv), by striking the period and
                    inserting ``; and''; and
                        (C) by adding at the end the following:
                                ``(v) shall, beginning January 1, 2014, use
                            modified gross income and household income (as
                            defined in section 36B(d)(2) of the Internal
                            Revenue Code of 1986) to determine eligibility
                            for child health assistance under the State
                            child health plan or under any waiver of such
                            plan and for any other purpose applicable under
                            the plan or waiver for which a determination of
                            income is required, including with respect to
                            the imposition of premiums and cost-sharing,
                            consistent with section 1902(e)(14).''.
                (2) Conforming amendment.--Section 2107(e)(1) of the Social
            Security Act (42 U.S.C. 1397gg(e)(1)) is amended--
                        (A) by redesignating subparagraphs (E) through (L)
                    as subparagraphs (F) through (M), respectively; and
                        (B) by inserting after subparagraph (D), the
                    following:
                        ``(E) Section 1902(e)(14) (relating to income
                    determined using modified gross income and household
                    income).''.
        (e) Application of Streamlined Enrollment System.--Section
    2107(e)(1) of the Social Security Act (42 U.S.C. 1397gg(e)(1)), as
    amended by subsection (d)(2), is amended by adding at the end the
    following:
                        ``(N) Section 1943(b) (relating to coordination
                    with State Exchanges and the State Medicaid agency).''.
        (f) CHIP Eligibility for Children Ineligible for Medicaid as a
    Result of Elimination of Disregards.--Notwithstanding any other
    provision of law, a State shall treat any child who is determined to be
    ineligible for medical assistance under the State Medicaid plan or
    under a waiver of the plan as a result of the elimination of the
    application of an income disregard based on expense or type of income,
    as required under section 1902(e)(14) of the Social Security Act (as
    added by this Act), as a targeted low-income child under section
    2110(b) (unless the child is excluded under paragraph (2) of that
    section) and shall provide child health assistance to the child under
    the State child health plan (whether implemented under title XIX or
    XXI, or both, of the Social Security Act).

    SEC. 2102. TECHNICAL CORRECTIONS.

        (a) CHIPRA.--Effective as if included in the enactment of the
    Children's Health Insurance Program Reauthorization Act of 2009 (Public
    Law 111-3) (in this section referred to as ``CHIPRA''):
                (1) Section 2104(m) of the Social Security Act, as added by
            section 102 of CHIPRA, is amended--
                        (A) by redesignating paragraph (7) as paragraph
                    (8); and
                        (B) by inserting after paragraph (6), the
                    following:
                ``(7) Adjustment of fiscal year 2010 allotments to account
            for changes in projected spending for certain previously
            approved expansion programs.--For purposes of recalculating the
            fiscal year 2010 allotment, in the case of one of the 50 States
            or the District of Columbia that has an approved State plan
            amendment effective January 1, 2006, to provide child health
            assistance through the provision of benefits under the State
            plan under title XIX for children from birth through age 5
            whose family income does not exceed 200 percent of the poverty
            line, the Secretary shall increase the allotment by an amount
            that would be equal to the Federal share of expenditures that
            would have been claimed at the enhanced FMAP rate rather than
            the Federal medical assistance percentage matching rate for
            such population.''.
                (2) Section 605 of CHIPRA is amended by striking ``legal
            residents'' and insert ``lawfully residing in the United
            States''.
                (3) Subclauses (I) and (II) of paragraph (3)(C)(i) of
            section 2105(a) of the Social Security Act (42 U.S.C.
            1397ee(a)(3)(ii)), as added by section 104 of CHIPRA, are each
            amended by striking ``, respectively''.
                (4) Section 2105(a)(3)(E)(ii) of the Social Security Act
            (42 U.S.C. 1397ee(a)(3)(E)(ii)), as added by section 104 of
            CHIPRA, is amended by striking subclause (IV).
                (5) Section 2105(c)(9)(B) of the Social Security Act (42
            U.S.C. 1397e(c)(9)(B)), as added by section 211(c)(1) of
            CHIPRA, is amended by striking ``section 1903(a)(3)(F)'' and
            inserting ``section 1903(a)(3)(G)''.
                (6) Section 2109(b)(2)(B) of the Social Security Act (42
            U.S.C. 1397ii(b)(2)(B)), as added by section 602 of CHIPRA, is
            amended by striking ``the child population growth factor under
            section 2104(m)(5)(B)'' and inserting ``a high-performing State
            under section 2111(b)(3)(B)''.
                (7) Section 2110(c)(9)(B)(v) of the Social Security Act (42
            U.S.C. 1397jj(c)(9)(B)(v)), as added by section 505(b) of
            CHIPRA, is amended by striking ``school or school system'' and
            inserting ``local educational agency (as defined under section
            9101 of the Elementary and Secondary Education Act of 1965''.
                (8) Section 211(a)(1)(B) of CHIPRA is amended--
                        (A) by striking ``is amended'' and all that follows
                    through ``adding'' and inserting ``is amended by
                    adding''; and
                        (B) by redesignating the new subparagraph to be
                    added by such section to section 1903(a)(3) of the
                    Social Security Act as a new subparagraph (H).
        (b) ARRA.--Effective as if included in the enactment of section
    5006(a) of division B of the American Recovery and Reinvestment Act of
    2009 (Public Law 111-5), the second sentence of section 1916A(a)(1) of
    the Social Security Act (42 U.S.C. 1396o-1(a)(1)) is amended by
    striking ``or (i)'' and inserting ``, (i), or (j)''.

            Subtitle C--Medicaid and CHIP Enrollment Simplification

    SEC. 2201. ENROLLMENT SIMPLIFICATION AND COORDINATION WITH STATE HEALTH
                  INSURANCE EXCHANGES.

        Title XIX of the Social Security Act (42 U.S.C. 1397aa et seq.) is
    amended by adding at the end the following:

    ``SEC. 1943. ENROLLMENT SIMPLIFICATION AND COORDINATION WITH STATE
                  HEALTH INSURANCE EXCHANGES.

        ``(a) Condition for Participation in Medicaid.--As a condition of
    the State plan under this title and receipt of any Federal financial
    assistance under section 1903(a) for calendar quarters beginning after
    January 1, 2014, a State shall ensure that the requirements of
    subsection (b) is met.
        ``(b) Enrollment Simplification and Coordination With State Health
    Insurance Exchanges and Chip.--
                ``(1) In general.--A State shall establish procedures for--
                        ``(A) enabling individuals, through an Internet
                    website that meets the requirements of paragraph (4),
                    to apply for medical assistance under the State plan or
                    under a waiver of the plan, to be enrolled in the State
                    plan or waiver, to renew their enrollment in the plan
                    or waiver, and to consent to enrollment or reenrollment
                    in the State plan through electronic signature;
                        ``(B) enrolling, without any further determination
                    by the State and through such website, individuals who
                    are identified by an Exchange established by the State
                    under section 1311 of the Patient Protection and
                    Affordable Care Act as being eligible for--
                                ``(i) medical assistance under the State
                            plan or under a waiver of the plan; or
                                ``(ii) child health assistance under the
                            State child health plan under title XXI;
                        ``(C) ensuring that individuals who apply for but
                    are determined to be ineligible for medical assistance
                    under the State plan or a waiver or ineligible for
                    child health assistance under the State child health
                    plan under title XXI, are screened for eligibility for
                    enrollment in qualified health plans offered through
                    such an Exchange and, if applicable, premium assistance
                    for the purchase of a qualified health plan under
                    section 36B of the Internal Revenue Code of 1986 (and,
                    if applicable, advance payment of such assistance under
                    section 1412 of the Patient Protection and Affordable
                    Care Act), and, if eligible, enrolled in such a plan
                    without having to submit an additional or separate
                    application, and that such individuals receive
                    information regarding reduced cost-sharing for eligible
                    individuals under section 1402 of the Patient
                    Protection and Affordable Care Act, and any other
                    assistance or subsidies available for coverage obtained
                    through the Exchange;
                        ``(D) ensuring that the State agency responsible
                    for administering the State plan under this title (in
                    this section referred to as the `State Medicaid
                    agency'), the State agency responsible for
                    administering the State child health plan under title
                    XXI (in this section referred to as the `State CHIP
                    agency') and an Exchange established by the State under
                    section 1311 of the Patient Protection and Affordable
                    Care Act utilize a secure electronic interface
                    sufficient to allow for a determination of an
                    individual's eligibility for such medical assistance,
                    child health assistance, or premium assistance, and
                    enrollment in the State plan under this title, title
                    XXI, or a qualified health plan, as appropriate;
                        ``(E) coordinating, for individuals who are
                    enrolled in the State plan or under a waiver of the
                    plan and who are also enrolled in a qualified health
                    plan offered through such an Exchange, and for
                    individuals who are enrolled in the State child health
                    plan under title XXI and who are also enrolled in a
                    qualified health plan, the provision of medical
                    assistance or child health assistance to such
                    individuals with the coverage provided under the
                    qualified health plan in which they are enrolled,
                    including services described in section 1905(a)(4)(B)
                    (relating to early and periodic screening, diagnostic,
                    and treatment services defined in section 1905(r)) and
                    provided in accordance with the requirements of section
                    1902(a)(43); and
                        ``(F) conducting outreach to and enrolling
                    vulnerable and underserved populations eligible for
                    medical assistance under this title XIX or for child
                    health assistance under title XXI, including children,
                    unaccompanied homeless youth, children and youth with
                    special health care needs, pregnant women, racial and
                    ethnic minorities, rural populations, victims of abuse
                    or trauma, individuals with mental health or substance-
                    related disorders, and individuals with HIV/AIDS.
                ``(2) Agreements with state health insurance exchanges.--
            The State Medicaid agency and the State CHIP agency may enter
            into an agreement with an Exchange established by the State
            under section 1311 of the Patient Protection and Affordable
            Care Act under which the State Medicaid agency or State CHIP
            agency may determine whether a State resident is eligible for
            premium assistance for the purchase of a qualified health plan
            under section 36B of the Internal Revenue Code of 1986 (and, if
            applicable, advance payment of such assistance under section
            1412 of the Patient Protection and Affordable Care Act), so
            long as the agreement meets such conditions and requirements as
            the Secretary of the Treasury may prescribe to reduce
            administrative costs and the likelihood of eligibility errors
            and disruptions in coverage.
                ``(3) Streamlined enrollment system.--The State Medicaid
            agency and State CHIP agency shall participate in and comply
            with the requirements for the system established under section
            1413 of the Patient Protection and Affordable Care Act
            (relating to streamlined procedures for enrollment through an
            Exchange, Medicaid, and CHIP).
                ``(4) Enrollment website requirements.--The procedures
            established by State under paragraph (1) shall include
            establishing and having in operation, not later than January 1,
            2014, an Internet website that is linked to any website of an
            Exchange established by the State under section 1311 of the
            Patient Protection and Affordable Care Act and to the State
            CHIP agency (if different from the State Medicaid agency) and
            allows an individual who is eligible for medical assistance
            under the State plan or under a waiver of the plan and who is
            eligible to receive premium credit assistance for the purchase
            of a qualified health plan under section 36B of the Internal
            Revenue Code of 1986 to compare the benefits, premiums, and
            cost-sharing applicable to the individual under the State plan
            or waiver with the benefits, premiums, and cost-sharing
            available to the individual under a qualified health plan
            offered through such an Exchange, including, in the case of a
            child, the coverage that would be provided for the child
            through the State plan or waiver with the coverage that would
            be provided to the child through enrollment in family coverage
            under that plan and as supplemental coverage by the State under
            the State plan or waiver.
                ``(5) Continued need for assessment for home and community-
            based services.--Nothing in paragraph (1) shall limit or modify
            the requirement that the State assess an individual for
            purposes of providing home and community-based services under
            the State plan or under any waiver of such plan for individuals
            described in subsection (a)(10)(A)(ii)(VI).''.

    SEC. 2202. PERMITTING HOSPITALS TO MAKE PRESUMPTIVE ELIGIBILITY
                  DETERMINATIONS FOR ALL MEDICAID ELIGIBLE POPULATIONS.

        (a) In General.--Section 1902(a)(47) of the Social Security Act (42
    U.S.C. 1396a(a)(47)) is amended--
                (1) by striking ``at the option of the State, provide'' and
            inserting ``provide--
                        ``(A) at the option of the State,'';
                (2) by inserting ``and'' after the semicolon; and
                (3) by adding at the end the following:
                        ``(B) that any hospital that is a participating
                    provider under the State plan may elect to be a
                    qualified entity for purposes of determining, on the
                    basis of preliminary information, whether any
                    individual is eligible for medical assistance under the
                    State plan or under a waiver of the plan for purposes
                    of providing the individual with medical assistance
                    during a presumptive eligibility period, in the same
                    manner, and subject to the same requirements, as apply
                    to the State options with respect to populations
                    described in section 1920, 1920A, or 1920B (but without
                    regard to whether the State has elected to provide for
                    a presumptive eligibility period under any such
                    sections), subject to such guidance as the Secretary
                    shall establish;''.
        (b) Conforming Amendment.--Section 1903(u)(1)(D)(v) of such Act (42
    U.S.C. 1396b(u)(1)(D)v)) is amended--
                (1) by striking ``or for'' and inserting ``for''; and
                (2) by inserting before the period at the end the
            following: ``, or for medical assistance provided to an
            individual during a presumptive eligibility period resulting
            from a determination of presumptive eligibility made by a
            hospital that elects under section 1902(a)(47)(B) to be a
            qualified entity for such purpose''.
        (c) Effective Date.--The amendments made by this section take
    effect on January 1, 2014, and apply to services furnished on or after
    that date.

                 Subtitle D--Improvements to Medicaid Services

    SEC. 2301. COVERAGE FOR FREESTANDING BIRTH CENTER SERVICES.

        (a) In General.--Section 1905 of the Social Security Act (42 U.S.C.
    1396d), is amended--
                (1) in subsection (a)--
                        (A) in paragraph (27), by striking ``and'' at the
                    end;
                        (B) by redesignating paragraph (28) as paragraph
                    (29); and
                        (C) by inserting after paragraph (27) the following
                    new paragraph:
                ``(28) freestanding birth center services (as defined in
            subsection (l)(3)(A)) and other ambulatory services that are
            offered by a freestanding birth center (as defined in
            subsection (l)(3)(B)) and that are otherwise included in the
            plan; and''; and
                (2) in subsection (l), by adding at the end the following
            new paragraph:
        ``(3)(A) The term `freestanding birth center services' means
    services furnished to an individual at a freestanding birth center (as
    defined in subparagraph (B)) at such center.
        ``(B) The term `freestanding birth center' means a health
    facility--
                ``(i) that is not a hospital;
                ``(ii) where childbirth is planned to occur away from the
            pregnant woman's residence;
                ``(iii) that is licensed or otherwise approved by the State
            to provide prenatal labor and delivery or postpartum care and
            other ambulatory services that are included in the plan; and
                ``(iv) that complies with such other requirements relating
            to the health and safety of individuals furnished services by
            the facility as the State shall establish.
        ``(C) A State shall provide separate payments to providers
    administering prenatal labor and delivery or postpartum care in a
    freestanding birth center (as defined in subparagraph (B)), such as
    nurse midwives and other providers of services such as birth attendants
    recognized under State law, as determined appropriate by the Secretary.
    For purposes of the preceding sentence, the term `birth attendant'
    means an individual who is recognized or registered by the State
    involved to provide health care at childbirth and who provides such
    care within the scope of practice under which the individual is legally
    authorized to perform such care under State law (or the State
    regulatory mechanism provided by State law), regardless of whether the
    individual is under the supervision of, or associated with, a physician
    or other health care provider. Nothing in this subparagraph shall be
    construed as changing State law requirements applicable to a birth
    attendant.''.
        (b) Conforming Amendment.--Section 1902(a)(10)(A) of the Social
    Security Act (42 U.S.C. 1396a(a)(10)(A)), is amended in the matter
    preceding clause (i) by striking ``and (21)'' and inserting ``, (21),
    and (28)''.
        (c) Effective Date.--
                (1) In general.--Except as provided in paragraph (2), the
            amendments made by this section shall take effect on the date
            of the enactment of this Act and shall apply to services
            furnished on or after such date.
                (2) Exception if state legislation required.--In the case
            of a State plan for medical assistance under title XIX of the
            Social Security Act which the Secretary of Health and Human
            Services determines requires State legislation (other than
            legislation appropriating funds) in order for the plan to meet
            the additional requirement imposed by the amendments made by
            this section, the State plan shall not be regarded as failing
            to comply with the requirements of such title solely on the
            basis of its failure to meet this additional requirement before
            the first day of the first calendar quarter beginning after the
            close of the first regular session of the State legislature
            that begins after the date of the enactment of this Act. For
            purposes of the previous sentence, in the case of a State that
            has a 2-year legislative session, each year of such session
            shall be deemed to be a separate regular session of the State
            legislature.

    SEC. 2302. CONCURRENT CARE FOR CHILDREN.

        (a) In General.--Section 1905(o)(1) of the Social Security Act (42
    U.S.C. 1396d(o)(1)) is amended--
                (1) in subparagraph (A), by striking ``subparagraph (B)''
            and inserting ``subparagraphs (B) and (C)''; and
                (2) by adding at the end the following new subparagraph:
        ``(C) A voluntary election to have payment made for hospice care
    for a child (as defined by the State) shall not constitute a waiver of
    any rights of the child to be provided with, or to have payment made
    under this title for, services that are related to the treatment of the
    child's condition for which a diagnosis of terminal illness has been
    made.''.
        (b) Application to CHIP.--Section 2110(a)(23) of the Social
    Security Act (42 U.S.C. 1397jj(a)(23)) is amended by inserting
    ``(concurrent, in the case of an individual who is a child, with care
    related to the treatment of the child's condition with respect to which
    a diagnosis of terminal illness has been made'' after ``hospice care''.

    SEC. 2303. STATE ELIGIBILITY OPTION FOR FAMILY PLANNING SERVICES.

        (a) Coverage as Optional Categorically Needy Group.--
                (1) In general.--Section 1902(a)(10)(A)(ii) of the Social
            Security Act (42 U.S.C. 1396a(a)(10)(A)(ii)), as amended by
            section 2001(e), is amended--
                        (A) in subclause (XIX), by striking ``or'' at the
                    end;
                        (B) in subclause (XX), by adding ``or'' at the end;
                    and
                        (C) by adding at the end the following new
                    subclause:
                                        ``(XXI) who are described in
                                    subsection (ii) (relating to
                                    individuals who meet certain income
                                    standards);''.
                (2) Group described.--Section 1902 of such Act (42 U.S.C.
            1396a), as amended by section 2001(d), is amended by adding at
            the end the following new subsection:
        ``(ii)(1) Individuals described in this subsection are
    individuals--
                        ``(A) whose income does not exceed an income
                    eligibility level established by the State that does
                    not exceed the highest income eligibility level
                    established under the State plan under this title (or
                    under its State child health plan under title XXI) for
                    pregnant women; and
                        ``(B) who are not pregnant.
                ``(2) At the option of a State, individuals described in
            this subsection may include individuals who, had individuals
            applied on or before January 1, 2007, would have been made
            eligible pursuant to the standards and processes imposed by
            that State for benefits described in clause (XV) of the matter
            following subparagraph (G) of section subsection (a)(10)
            pursuant to a waiver granted under section 1115.
                ``(3) At the option of a State, for purposes of subsection
            (a)(17)(B), in determining eligibility for services under this
            subsection, the State may consider only the income of the
            applicant or recipient.''.
                (3) Limitation on benefits.--Section 1902(a)(10) of the
            Social Security Act (42 U.S.C. 1396a(a)(10)), as amended by
            section 2001(a)(5)(A), is amended in the matter following
            subparagraph (G)--
                        (A) by striking ``and (XV)'' and inserting
                    ``(XV)''; and
                        (B) by inserting ``, and (XVI) the medical
                    assistance made available to an individual described in
                    subsection (ii) shall be limited to family planning
                    services and supplies described in section
                    1905(a)(4)(C) including medical diagnosis and treatment
                    services that are provided pursuant to a family
                    planning service in a family planning setting'' before
                    the semicolon.
                (4) Conforming amendments.--
                        (A) Section 1905(a) of the Social Security Act (42
                    U.S.C. 1396d(a)), as amended by section 2001(e)(2)(A),
                    is amended in the matter preceding paragraph (1)--
                                (i) in clause (xiv), by striking ``or'' at
                            the end;
                                (ii) in clause (xv), by adding ``or'' at
                            the end; and
                                (iii) by inserting after clause (xv) the
                            following:
                                ``(xvi) individuals described in section
                            1902(ii),''.
                        (B) Section 1903(f)(4) of such Act (42 U.S.C.
                    1396b(f)(4)), as amended by section 2001(e)(2)(B), is
                    amended by inserting ``1902(a)(10)(A)(ii)(XXI),'' after
                    ``1902(a)(10)(A)(ii)(XX),''.
        (b) Presumptive Eligibility.--
                (1) In general.--Title XIX of the Social Security Act (42
            U.S.C. 1396 et seq.) is amended by inserting after section
            1920B the following:

             ``presumptive eligibility for family planning services

        ``Sec. 1920C.  (a) State Option.--State plan approved under section
    1902 may provide for making medical assistance available to an
    individual described in section 1902(ii) (relating to individuals who
    meet certain income eligibility standard) during a presumptive
    eligibility period. In the case of an individual described in section
    1902(ii), such medical assistance shall be limited to family planning
    services and supplies described in 1905(a)(4)(C) and, at the State's
    option, medical diagnosis and treatment services that are provided in
    conjunction with a family planning service in a family planning
    setting.
        ``(b) Definitions.--For purposes of this section:
                ``(1) Presumptive eligibility period.--The term
            `presumptive eligibility period' means, with respect to an
            individual described in subsection (a), the period that--
                        ``(A) begins with the date on which a qualified
                    entity determines, on the basis of preliminary
                    information, that the individual is described in
                    section 1902(ii); and
                        ``(B) ends with (and includes) the earlier of--
                                ``(i) the day on which a determination is
                            made with respect to the eligibility of such
                            individual for services under the State plan;
                            or
                                ``(ii) in the case of such an individual
                            who does not file an application by the last
                            day of the month following the month during
                            which the entity makes the determination
                            referred to in subparagraph (A), such last day.
                ``(2) Qualified entity.--
                        ``(A) In general.--Subject to subparagraph (B), the
                    term `qualified entity' means any entity that--
                                ``(i) is eligible for payments under a
                            State plan approved under this title; and
                                ``(ii) is determined by the State agency to
                            be capable of making determinations of the type
                            described in paragraph (1)(A).
                        ``(B) Rule of construction.--Nothing in this
                    paragraph shall be construed as preventing a State from
                    limiting the classes of entities that may become
                    qualified entities in order to prevent fraud and abuse.
        ``(c) Administration.--
                ``(1) In general.--The State agency shall provide qualified
            entities with--
                        ``(A) such forms as are necessary for an
                    application to be made by an individual described in
                    subsection (a) for medical assistance under the State
                    plan; and
                        ``(B) information on how to assist such individuals
                    in completing and filing such forms.
                ``(2) Notification requirements.--A qualified entity that
            determines under subsection (b)(1)(A) that an individual
            described in subsection (a) is presumptively eligible for
            medical assistance under a State plan shall--
                        ``(A) notify the State agency of the determination
                    within 5 working days after the date on which
                    determination is made; and
                        ``(B) inform such individual at the time the
                    determination is made that an application for medical
                    assistance is required to be made by not later than the
                    last day of the month following the month during which
                    the determination is made.
                ``(3) Application for medical assistance.--In the case of
            an individual described in subsection (a) who is determined by
            a qualified entity to be presumptively eligible for medical
            assistance under a State plan, the individual shall apply for
            medical assistance by not later than the last day of the month
            following the month during which the determination is made.
        ``(d) Payment.--Notwithstanding any other provision of law, medical
    assistance that--
                ``(1) is furnished to an individual described in subsection
            (a)--
                        ``(A) during a presumptive eligibility period; and
                        ``(B) by a entity that is eligible for payments
                    under the State plan; and
                ``(2) is included in the care and services covered by the
            State plan,
    shall be treated as medical assistance provided by such plan for
    purposes of clause (4) of the first sentence of section 1905(b).''.
                (2) Conforming amendments.--
                        (A) Section 1902(a)(47) of the Social Security Act
                    (42 U.S.C. 1396a(a)(47)), as amended by section
                    2202(a), is amended--
                                (i) in subparagraph (A), by inserting
                            before the semicolon at the end the following:
                            ``and provide for making medical assistance
                            available to individuals described in
                            subsection (a) of section 1920C during a
                            presumptive eligibility period in accordance
                            with such section''; and
                                (ii) in subparagraph (B), by striking ``or
                            1920B'' and inserting ``1920B, or 1920C''.
                        (B) Section 1903(u)(1)(D)(v) of such Act (42 U.S.C.
                    1396b(u)(1)(D)(v)), as amended by section 2202(b), is
                    amended by inserting ``or for medical assistance
                    provided to an individual described in subsection (a)
                    of section 1920C during a presumptive eligibility
                    period under such section,'' after ``1920B during a
                    presumptive eligibility period under such section,''.
        (c) Clarification of Coverage of Family Planning Services and
    Supplies.--Section 1937(b) of the Social Security Act (42 U.S.C. 1396u-
    7(b)), as amended by section 2001(c), is amended by adding at the end
    the following:
                ``(7) Coverage of family planning services and supplies.--
            Notwithstanding the previous provisions of this section, a
            State may not provide for medical assistance through enrollment
            of an individual with benchmark coverage or benchmark-
            equivalent coverage under this section unless such coverage
            includes for any individual described in section 1905(a)(4)(C),
            medical assistance for family planning services and supplies in
            accordance with such section.''.
        (d) Effective Date.--The amendments made by this section take
    effect on the date of the enactment of this Act and shall apply to
    items and services furnished on or after such date.

    SEC. 2304. CLARIFICATION OF DEFINITION OF MEDICAL ASSISTANCE.

        Section 1905(a) of the Social Security Act (42 U.S.C. 1396d(a)) is
    amended by inserting ``or the care and services themselves, or both''
    before ``(if provided in or after''.

     Subtitle E--New Options for States to Provide Long-Term Services and
                                    Supports

    SEC. 2401. COMMUNITY FIRST CHOICE OPTION.

        Section 1915 of the Social Security Act (42 U.S.C. 1396n) is
    amended by adding at the end the following:
        ``(k) State Plan Option To Provide Home and Community-based
    Attendant Services and Supports.--
                ``(1) In general.--Subject to the succeeding provisions of
            this subsection, beginning October 1, 2010, a State may provide
            through a State plan amendment for the provision of medical
            assistance for home and community-based attendant services and
            supports for individuals who are eligible for medical
            assistance under the State plan whose income does not exceed
            150 percent of the poverty line (as defined in section
            2110(c)(5)) or, if greater, the income level applicable for an
            individual who has been determined to require an institutional
            level of care to be eligible for nursing facility services
            under the State plan and with respect to whom there has been a
            determination that, but for the provision of such services, the
            individuals would require the level of care provided in a
            hospital, a nursing facility, an intermediate care facility for
            the mentally retarded, or an institution for mental diseases,
            the cost of which could be reimbursed under the State plan, but
            only if the individual chooses to receive such home and
            community-based attendant services and supports, and only if
            the State meets the following requirements:
                        ``(A) Availability.--The State shall make available
                    home and community-based attendant services and
                    supports to eligible individuals, as needed, to assist
                    in accomplishing activities of daily living,
                    instrumental activities of daily living, and health-
                    related tasks through hands-on assistance, supervision,
                    or cueing--
                                ``(i) under a person-centered plan of
                            services and supports that is based on an
                            assessment of functional need and that is
                            agreed to in writing by the individual or, as
                            appropriate, the individual's representative;
                                ``(ii) in a home or community setting,
                            which does not include a nursing facility,
                            institution for mental diseases, or an
                            intermediate care facility for the mentally
                            retarded;
                                ``(iii) under an agency-provider model or
                            other model (as defined in paragraph (6)(C ));
                            and
                                ``(iv) the furnishing of which--
                                        ``(I) is selected, managed, and
                                    dismissed by the individual, or, as
                                    appropriate, with assistance from the
                                    individual's representative;
                                        ``(II) is controlled, to the
                                    maximum extent possible, by the
                                    individual or where appropriate, the
                                    individual's representative, regardless
                                    of who may act as the employer of
                                    record; and
                                        ``(III) provided by an individual
                                    who is qualified to provide such
                                    services, including family members (as
                                    defined by the Secretary).
                        ``(B) Included services and supports.--In addition
                    to assistance in accomplishing activities of daily
                    living, instrumental activities of daily living, and
                    health related tasks, the home and community-based
                    attendant services and supports made available
                    include--
                                ``(i) the acquisition, maintenance, and
                            enhancement of skills necessary for the
                            individual to accomplish activities of daily
                            living, instrumental activities of daily
                            living, and health related tasks;
                                ``(ii) back-up systems or mechanisms (such
                            as the use of beepers or other electronic
                            devices) to ensure continuity of services and
                            supports; and
                                ``(iii) voluntary training on how to
                            select, manage, and dismiss attendants.
                        ``(C) Excluded services and supports.--Subject to
                    subparagraph (D), the home and community-based
                    attendant services and supports made available do not
                    include--
                                ``(i) room and board costs for the
                            individual;
                                ``(ii) special education and related
                            services provided under the Individuals with
                            Disabilities Education Act and vocational
                            rehabilitation services provided under the
                            Rehabilitation Act of 1973;
                                ``(iii) assistive technology devices and
                            assistive technology services other than those
                            under (1)(B)(ii);
                                ``(iv) medical supplies and equipment; or
                                ``(v) home modifications.
                        ``(D) Permissible services and supports.--The home
                    and community-based attendant services and supports may
                    include--
                                ``(i) expenditures for transition costs
                            such as rent and utility deposits, first
                            month's rent and utilities, bedding, basic
                            kitchen supplies, and other necessities
                            required for an individual to make the
                            transition from a nursing facility, institution
                            for mental diseases, or intermediate care
                            facility for the mentally retarded to a
                            community-based home setting where the
                            individual resides; and
                                ``(ii) expenditures relating to a need
                            identified in an individual's person-centered
                            plan of services that increase independence or
                            substitute for human assistance, to the extent
                            that expenditures would otherwise be made for
                            the human assistance.
                ``(2) Increased federal financial participation.--For
            purposes of payments to a State under section 1903(a)(1), with
            respect to amounts expended by the State to provide medical
            assistance under the State plan for home and community-based
            attendant services and supports to eligible individuals in
            accordance with this subsection during a fiscal year quarter
            occurring during the period described in paragraph (1), the
            Federal medical assistance percentage applicable to the State
            (as determined under section 1905(b)) shall be increased by 6
            percentage points.
                ``(3) State requirements.--In order for a State plan
            amendment to be approved under this subsection, the State
            shall--
                        ``(A) develop and implement such amendment in
                    collaboration with a Development and Implementation
                    Council established by the State that includes a
                    majority of members with disabilities, elderly
                    individuals, and their representatives and consults and
                    collaborates with such individuals;
                        ``(B) provide consumer controlled home and
                    community-based attendant services and supports to
                    individuals on a statewide basis, in a manner that
                    provides such services and supports in the most
                    integrated setting appropriate to the individual's
                    needs, and without regard to the individual's age, type
                    or nature of disability, severity of disability, or the
                    form of home and community-based attendant services and
                    supports that the individual requires in order to lead
                    an independent life;
                        ``(C) with respect to expenditures during the first
                    full fiscal year in which the State plan amendment is
                    implemented, maintain or exceed the level of State
                    expenditures for medical assistance that is provided
                    under section 1905(a), section 1915, section 1115, or
                    otherwise to individuals with disabilities or elderly
                    individuals attributable to the preceding fiscal year;
                        ``(D) establish and maintain a comprehensive,
                    continuous quality assurance system with respect to
                    community- based attendant services and supports that--
                                ``(i) includes standards for agency-based
                            and other delivery models with respect to
                            training, appeals for denials and
                            reconsideration procedures of an individual
                            plan, and other factors as determined by the
                            Secretary;
                                ``(ii) incorporates feedback from consumers
                            and their representatives, disability
                            organizations, providers, families of disabled
                            or elderly individuals, members of the
                            community, and others and maximizes consumer
                            independence and consumer control;
                                ``(iii) monitors the health and well-being
                            of each individual who receives home and
                            community-based attendant services and
                            supports, including a process for the mandatory
                            reporting, investigation, and resolution of
                            allegations of neglect, abuse, or exploitation
                            in connection with the provision of such
                            services and supports; and
                                ``(iv) provides information about the
                            provisions of the quality assurance required
                            under clauses (i) through (iii) to each
                            individual receiving such services; and
                        ``(E) collect and report information, as determined
                    necessary by the Secretary, for the purposes of
                    approving the State plan amendment, providing Federal
                    oversight, and conducting an evaluation under paragraph
                    (5)(A), including data regarding how the State provides
                    home and community-based attendant services and
                    supports and other home and community-based services,
                    the cost of such services and supports, and how the
                    State provides individuals with disabilities who
                    otherwise qualify for institutional care under the
                    State plan or under a waiver the choice to instead
                    receive home and community-based services in lieu of
                    institutional care.
                ``(4) Compliance with certain laws.--A State shall ensure
            that, regardless of whether the State uses an agency-provider
            model or other models to provide home and community-based
            attendant services and supports under a State plan amendment
            under this subsection, such services and supports are provided
            in accordance with the requirements of the Fair Labor Standards
            Act of 1938 and applicable Federal and State laws regarding--
                        ``(A) withholding and payment of Federal and State
                    income and payroll taxes;
                        ``(B) the provision of unemployment and workers
                    compensation insurance;
                        ``(C) maintenance of general liability insurance;
                    and
                        ``(D) occupational health and safety.
                ``(5) Evaluation, data collection, and report to
            congress.--
                        ``(A) Evaluation.--The Secretary shall conduct an
                    evaluation of the provision of home and community-based
                    attendant services and supports under this subsection
                    in order to determine the effectiveness of the
                    provision of such services and supports in allowing the
                    individuals receiving such services and supports to
                    lead an independent life to the maximum extent
                    possible; the impact on the physical and emotional
                    health of the individuals who receive such services;
                    and an comparative analysis of the costs of services
                    provided under the State plan amendment under this
                    subsection and those provided under institutional care
                    in a nursing facility, institution for mental diseases,
                    or an intermediate care facility for the mentally
                    retarded.
                        ``(B) Data collection.--The State shall provide the
                    Secretary with the following information regarding the
                    provision of home and community-based attendant
                    services and supports under this subsection for each
                    fiscal year for which such services and supports are
                    provided:
                                ``(i) The number of individuals who are
                            estimated to receive home and community-based
                            attendant services and supports under this
                            subsection during the fiscal year.
                                ``(ii) The number of individuals that
                            received such services and supports during the
                            preceding fiscal year.
                                ``(iii) The specific number of individuals
                            served by type of disability, age, gender,
                            education level, and employment status.
                                ``(iv) Whether the specific individuals
                            have been previously served under any other
                            home and community based services program under
                            the State plan or under a waiver.
                        ``(C) Reports.--Not later than--
                                ``(i) December 31, 2013, the Secretary
                            shall submit to Congress and make available to
                            the public an interim report on the findings of
                            the evaluation under subparagraph (A); and
                                ``(ii) December 31, 2015, the Secretary
                            shall submit to Congress and make available to
                            the public a final report on the findings of
                            the evaluation under subparagraph (A).
                ``(6) Definitions.--In this subsection:
                        ``(A) Activities of daily living.--The term
                    `activities of daily living' includes tasks such as
                    eating, toileting, grooming, dressing, bathing, and
                    transferring.
                        ``(B) Consumer controlled.--The term `consumer
                    controlled' means a method of selecting and providing
                    services and supports that allow the individual, or
                    where appropriate, the individual's representative,
                    maximum control of the home and community-based
                    attendant services and supports, regardless of who acts
                    as the employer of record.
                        ``(C) Delivery models.--
                                ``(i) Agency-provider model.--The term
                            `agency-provider model' means, with respect to
                            the provision of home and community-based
                            attendant services and supports for an
                            individual, subject to paragraph (4), a method
                            of providing consumer controlled services and
                            supports under which entities contract for the
                            provision of such services and supports.
                                ``(ii) Other models.--The term `other
                            models' means, subject to paragraph (4),
                            methods, other than an agency-provider model,
                            for the provision of consumer controlled
                            services and supports. Such models may include
                            the provision of vouchers, direct cash
                            payments, or use of a fiscal agent to assist in
                            obtaining services.
                        ``(D) Health-related tasks.--The term `health-
                    related tasks' means specific tasks related to the
                    needs of an individual, which can be delegated or
                    assigned by licensed health-care professionals under
                    State law to be performed by an attendant.
                        ``(E) Individual's representative.--The term
                    `individual's representative' means a parent, family
                    member, guardian, advocate, or other authorized
                    representative of an individual
                        ``(F) Instrumental activities of daily living.--The
                    term `instrumental activities of daily living' includes
                    (but is not limited to) meal planning and preparation,
                    managing finances, shopping for food, clothing, and
                    other essential items, performing essential household
                    chores, communicating by phone or other media, and
                    traveling around and participating in the community.''.

    SEC. 2402. REMOVAL OF BARRIERS TO PROVIDING HOME AND COMMUNITY-BASED
                  SERVICES.

        (a) Oversight and Assessment of the Administration of Home and
    Community-based Services.--The Secretary of Health and Human Services
    shall promulgate regulations to ensure that all States develop service
    systems that are designed to--
                (1) allocate resources for services in a manner that is
            responsive to the changing needs and choices of beneficiaries
            receiving non-institutionally-based long-term services and
            supports (including such services and supports that are
            provided under programs other the State Medicaid program), and
            that provides strategies for beneficiaries receiving such
            services to maximize their independence, including through the
            use of client-employed providers;
                (2) provide the support and coordination needed for a
            beneficiary in need of such services (and their family
            caregivers or representative, if applicable) to design an
            individualized, self-directed, community-supported life; and
                (3) improve coordination among, and the regulation of, all
            providers of such services under federally and State-funded
            programs in order to--
                        (A) achieve a more consistent administration of
                    policies and procedures across programs in relation to
                    the provision of such services; and
                        (B) oversee and monitor all service system
                    functions to assure--
                                (i) coordination of, and effectiveness of,
                            eligibility determinations and individual
                            assessments;
                                (ii) development and service monitoring of
                            a complaint system, a management system, a
                            system to qualify and monitor providers, and
                            systems for role-setting and individual budget
                            determinations; and
                                (iii) an adequate number of qualified
                            direct care workers to provide self-directed
                            personal assistance services.
        (b) Additional State Options.--Section 1915(i) of the Social
    Security Act (42 U.S.C. 1396n(i)) is amended by adding at the end the
    following new paragraphs:
                ``(6) State option to provide home and community-based
            services to individuals eligible for services under a waiver.--
                        ``(A) In general.--A State that provides home and
                    community-based services in accordance with this
                    subsection to individuals who satisfy the needs-based
                    criteria for the receipt of such services established
                    under paragraph (1)(A) may, in addition to continuing
                    to provide such services to such individuals, elect to
                    provide home and community-based services in accordance
                    with the requirements of this paragraph to individuals
                    who are eligible for home and community-based services
                    under a waiver approved for the State under subsection
                    (c), (d), or (e) or under section 1115 to provide such
                    services, but only for those individuals whose income
                    does not exceed 300 percent of the supplemental
                    security income benefit rate established by section
                    1611(b)(1).
                        ``(B) Application of same requirements for
                    individuals satisfying needs-based criteria.--Subject
                    to subparagraph (C), a State shall provide home and
                    community-based services to individuals under this
                    paragraph in the same manner and subject to the same
                    requirements as apply under the other paragraphs of
                    this subsection to the provision of home and community-
                    based services to individuals who satisfy the needs-
                    based criteria established under paragraph (1)(A).
                        ``(C) Authority to offer different type, amount,
                    duration, or scope of home and community-based
                    services.--A State may offer home and community-based
                    services to individuals under this paragraph that
                    differ in type, amount, duration, or scope from the
                    home and community-based services offered for
                    individuals who satisfy the needs-based criteria
                    established under paragraph (1)(A), so long as such
                    services are within the scope of services described in
                    paragraph (4)(B) of subsection (c) for which the
                    Secretary has the authority to approve a waiver and do
                    not include room or board.
                ``(7) State option to offer home and community-based
            services to specific, targeted populations.--
                        ``(A) In general.--A State may elect in a State
                    plan amendment under this subsection to target the
                    provision of home and community-based services under
                    this subsection to specific populations and to differ
                    the type, amount, duration, or scope of such services
                    to such specific populations.
                        ``(B) 5-year term.--
                                ``(i) In general.--An election by a State
                            under this paragraph shall be for a period of 5
                            years.
                                ``(ii) Phase-in of services and eligibility
                            permitted during initial 5-year period.--A
                            State making an election under this paragraph
                            may, during the first 5-year period for which
                            the election is made, phase-in the enrollment
                            of eligible individuals, or the provision of
                            services to such individuals, or both, so long
                            as all eligible individuals in the State for
                            such services are enrolled, and all such
                            services are provided, before the end of the
                            initial 5-year period.
                        ``(C) Renewal.--An election by a State under this
                    paragraph may be renewed for additional 5-year terms if
                    the Secretary determines, prior to beginning of each
                    such renewal period, that the State has--
                                ``(i) adhered to the requirements of this
                            subsection and paragraph in providing services
                            under such an election; and
                                ``(ii) met the State's objectives with
                            respect to quality improvement and beneficiary
                            outcomes.''.
        (c) Removal of Limitation on Scope of Services.--Paragraph (1) of
    section 1915(i) of the Social Security Act (42 U.S.C. 1396n(i)), as
    amended by subsection (a), is amended by striking ``or such other
    services requested by the State as the Secretary may approve''.
        (d) Optional Eligibility Category To Provide Full Medicaid Benefits
    to Individuals Receiving Home and Community-based Services Under a
    State Plan Amendment.--
                (1) In general.--Section 1902(a)(10)(A)(ii) of the Social
            Security Act (42 U.S.C. 1396a(a)(10)(A)(ii)), as amended by
            section 2304(a)(1), is amended--
                        (A) in subclause (XX), by striking ``or'' at the
                    end;
                        (B) in subclause (XXI), by adding ``or'' at the
                    end; and
                        (C) by inserting after subclause (XXI), the
                    following new subclause:
                                        ``(XXII) who are eligible for home
                                    and community-based services under
                                    needs-based criteria established under
                                    paragraph (1)(A) of section 1915(i), or
                                    who are eligible for home and
                                    community-based services under
                                    paragraph (6) of such section, and who
                                    will receive home and community-based
                                    services pursuant to a State plan
                                    amendment under such subsection;''.
                (2) Conforming amendments.--
                        (A) Section 1903(f)(4) of the Social Security Act
                    (42 U.S.C. 1396b(f)(4)), as amended by section
                    2304(a)(4)(B), is amended in the matter preceding
                    subparagraph (A), by inserting
                    ``1902(a)(10)(A)(ii)(XXII),'' after
                    ``1902(a)(10)(A)(ii)(XXI),''.
                        (B) Section 1905(a) of the Social Security Act (42
                    U.S.C. 1396d(a)), as so amended, is amended in the
                    matter preceding paragraph (1)--
                                (i) in clause (xv), by striking ``or'' at
                            the end;
                                (ii) in clause (xvi), by adding ``or'' at
                            the end; and
                                (iii) by inserting after clause (xvi) the
                            following new clause:
                ``(xvii) individuals who are eligible for home and
            community-based services under needs-based criteria established
            under paragraph (1)(A) of section 1915(i), or who are eligible
            for home and community-based services under paragraph (6) of
            such section, and who will receive home and community-based
            services pursuant to a State plan amendment under such
            subsection,''.
        (e) Elimination of Option To Limit Number of Eligible Individuals
    or Length of Period for Grandfathered Individuals if Eligibility
    Criteria Is Modified.--Paragraph (1) of section 1915(i) of such Act (42
    U.S.C. 1396n(i)) is amended--
                (1) by striking subparagraph (C) and inserting the
            following:
                        ``(C) Projection of number of individuals to be
                    provided home and community-based services.--The State
                    submits to the Secretary, in such form and manner, and
                    upon such frequency as the Secretary shall specify, the
                    projected number of individuals to be provided home and
                    community-based services.''; and
                (2) in subclause (II) of subparagraph (D)(ii), by striking
            ``to be eligible for such services for a period of at least 12
            months beginning on the date the individual first received
            medical assistance for such services'' and inserting ``to
            continue to be eligible for such services after the effective
            date of the modification and until such time as the individual
            no longer meets the standard for receipt of such services under
            such pre-modified criteria''.
        (f) Elimination of Option To Waive Statewideness; Addition of
    Option To Waive Comparability.--Paragraph (3) of section 1915(i) of
    such Act (42 U.S.C. 1396n(3)) is amended by striking ``1902(a)(1)
    (relating to statewideness)'' and inserting ``1902(a)(10)(B) (relating
    to comparability)''.
        (g) Effective Date.--The amendments made by subsections (b) through
    (f) take effect on the first day of the first fiscal year quarter that
    begins after the date of enactment of this Act.

    SEC. 2403. MONEY FOLLOWS THE PERSON REBALANCING DEMONSTRATION.

        (a) Extension of Demonstration.--
                (1) In general.--Section 6071(h) of the Deficit Reduction
            Act of 2005 (42 U.S.C. 1396a note) is amended--
                        (A) in paragraph (1)(E), by striking ``fiscal year
                    2011'' and inserting ``each of fiscal years 2011
                    through 2016''; and
                        (B) in paragraph (2), by striking ``2011'' and
                    inserting ``2016''.
                (2) Evaluation.--Paragraphs (2) and (3) of section 6071(g)
            of such Act is amended are each amended by striking ``2011''
            and inserting ``2016''.
        (b) Reduction of Institutional Residency Period.--
                (1) In general.--Section 6071(b)(2) of the Deficit
            Reduction Act of 2005 (42 U.S.C. 1396a note) is amended--
                        (A) in subparagraph (A)(i), by striking ``, for a
                    period of not less than 6 months or for such longer
                    minimum period, not to exceed 2 years, as may be
                    specified by the State'' and inserting ``for a period
                    of not less than 90 consecutive days''; and
                        (B) by adding at the end the following:
            ``Any days that an individual resides in an institution on the
            basis of having been admitted solely for purposes of receiving
            short-term rehabilitative services for a period for which
            payment for such services is limited under title XVIII shall
            not be taken into account for purposes of determining the 90-
            day period required under subparagraph (A)(i).''.
                (2) Effective date.--The amendments made by this subsection
            take effect 30 days after the date of enactment of this Act.

    SEC. 2404. PROTECTION FOR RECIPIENTS OF HOME AND COMMUNITY-BASED
                  SERVICES AGAINST SPOUSAL IMPOVERISHMENT.

        During the 5-year period that begins on January 1, 2014, section
    1924(h)(1)(A) of the Social Security Act (42 U.S.C. 1396r-5(h)(1)(A))
    shall be applied as though ``is eligible for medical assistance for
    home and community-based services provided under subsection (c), (d),
    or (i) of section 1915, under a waiver approved under section 1115, or
    who is eligible for such medical assistance by reason of being
    determined eligible under section 1902(a)(10)(C) or by reason of
    section 1902(f) or otherwise on the basis of a reduction of income
    based on costs incurred for medical or other remedial care, or who is
    eligible for medical assistance for home and community-based attendant
    services and supports under section 1915(k)'' were substituted in such
    section for ``(at the option of the State) is described in section
    1902(a)(10)(A)(ii)(VI)''.

    SEC. 2405. FUNDING TO EXPAND STATE AGING AND DISABILITY RESOURCE
                  CENTERS.

        Out of any funds in the Treasury not otherwise appropriated, there
    is appropriated to the Secretary of Health and Human Services, acting
    through the Assistant Secretary for Aging, $10,000,000 for each of
    fiscal years 2010 through 2014, to carry out subsections
    (a)(20)(B)(iii) and (b)(8) of section 202 of the Older Americans Act of
    1965 (42 U.S.C. 3012).

    SEC. 2406. SENSE OF THE SENATE REGARDING LONG-TERM CARE.

        (a) Findings.--The Senate makes the following findings:
                (1) Nearly 2 decades have passed since Congress seriously
            considered long-term care reform. The United States Bipartisan
            Commission on Comprehensive Health Care, also know as the
            ``Pepper Commission'', released its ``Call for Action''
            blueprint for health reform in September 1990. In the 20 years
            since those recommendations were made, Congress has never acted
            on the report.
                (2) In 1999, under the United States Supreme Court's
            decision in Olmstead v. L.C., 527 U.S. 581 (1999), individuals
            with disabilities have the right to choose to receive their
            long-term services and supports in the community, rather than
            in an institutional setting.
                (3) Despite the Pepper Commission and Olmstead decision,
            the long-term care provided to our Nation's elderly and
            disabled has not improved. In fact, for many, it has gotten far
            worse.
                (4) In 2007, 69 percent of Medicaid long-term care spending
            for elderly individuals and adults with physical disabilities
            paid for institutional services. Only 6 states spent 50 percent
            or more of their Medicaid long-term care dollars on home and
            community-based services for elderly individuals and adults
            with physical disabilities while \1/2\ of the States spent less
            than 25 percent. This disparity continues even though, on
            average, it is estimated that Medicaid dollars can support
            nearly 3 elderly individuals and adults with physical
            disabilities in home and community-based services for every
            individual in a nursing home. Although every State has chosen
            to provide certain services under home and community-based
            waivers, these services are unevenly available within and
            across States, and reach a small percentage of eligible
            individuals.
        (b) Sense of the Senate.--It is the sense of the Senate that--
                (1) during the 111th session of Congress, Congress should
            address long-term services and supports in a comprehensive way
            that guarantees elderly and disabled individuals the care they
            need; and
                (2) long term services and supports should be made
            available in the community in addition to in institutions.

                Subtitle F--Medicaid Prescription Drug Coverage

    SEC. 2501. PRESCRIPTION DRUG REBATES.

        (a) Increase in Minimum Rebate Percentage for Single Source Drugs
    and Innovator Multiple Source Drugs.--
                (1) In general.--Section 1927(c)(1)(B) of the Social
            Security Act (42 U.S.C. 1396r-8(c)(1)(B)) is amended--
                        (A) in clause (i)--
                                (i) in subclause (IV), by striking ``and''
                            at the end;
                                (ii) in subclause (V)--
                                        (I) by inserting ``and before
                                    January 1, 2010'' after ``December 31,
                                    1995,''; and
                                        (II) by striking the period at the
                                    end and inserting ``; and''; and
                                (iii) by adding at the end the following
                            new subclause:
                                        ``(VI) except as provided in clause
                                    (iii), after December 31, 2009, 23.1
                                    percent.''; and
                        (B) by adding at the end the following new clause:
                                ``(iii) Minimum rebate percentage for
                            certain drugs.--
                                        ``(I) In general.--In the case of a
                                    single source drug or an innovator
                                    multiple source drug described in
                                    subclause (II), the minimum rebate
                                    percentage for rebate periods specified
                                    in clause (i)(VI) is 17.1 percent.
                                        ``(II) Drug described.--For
                                    purposes of subclause (I), a single
                                    source drug or an innovator multiple
                                    source drug described in this subclause
                                    is any of the following drugs:
                                                ``(aa) A clotting factor
                                            for which a separate furnishing
                                            payment is made under section
                                            1842(o)(5) and which is
                                            included on a list of such
                                            factors specified and updated
                                            regularly by the Secretary.
                                                ``(bb) A drug approved by
                                            the Food and Drug
                                            Administration exclusively for
                                            pediatric indications.''.
                (2) Recapture of total savings due to increase.--Section
            1927(b)(1) of such Act (42 U.S.C. 1396r-8(b)(1)) is amended by
            adding at the end the following new subparagraph:
                        ``(C) Special rule for increased minimum rebate
                    percentage.--
                                ``(i) In general.--In addition to the
                            amounts applied as a reduction under
                            subparagraph (B), for rebate periods beginning
                            on or after January 1, 2010, during a fiscal
                            year, the Secretary shall reduce payments to a
                            State under section 1903(a) in the manner
                            specified in clause (ii), in an amount equal to
                            the product of--
                                        ``(I) 100 percent minus the Federal
                                    medical assistance percentage
                                    applicable to the rebate period for the
                                    State; and
                                        ``(II) the amounts received by the
                                    State under such subparagraph that are
                                    attributable (as estimated by the
                                    Secretary based on utilization and
                                    other data) to the increase in the
                                    minimum rebate percentage effected by
                                    the amendments made by subsections
                                    (a)(1), (b), and (d) of section 2501 of
                                    the Patient Protection and Affordable
                                    Care Act, taking into account the
                                    additional drugs included under the
                                    amendments made by subsection (c) of
                                    section 2501 of such Act.
                            The Secretary shall adjust such payment
                            reduction for a calendar quarter to the extent
                            the Secretary determines, based upon subsequent
                            utilization and other data, that the reduction
                            for such quarter was greater or less than the
                            amount of payment reduction that should have
                            been made.
                                ``(ii) Manner of payment reduction.--The
                            amount of the payment reduction under clause
                            (i) for a State for a quarter shall be deemed
                            an overpayment to the State under this title to
                            be disallowed against the State's regular
                            quarterly draw for all Medicaid spending under
                            section 1903(d)(2). Such a disallowance is not
                            subject to a reconsideration under section
                            1116(d).''.
        (b) Increase in Rebate for Other Drugs.--Section 1927(c)(3)(B) of
    such Act (42 U.S.C. 1396r-8(c)(3)(B)) is amended--
                (1) in clause (i), by striking ``and'' at the end;
                (2) in clause (ii)--
                        (A) by inserting ``and before January 1, 2010,''
                    after ``December 31, 1993,''; and
                        (B) by striking the period and inserting ``; and'';
                    and
                (3) by adding at the end the following new clause:
                                ``(iii) after December 31, 2009, is 13
                            percent.''.
        (c) Extension of Prescription Drug Discounts to Enrollees of
    Medicaid Managed Care Organizations.--
                (1) In general.--Section 1903(m)(2)(A) of such Act (42
            U.S.C. 1396b(m)(2)(A)) is amended--
                        (A) in clause (xi), by striking ``and'' at the end;
                        (B) in clause (xii), by striking the period at the
                    end and inserting ``; and''; and
                        (C) by adding at the end the following:
                                ``(xiii) such contract provides that (I)
                            covered outpatient drugs dispensed to
                            individuals eligible for medical assistance who
                            are enrolled with the entity shall be subject
                            to the same rebate required by the agreement
                            entered into under section 1927 as the State is
                            subject to and that the State shall collect
                            such rebates from manufacturers, (II)
                            capitation rates paid to the entity shall be
                            based on actual cost experience related to
                            rebates and subject to the Federal regulations
                            requiring actuarially sound rates, and (III)
                            the entity shall report to the State, on such
                            timely and periodic basis as specified by the
                            Secretary in order to include in the
                            information submitted by the State to a
                            manufacturer and the Secretary under section
                            1927(b)(2)(A), information on the total number
                            of units of each dosage form and strength and
                            package size by National Drug Code of each
                            covered outpatient drug dispensed to
                            individuals eligible for medical assistance who
                            are enrolled with the entity and for which the
                            entity is responsible for coverage of such drug
                            under this subsection (other than covered
                            outpatient drugs that under subsection (j)(1)
                            of section 1927 are not subject to the
                            requirements of that section) and such other
                            data as the Secretary determines necessary to
                            carry out this subsection.''.
                (2) Conforming amendments.--Section 1927 (42 U.S.C. 1396r-
            8) is amended--
                        (A) in subsection (b)--
                                (i) in paragraph (1)(A), in the first
                            sentence, by inserting ``, including such drugs
                            dispensed to individuals enrolled with a
                            medicaid managed care organization if the
                            organization is responsible for coverage of
                            such drugs'' before the period; and
                                (ii) in paragraph (2)(A), by inserting
                            ``including such information reported by each
                            medicaid managed care organization,'' after
                            ``for which payment was made under the plan
                            during the period,''; and
                        (B) in subsection (j), by striking paragraph (1)
                    and inserting the following:
                ``(1) Covered outpatient drugs are not subject to the
            requirements of this section if such drugs are--
                        ``(A) dispensed by health maintenance
                    organizations, including Medicaid managed care
                    organizations that contract under section 1903(m); and
                        ``(B) subject to discounts under section 340B of
                    the Public Health Service Act.''.
        (d) Additional Rebate for New Formulations of Existing Drugs.--
                (1) In general.--Section 1927(c)(2) of the Social Security
            Act (42 U.S.C. 1396r-8(c)(2)) is amended by adding at the end
            the following new subparagraph:
                        ``(C) Treatment of new formulations.--
                                ``(i) In general.--Except as provided in
                            clause (ii), in the case of a drug that is a
                            new formulation, such as an extended-release
                            formulation, of a single source drug or an
                            innovator multiple source drug, the rebate
                            obligation with respect to the drug under this
                            section shall be the amount computed under this
                            section for the new formulation of the drug or,
                            if greater, the product of--
                                        ``(I) the average manufacturer
                                    price for each dosage form and strength
                                    of the new formulation of the single
                                    source drug or innovator multiple
                                    source drug;
                                        ``(II) the highest additional
                                    rebate (calculated as a percentage of
                                    average manufacturer price) under this
                                    section for any strength of the
                                    original single source drug or
                                    innovator multiple source drug; and
                                        ``(III) the total number of units
                                    of each dosage form and strength of the
                                    new formulation paid for under the
                                    State plan in the rebate period (as
                                    reported by the State).
                                ``(ii) No application to new formulations
                            of orphan drugs.--Clause (i) shall not apply to
                            a new formulation of a covered outpatient drug
                            that is or has been designated under section
                            526 of the Federal Food, Drug, and Cosmetic Act
                            (21 U.S.C. 360bb) for a rare disease or
                            condition, without regard to whether the period
                            of market exclusivity for the drug under
                            section 527 of such Act has expired or the
                            specific indication for use of the drug.''.
                (2) Effective date.--The amendment made by paragraph (1)
            shall apply to drugs that are paid for by a State after
            December 31, 2009.
        (e) Maximum Rebate Amount.--Section 1927(c)(2) of such Act (42
    U.S.C. 1396r-8(c)(2)), as amended by subsection (d), is amended by
    adding at the end the following new subparagraph:
                        ``(D) Maximum rebate amount.--In no case shall the
                    sum of the amounts applied under paragraph (1)(A)(ii)
                    and this paragraph with respect to each dosage form and
                    strength of a single source drug or an innovator
                    multiple source drug for a rebate period beginning
                    after December 31, 2009, exceed 100 percent of the
                    average manufacturer price of the drug.''.
        (f) Conforming Amendments.--
                (1) In general.--Section 340B of the Public Health Service
            Act (42 U.S.C. 256b) is amended--
                        (A) in subsection (a)(2)(B)(i), by striking
                    ``1927(c)(4)'' and inserting ``1927(c)(3)''; and
                        (B) by striking subsection (c); and
                        (C) redesignating subsection (d) as subsection (c).
                (2) Effective date.--The amendments made by this subsection
            take effect on January 1, 2010.

    SEC. 2502. ELIMINATION OF EXCLUSION OF COVERAGE OF CERTAIN DRUGS.

        (a) In General.--Section 1927(d) of the Social Security Act (42
    U.S.C. 1397r-8(d)) is amended--
                (1) in paragraph (2)--
                        (A) by striking subparagraphs (E), (I), and (J),
                    respectively; and
                        (B) by redesignating subparagraphs (F), (G), (H),
                    and (K) as subparagraphs (E), (F), (G), and (H),
                    respectively; and
                (2) by adding at the end the following new paragraph:
                ``(7) Non-excludable drugs.--The following drugs or classes
            of drugs, or their medical uses, shall not be excluded from
            coverage:
                        ``(A) Agents when used to promote smoking
                    cessation, including agents approved by the Food and
                    Drug Administration under the over-the-counter
                    monograph process for purposes of promoting, and when
                    used to promote, tobacco cessation.
                        ``(B) Barbiturates.
                        ``(C) Benzodiazepines.''.
        (b) Effective Date.--The amendments made by this section shall
    apply to services furnished on or after January 1, 2014.

    SEC. 2503. PROVIDING ADEQUATE PHARMACY REIMBURSEMENT.

        (a) Pharmacy Reimbursement Limits.--
                (1) In general.--Section 1927(e) of the Social Security Act
            (42 U.S.C. 1396r-8(e)) is amended--
                        (A) in paragraph (4), by striking ``(or, effective
                    January 1, 2007, two or more)''; and
                        (B) by striking paragraph (5) and inserting the
                    following:
                ``(5) Use of amp in upper payment limits.--The Secretary
            shall calculate the Federal upper reimbursement limit
            established under paragraph (4) as no less than 175 percent of
            the weighted average (determined on the basis of utilization)
            of the most recently reported monthly average manufacturer
            prices for pharmaceutically and therapeutically equivalent
            multiple source drug products that are available for purchase
            by retail community pharmacies on a nationwide basis. The
            Secretary shall implement a smoothing process for average
            manufacturer prices. Such process shall be similar to the
            smoothing process used in determining the average sales price
            of a drug or biological under section 1847A.''.
                (2) Definition of amp.--Section 1927(k)(1) of such Act (42
            U.S.C. 1396r-8(k)(1)) is amended--
                        (A) in subparagraph (A), by striking ``by'' and all
                    that follows through the period and inserting ``by--
                                ``(i) wholesalers for drugs distributed to
                            retail community pharmacies; and
                                ``(ii) retail community pharmacies that
                            purchase drugs directly from the
                            manufacturer.''; and
                        (B) by striking subparagraph (B) and inserting the
                    following:
                        ``(B) Exclusion of customary prompt pay discounts
                    and other payments.--
                                ``(i) In general.--The average manufacturer
                            price for a covered outpatient drug shall
                            exclude--
                                        ``(I) customary prompt pay
                                    discounts extended to wholesalers;
                                        ``(II) bona fide service fees paid
                                    by manufacturers to wholesalers or
                                    retail community pharmacies, including
                                    (but not limited to) distribution
                                    service fees, inventory management
                                    fees, product stocking allowances, and
                                    fees associated with administrative
                                    services agreements and patient care
                                    programs (such as medication compliance
                                    programs and patient education
                                    programs);
                                        ``(III) reimbursement by
                                    manufacturers for recalled, damaged,
                                    expired, or otherwise unsalable
                                    returned goods, including (but not
                                    limited to) reimbursement for the cost
                                    of the goods and any reimbursement of
                                    costs associated with return goods
                                    handling and processing, reverse
                                    logistics, and drug destruction; and
                                        ``(IV) payments received from, and
                                    rebates or discounts provided to,
                                    pharmacy benefit managers, managed care
                                    organizations, health maintenance
                                    organizations, insurers, hospitals,
                                    clinics, mail order pharmacies, long
                                    term care providers, manufacturers, or
                                    any other entity that does not conduct
                                    business as a wholesaler or a retail
                                    community pharmacy.
                                ``(ii) Inclusion of other discounts and
                            payments.--Notwithstanding clause (i), any
                            other discounts, rebates, payments, or other
                            financial transactions that are received by,
                            paid by, or passed through to, retail community
                            pharmacies shall be included in the average
                            manufacturer price for a covered outpatient
                            drug.''; and
                        (C) in subparagraph (C), by striking ``the retail
                    pharmacy class of trade'' and inserting ``retail
                    community pharmacies''.
                (3) Definition of multiple source drug.--Section 1927(k)(7)
            of such Act (42 U.S.C. 1396r-8(k)(7)) is amended--
                        (A) in subparagraph (A)(i)(III), by striking ``the
                    State'' and inserting ``the United States''; and
                        (B) in subparagraph (C)--
                                (i) in clause (i), by inserting ``and''
                            after the semicolon;
                                (ii) in clause (ii), by striking ``; and''
                            and inserting a period; and
                                (iii) by striking clause (iii).
                (4) Definitions of retail community pharmacy; wholesaler.--
            Section 1927(k) of such Act (42 U.S.C. 1396r-8(k)) is amended
            by adding at the end the following new paragraphs:
                ``(10) Retail community pharmacy.--The term `retail
            community pharmacy' means an independent pharmacy, a chain
            pharmacy, a supermarket pharmacy, or a mass merchandiser
            pharmacy that is licensed as a pharmacy by the State and that
            dispenses medications to the general public at retail prices.
            Such term does not include a pharmacy that dispenses
            prescription medications to patients primarily through the
            mail, nursing home pharmacies, long-term care facility
            pharmacies, hospital pharmacies, clinics, charitable or not-
            for-profit pharmacies, government pharmacies, or pharmacy
            benefit managers.
                ``(11) Wholesaler.--The term `wholesaler' means a drug
            wholesaler that is engaged in wholesale distribution of
            prescription drugs to retail community pharmacies, including
            (but not limited to) manufacturers, repackers, distributors,
            own-label distributors, private-label distributors, jobbers,
            brokers, warehouses (including manufacturer's and distributor's
            warehouses, chain drug warehouses, and wholesale drug
            warehouses) independent wholesale drug traders, and retail
            community pharmacies that conduct wholesale distributions.''.
        (b) Disclosure of Price Information to the Public.--Section
    1927(b)(3) of such Act (42 U.S.C. 1396r-8(b)(3)) is amended--
                (1) in subparagraph (A)--
                        (A) in the first sentence, by inserting after
                    clause (iii) the following:
                                ``(iv) not later than 30 days after the
                            last day of each month of a rebate period under
                            the agreement, on the manufacturer's total
                            number of units that are used to calculate the
                            monthly average manufacturer price for each
                            covered outpatient drug;''; and
                        (B) in the second sentence, by inserting
                    ``(relating to the weighted average of the most
                    recently reported monthly average manufacturer
                    prices)'' after ``(D)(v)''; and
                (2) in subparagraph (D)(v), by striking ``average
            manufacturer prices'' and inserting ``the weighted average of
            the most recently reported monthly average manufacturer prices
            and the average retail survey price determined for each
            multiple source drug in accordance with subsection (f)''.
        (c) Clarification of Application of Survey of Retail Prices.--
    Section 1927(f)(1) of such Act (42 U.S.C. 1396r-8(b)(1)) is amended--
                (1) in subparagraph (A)(i), by inserting ``with respect to
            a retail community pharmacy,'' before ``the determination'';
            and
                (2) in subparagraph (C)(ii), by striking ``retail
            pharmacies'' and inserting ``retail community pharmacies''.
        (d) Effective Date.--The amendments made by this section shall take
    effect on the first day of the first calendar year quarter that begins
    at least 180 days after the date of enactment of this Act, without
    regard to whether or not final regulations to carry out such amendments
    have been promulgated by such date.

      Subtitle G--Medicaid Disproportionate Share Hospital (DSH) Payments

    SEC. 2551. DISPROPORTIONATE SHARE HOSPITAL PAYMENTS.

        (a) In General.--Section 1923(f) of the Social Security Act (42
    U.S.C. 1396r-4(f)) is amended--
                (1) in paragraph (1), by striking ``and (3)'' and inserting
            ``, (3), and (7)'';
                (2) in paragraph (3)(A), by striking ``paragraph (6)'' and
            inserting ``paragraphs (6) and (7)'';
                (3) by redesignating paragraph (7) as paragraph (8); and
                (4) by inserting after paragraph (6) the following new
            paragraph:
                ``(7) Reduction of state dsh allotments once reduction in
            uninsured threshold reached.--
                        ``(A) In general.--Subject to subparagraph (E), the
                    DSH allotment for a State for fiscal years beginning
                    with the fiscal year described in subparagraph (C)
                    (with respect to the State), is equal to--
                                ``(i) in the case of the first fiscal year
                            described in subparagraph (C) with respect to a
                            State, the DSH allotment that would be
                            determined under this subsection for the State
                            for the fiscal year without application of this
                            paragraph (but after the application of
                            subparagraph (D)), reduced by the applicable
                            percentage determined for the State for the
                            fiscal year under subparagraph (B)(i); and
                                ``(ii) in the case of any subsequent fiscal
                            year with respect to the State, the DSH
                            allotment determined under this paragraph for
                            the State for the preceding fiscal year,
                            reduced by the applicable percentage determined
                            for the State for the fiscal year under
                            subparagraph (B)(ii).
                        ``(B) Applicable percentage.--For purposes of
                    subparagraph (A), the applicable percentage for a State
                    for a fiscal year is the following:
                                ``(i) Uninsured reduction threshold fiscal
                            year.--In the case of the first fiscal year
                            described in subparagraph (C) with respect to
                            the State--
                                        ``(I) if the State is a low DSH
                                    State described in paragraph (5)(B),
                                    the applicable percentage is equal to
                                    25 percent; and
                                        ``(II) if the State is any other
                                    State, the applicable percentage is 50
                                    percent.
                                ``(ii) Subsequent fiscal years in which the
                            percentage of uninsured decreases.--In the case
                            of any fiscal year after the first fiscal year
                            described in subparagraph (C) with respect to a
                            State, if the Secretary determines on the basis
                            of the most recent American Community Survey of
                            the Bureau of the Census, that the percentage
                            of uncovered individuals residing in the State
                            is less than the percentage of such individuals
                            determined for the State for the preceding
                            fiscal year--
                                        ``(I) if the State is a low DSH
                                    State described in paragraph (5)(B),
                                    the applicable percentage is equal to
                                    the product of the percentage reduction
                                    in uncovered individuals for the fiscal
                                    year from the preceding fiscal year and
                                    25 percent; and
                                        ``(II) if the State is any other
                                    State, the applicable percentage is
                                    equal to the product of the percentage
                                    reduction in uncovered individuals for
                                    the fiscal year from the preceding
                                    fiscal year and 50 percent.
                        ``(C) Fiscal year described.--For purposes of
                    subparagraph (A), the fiscal year described in this
                    subparagraph with respect to a State is the first
                    fiscal year that occurs after fiscal year 2012 for
                    which the Secretary determines, on the basis of the
                    most recent American Community Survey of the Bureau of
                    the Census, that the percentage of uncovered
                    individuals residing in the State is at least 45
                    percent less than the percentage of such individuals
                    determined for the State for fiscal year 2009.
                        ``(D) Exclusion of portions diverted for coverage
                    expansions.--For purposes of applying the applicable
                    percentage reduction under subparagraph (A) to the DSH
                    allotment for a State for a fiscal year, the DSH
                    allotment for a State that would be determined under
                    this subsection for the State for the fiscal year
                    without the application of this paragraph (and prior to
                    any such reduction) shall not include any portion of
                    the allotment for which the Secretary has approved the
                    State's diversion to the costs of providing medical
                    assistance or other health benefits coverage under a
                    waiver that is in effect on July 2009.
                        ``(E) Minimum allotment.--In no event shall the DSH
                    allotment determined for a State in accordance with
                    this paragraph for fiscal year 2013 or any succeeding
                    fiscal year be less than the amount equal to 35 percent
                    of the DSH allotment determined for the State for
                    fiscal year 2012 under this subsection (and after the
                    application of this paragraph, if applicable),
                    increased by the percentage change in the consumer
                    price index for all urban consumers (all items, U.S.
                    city average) for each previous fiscal year occurring
                    before the fiscal year.
                        ``(F) Uncovered individuals.--In this paragraph,
                    the term `uncovered individuals' means individuals with
                    no health insurance coverage at any time during a year
                    (as determined by the Secretary based on the most
                    recent data available).''.
        (b) Effective Date.--The amendments made by subsection (a) take
    effect on October 1, 2011.

       Subtitle H--Improved Coordination for Dual Eligible Beneficiaries

    SEC. 2601. 5-YEAR PERIOD FOR DEMONSTRATION PROJECTS.

        (a) In General.--Section 1915(h) of the Social Security Act (42
    U.S.C. 1396n(h)) is amended--
                (1) by inserting ``(1)'' after ``(h)'';
                (2) by inserting ``, or a waiver described in paragraph
            (2)'' after ``(e)''; and
                (3) by adding at the end the following new paragraph:
        ``(2)(A) Notwithstanding subsections (c)(3) and (d) (3), any waiver
    under subsection (b), (c), or (d), or a waiver under section 1115, that
    provides medical assistance for dual eligible individuals (including
    any such waivers under which non dual eligible individuals may be
    enrolled in addition to dual eligible individuals) may be conducted for
    a period of 5 years and, upon the request of the State, may be extended
    for additional 5-year periods unless the Secretary determines that for
    the previous waiver period the conditions for the waiver have not been
    met or it would no longer be cost-effective and efficient, or
    consistent with the purposes of this title, to extend the waiver.
        ``(B) In this paragraph, the term `dual eligible individual' means
    an individual who is entitled to, or enrolled for, benefits under part
    A of title XVIII, or enrolled for benefits under part B of title XVIII,
    and is eligible for medical assistance under the State plan under this
    title or under a waiver of such plan.''.
        (b) Conforming Amendments.--
                (1) Section 1915 of such Act (42 U.S.C. 1396n) is amended--
                        (A) in subsection (b), by adding at the end the
                    following new sentence: ``Subsection (h)(2) shall apply
                    to a waiver under this subsection.'';
                        (B) in subsection (c)(3), in the second sentence,
                    by inserting ``(other than a waiver described in
                    subsection (h)(2))'' after ``A waiver under this
                    subsection'';
                        (C) in subsection (d)(3), in the second sentence,
                    by inserting ``(other than a waiver described in
                    subsection (h)(2))'' after ``A waiver under this
                    subsection''.
                (2) Section 1115 of such Act (42 U.S.C. 1315) is amended--
                        (A) in subsection (e)(2), by inserting ``(5 years,
                    in the case of a waiver described in section
                    1915(h)(2))'' after ``3 years''; and
                        (B) in subsection (f)(6), by inserting ``(5 years,
                    in the case of a waiver described in section
                    1915(h)(2))'' after ``3 years''.

    SEC. 2602. PROVIDING FEDERAL COVERAGE AND PAYMENT COORDINATION FOR DUAL
                  ELIGIBLE BENEFICIARIES.

        (a) Establishment of Federal Coordinated Health Care Office.--
                (1) In general.--Not later than March 1, 2010, the
            Secretary of Health and Human Services (in this section
            referred to as the ``Secretary'') shall establish a Federal
            Coordinated Health Care Office.
                (2) Establishment and reporting to cms administrator.--The
            Federal Coordinated Health Care Office--
                        (A) shall be established within the Centers for
                    Medicare & Medicaid Services; and
                        (B) have as the Office a Director who shall be
                    appointed by, and be in direct line of authority to,
                    the Administrator of the Centers for Medicare &
                    Medicaid Services.
        (b) Purpose.--The purpose of the Federal Coordinated Health Care
    Office is to bring together officers and employees of the Medicare and
    Medicaid programs at the Centers for Medicare & Medicaid Services in
    order to--
                (1) more effectively integrate benefits under the Medicare
            program under title XVIII of the Social Security Act and the
            Medicaid program under title XIX of such Act; and
                (2) improve the coordination between the Federal Government
            and States for individuals eligible for benefits under both
            such programs in order to ensure that such individuals get full
            access to the items and services to which they are entitled
            under titles XVIII and XIX of the Social Security Act.
        (c) Goals.--The goals of the Federal Coordinated Health Care Office
    are as follows:
                (1) Providing dual eligible individuals full access to the
            benefits to which such individuals are entitled under the
            Medicare and Medicaid programs.
                (2) Simplifying the processes for dual eligible individuals
            to access the items and services they are entitled to under the
            Medicare and Medicaid programs.
                (3) Improving the quality of health care and long-term
            services for dual eligible individuals.
                (4) Increasing dual eligible individuals' understanding of
            and satisfaction with coverage under the Medicare and Medicaid
            programs.
                (5) Eliminating regulatory conflicts between rules under
            the Medicare and Medicaid programs.
                (6) Improving care continuity and ensuring safe and
            effective care transitions for dual eligible individuals.
                (7) Eliminating cost-shifting between the Medicare and
            Medicaid program and among related health care providers.
                (8) Improving the quality of performance of providers of
            services and suppliers under the Medicare and Medicaid
            programs.
        (d) Specific Responsibilities.--The specific responsibilities of
    the Federal Coordinated Health Care Office are as follows:
                (1) Providing States, specialized MA plans for special
            needs individuals (as defined in section 1859(b)(6) of the
            Social Security Act (42 U.S.C. 1395w-28(b)(6))), physicians and
            other relevant entities or individuals with the education and
            tools necessary for developing programs that align benefits
            under the Medicare and Medicaid programs for dual eligible
            individuals.
                (2) Supporting State efforts to coordinate and align acute
            care and long-term care services for dual eligible individuals
            with other items and services furnished under the Medicare
            program.
                (3) Providing support for coordination of contracting and
            oversight by States and the Centers for Medicare & Medicaid
            Services with respect to the integration of the Medicare and
            Medicaid programs in a manner that is supportive of the goals
            described in paragraph (3).
                (4) To consult and coordinate with the Medicare Payment
            Advisory Commission established under section 1805 of the
            Social Security Act (42 U.S.C. 1395b-6) and the Medicaid and
            CHIP Payment and Access Commission established under section
            1900 of such Act (42 U.S.C. 1396) with respect to policies
            relating to the enrollment in, and provision of, benefits to
            dual eligible individuals under the Medicare program under
            title XVIII of the Social Security Act and the Medicaid program
            under title XIX of such Act.
                (5) To study the provision of drug coverage for new full-
            benefit dual eligible individuals (as defined in section
            1935(c)(6) of the Social Security Act (42 U.S.C. 1396u-
            5(c)(6)), as well as to monitor and report annual total
            expenditures, health outcomes, and access to benefits for all
            dual eligible individuals.
        (e) Report.--The Secretary shall, as part of the budget transmitted
    under section 1105(a) of title 31, United States Code, submit to
    Congress an annual report containing recommendations for legislation
    that would improve care coordination and benefits for dual eligible
    individuals.
        (f) Dual Eligible Defined.--In this section, the term ``dual
    eligible individual'' means an individual who is entitled to, or
    enrolled for, benefits under part A of title XVIII of the Social
    Security Act, or enrolled for benefits under part B of title XVIII of
    such Act, and is eligible for medical assistance under a State plan
    under title XIX of such Act or under a waiver of such plan.

        Subtitle I--Improving the Quality of Medicaid for Patients and
                                   Providers

    SEC. 2701. ADULT HEALTH QUALITY MEASURES.

        Title XI of the Social Security Act (42 U.S.C. 1301 et seq.), as
    amended by section 401 of the Children's Health Insurance Program
    Reauthorization Act of 2009 (Public Law 111-3), is amended by inserting
    after section 1139A the following new section:

    ``SEC. 1139B. ADULT HEALTH QUALITY MEASURES.

        ``(a) Development of Core Set of Health Care Quality Measures for
    Adults Eligible for Benefits Under Medicaid.--The Secretary shall
    identify and publish a recommended core set of adult health quality
    measures for Medicaid eligible adults in the same manner as the
    Secretary identifies and publishes a core set of child health quality
    measures under section 1139A, including with respect to identifying and
    publishing existing adult health quality measures that are in use under
    public and privately sponsored health care coverage arrangements, or
    that are part of reporting systems that measure both the presence and
    duration of health insurance coverage over time, that may be applicable
    to Medicaid eligible adults.
        ``(b) Deadlines.--
                ``(1) Recommended measures.--Not later than January 1,
            2011, the Secretary shall identify and publish for comment a
            recommended core set of adult health quality measures for
            Medicaid eligible adults.
                ``(2) Dissemination.--Not later than January 1, 2012, the
            Secretary shall publish an initial core set of adult health
            quality measures that are applicable to Medicaid eligible
            adults.
                ``(3) Standardized reporting.--Not later than January 1,
            2013, the Secretary, in consultation with States, shall develop
            a standardized format for reporting information based on the
            initial core set of adult health quality measures and create
            procedures to encourage States to use such measures to
            voluntarily report information regarding the quality of health
            care for Medicaid eligible adults.
                ``(4) Reports to congress.--Not later than January 1, 2014,
            and every 3 years thereafter, the Secretary shall include in
            the report to Congress required under section 1139A(a)(6)
            information similar to the information required under that
            section with respect to the measures established under this
            section.
                ``(5) Establishment of medicaid quality measurement
            program.--
                        ``(A) In general.--Not later than 12 months after
                    the release of the recommended core set of adult health
                    quality measures under paragraph (1)), the Secretary
                    shall establish a Medicaid Quality Measurement Program
                    in the same manner as the Secretary establishes the
                    pediatric quality measures program under section
                    1139A(b). The aggregate amount awarded by the Secretary
                    for grants and contracts for the development, testing,
                    and validation of emerging and innovative evidence-
                    based measures under such program shall equal the
                    aggregate amount awarded by the Secretary for grants
                    under section 1139A(b)(4)(A)
                        ``(B) Revising, strengthening, and improving
                    initial core measures.--Beginning not later than 24
                    months after the establishment of the Medicaid Quality
                    Measurement Program, and annually thereafter, the
                    Secretary shall publish recommended changes to the
                    initial core set of adult health quality measures that
                    shall reflect the results of the testing, validation,
                    and consensus process for the development of adult
                    health quality measures.
        ``(c) Construction.--Nothing in this section shall be construed as
    supporting the restriction of coverage, under title XIX or XXI or
    otherwise, to only those services that are evidence-based, or in anyway
    limiting available services.
        ``(d) Annual State Reports Regarding State-Specific Quality of Care
    Measures Applied Under Medicaid.--
                ``(1) Annual state reports.--Each State with a State plan
            or waiver approved under title XIX shall annually report
            (separately or as part of the annual report required under
            section 1139A(c)), to the Secretary on the--
                        ``(A) State-specific adult health quality measures
                    applied by the State under the such plan, including
                    measures described in subsection (a)(5); and
                        ``(B) State-specific information on the quality of
                    health care furnished to Medicaid eligible adults under
                    such plan, including information collected through
                    external quality reviews of managed care organizations
                    under section 1932 and benchmark plans under section
                    1937.
                ``(2) Publication.--Not later than September 30, 2014, and
            annually thereafter, the Secretary shall collect, analyze, and
            make publicly available the information reported by States
            under paragraph (1).
        ``(e) Appropriation.--Out of any funds in the Treasury not
    otherwise appropriated, there is appropriated for each of fiscal years
    2010 through 2014, $60,000,000 for the purpose of carrying out this
    section. Funds appropriated under this subsection shall remain
    available until expended.''.

    SEC. 2702. PAYMENT ADJUSTMENT FOR HEALTH CARE-ACQUIRED CONDITIONS.

        (a) In General.--The Secretary of Health and Human Services (in
    this subsection referred to as the ``Secretary'') shall identify
    current State practices that prohibit payment for health care-acquired
    conditions and shall incorporate the practices identified, or elements
    of such practices, which the Secretary determines appropriate for
    application to the Medicaid program in regulations. Such regulations
    shall be effective as of July 1, 2011, and shall prohibit payments to
    States under section 1903 of the Social Security Act for any amounts
    expended for providing medical assistance for health care-acquired
    conditions specified in the regulations. The regulations shall ensure
    that the prohibition on payment for health care-acquired conditions
    shall not result in a loss of access to care or services for Medicaid
    beneficiaries.
        (b) Health Care-Acquired Condition.--In this section. the term
    ``health care-acquired condition'' means a medical condition for which
    an individual was diagnosed that could be identified by a secondary
    diagnostic code described in section 1886(d)(4)(D)(iv) of the Social
    Security Act (42 U.S.C. 1395ww(d)(4)(D)(iv)).
        (c) Medicare Provisions.--In carrying out this section, the
    Secretary shall apply to State plans (or waivers) under title XIX of
    the Social Security Act the regulations promulgated pursuant to section
    1886(d)(4)(D) of such Act (42 U.S.C. 1395ww(d)(4)(D)) relating to the
    prohibition of payments based on the presence of a secondary diagnosis
    code specified by the Secretary in such regulations, as appropriate for
    the Medicaid program. The Secretary may exclude certain conditions
    identified under title XVIII of the Social Security Act for non-payment
    under title XIX of such Act when the Secretary finds the inclusion of
    such conditions to be inapplicable to beneficiaries under title XIX.

    SEC. 2703. STATE OPTION TO PROVIDE HEALTH HOMES FOR ENROLLEES WITH
                  CHRONIC CONDITIONS.

        (a) State Plan Amendment.--Title XIX of the Social Security Act (42
    U.S.C. 1396a et seq.), as amended by sections 2201 and 2305, is amended
    by adding at the end the following new section:
        ``Sec. 1945. State Option To Provide Coordinated Care Through a
    Health Home for Individuals With Chronic Conditions.--
        ``(a) In General.--Notwithstanding section 1902(a)(1) (relating to
    statewideness), section 1902(a)(10)(B) (relating to comparability), and
    any other provision of this title for which the Secretary determines it
    is necessary to waive in order to implement this section, beginning
    January 1, 2011, a State, at its option as a State plan amendment, may
    provide for medical assistance under this title to eligible individuals
    with chronic conditions who select a designated provider (as described
    under subsection (h)(5)), a team of health care professionals (as
    described under subsection (h)(6)) operating with such a provider, or a
    health team (as described under subsection (h)(7)) as the individual's
    health home for purposes of providing the individual with health home
    services.
        ``(b) Health Home Qualification Standards.--The Secretary shall
    establish standards for qualification as a designated provider for the
    purpose of being eligible to be a health home for purposes of this
    section.
        ``(c) Payments.--
                ``(1) In general.--A State shall provide a designated
            provider, a team of health care professionals operating with
            such a provider, or a health team with payments for the
            provision of health home services to each eligible individual
            with chronic conditions that selects such provider, team of
            health care professionals, or health team as the individual's
            health home. Payments made to a designated provider, a team of
            health care professionals operating with such a provider, or a
            health team for such services shall be treated as medical
            assistance for purposes of section 1903(a), except that, during
            the first 8 fiscal year quarters that the State plan amendment
            is in effect, the Federal medical assistance percentage
            applicable to such payments shall be equal to 90 percent.
                ``(2) Methodology.--
                        ``(A) In general.--The State shall specify in the
                    State plan amendment the methodology the State will use
                    for determining payment for the provision of health
                    home services. Such methodology for determining
                    payment--
                                ``(i) may be tiered to reflect, with
                            respect to each eligible individual with
                            chronic conditions provided such services by a
                            designated provider, a team of health care
                            professionals operating with such a provider,
                            or a health team, as well as the severity or
                            number of each such individual's chronic
                            conditions or the specific capabilities of the
                            provider, team of health care professionals, or
                            health team; and
                                ``(ii) shall be established consistent with
                            section 1902(a)(30)(A).
                        ``(B) Alternate models of payment.--The methodology
                    for determining payment for provision of health home
                    services under this section shall not be limited to a
                    per-member per-month basis and may provide (as proposed
                    by the State and subject to approval by the Secretary)
                    for alternate models of payment.
                ``(3) Planning grants.--
                        ``(A) In general.--Beginning January 1, 2011, the
                    Secretary may award planning grants to States for
                    purposes of developing a State plan amendment under
                    this section. A planning grant awarded to a State under
                    this paragraph shall remain available until expended.
                        ``(B) State contribution.--A State awarded a
                    planning grant shall contribute an amount equal to the
                    State percentage determined under section 1905(b)
                    (without regard to section 5001 of Public Law 111-5)
                    for each fiscal year for which the grant is awarded.
                        ``(C) Limitation.--The total amount of payments
                    made to States under this paragraph shall not exceed
                    $25,000,000.
        ``(d) Hospital Referrals.--A State shall include in the State plan
    amendment a requirement for hospitals that are participating providers
    under the State plan or a waiver of such plan to establish procedures
    for referring any eligible individuals with chronic conditions who seek
    or need treatment in a hospital emergency department to designated
    providers.
        ``(e) Coordination.--A State shall consult and coordinate, as
    appropriate, with the Substance Abuse and Mental Health Services
    Administration in addressing issues regarding the prevention and
    treatment of mental illness and substance abuse among eligible
    individuals with chronic conditions.
        ``(f) Monitoring.--A State shall include in the State plan
    amendment--
                ``(1) a methodology for tracking avoidable hospital
            readmissions and calculating savings that result from improved
            chronic care coordination and management under this section;
            and
                ``(2) a proposal for use of health information technology
            in providing health home services under this section and
            improving service delivery and coordination across the care
            continuum (including the use of wireless patient technology to
            improve coordination and management of care and patient
            adherence to recommendations made by their provider).
        ``(g) Report on Quality Measures.--As a condition for receiving
    payment for health home services provided to an eligible individual
    with chronic conditions, a designated provider shall report to the
    State, in accordance with such requirements as the Secretary shall
    specify, on all applicable measures for determining the quality of such
    services. When appropriate and feasible, a designated provider shall
    use health information technology in providing the State with such
    information.
        ``(h) Definitions.--In this section:
                ``(1) Eligible individual with chronic conditions.--
                        ``(A) In general.--Subject to subparagraph (B), the
                    term `eligible individual with chronic conditions'
                    means an individual who--
                                ``(i) is eligible for medical assistance
                            under the State plan or under a waiver of such
                            plan; and
                                ``(ii) has at least--
                                        ``(I) 2 chronic conditions;
                                        ``(II) 1 chronic condition and is
                                    at risk of having a second chronic
                                    condition; or
                                        ``(III) 1 serious and persistent
                                    mental health condition.
                        ``(B) Rule of construction.--Nothing in this
                    paragraph shall prevent the Secretary from establishing
                    higher levels as to the number or severity of chronic
                    or mental health conditions for purposes of determining
                    eligibility for receipt of health home services under
                    this section.
                ``(2) Chronic condition.--The term `chronic condition' has
            the meaning given that term by the Secretary and shall include,
            but is not limited to, the following:
                        ``(A) A mental health condition.
                        ``(B) Substance use disorder.
                        ``(C) Asthma.
                        ``(D) Diabetes.
                        ``(E) Heart disease.
                        ``(F) Being overweight, as evidenced by having a
                    Body Mass Index (BMI) over 25.
                ``(3) Health home.--The term `health home' means a
            designated provider (including a provider that operates in
            coordination with a team of health care professionals) or a
            health team selected by an eligible individual with chronic
            conditions to provide health home services.
                ``(4) Health home services.--
                        ``(A) In general.--The term `health home services'
                    means comprehensive and timely high-quality services
                    described in subparagraph (B) that are provided by a
                    designated provider, a team of health care
                    professionals operating with such a provider, or a
                    health team.
                        ``(B) Services described.--The services described
                    in this subparagraph are--
                                ``(i) comprehensive care management;
                                ``(ii) care coordination and health
                            promotion;
                                ``(iii) comprehensive transitional care,
                            including appropriate follow-up, from inpatient
                            to other settings;
                                ``(iv) patient and family support
                            (including authorized representatives);
                                ``(v) referral to community and social
                            support services, if relevant; and
                                ``(vi) use of health information technology
                            to link services, as feasible and appropriate.
                ``(5) Designated provider.--The term `designated provider'
            means a physician, clinical practice or clinical group
            practice, rural clinic, community health center, community
            mental health center, home health agency, or any other entity
            or provider (including pediatricians, gynecologists, and
            obstetricians) that is determined by the State and approved by
            the Secretary to be qualified to be a health home for eligible
            individuals with chronic conditions on the basis of
            documentation evidencing that the physician, practice, or
            clinic--
                        ``(A) has the systems and infrastructure in place
                    to provide health home services; and
                        ``(B) satisfies the qualification standards
                    established by the Secretary under subsection (b).
                ``(6) Team of health care professionals.--The term `team of
            health care professionals' means a team of health professionals
            (as described in the State plan amendment) that may--
                        ``(A) include physicians and other professionals,
                    such as a nurse care coordinator, nutritionist, social
                    worker, behavioral health professional, or any
                    professionals deemed appropriate by the State; and
                        ``(B) be free standing, virtual, or based at a
                    hospital, community health center, community mental
                    health center, rural clinic, clinical practice or
                    clinical group practice, academic health center, or any
                    entity deemed appropriate by the State and approved by
                    the Secretary.
                ``(7) Health team.--The term `health team' has the meaning
            given such term for purposes of section 3502 of the Patient
            Protection and Affordable Care Act.''.
        (b) Evaluation.--
                (1) Independent evaluation.--
                        (A) In general.--The Secretary shall enter into a
                    contract with an independent entity or organization to
                    conduct an evaluation and assessment of the States that
                    have elected the option to provide coordinated care
                    through a health home for Medicaid beneficiaries with
                    chronic conditions under section 1945 of the Social
                    Security Act (as added by subsection (a)) for the
                    purpose of determining the effect of such option on
                    reducing hospital admissions, emergency room visits,
                    and admissions to skilled nursing facilities.
                        (B) Evaluation report.--Not later than January 1,
                    2017, the Secretary shall report to Congress on the
                    evaluation and assessment conducted under subparagraph
                    (A).
                (2) Survey and interim report.--
                        (A) In general.--Not later than January 1, 2014,
                    the Secretary of Health and Human Services shall survey
                    States that have elected the option under section 1945
                    of the Social Security Act (as added by subsection (a))
                    and report to Congress on the nature, extent, and use
                    of such option, particularly as it pertains to--
                                (i) hospital admission rates;
                                (ii) chronic disease management;
                                (iii) coordination of care for individuals
                            with chronic conditions;
                                (iv) assessment of program implementation;
                                (v) processes and lessons learned (as
                            described in subparagraph (B));
                                (vi) assessment of quality improvements and
                            clinical outcomes under such option; and
                                (vii) estimates of cost savings.
                        (B)  Implementation reporting.--A State that has
                    elected the option under section 1945 of the Social
                    Security Act (as added by subsection (a)) shall report
                    to the Secretary, as necessary, on processes that have
                    been developed and lessons learned regarding provision
                    of coordinated care through a health home for Medicaid
                    beneficiaries with chronic conditions under such
                    option.

    SEC. 2704. DEMONSTRATION PROJECT TO EVALUATE INTEGRATED CARE AROUND A
                  HOSPITALIZATION.

        (a) Authority To Conduct Project.--
                (1) In general.--The Secretary of Health and Human Services
            (in this section referred to as the ``Secretary'') shall
            establish a demonstration project under title XIX of the Social
            Security Act to evaluate the use of bundled payments for the
            provision of integrated care for a Medicaid beneficiary--
                        (A) with respect to an episode of care that
                    includes a hospitalization; and
                        (B) for concurrent physicians services provided
                    during a hospitalization.
                (2) Duration.--The demonstration project shall begin on
            January 1, 2012, and shall end on December 31, 2016.
        (b) Requirements.--The demonstration project shall be conducted in
    accordance with the following:
                (1) The demonstration project shall be conducted in up to 8
            States, determined by the Secretary based on consideration of
            the potential to lower costs under the Medicaid program while
            improving care for Medicaid beneficiaries. A State selected to
            participate in the demonstration project may target the
            demonstration project to particular categories of
            beneficiaries, beneficiaries with particular diagnoses, or
            particular geographic regions of the State, but the Secretary
            shall insure that, as a whole, the demonstration project is, to
            the greatest extent possible, representative of the demographic
            and geographic composition of Medicaid beneficiaries
            nationally.
                (2) The demonstration project shall focus on conditions
            where there is evidence of an opportunity for providers of
            services and suppliers to improve the quality of care furnished
            to Medicaid beneficiaries while reducing total expenditures
            under the State Medicaid programs selected to participate, as
            determined by the Secretary.
                (3) A State selected to participate in the demonstration
            project shall specify the 1 or more episodes of care the State
            proposes to address in the project, the services to be included
            in the bundled payments, and the rationale for the selection of
            such episodes of care and services. The Secretary may modify
            the episodes of care as well as the services to be included in
            the bundled payments prior to or after approving the project.
            The Secretary may also vary such factors among the different
            States participating in the demonstration project.
                (4) The Secretary shall ensure that payments made under the
            demonstration project are adjusted for severity of illness and
            other characteristics of Medicaid beneficiaries within a
            category or having a diagnosis targeted as part of the
            demonstration project. States shall ensure that Medicaid
            beneficiaries are not liable for any additional cost sharing
            than if their care had not been subject to payment under the
            demonstration project.
                (5) Hospitals participating in the demonstration project
            shall have or establish robust discharge planning programs to
            ensure that Medicaid beneficiaries requiring post-acute care
            are appropriately placed in, or have ready access to, post-
            acute care settings.
                (6) The Secretary and each State selected to participate in
            the demonstration project shall ensure that the demonstration
            project does not result in the Medicaid beneficiaries whose
            care is subject to payment under the demonstration project
            being provided with less items and services for which medical
            assistance is provided under the State Medicaid program than
            the items and services for which medical assistance would have
            been provided to such beneficiaries under the State Medicaid
            program in the absence of the demonstration project.
        (c) Waiver of Provisions.--Notwithstanding section 1115(a) of the
    Social Security Act (42 U.S.C. 1315(a)), the Secretary may waive such
    provisions of titles XIX, XVIII, and XI of that Act as may be necessary
    to accomplish the goals of the demonstration, ensure beneficiary access
    to acute and post-acute care, and maintain quality of care.
        (d) Evaluation and Report.--
                (1) Data.--Each State selected to participate in the
            demonstration project under this section shall provide to the
            Secretary, in such form and manner as the Secretary shall
            specify, relevant data necessary to monitor outcomes, costs,
            and quality, and evaluate the rationales for selection of the
            episodes of care and services specified by States under
            subsection (b)(3).
                (2) Report.--Not later than 1 year after the conclusion of
            the demonstration project, the Secretary shall submit a report
            to Congress on the results of the demonstration project.

    SEC. 2705. MEDICAID GLOBAL PAYMENT SYSTEM DEMONSTRATION PROJECT.

        (a) In General.--The Secretary of Health and Human Services
    (referred to in this section as the ``Secretary'') shall, in
    coordination with the Center for Medicare and Medicaid Innovation (as
    established under section 1115A of the Social Security Act, as added by
    section 3021 of this Act), establish the Medicaid Global Payment System
    Demonstration Project under which a participating State shall adjust
    the payments made to an eligible safety net hospital system or network
    from a fee-for-service payment structure to a global capitated payment
    model.
        (b) Duration and Scope.--The demonstration project conducted under
    this section shall operate during a period of fiscal years 2010 through
    2012. The Secretary shall select not more than 5 States to participate
    in the demonstration project.
        (c) Eligible Safety Net Hospital System or Network.--For purposes
    of this section, the term ``eligible safety net hospital system or
    network'' means a large, safety net hospital system or network (as
    defined by the Secretary) that operates within a State selected by the
    Secretary under subsection (b).
        (d) Evaluation.--
                (1) Testing.--The Innovation Center shall test and evaluate
            the demonstration project conducted under this section to
            examine any changes in health care quality outcomes and
            spending by the eligible safety net hospital systems or
            networks.
                (2) Budget neutrality.--During the testing period under
            paragraph (1), any budget neutrality requirements under section
            1115A(b)(3) of the Social Security Act (as so added) shall not
            be applicable.
                (3) Modification.--During the testing period under
            paragraph (1), the Secretary may, in the Secretary's
            discretion, modify or terminate the demonstration project
            conducted under this section.
        (e) Report.--Not later than 12 months after the date of completion
    of the demonstration project under this section, the Secretary shall
    submit to Congress a report containing the results of the evaluation
    and testing conducted under subsection (d), together with
    recommendations for such legislation and administrative action as the
    Secretary determines appropriate.
        (f) Authorization of Appropriations.--There are authorized to be
    appropriated such sums as are necessary to carry out this section.

    SEC. 2706. PEDIATRIC ACCOUNTABLE CARE ORGANIZATION DEMONSTRATION
                  PROJECT.

        (a) Authority To Conduct Demonstration.--
                (1) In general.--The Secretary of Health and Human Services
            (referred to in this section as the ``Secretary'') shall
            establish the Pediatric Accountable Care Organization
            Demonstration Project to authorize a participating State to
            allow pediatric medical providers that meet specified
            requirements to be recognized as an accountable care
            organization for purposes of receiving incentive payments (as
            described under subsection (d)), in the same manner as an
            accountable care organization is recognized and provided with
            incentive payments under section 1899 of the Social Security
            Act (as added by section 3022).
                (2) Duration.--The demonstration project shall begin on
            January 1, 2012, and shall end on December 31, 2016.
        (b) Application.--A State that desires to participate in the
    demonstration project under this section shall submit to the Secretary
    an application at such time, in such manner, and containing such
    information as the Secretary may require.
        (c) Requirements.--
                (1) Performance guidelines.--The Secretary, in consultation
            with the States and pediatric providers, shall establish
            guidelines to ensure that the quality of care delivered to
            individuals by a provider recognized as an accountable care
            organization under this section is not less than the quality of
            care that would have otherwise been provided to such
            individuals.
                (2) Savings requirement.--A participating State, in
            consultation with the Secretary, shall establish an annual
            minimal level of savings in expenditures for items and services
            covered under the Medicaid program under title XIX of the
            Social Security Act and the CHIP program under title XXI of
            such Act that must be reached by an accountable care
            organization in order for such organization to receive an
            incentive payment under subsection (d).
                (3) Minimum participation period.--A provider desiring to
            be recognized as an accountable care organization under the
            demonstration project shall enter into an agreement with the
            State to participate in the project for not less than a 3-year
            period.
        (d) Incentive Payment.--An accountable care organization that meets
    the performance guidelines established by the Secretary under
    subsection (c)(1) and achieves savings greater than the annual minimal
    savings level established by the State under subsection (c)(2) shall
    receive an incentive payment for such year equal to a portion (as
    determined appropriate by the Secretary) of the amount of such excess
    savings. The Secretary may establish an annual cap on incentive
    payments for an accountable care organization.
        (e) Authorization of Appropriations.--There are authorized to be
    appropriated such sums as are necessary to carry out this section.

    SEC. 2707. MEDICAID EMERGENCY PSYCHIATRIC DEMONSTRATION PROJECT.

        (a) Authority To Conduct Demonstration Project.--The Secretary of
    Health and Human Services (in this section referred to as the
    ``Secretary'') shall establish a demonstration project under which an
    eligible State (as described in subsection (c)) shall provide payment
    under the State Medicaid plan under title XIX of the Social Security
    Act to an institution for mental diseases that is not publicly owned or
    operated and that is subject to the requirements of section 1867 of the
    Social Security Act (42 U.S.C. 1395dd) for the provision of medical
    assistance available under such plan to individuals who--
                (1) have attained age 21, but have not attained age 65;
                (2) are eligible for medical assistance under such plan;
            and
                (3) require such medical assistance to stabilize an
            emergency medical condition.
        (b) Stabilization Review.--A State shall specify in its application
    described in subsection (c)(1) establish a mechanism for how it will
    ensure that institutions participating in the demonstration will
    determine whether or not such individuals have been stabilized (as
    defined in subsection (h)(5)). This mechanism shall commence before the
    third day of the inpatient stay. States participating in the
    demonstration project may manage the provision of services for the
    stabilization of medical emergency conditions through utilization
    review, authorization, or management practices, or the application of
    medical necessity and appropriateness criteria applicable to behavioral
    health.
        (c) Eligible State Defined.--
                (1) In general.--An eligible State is a State that has made
            an application and has been selected pursuant to paragraphs (2)
            and (3).
                (2) Application.--A State seeking to participate in the
            demonstration project under this section shall submit to the
            Secretary, at such time and in such format as the Secretary
            requires, an application that includes such information,
            provisions, and assurances, as the Secretary may require.
                (3) Selection.--A State shall be determined eligible for
            the demonstration by the Secretary on a competitive basis among
            States with applications meeting the requirements of paragraph
            (1). In selecting State applications for the demonstration
            project, the Secretary shall seek to achieve an appropriate
            national balance in the geographic distribution of such
            projects.
        (d) Length of Demonstration Project.--The demonstration project
    established under this section shall be conducted for a period of 3
    consecutive years.
        (e) Limitations on Federal Funding.--
                (1) Appropriation.--
                        (A) In general.--Out of any funds in the Treasury
                    not otherwise appropriated, there is appropriated to
                    carry out this section, $75,000,000 for fiscal year
                    2011.
                        (B) Budget authority.--Subparagraph (A) constitutes
                    budget authority in advance of appropriations Act and
                    represents the obligation of the Federal Government to
                    provide for the payment of the amounts appropriated
                    under that subparagraph.
                (2) 5-year availability.--Funds appropriated under
            paragraph (1) shall remain available for obligation through
            December 31, 2015.
                (3) Limitation on payments.--In no case may--
                        (A) the aggregate amount of payments made by the
                    Secretary to eligible States under this section exceed
                    $75,000,000; or
                        (B) payments be provided by the Secretary under
                    this section after December 31, 2015.
                (4) Funds allocated to states.--Funds shall be allocated to
            eligible States on the basis of criteria, including a State's
            application and the availability of funds, as determined by the
            Secretary.
                (5) Payments to states.--The Secretary shall pay to each
            eligible State, from its allocation under paragraph (4), an
            amount each quarter equal to the Federal medical assistance
            percentage of expenditures in the quarter for medical
            assistance described in subsection (a). As a condition of
            receiving payment, a State shall collect and report
            information, as determined necessary by the Secretary, for the
            purposes of providing Federal oversight and conducting an
            evaluation under subsection (f)(1).
        (f) Evaluation and Report to Congress.--
                (1) Evaluation.--The Secretary shall conduct an evaluation
            of the demonstration project in order to determine the impact
            on the functioning of the health and mental health service
            system and on individuals enrolled in the Medicaid program and
            shall include the following:
                        (A) An assessment of access to inpatient mental
                    health services under the Medicaid program; average
                    lengths of inpatient stays; and emergency room visits.
                        (B) An assessment of discharge planning by
                    participating hospitals.
                        (C) An assessment of the impact of the
                    demonstration project on the costs of the full range of
                    mental health services (including inpatient, emergency
                    and ambulatory care).
                        (D) An analysis of the percentage of consumers with
                    Medicaid coverage who are admitted to inpatient
                    facilities as a result of the demonstration project as
                    compared to those admitted to these same facilities
                    through other means.
                        (E) A recommendation regarding whether the
                    demonstration project should be continued after
                    December 31, 2013, and expanded on a national basis.
                (2) Report.--Not later than December 31, 2013, the
            Secretary shall submit to Congress and make available to the
            public a report on the findings of the evaluation under
            paragraph (1).
        (g) Waiver Authority.--
                (1) In general.--The Secretary shall waive the limitation
            of subdivision (B) following paragraph (28) of section 1905(a)
            of the Social Security Act (42 U.S.C. 1396d(a)) (relating to
            limitations on payments for care or services for individuals
            under 65 years of age who are patients in an institution for
            mental diseases) for purposes of carrying out the demonstration
            project under this section.
                (2) Limited other waiver authority.--The Secretary may
            waive other requirements of titles XI and XIX of the Social
            Security Act (including the requirements of sections 1902(a)(1)
            (relating to statewideness) and 1902(1)(10)(B) (relating to
            comparability)) only to extent necessary to carry out the
            demonstration project under this section.
        (h) Definitions.--In this section:
                (1) Emergency medical condition.--The term ``emergency
            medical condition'' means, with respect to an individual, an
            individual who expresses suicidal or homicidal thoughts or
            gestures, if determined dangerous to self or others.
                (2) Federal medical assistance percentage.--The term
            ``Federal medical assistance percentage'' has the meaning given
            that term with respect to a State under section 1905(b) of the
            Social Security Act (42 U.S.C. 1396d(b)).
                (3) Institution for mental diseases.--The term
            ``institution for mental diseases'' has the meaning given to
            that term in section 1905(i) of the Social Security Act (42
            U.S.C. 1396d(i)).
                (4) Medical assistance.--The term ``medical assistance''
            has the meaning given that term in section 1905(a) of the
            Social Security Act (42 U.S.C. 1396d(a)).
                (5) Stabilized.--The term ``stabilized'' means, with
            respect to an individual, that the emergency medical condition
            no longer exists with respect to the individual and the
            individual is no longer dangerous to self or others.
                (6) State.--The term ``State'' has the meaning given that
            term for purposes of title XIX of the Social Security Act (42
            U.S.C. 1396 et seq.).

     Subtitle J--Improvements to the Medicaid and CHIP Payment and Access
                              Commission (MACPAC)

    SEC. 2801. MACPAC ASSESSMENT OF POLICIES AFFECTING ALL MEDICAID
                  BENEFICIARIES.

        (a) In General.--Section 1900 of the Social Security Act (42 U.S.C.
    1396) is amended--
                (1) in subsection (b)--
                        (A) in paragraph (1)--
                                (i) in the paragraph heading, by inserting
                            ``for all states'' before ``and annual''; and
                                (ii) in subparagraph (A), by striking
                            ``children's'';
                                (iii) in subparagraph (B), by inserting ``,
                            the Secretary, and States'' after ``Congress'';
                                (iv) in subparagraph (C), by striking
                            ``March 1'' and inserting ``March 15''; and
                                (v) in subparagraph (D), by striking ``June
                            1'' and inserting ``June 15'';
                        (B) in paragraph (2)--
                                (i) in subparagraph (A)--
                                        (I) in clause (i)--
                                                (aa) by inserting ``the
                                            efficient provision of'' after
                                            ``expenditures for''; and
                                                (bb) by striking
                                            ``hospital, skilled nursing
                                            facility, physician, Federally-
                                            qualified health center, rural
                                            health center, and other fees''
                                            and inserting ``payments to
                                            medical, dental, and health
                                            professionals, hospitals,
                                            residential and long-term care
                                            providers, providers of home
                                            and community based services,
                                            Federally-qualified health
                                            centers and rural health
                                            clinics, managed care entities,
                                            and providers of other covered
                                            items and services''; and
                                        (II) in clause (iii), by inserting
                                    ``(including how such factors and
                                    methodologies enable such beneficiaries
                                    to obtain the services for which they
                                    are eligible, affect provider supply,
                                    and affect providers that serve a
                                    disproportionate share of low-income
                                    and other vulnerable populations)''
                                    after ``beneficiaries'';
                                (ii) by redesignating subparagraphs (B) and
                            (C) as subparagraphs (F) and (H), respectively;
                                (iii) by inserting after subparagraph (A),
                            the following:
                        ``(B) Eligibility policies.--Medicaid and CHIP
                    eligibility policies, including a determination of the
                    degree to which Federal and State policies provide
                    health care coverage to needy populations.
                        ``(C) Enrollment and retention processes.--Medicaid
                    and CHIP enrollment and retention processes, including
                    a determination of the degree to which Federal and
                    State policies encourage the enrollment of individuals
                    who are eligible for such programs and screen out
                    individuals who are ineligible, while minimizing the
                    share of program expenses devoted to such processes.
                        ``(D) Coverage policies.--Medicaid and CHIP benefit
                    and coverage policies, including a determination of the
                    degree to which Federal and State policies provide
                    access to the services enrollees require to improve and
                    maintain their health and functional status.
                        ``(E) Quality of care.--Medicaid and CHIP policies
                    as they relate to the quality of care provided under
                    those programs, including a determination of the degree
                    to which Federal and State policies achieve their
                    stated goals and interact with similar goals
                    established by other purchasers of health care
                    services.'';
                                (iv) by inserting after subparagraph (F)
                            (as redesignated by clause (ii) of this
                            subparagraph), the following:
                        ``(G) Interactions with medicare and medicaid.--
                    Consistent with paragraph (11), the interaction of
                    policies under Medicaid and the Medicare program under
                    title XVIII, including with respect to how such
                    interactions affect access to services, payments, and
                    dual eligible individuals.'' and
                                (v) in subparagraph (H) (as so
                            redesignated), by inserting ``and preventive,
                            acute, and long-term services and supports''
                            after ``barriers'';
                        (C) by redesignating paragraphs (3) through (9) as
                    paragraphs (4) through (10), respectively;
                        (D) by inserting after paragraph (2), the following
                    new paragraph:
                ``(3) Recommendations and reports of state-specific data.--
            MACPAC shall--
                        ``(A) review national and State-specific Medicaid
                    and CHIP data; and
                        ``(B) submit reports and recommendations to
                    Congress, the Secretary, and States based on such
                    reviews.'';
                        (E) in paragraph (4), as redesignated by
                    subparagraph (C), by striking ``or any other problems''
                    and all that follows through the period and inserting
                    ``, as well as other factors that adversely affect, or
                    have the potential to adversely affect, access to care
                    by, or the health care status of, Medicaid and CHIP
                    beneficiaries. MACPAC shall include in the annual
                    report required under paragraph (1)(D) a description of
                    all such areas or problems identified with respect to
                    the period addressed in the report.'';
                        (F) in paragraph (5), as so redesignated,--
                                (i) in the paragraph heading, by inserting
                            ``and regulations'' after ``reports''; and
                                (ii) by striking ``If'' and inserting the
                            following:
                        ``(A) Certain secretarial reports.--If''; and
                                (iii) in the second sentence, by inserting
                            ``and the Secretary'' after ``appropriate
                            committees of Congress''; and
                                (iv) by adding at the end the following:
                        ``(B) Regulations.--MACPAC shall review Medicaid
                    and CHIP regulations and may comment through submission
                    of a report to the appropriate committees of Congress
                    and the Secretary, on any such regulations that affect
                    access, quality, or efficiency of health care.'';
                        (G) in paragraph (10), as so redesignated, by
                    inserting ``, and shall submit with any
                    recommendations, a report on the Federal and State-
                    specific budget consequences of the recommendations''
                    before the period; and
                        (H) by adding at the end the following:
                ``(11) Consultation and coordination with medpac.--
                        ``(A) In general.--MACPAC shall consult with the
                    Medicare Payment Advisory Commission (in this paragraph
                    referred to as `MedPAC') established under section 1805
                    in carrying out its duties under this section, as
                    appropriate and particularly with respect to the issues
                    specified in paragraph (2) as they relate to those
                    Medicaid beneficiaries who are dually eligible for
                    Medicaid and the Medicare program under title XVIII,
                    adult Medicaid beneficiaries (who are not dually
                    eligible for Medicare), and beneficiaries under
                    Medicare. Responsibility for analysis of and
                    recommendations to change Medicare policy regarding
                    Medicare beneficiaries, including Medicare
                    beneficiaries who are dually eligible for Medicare and
                    Medicaid, shall rest with MedPAC.
                        ``(B) Information sharing.--MACPAC and MedPAC shall
                    have access to deliberations and records of the other
                    such entity, respectively, upon the request of the
                    other such entity.
                ``(12) Consultation with states.--MACPAC shall regularly
            consult with States in carrying out its duties under this
            section, including with respect to developing processes for
            carrying out such duties, and shall ensure that input from
            States is taken into account and represented in MACPAC's
            recommendations and reports.
                ``(13) Coordinate and consult with the federal coordinated
            health care office.--MACPAC shall coordinate and consult with
            the Federal Coordinated Health Care Office established under
            section 2081 of the Patient Protection and Affordable Care Act
            before making any recommendations regarding dual eligible
            individuals.
                ``(14) Programmatic oversight vested in the secretary.--
            MACPAC's authority to make recommendations in accordance with
            this section shall not affect, or be considered to duplicate,
            the Secretary's authority to carry out Federal responsibilities
            with respect to Medicaid and CHIP.'';
                (2) in subsection (c)(2)--
                        (A) by striking subparagraphs (A) and (B) and
                    inserting the following:
                        ``(A) In general.--The membership of MACPAC shall
                    include individuals who have had direct experience as
                    enrollees or parents or caregivers of enrollees in
                    Medicaid or CHIP and individuals with national
                    recognition for their expertise in Federal safety net
                    health programs, health finance and economics,
                    actuarial science, health plans and integrated delivery
                    systems, reimbursement for health care, health
                    information technology, and other providers of health
                    services, public health, and other related fields, who
                    provide a mix of different professions, broad
                    geographic representation, and a balance between urban
                    and rural representation.
                        ``(B) Inclusion.--The membership of MACPAC shall
                    include (but not be limited to) physicians, dentists,
                    and other health professionals, employers, third-party
                    payers, and individuals with expertise in the delivery
                    of health services. Such membership shall also include
                    representatives of children, pregnant women, the
                    elderly, individuals with disabilities, caregivers, and
                    dual eligible individuals, current or former
                    representatives of State agencies responsible for
                    administering Medicaid, and current or former
                    representatives of State agencies responsible for
                    administering CHIP.''.
                (3) in subsection (d)(2), by inserting ``and State'' after
            ``Federal'';
                (4) in subsection (e)(1), in the first sentence, by
            inserting ``and, as a condition for receiving payments under
            sections 1903(a) and 2105(a), from any State agency responsible
            for administering Medicaid or CHIP,'' after ``United States'';
            and
                (5) in subsection (f)--
                        (A) in the subsection heading, by striking
                    ``Authorization of Appropriations'' and inserting
                    ``Funding'';
                        (B) in paragraph (1), by inserting ``(other than
                    for fiscal year 2010)'' before ``in the same manner'';
                    and
                        (C) by adding at the end the following:
                ``(3) Funding for fiscal year 2010.--
                        ``(A) In general.--Out of any funds in the Treasury
                    not otherwise appropriated, there is appropriated to
                    MACPAC to carry out the provisions of this section for
                    fiscal year 2010, $9,000,000.
                        ``(B) Transfer of funds.--Notwithstanding section
                    2104(a)(13), from the amounts appropriated in such
                    section for fiscal year 2010, $2,000,000 is hereby
                    transferred and made available in such fiscal year to
                    MACPAC to carry out the provisions of this section.
                ``(4) Availability.--Amounts made available under
            paragraphs (2) and (3) to MACPAC to carry out the provisions of
            this section shall remain available until expended.''.
        (b) Conforming MedPAC Amendments.--Section 1805(b) of the Social
    Security Act (42 U.S.C. 1395b-6(b)), is amended--
                (1) in paragraph (1)(C), by striking ``March 1 of each year
            (beginning with 1998)'' and inserting ``March 15'';
                (2) in paragraph (1)(D), by inserting ``, and (beginning
            with 2012) containing an examination of the topics described in
            paragraph (9), to the extent feasible'' before the period; and
                (3) by adding at the end the following:
                ``(9) Review and annual report on medicaid and commercial
            trends.--The Commission shall review and report on aggregate
            trends in spending, utilization, and financial performance
            under the Medicaid program under title XIX and the private
            market for health care services with respect to providers for
            which, on an aggregate national basis, a significant portion of
            revenue or services is associated with the Medicaid program.
            Where appropriate, the Commission shall conduct such review in
            consultation with the Medicaid and CHIP Payment and Access
            Commission established under section 1900 (in this section
            referred to as `MACPAC').
                ``(10) Coordinate and consult with the federal coordinated
            health care office.--The Commission shall coordinate and
            consult with the Federal Coordinated Health Care Office
            established under section 2081 of the Patient Protection and
            Affordable Care Act before making any recommendations regarding
            dual eligible individuals.
                ``(11) Interaction of medicaid and medicare.--The
            Commission shall consult with MACPAC in carrying out its duties
            under this section, as appropriate. Responsibility for analysis
            of and recommendations to change Medicare policy regarding
            Medicare beneficiaries, including Medicare beneficiaries who
            are dually eligible for Medicare and Medicaid, shall rest with
            the Commission. Responsibility for analysis of and
            recommendations to change Medicaid policy regarding Medicaid
            beneficiaries, including Medicaid beneficiaries who are dually
            eligible for Medicare and Medicaid, shall rest with MACPAC.''.

        Subtitle K--Protections for American Indians and Alaska Natives

    SEC. 2901. SPECIAL RULES RELATING TO INDIANS.

        (a) No Cost-sharing for Indians With Income at or Below 300 Percent
    of Poverty Enrolled in Coverage Through a State Exchange.--For
    provisions prohibiting cost sharing for Indians enrolled in any
    qualified health plan in the individual market through an Exchange, see
    section 1402(d) of the Patient Protection and Affordable Care Act.
        (b) Payer of Last Resort.--Health programs operated by the Indian
    Health Service, Indian tribes, tribal organizations, and Urban Indian
    organizations (as those terms are defined in section 4 of the Indian
    Health Care Improvement Act (25 U.S.C. 1603)) shall be the payer of
    last resort for services provided by such Service, tribes, or
    organizations to individuals eligible for services through such
    programs, notwithstanding any Federal, State, or local law to the
    contrary.
        (c) Facilitating Enrollment of Indians Under the Express Lane
    Option.--Section 1902(e)(13)(F)(ii) of the Social Security Act (42
    U.S.C. 1396a(e)(13)(F)(ii)) is amended--
                (1) in the clause heading, by inserting ``and indian tribes
            and tribal organizations'' after ``agencies''; and
                (2) by adding at the end the following:
                                        ``(IV) The Indian Health Service,
                                    an Indian Tribe, Tribal Organization,
                                    or Urban Indian Organization (as
                                    defined in section 1139(c)).''.
        (d) Technical Corrections.--Section 1139(c) of the Social Security
    Act (42 U.S.C. 1320b-9(c)) is amended by striking ``In this section''
    and inserting ``For purposes of this section, title XIX, and title
    XXI''.

    SEC. 2902. ELIMINATION OF SUNSET FOR REIMBURSEMENT FOR ALL MEDICARE
                  PART B SERVICES FURNISHED BY CERTAIN INDIAN HOSPITALS AND
                  CLINICS.

        (a) Reimbursement for All Medicare Part B Services Furnished by
    Certain Indian Hospitals and Clinics.--Section 1880(e)(1)(A) of the
    Social Security Act (42 U.S.C. 1395qq(e)(1)(A)) is amended by striking
    ``during the 5-year period beginning on'' and inserting ``on or
    after''.
        (b) Effective Date.--The amendments made by this section shall
    apply to items or services furnished on or after January 1, 2010.

                 Subtitle L--Maternal and Child Health Services

    SEC. 2951. MATERNAL, INFANT, AND EARLY CHILDHOOD HOME VISITING
                  PROGRAMS.

        Title V of the Social Security Act (42 U.S.C. 701 et seq.) is
    amended by adding at the end the following new section:

    ``SEC. 511. MATERNAL, INFANT, AND EARLY CHILDHOOD HOME VISITING
                  PROGRAMS.

        ``(a) Purposes.--The purposes of this section are--
                ``(1) to strengthen and improve the programs and activities
            carried out under this title;
                ``(2) to improve coordination of services for at risk
            communities; and
                ``(3) to identify and provide comprehensive services to
            improve outcomes for families who reside in at risk
            communities.
        ``(b) Requirement for All States To Assess Statewide Needs and
    Identify at Risk Communities.--
                ``(1) In general.--Not later than 6 months after the date
            of enactment of this section, each State shall, as a condition
            of receiving payments from an allotment for the State under
            section 502 for fiscal year 2011, conduct a statewide needs
            assessment (which shall be separate from the statewide needs
            assessment required under section 505(a)) that identifies--
                        ``(A) communities with concentrations of--
                                ``(i) premature birth, low-birth weight
                            infants, and infant mortality, including infant
                            death due to neglect, or other indicators of
                            at-risk prenatal, maternal, newborn, or child
                            health;
                                ``(ii) poverty;
                                ``(iii) crime;
                                ``(iv) domestic violence;
                                ``(v) high rates of high-school drop-outs;
                                ``(vi) substance abuse;
                                ``(vii) unemployment; or
                                ``(viii) child maltreatment;
                        ``(B) the quality and capacity of existing programs
                    or initiatives for early childhood home visitation in
                    the State including--
                                ``(i) the number and types of individuals
                            and families who are receiving services under
                            such programs or initiatives;
                                ``(ii) the gaps in early childhood home
                            visitation in the State; and
                                ``(iii) the extent to which such programs
                            or initiatives are meeting the needs of
                            eligible families described in subsection
                            (k)(2); and
                        ``(C) the State's capacity for providing substance
                    abuse treatment and counseling services to individuals
                    and families in need of such treatment or services.
                ``(2) Coordination with other assessments.--In conducting
            the statewide needs assessment required under paragraph (1),
            the State shall coordinate with, and take into account, other
            appropriate needs assessments conducted by the State, as
            determined by the Secretary, including the needs assessment
            required under section 505(a) (both the most recently completed
            assessment and any such assessment in progress), the
            communitywide strategic planning and needs assessments
            conducted in accordance with section 640(g)(1)(C) of the Head
            Start Act, and the inventory of current unmet needs and current
            community-based and prevention-focused programs and activities
            to prevent child abuse and neglect, and other family resource
            services operating in the State required under section 205(3)
            of the Child Abuse Prevention and Treatment Act.
                ``(3) Submission to the secretary.--Each State shall submit
            to the Secretary, in such form and manner as the Secretary
            shall require--
                        ``(A) the results of the statewide needs assessment
                    required under paragraph (1); and
                        ``(B) a description of how the State intends to
                    address needs identified by the assessment,
                    particularly with respect to communities identified
                    under paragraph (1)(A), which may include applying for
                    a grant to conduct an early childhood home visitation
                    program in accordance with the requirements of this
                    section.
        ``(c) Grants for Early Childhood Home Visitation Programs.--
                ``(1) Authority to make grants.--In addition to any other
            payments made under this title to a State, the Secretary shall
            make grants to eligible entities to enable the entities to
            deliver services under early childhood home visitation programs
            that satisfy the requirements of subsection (d) to eligible
            families in order to promote improvements in maternal and
            prenatal health, infant health, child health and development,
            parenting related to child development outcomes, school
            readiness, and the socioeconomic status of such families, and
            reductions in child abuse, neglect, and injuries.
                ``(2) Authority to use initial grant funds for planning or
            implementation.--An eligible entity that receives a grant under
            paragraph (1) may use a portion of the funds made available to
            the entity during the first 6 months of the period for which
            the grant is made for planning or implementation activities to
            assist with the establishment of early childhood home
            visitation programs that satisfy the requirements of subsection
            (d).
                ``(3) Grant duration.--The Secretary shall determine the
            period of years for which a grant is made to an eligible entity
            under paragraph (1).
                ``(4) Technical assistance.--The Secretary shall provide an
            eligible entity that receives a grant under paragraph (1) with
            technical assistance in administering programs or activities
            conducted in whole or in part with grant funds.
        ``(d) Requirements.--The requirements of this subsection for an
    early childhood home visitation program conducted with a grant made
    under this section are as follows:
                ``(1) Quantifiable, measurable improvement in benchmark
            areas.--
                        ``(A) In general.--The eligible entity establishes,
                    subject to the approval of the Secretary, quantifiable,
                    measurable 3- and 5-year benchmarks for demonstrating
                    that the program results in improvements for the
                    eligible families participating in the program in each
                    of the following areas:
                                ``(i) Improved maternal and newborn health.
                                ``(ii) Prevention of child injuries, child
                            abuse, neglect, or maltreatment, and reduction
                            of emergency department visits.
                                ``(iii) Improvement in school readiness and
                            achievement.
                                ``(iv) Reduction in crime or domestic
                            violence.
                                ``(v) Improvements in family economic self-
                            sufficiency.
                                ``(vi) Improvements in the coordination and
                            referrals for other community resources and
                            supports.
                        ``(B) Demonstration of improvements after 3
                    years.--
                                ``(i) Report to the secretary.--Not later
                            than 30 days after the end of the 3rd year in
                            which the eligible entity conducts the program,
                            the entity submits to the Secretary a report
                            demonstrating improvement in at least 4 of the
                            areas specified in subparagraph (A).
                                ``(ii) Corrective action plan.--If the
                            report submitted by the eligible entity under
                            clause (i) fails to demonstrate improvement in
                            at least 4 of the areas specified in
                            subparagraph (A), the entity shall develop and
                            implement a plan to improve outcomes in each of
                            the areas specified in subparagraph (A),
                            subject to approval by the Secretary. The plan
                            shall include provisions for the Secretary to
                            monitor implementation of the plan and conduct
                            continued oversight of the program, including
                            through submission by the entity of regular
                            reports to the Secretary.
                                ``(iii) Technical assistance.--
                                        ``(I) In general.--The Secretary
                                    shall provide an eligible entity
                                    required to develop and implement an
                                    improvement plan under clause (ii) with
                                    technical assistance to develop and
                                    implement the plan. The Secretary may
                                    provide the technical assistance
                                    directly or through grants, contracts,
                                    or cooperative agreements.
                                        ``(II) Advisory panel.--The
                                    Secretary shall establish an advisory
                                    panel for purposes of obtaining
                                    recommendations regarding the technical
                                    assistance provided to entities in
                                    accordance with subclause (I).
                                ``(iv) No improvement or failure to submit
                            report.--If the Secretary determines after a
                            period of time specified by the Secretary that
                            an eligible entity implementing an improvement
                            plan under clause (ii) has failed to
                            demonstrate any improvement in the areas
                            specified in subparagraph (A), or if the
                            Secretary determines that an eligible entity
                            has failed to submit the report required under
                            clause (i), the Secretary shall terminate the
                            entity's grant and may include any unexpended
                            grant funds in grants made to nonprofit
                            organizations under subsection (h)(2)(B).
                        ``(C) Final report.--Not later than December 31,
                    2015, the eligible entity shall submit a report to the
                    Secretary demonstrating improvements (if any) in each
                    of the areas specified in subparagraph (A).
                ``(2) Improvements in outcomes for individual families.--
                        ``(A) In general.--The program is designed, with
                    respect to an eligible family participating in the
                    program, to result in the participant outcomes
                    described in subparagraph (B) that the eligible entity
                    identifies on the basis of an individualized assessment
                    of the family, are relevant for that family.
                        ``(B) Participant outcomes.--The participant
                    outcomes described in this subparagraph are the
                    following:
                                ``(i) Improvements in prenatal, maternal,
                            and newborn health, including improved
                            pregnancy outcomes
                                ``(ii) Improvements in child health and
                            development, including the prevention of child
                            injuries and maltreatment and improvements in
                            cognitive, language, social-emotional, and
                            physical developmental indicators.
                                ``(iii) Improvements in parenting skills.
                                ``(iv) Improvements in school readiness and
                            child academic achievement.
                                ``(v) Reductions in crime or domestic
                            violence.
                                ``(vi) Improvements in family economic
                            self-sufficiency.
                                ``(vii) Improvements in the coordination of
                            referrals for, and the provision of, other
                            community resources and supports for eligible
                            families, consistent with State child welfare
                            agency training.
                ``(3) Core components.--The program includes the following
            core components:
                        ``(A) Service delivery model or models.--
                                ``(i) In general.--Subject to clause (ii),
                            the program is conducted using 1 or more of the
                            service delivery models described in item (aa)
                            or (bb) of subclause (I) or in subclause (II)
                            selected by the eligible entity:
                                        ``(I) The model conforms to a clear
                                    consistent home visitation model that
                                    has been in existence for at least 3
                                    years and is research-based, grounded
                                    in relevant empirically-based
                                    knowledge, linked to program determined
                                    outcomes, associated with a national
                                    organization or institution of higher
                                    education that has comprehensive home
                                    visitation program standards that
                                    ensure high quality service delivery
                                    and continuous program quality
                                    improvement, and has demonstrated
                                    significant, (and in the case of the
                                    service delivery model described in
                                    item (aa), sustained) positive
                                    outcomes, as described in the benchmark
                                    areas specified in paragraph (1)(A) and
                                    the participant outcomes described in
                                    paragraph (2)(B), when evaluated using
                                    well-designed and rigorous--
                                                ``(aa) randomized
                                            controlled research designs,
                                            and the evaluation results have
                                            been published in a peer-
                                            reviewed journal; or
                                                ``(bb) quasi-experimental
                                            research designs.
                                        ``(II) The model conforms to a
                                    promising and new approach to achieving
                                    the benchmark areas specified in
                                    paragraph (1)(A) and the participant
                                    outcomes described in paragraph (2)(B),
                                    has been developed or identified by a
                                    national organization or institution of
                                    higher education, and will be evaluated
                                    through well-designed and rigorous
                                    process.
                                ``(ii) Majority of grant funds used for
                            evidence-based models.--An eligible entity
                            shall use not more than 25 percent of the
                            amount of the grant paid to the entity for a
                            fiscal year for purposes of conducting a
                            program using the service delivery model
                            described in clause (i)(II).
                                ``(iii) Criteria for evidence of
                            effectiveness of models.--The Secretary shall
                            establish criteria for evidence of
                            effectiveness of the service delivery models
                            and shall ensure that the process for
                            establishing the criteria is transparent and
                            provides the opportunity for public comment.
                        ``(B) Additional requirements.--
                                ``(i) The program adheres to a clear,
                            consistent model that satisfies the
                            requirements of being grounded in empirically-
                            based knowledge related to home visiting and
                            linked to the benchmark areas specified in
                            paragraph (1)(A) and the participant outcomes
                            described in paragraph (2)(B) related to the
                            purposes of the program.
                                ``(ii) The program employs well-trained and
                            competent staff, as demonstrated by education
                            or training, such as nurses, social workers,
                            educators, child development specialists, or
                            other well-trained and competent staff, and
                            provides ongoing and specific training on the
                            model being delivered.
                                ``(iii) The program maintains high quality
                            supervision to establish home visitor
                            competencies.
                                ``(iv) The program demonstrates strong
                            organizational capacity to implement the
                            activities involved.
                                ``(v) The program establishes appropriate
                            linkages and referral networks to other
                            community resources and supports for eligible
                            families.
                                ``(vi) The program monitors the fidelity of
                            program implementation to ensure that services
                            are delivered pursuant to the specified model.
                ``(4) Priority for serving high-risk populations.--The
            eligible entity gives priority to providing services under the
            program to the following:
                        ``(A) Eligible families who reside in communities
                    in need of such services, as identified in the
                    statewide needs assessment required under subsection
                    (b)(1)(A).
                        ``(B) Low-income eligible families.
                        ``(C) Eligible families who are pregnant women who
                    have not attained age 21.
                        ``(D) Eligible families that have a history of
                    child abuse or neglect or have had interactions with
                    child welfare services.
                        ``(E) Eligible families that have a history of
                    substance abuse or need substance abuse treatment.
                        ``(F) Eligible families that have users of tobacco
                    products in the home.
                        ``(G) Eligible families that are or have children
                    with low student achievement.
                        ``(H) Eligible families with children with
                    developmental delays or disabilities.
                        ``(I) Eligible families who, or that include
                    individuals who, are serving or formerly served in the
                    Armed Forces, including such families that have members
                    of the Armed Forces who have had multiple deployments
                    outside of the United States.
        ``(e) Application Requirements.--An eligible entity desiring a
    grant under this section shall submit an application to the Secretary
    for approval, in such manner as the Secretary may require, that
    includes the following:
                ``(1) A description of the populations to be served by the
            entity, including specific information regarding how the entity
            will serve high risk populations described in subsection
            (d)(4).
                ``(2) An assurance that the entity will give priority to
            serving low-income eligible families and eligible families who
            reside in at risk communities identified in the statewide needs
            assessment required under subsection (b)(1)(A).
                ``(3) The service delivery model or models described in
            subsection (d)(3)(A) that the entity will use under the program
            and the basis for the selection of the model or models.
                ``(4) A statement identifying how the selection of the
            populations to be served and the service delivery model or
            models that the entity will use under the program for such
            populations is consistent with the results of the statewide
            needs assessment conducted under subsection (b).
                ``(5) The quantifiable, measurable benchmarks established
            by the State to demonstrate that the program contributes to
            improvements in the areas specified in subsection (d)(1)(A).
                ``(6) An assurance that the entity will obtain and submit
            documentation or other appropriate evidence from the
            organization or entity that developed the service delivery
            model or models used under the program to verify that the
            program is implemented and services are delivered according to
            the model specifications.
                ``(7) Assurances that the entity will establish procedures
            to ensure that--
                        ``(A) the participation of each eligible family in
                    the program is voluntary; and
                        ``(B) services are provided to an eligible family
                    in accordance with the individual assessment for that
                    family.
                ``(8) Assurances that the entity will--
                        ``(A) submit annual reports to the Secretary
                    regarding the program and activities carried out under
                    the program that include such information and data as
                    the Secretary shall require; and
                        ``(B) participate in, and cooperate with, data and
                    information collection necessary for the evaluation
                    required under subsection (g)(2) and other research and
                    evaluation activities carried out under subsection
                    (h)(3).
                ``(9) A description of other State programs that include
            home visitation services, including, if applicable to the
            State, other programs carried out under this title with funds
            made available from allotments under section 502(c), programs
            funded under title IV, title II of the Child Abuse Prevention
            and Treatment Act (relating to community-based grants for the
            prevention of child abuse and neglect), and section 645A of the
            Head Start Act (relating to Early Head Start programs).
                ``(10) Other information as required by the Secretary.
        ``(f) Maintenance of Effort.--Funds provided to an eligible entity
    receiving a grant under this section shall supplement, and not
    supplant, funds from other sources for early childhood home visitation
    programs or initiatives.
        ``(g) Evaluation.--
                ``(1) Independent, expert advisory panel.--The Secretary,
            in accordance with subsection (h)(1)(A), shall appoint an
            independent advisory panel consisting of experts in program
            evaluation and research, education, and early childhood
            development--
                        ``(A) to review, and make recommendations on, the
                    design and plan for the evaluation required under
                    paragraph (2) within 1 year after the date of enactment
                    of this section;
                        ``(B) to maintain and advise the Secretary
                    regarding the progress of the evaluation; and
                        ``(C) to comment, if the panel so desires, on the
                    report submitted under paragraph (3).
                ``(2) Authority to conduct evaluation.--On the basis of the
            recommendations of the advisory panel under paragraph (1), the
            Secretary shall, by grant, contract, or interagency agreement,
            conduct an evaluation of the statewide needs assessments
            submitted under subsection (b) and the grants made under
            subsections (c) and (h)(3)(B). The evaluation shall include--
                        ``(A) an analysis, on a State-by-State basis, of
                    the results of such assessments, including indicators
                    of maternal and prenatal health and infant health and
                    mortality, and State actions in response to the
                    assessments; and
                        ``(B) an assessment of--
                                ``(i) the effect of early childhood home
                            visitation programs on child and parent
                            outcomes, including with respect to each of the
                            benchmark areas specified in subsection
                            (d)(1)(A) and the participant outcomes
                            described in subsection (d)(2)(B);
                                ``(ii) the effectiveness of such programs
                            on different populations, including the extent
                            to which the ability of programs to improve
                            participant outcomes varies across programs and
                            populations; and
                                ``(iii) the potential for the activities
                            conducted under such programs, if scaled
                            broadly, to improve health care practices,
                            eliminate health disparities, and improve
                            health care system quality, efficiencies, and
                            reduce costs.
                ``(3) Report.--Not later than March 31, 2015, the Secretary
            shall submit a report to Congress on the results of the
            evaluation conducted under paragraph (2) and shall make the
            report publicly available.
        ``(h) Other Provisions.--
                ``(1) Intra-agency collaboration.--The Secretary shall
            ensure that the Maternal and Child Health Bureau and the
            Administration for Children and Families collaborate with
            respect to carrying out this section, including with respect
            to--
                        ``(A) reviewing and analyzing the statewide needs
                    assessments required under subsection (b), the awarding
                    and oversight of grants awarded under this section, the
                    establishment of the advisory panels required under
                    subsections (d)(1)(B)(iii)(II) and (g)(1), and the
                    evaluation and report required under subsection (g);
                    and
                        ``(B) consulting with other Federal agencies with
                    responsibility for administering or evaluating programs
                    that serve eligible families to coordinate and
                    collaborate with respect to research related to such
                    programs and families, including the Office of the
                    Assistant Secretary for Planning and Evaluation of the
                    Department of Health and Human Services, the Centers
                    for Disease Control and Prevention, the National
                    Institute of Child Health and Human Development of the
                    National Institutes of Health, the Office of Juvenile
                    Justice and Delinquency Prevention of the Department of
                    Justice, and the Institute of Education Sciences of the
                    Department of Education.
                ``(2) Grants to eligible entities that are not states.--
                        ``(A) Indian tribes, tribal organizations, or urban
                    indian organizations.--The Secretary shall specify
                    requirements for eligible entities that are Indian
                    Tribes (or a consortium of Indian Tribes), Tribal
                    Organizations, or Urban Indian Organizations to apply
                    for and conduct an early childhood home visitation
                    program with a grant under this section. Such
                    requirements shall, to the greatest extent practicable,
                    be consistent with the requirements applicable to
                    eligible entities that are States and shall require an
                    Indian Tribe (or consortium), Tribal Organization, or
                    Urban Indian Organization to--
                                ``(i) conduct a needs assessment similar to
                            the assessment required for all States under
                            subsection (b); and
                                ``(ii) establish quantifiable, measurable
                            3- and 5-year benchmarks consistent with
                            subsection (d)(1)(A).
                        ``(B) Nonprofit organizations.--If, as of the
                    beginning of fiscal year 2012, a State has not applied
                    or been approved for a grant under this section, the
                    Secretary may use amounts appropriated under paragraph
                    (1) of subsection (j) that are available for
                    expenditure under paragraph (3) of that subsection to
                    make a grant to an eligible entity that is a nonprofit
                    organization described in subsection (k)(1)(B) to
                    conduct an early childhood home visitation program in
                    the State. The Secretary shall specify the requirements
                    for such an organization to apply for and conduct the
                    program which shall, to the greatest extent
                    practicable, be consistent with the requirements
                    applicable to eligible entities that are States and
                    shall require the organization to--
                                ``(i) carry out the program based on the
                            needs assessment conducted by the State under
                            subsection (b); and
                                ``(ii) establish quantifiable, measurable
                            3- and 5-year benchmarks consistent with
                            subsection (d)(1)(A).
                ``(3) Research and other evaluation activities.--
                        ``(A) In general.--The Secretary shall carry out a
                    continuous program of research and evaluation
                    activities in order to increase knowledge about the
                    implementation and effectiveness of home visiting
                    programs, using random assignment designs to the
                    maximum extent feasible. The Secretary may carry out
                    such activities directly, or through grants,
                    cooperative agreements, or contracts.
                        ``(B) Requirements.--The Secretary shall ensure
                    that--
                                ``(i) evaluation of a specific program or
                            project is conducted by persons or individuals
                            not directly involved in the operation of such
                            program or project; and
                                ``(ii) the conduct of research and
                            evaluation activities includes consultation
                            with independent researchers, State officials,
                            and developers and providers of home visiting
                            programs on topics including research design
                            and administrative data matching.
                ``(4) Report and recommendation.--Not later than December
            31, 2015, the Secretary shall submit a report to Congress
            regarding the programs conducted with grants under this
            section. The report required under this paragraph shall
            include--
                        ``(A) information regarding the extent to which
                    eligible entities receiving grants under this section
                    demonstrated improvements in each of the areas
                    specified in subsection (d)(1)(A);
                        ``(B) information regarding any technical
                    assistance provided under subsection (d)(1)(B)(iii)(I),
                    including the type of any such assistance provided; and
                        ``(C) recommendations for such legislative or
                    administrative action as the Secretary determines
                    appropriate.
        ``(i) Application of Other Provisions of Title.--
                ``(1) In general.--Except as provided in paragraph (2), the
            other provisions of this title shall not apply to a grant made
            under this section.
                ``(2) Exceptions.--The following provisions of this title
            shall apply to a grant made under this section to the same
            extent and in the same manner as such provisions apply to
            allotments made under section 502(c):
                        ``(A) Section 504(b)(6) (relating to prohibition on
                    payments to excluded individuals and entities).
                        ``(B) Section 504(c) (relating to the use of funds
                    for the purchase of technical assistance).
                        ``(C) Section 504(d) (relating to a limitation on
                    administrative expenditures).
                        ``(D) Section 506 (relating to reports and audits),
                    but only to the extent determined by the Secretary to
                    be appropriate for grants made under this section.
                        ``(E) Section 507 (relating to penalties for false
                    statements).
                        ``(F) Section 508 (relating to nondiscrimination).
                        ``(G) Section 509(a) (relating to the
                    administration of the grant program).
        ``(j) Appropriations.--
                ``(1) In general.--Out of any funds in the Treasury not
            otherwise appropriated, there are appropriated to the Secretary
            to carry out this section--
                        ``(A) $100,000,000 for fiscal year 2010;
                        ``(B) $250,000,000 for fiscal year 2011;
                        ``(C) $350,000,000 for fiscal year 2012;
                        ``(D) $400,000,000 for fiscal year 2013; and
                        ``(E) $400,000,000 for fiscal year 2014.
                ``(2) Reservations.--Of the amount appropriated under this
            subsection for a fiscal year, the Secretary shall reserve--
                        ``(A) 3 percent of such amount for purposes of
                    making grants to eligible entities that are Indian
                    Tribes (or a consortium of Indian Tribes), Tribal
                    Organizations, or Urban Indian Organizations; and
                        ``(B) 3 percent of such amount for purposes of
                    carrying out subsections (d)(1)(B)(iii), (g), and
                    (h)(3).
                ``(3) Availability.--Funds made available to an eligible
            entity under this section for a fiscal year shall remain
            available for expenditure by the eligible entity through the
            end of the second succeeding fiscal year after award. Any funds
            that are not expended by the eligible entity during the period
            in which the funds are available under the preceding sentence
            may be used for grants to nonprofit organizations under
            subsection (h)(2)(B).
        ``(k) Definitions.--In this section:
                ``(1) Eligible entity.--
                        ``(A) In general.--The term `eligible entity' means
                    a State, an Indian Tribe, Tribal Organization, or Urban
                    Indian Organization, Puerto Rico, Guam, the Virgin
                    Islands, the Northern Mariana Islands, and American
                    Samoa.
                        ``(B) Nonprofit organizations.--Only for purposes
                    of awarding grants under subsection (h)(2)(B), such
                    term shall include a nonprofit organization with an
                    established record of providing early childhood home
                    visitation programs or initiatives in a State or
                    several States.
                ``(2) Eligible family.--The term `eligible family' means--
                        ``(A) a woman who is pregnant, and the father of
                    the child if the father is available; or
                        ``(B) a parent or primary caregiver of a child,
                    including grandparents or other relatives of the child,
                    and foster parents, who are serving as the child's
                    primary caregiver from birth to kindergarten entry, and
                    including a noncustodial parent who has an ongoing
                    relationship with, and at times provides physical care
                    for, the child.
                ``(3) Indian tribe; tribal organization.--The terms `Indian
            Tribe' and `Tribal Organization', and `Urban Indian
            Organization' have the meanings given such terms in section 4
            of the Indian Health Care Improvement Act.''.

    SEC. 2952. SUPPORT, EDUCATION, AND RESEARCH FOR POSTPARTUM DEPRESSION.

        (a) Research on Postpartum Conditions.--
                (1) Expansion and intensification of activities.--The
            Secretary of Health and Human Services (in this subsection and
            subsection (c) referred to as the ``Secretary'') is encouraged
            to continue activities on postpartum depression or postpartum
            psychosis (in this subsection and subsection (c) referred to as
            ``postpartum conditions''), including research to expand the
            understanding of the causes of, and treatments for, postpartum
            conditions. Activities under this paragraph shall include
            conducting and supporting the following:
                        (A) Basic research concerning the etiology and
                    causes of the conditions.
                        (B) Epidemiological studies to address the
                    frequency and natural history of the conditions and the
                    differences among racial and ethnic groups with respect
                    to the conditions.
                        (C) The development of improved screening and
                    diagnostic techniques.
                        (D) Clinical research for the development and
                    evaluation of new treatments.
                        (E) Information and education programs for health
                    care professionals and the public, which may include a
                    coordinated national campaign to increase the awareness
                    and knowledge of postpartum conditions. Activities
                    under such a national campaign may--
                                (i) include public service announcements
                            through television, radio, and other means; and
                                (ii) focus on--
                                        (I) raising awareness about
                                    screening;
                                        (II) educating new mothers and
                                    their families about postpartum
                                    conditions to promote earlier diagnosis
                                    and treatment; and
                                        (III) ensuring that such education
                                    includes complete information
                                    concerning postpartum conditions,
                                    including its symptoms, methods of
                                    coping with the illness, and treatment
                                    resources.
                (2) Sense of congress regarding longitudinal study of
            relative mental health consequences for women of resolving a
            pregnancy.--
                        (A) Sense of congress.--It is the sense of Congress
                    that the Director of the National Institute of Mental
                    Health may conduct a nationally representative
                    longitudinal study (during the period of fiscal years
                    2010 through 2019) of the relative mental health
                    consequences for women of resolving a pregnancy
                    (intended and unintended) in various ways, including
                    carrying the pregnancy to term and parenting the child,
                    carrying the pregnancy to term and placing the child
                    for adoption, miscarriage, and having an abortion. This
                    study may assess the incidence, timing, magnitude, and
                    duration of the immediate and long-term mental health
                    consequences (positive or negative) of these pregnancy
                    outcomes.
                        (B) Report.--Subject to the completion of the study
                    under subsection (a), beginning not later than 5 years
                    after the date of the enactment of this Act, and
                    periodically thereafter for the duration of the study,
                    such Director may prepare and submit to the Congress
                    reports on the findings of the study.
        (b) Grants To Provide Services to Individuals With a Postpartum
    Condition and Their Families.--Title V of the Social Security Act (42
    U.S.C. 701 et seq.), as amended by section 2951, is amended by adding
    at the end the following new section:

    ``SEC. 512. SERVICES TO INDIVIDUALS WITH A POSTPARTUM CONDITION AND
                  THEIR FAMILIES.

        ``(a) In General.--In addition to any other payments made under
    this title to a State, the Secretary may make grants to eligible
    entities for projects for the establishment, operation, and
    coordination of effective and cost-efficient systems for the delivery
    of essential services to individuals with or at risk for postpartum
    conditions and their families.
        ``(b) Certain Activities.--To the extent practicable and
    appropriate, the Secretary shall ensure that projects funded under
    subsection (a) provide education and services with respect to the
    diagnosis and management of postpartum conditions for individuals with
    or at risk for postpartum conditions and their families. The Secretary
    may allow such projects to include the following:
                ``(1) Delivering or enhancing outpatient and home-based
            health and support services, including case management and
            comprehensive treatment services.
                ``(2) Delivering or enhancing inpatient care management
            services that ensure the well-being of the mother and family
            and the future development of the infant.
                ``(3) Improving the quality, availability, and organization
            of health care and support services (including transportation
            services, attendant care, homemaker services, day or respite
            care, and providing counseling on financial assistance and
            insurance).
                ``(4) Providing education about postpartum conditions to
            promote earlier diagnosis and treatment. Such education may
            include--
                        ``(A) providing complete information on postpartum
                    conditions, symptoms, methods of coping with the
                    illness, and treatment resources; and
                        ``(B) in the case of a grantee that is a State,
                    hospital, or birthing facility--
                                ``(i) providing education to new mothers
                            and fathers, and other family members as
                            appropriate, concerning postpartum conditions
                            before new mothers leave the health facility;
                            and
                                ``(ii) ensuring that training programs
                            regarding such education are carried out at the
                            health facility.
        ``(c) Integration With Other Programs.--To the extent practicable
    and appropriate, the Secretary may integrate the grant program under
    this section with other grant programs carried out by the Secretary,
    including the program under section 330 of the Public Health Service
    Act.
        ``(d) Requirements.--The Secretary shall establish requirements for
    grants made under this section that include a limit on the amount of
    grants funds that may be used for administration, accounting,
    reporting, or program oversight functions and a requirement for each
    eligible entity that receives a grant to submit, for each grant period,
    a report to the Secretary that describes how grant funds were used
    during such period.
        ``(e) Technical Assistance.--The Secretary may provide technical
    assistance to entities seeking a grant under this section in order to
    assist such entities in complying with the requirements of this
    section.
        ``(f) Application of Other Provisions of Title.--
                ``(1) In general.--Except as provided in paragraph (2), the
            other provisions of this title shall not apply to a grant made
            under this section.
                ``(2) Exceptions.--The following provisions of this title
            shall apply to a grant made under this section to the same
            extent and in the same manner as such provisions apply to
            allotments made under section 502(c):
                        ``(A) Section 504(b)(6) (relating to prohibition on
                    payments to excluded individuals and entities).
                        ``(B) Section 504(c) (relating to the use of funds
                    for the purchase of technical assistance).
                        ``(C) Section 504(d) (relating to a limitation on
                    administrative expenditures).
                        ``(D) Section 506 (relating to reports and audits),
                    but only to the extent determined by the Secretary to
                    be appropriate for grants made under this section.
                        ``(E) Section 507 (relating to penalties for false
                    statements).
                        ``(F) Section 508 (relating to nondiscrimination).
                        ``(G) Section 509(a) (relating to the
                    administration of the grant program).
        ``(g) Definitions.--In this section:
                ``(1) The term `eligible entity'--
                        ``(A) means a public or nonprofit private entity;
                    and
                        ``(B) includes a State or local government, public-
                    private partnership, recipient of a grant under section
                    330H of the Public Health Service Act (relating to the
                    Healthy Start Initiative), public or nonprofit private
                    hospital, community-based organization, hospice,
                    ambulatory care facility, community health center,
                    migrant health center, public housing primary care
                    center, or homeless health center.
                ``(2) The term `postpartum condition' means postpartum
            depression or postpartum psychosis.''.
        (c) General Provisions.--
                (1) Authorization of appropriations.--To carry out this
            section and the amendment made by subsection (b), there are
            authorized to be appropriated, in addition to such other sums
            as may be available for such purpose--
                        (A) $3,000,000 for fiscal year 2010; and
                        (B) such sums as may be necessary for fiscal years
                    2011 and 2012.
                (2) Report by the secretary.--
                        (A) Study.--The Secretary shall conduct a study on
                    the benefits of screening for postpartum conditions.
                        (B) Report.--Not later than 2 years after the date
                    of the enactment of this Act, the Secretary shall
                    complete the study required by subparagraph (A) and
                    submit a report to the Congress on the results of such
                    study.

    SEC. 2953. PERSONAL RESPONSIBILITY EDUCATION.

        Title V of the Social Security Act (42 U.S.C. 701 et seq.), as
    amended by sections 2951 and 2952(c), is amended by adding at the end
    the following:

    ``SEC. 513. PERSONAL RESPONSIBILITY EDUCATION.

        ``(a) Allotments to States.--
                ``(1) Amount.--
                        ``(A) In general.--For the purpose described in
                    subsection (b), subject to the succeeding provisions of
                    this section, for each of fiscal years 2010 through
                    2014, the Secretary shall allot to each State an amount
                    equal to the product of--
                                ``(i) the amount appropriated under
                            subsection (f) for the fiscal year and
                            available for allotments to States after the
                            application of subsection (c); and
                                ``(ii) the State youth population
                            percentage determined under paragraph (2).
                        ``(B) Minimum allotment.--
                                ``(i) In general.--Each State allotment
                            under this paragraph for a fiscal year shall be
                            at least $250,000.
                                ``(ii) Pro rata adjustments.--The Secretary
                            shall adjust on a pro rata basis the amount of
                            the State allotments determined under this
                            paragraph for a fiscal year to the extent
                            necessary to comply with clause (i).
                        ``(C) Application required to access allotments.--
                                ``(i) In general.--A State shall not be
                            paid from its allotment for a fiscal year
                            unless the State submits an application to the
                            Secretary for the fiscal year and the Secretary
                            approves the application (or requires changes
                            to the application that the State satisfies)
                            and meets such additional requirements as the
                            Secretary may specify.
                                ``(ii) Requirements.--The State application
                            shall contain an assurance that the State has
                            complied with the requirements of this section
                            in preparing and submitting the application and
                            shall include the following as well as such
                            additional information as the Secretary may
                            require:
                                        ``(I) Based on data from the
                                    Centers for Disease Control and
                                    Prevention National Center for Health
                                    Statistics, the most recent pregnancy
                                    rates for the State for youth ages 10
                                    to 14 and youth ages 15 to 19 for which
                                    data are available, the most recent
                                    birth rates for such youth populations
                                    in the State for which data are
                                    available, and trends in those rates
                                    for the most recently preceding 5-year
                                    period for which such data are
                                    available.
                                        ``(II) State-established goals for
                                    reducing the pregnancy rates and birth
                                    rates for such youth populations.
                                        ``(III) A description of the
                                    State's plan for using the State
                                    allotments provided under this section
                                    to achieve such goals, especially among
                                    youth populations that are the most
                                    high-risk or vulnerable for pregnancies
                                    or otherwise have special
                                    circumstances, including youth in
                                    foster care, homeless youth, youth with
                                    HIV/AIDS, pregnant youth who are under
                                    21 years of age, mothers who are under
                                    21 years of age, and youth residing in
                                    areas with high birth rates for youth.
                ``(2) State youth population percentage.--
                        ``(A) In general.--For purposes of paragraph
                    (1)(A)(ii), the State youth population percentage is,
                    with respect to a State, the proportion (expressed as a
                    percentage) of--
                                ``(i) the number of individuals who have
                            attained age 10 but not attained age 20 in the
                            State; to
                                ``(ii) the number of such individuals in
                            all States.
                        ``(B) Determination of number of youth.--The number
                    of individuals described in clauses (i) and (ii) of
                    subparagraph (A) in a State shall be determined on the
                    basis of the most recent Bureau of the Census data.
                ``(3) Availability of state allotments.--Subject to
            paragraph (4)(A), amounts allotted to a State pursuant to this
            subsection for a fiscal year shall remain available for
            expenditure by the State through the end of the second
            succeeding fiscal year.
                ``(4) Authority to award grants from state allotments to
            local organizations and entities in nonparticipating states.--
                        ``(A) Grants from unexpended allotments.--If a
                    State does not submit an application under this section
                    for fiscal year 2010 or 2011, the State shall no longer
                    be eligible to submit an application to receive funds
                    from the amounts allotted for the State for each of
                    fiscal years 2010 through 2014 and such amounts shall
                    be used by the Secretary to award grants under this
                    paragraph for each of fiscal years 2012 through 2014.
                    The Secretary also shall use any amounts from the
                    allotments of States that submit applications under
                    this section for a fiscal year that remain unexpended
                    as of the end of the period in which the allotments are
                    available for expenditure under paragraph (3) for
                    awarding grants under this paragraph.
                        ``(B) 3-year grants.--
                                ``(i) In general.--The Secretary shall
                            solicit applications to award 3-year grants in
                            each of fiscal years 2012, 2013, and 2014 to
                            local organizations and entities to conduct,
                            consistent with subsection (b), programs and
                            activities in States that do not submit an
                            application for an allotment under this section
                            for fiscal year 2010 or 2011.
                                ``(ii) Faith-based organizations or
                            consortia.--The Secretary may solicit and award
                            grants under this paragraph to faith-based
                            organizations or consortia.
                        ``(C) Evaluation.--An organization or entity
                    awarded a grant under this paragraph shall agree to
                    participate in a rigorous Federal evaluation.
                ``(5) Maintenance of effort.--No payment shall be made to a
            State from the allotment determined for the State under this
            subsection or to a local organization or entity awarded a grant
            under paragraph (4), if the expenditure of non-federal funds by
            the State, organization, or entity for activities, programs, or
            initiatives for which amounts from allotments and grants under
            this subsection may be expended is less than the amount
            expended by the State, organization, or entity for such
            programs or initiatives for fiscal year 2009.
                ``(6) Data collection and reporting.--A State or local
            organization or entity receiving funds under this section shall
            cooperate with such requirements relating to the collection of
            data and information and reporting on outcomes regarding the
            programs and activities carried out with such funds, as the
            Secretary shall specify.
        ``(b) Purpose.--
                ``(1) In general.--The purpose of an allotment under
            subsection (a)(1) to a State is to enable the State (or, in the
            case of grants made under subsection (a)(4)(B), to enable a
            local organization or entity) to carry out personal
            responsibility education programs consistent with this
            subsection.
                ``(2) Personal responsibility education programs.--
                        ``(A) In general.--In this section, the term
                    `personal responsibility education program' means a
                    program that is designed to educate adolescents on--
                                ``(i) both abstinence and contraception for
                            the prevention of pregnancy and sexually
                            transmitted infections, including HIV/AIDS,
                            consistent with the requirements of
                            subparagraph (B); and
                                ``(ii) at least 3 of the adulthood
                            preparation subjects described in subparagraph
                            (C).
                        ``(B) Requirements.--The requirements of this
                    subparagraph are the following:
                                ``(i) The program replicates evidence-based
                            effective programs or substantially
                            incorporates elements of effective programs
                            that have been proven on the basis of rigorous
                            scientific research to change behavior, which
                            means delaying sexual activity, increasing
                            condom or contraceptive use for sexually active
                            youth, or reducing pregnancy among youth.
                                ``(ii) The program is medically-accurate
                            and complete.
                                ``(iii) The program includes activities to
                            educate youth who are sexually active regarding
                            responsible sexual behavior with respect to
                            both abstinence and the use of contraception.
                                ``(iv) The program places substantial
                            emphasis on both abstinence and contraception
                            for the prevention of pregnancy among youth and
                            sexually transmitted infections.
                                ``(v) The program provides age-appropriate
                            information and activities.
                                ``(vi) The information and activities
                            carried out under the program are provided in
                            the cultural context that is most appropriate
                            for individuals in the particular population
                            group to which they are directed.
                        ``(C) Adulthood preparation subjects.--The
                    adulthood preparation subjects described in this
                    subparagraph are the following:
                                ``(i) Healthy relationships, such as
                            positive self-esteem and relationship dynamics,
                            friendships, dating, romantic involvement,
                            marriage, and family interactions.
                                ``(ii) Adolescent development, such as the
                            development of healthy attitudes and values
                            about adolescent growth and development, body
                            image, racial and ethnic diversity, and other
                            related subjects.
                                ``(iii) Financial literacy.
                                ``(iv) Parent-child communication.
                                ``(v) Educational and career success, such
                            as developing skills for employment
                            preparation, job seeking, independent living,
                            financial self-sufficiency, and workplace
                            productivity.
                                ``(vi) Healthy life skills, such as goal-
                            setting, decision making, negotiation,
                            communication and interpersonal skills, and
                            stress management.
        ``(c) Reservations of Funds.--
                ``(1) Grants to implement innovative strategies.--From the
            amount appropriated under subsection (f) for the fiscal year,
            the Secretary shall reserve $10,000,000 of such amount for
            purposes of awarding grants to entities to implement innovative
            youth pregnancy prevention strategies and target services to
            high-risk, vulnerable, and culturally under-represented youth
            populations, including youth in foster care, homeless youth,
            youth with HIV/AIDS, pregnant women who are under 21 years of
            age and their partners, mothers who are under 21 years of age
            and their partners, and youth residing in areas with high birth
            rates for youth. An entity awarded a grant under this paragraph
            shall agree to participate in a rigorous Federal evaluation of
            the activities carried out with grant funds.
                ``(2) Other reservations.--From the amount appropriated
            under subsection (f) for the fiscal year that remains after the
            application of paragraph (1), the Secretary shall reserve the
            following amounts:
                        ``(A) Grants for indian tribes or tribal
                    organizations.--The Secretary shall reserve 5 percent
                    of such remainder for purposes of awarding grants to
                    Indian tribes and tribal organizations in such manner,
                    and subject to such requirements, as the Secretary, in
                    consultation with Indian tribes and tribal
                    organizations, determines appropriate.
                        ``(B) Secretarial responsibilities.--
                                ``(i) Reservation of funds.--The Secretary
                            shall reserve 10 percent of such remainder for
                            expenditures by the Secretary for the
                            activities described in clauses (ii) and (iii).
                                ``(ii) Program support.--The Secretary
                            shall provide, directly or through a
                            competitive grant process, research, training
                            and technical assistance, including
                            dissemination of research and information
                            regarding effective and promising practices,
                            providing consultation and resources on a broad
                            array of teen pregnancy prevention strategies,
                            including abstinence and contraception, and
                            developing resources and materials to support
                            the activities of recipients of grants and
                            other State, tribal, and community
                            organizations working to reduce teen pregnancy.
                            In carrying out such functions, the Secretary
                            shall collaborate with a variety of entities
                            that have expertise in the prevention of teen
                            pregnancy, HIV and sexually transmitted
                            infections, healthy relationships, financial
                            literacy, and other topics addressed through
                            the personal responsibility education programs.
                                ``(iii) Evaluation.--The Secretary shall
                            evaluate the programs and activities carried
                            out with funds made available through
                            allotments or grants under this section.
        ``(d) Administration.--
                ``(1) In general.--The Secretary shall administer this
            section through the Assistant Secretary for the Administration
            for Children and Families within the Department of Health and
            Human Services.
                ``(2) Application of other provisions of title.--
                        ``(A) In general.--Except as provided in
                    subparagraph (B), the other provisions of this title
                    shall not apply to allotments or grants made under this
                    section.
                        ``(B) Exceptions.--The following provisions of this
                    title shall apply to allotments and grants made under
                    this section to the same extent and in the same manner
                    as such provisions apply to allotments made under
                    section 502(c):
                                ``(i) Section 504(b)(6) (relating to
                            prohibition on payments to excluded individuals
                            and entities).
                                ``(ii) Section 504(c) (relating to the use
                            of funds for the purchase of technical
                            assistance).
                                ``(iii) Section 504(d) (relating to a
                            limitation on administrative expenditures).
                                ``(iv) Section 506 (relating to reports and
                            audits), but only to the extent determined by
                            the Secretary to be appropriate for grants made
                            under this section.
                                ``(v) Section 507 (relating to penalties
                            for false statements).
                                ``(vi) Section 508 (relating to
                            nondiscrimination).
        ``(e) Definitions.--In this section:
                ``(1) Age-appropriate.--The term `age-appropriate', with
            respect to the information in pregnancy prevention, means
            topics, messages, and teaching methods suitable to particular
            ages or age groups of children and adolescents, based on
            developing cognitive, emotional, and behavioral capacity
            typical for the age or age group.
                ``(2) Medically accurate and complete.--The term `medically
            accurate and complete' means verified or supported by the
            weight of research conducted in compliance with accepted
            scientific methods and--
                        ``(A) published in peer-reviewed journals, where
                    applicable; or
                        ``(B) comprising information that leading
                    professional organizations and agencies with relevant
                    expertise in the field recognize as accurate,
                    objective, and complete.
                ``(3) Indian tribes; tribal organizations.--The terms
            `Indian tribe' and `Tribal organization' have the meanings
            given such terms in section 4 of the Indian Health Care
            Improvement Act (25 U.S.C. 1603)).
                ``(4) Youth.--The term `youth' means an individual who has
            attained age 10 but has not attained age 20.
        ``(f) Appropriation.--For the purpose of carrying out this section,
    there is appropriated, out of any money in the Treasury not otherwise
    appropriated, $75,000,000 for each of fiscal years 2010 through 2014.
    Amounts appropriated under this subsection shall remain available until
    expended.''.

    SEC. 2954. RESTORATION OF FUNDING FOR ABSTINENCE EDUCATION.

        Section 510 of the Social Security Act (42 U.S.C. 710) is amended--
                (1) in subsection (a), by striking ``fiscal year 1998 and
            each subsequent fiscal year'' and inserting ``each of fiscal
            years 2010 through 2014''; and
                (2) in subsection (d)--
                        (A) in the first sentence, by striking ``1998
                    through 2003'' and inserting ``2010 through 2014''; and
                        (B) in the second sentence, by inserting ``(except
                    that such appropriation shall be made on the date of
                    enactment of the Patient Protection and Affordable Care
                    Act in the case of fiscal year 2010)'' before the
                    period.

    SEC. 2955. INCLUSION OF INFORMATION ABOUT THE IMPORTANCE OF HAVING A
                  HEALTH CARE POWER OF ATTORNEY IN TRANSITION PLANNING FOR
                  CHILDREN AGING OUT OF FOSTER CARE AND INDEPENDENT LIVING
                  PROGRAMS.

        (a) Transition Planning.--Section 475(5)(H) of the Social Security
    Act (42 U.S.C. 675(5)(H)) is amended by inserting ``includes
    information about the importance of designating another individual to
    make health care treatment decisions on behalf of the child if the
    child becomes unable to participate in such decisions and the child
    does not have, or does not want, a relative who would otherwise be
    authorized under State law to make such decisions, and provides the
    child with the option to execute a health care power of attorney,
    health care proxy, or other similar document recognized under State
    law,'' after ``employment services,''.
        (b) Independent Living Education.--Section 477(b)(3) of such Act
    (42 U.S.C. 677(b)(3)) is amended by adding at the end the following:
                        ``(K) A certification by the chief executive
                    officer of the State that the State will ensure that an
                    adolescent participating in the program under this
                    section are provided with education about the
                    importance of designating another individual to make
                    health care treatment decisions on behalf of the
                    adolescent if the adolescent becomes unable to
                    participate in such decisions and the adolescent does
                    not have, or does not want, a relative who would
                    otherwise be authorized under State law to make such
                    decisions, whether a health care power of attorney,
                    health care proxy, or other similar document is
                    recognized under State law, and how to execute such a
                    document if the adolescent wants to do so.''.
        (c) Health Oversight and Coordination Plan.--Section 422(b)(15)(A)
    of such Act (42 U.S.C. 622(b)(15)(A)) is amended--
                (1) in clause (v), by striking ``and'' at the end; and
                (2) by adding at the end the following:
                                ``(vii) steps to ensure that the components
                            of the transition plan development process
                            required under section 475(5)(H) that relate to
                            the health care needs of children aging out of
                            foster care, including the requirements to
                            include options for health insurance,
                            information about a health care power of
                            attorney, health care proxy, or other similar
                            document recognized under State law, and to
                            provide the child with the option to execute
                            such a document, are met; and''.
        (d) Effective Date.--The amendments made by this section take
    effect on October 1, 2010.

         TITLE III--IMPROVING THE QUALITY AND EFFICIENCY OF HEALTH CARE

            Subtitle A--Transforming the Health Care Delivery System

     PART I--LINKING PAYMENT TO QUALITY OUTCOMES UNDER THE MEDICARE PROGRAM

    SEC. 3001. HOSPITAL VALUE-BASED PURCHASING PROGRAM.

        (a) Program.--
                (1) In general.--Section 1886 of the Social Security Act
            (42 U.S.C. 1395ww), as amended by section 4102(a) of the HITECH
            Act (Public Law 111-5), is amended by adding at the end the
            following new subsection:
        ``(o) Hospital Value-Based Purchasing Program.--
                ``(1) Establishment.--
                        ``(A) In general.--Subject to the succeeding
                    provisions of this subsection, the Secretary shall
                    establish a hospital value-based purchasing program (in
                    this subsection referred to as the `Program') under
                    which value-based incentive payments are made in a
                    fiscal year to hospitals that meet the performance
                    standards under paragraph (3) for the performance
                    period for such fiscal year (as established under
                    paragraph (4)).
                        ``(B) Program to begin in fiscal year 2013.--The
                    Program shall apply to payments for discharges
                    occurring on or after October 1, 2012.
                        ``(C) Applicability of program to hospitals.--
                                ``(i) In general.--For purposes of this
                            subsection, subject to clause (ii), the term
                            `hospital' means a subsection (d) hospital (as
                            defined in subsection (d)(1)(B)).
                                ``(ii) Exclusions.--The term `hospital'
                            shall not include, with respect to a fiscal
                            year, a hospital--
                                        ``(I) that is subject to the
                                    payment reduction under subsection
                                    (b)(3)(B)(viii)(I) for such fiscal
                                    year;
                                        ``(II) for which, during the
                                    performance period for such fiscal
                                    year, the Secretary has cited
                                    deficiencies that pose immediate
                                    jeopardy to the health or safety of
                                    patients;
                                        ``(III) for which there are not a
                                    minimum number (as determined by the
                                    Secretary) of measures that apply to
                                    the hospital for the performance period
                                    for such fiscal year; or
                                        ``(IV) for which there are not a
                                    minimum number (as determined by the
                                    Secretary) of cases for the measures
                                    that apply to the hospital for the
                                    performance period for such fiscal
                                    year.
                                ``(iii) Independent analysis.--For purposes
                            of determining the minimum numbers under
                            subclauses (III) and (IV) of clause (ii), the
                            Secretary shall have conducted an independent
                            analysis of what numbers are appropriate.
                                ``(iv) Exemption.--In the case of a
                            hospital that is paid under section 1814(b)(3),
                            the Secretary may exempt such hospital from the
                            application of this subsection if the State
                            which is paid under such section submits an
                            annual report to the Secretary describing how a
                            similar program in the State for a
                            participating hospital or hospitals achieves or
                            surpasses the measured results in terms of
                            patient health outcomes and cost savings
                            established under this subsection.
                ``(2) Measures.--
                        ``(A) In general.--The Secretary shall select
                    measures for purposes of the Program. Such measures
                    shall be selected from the measures specified under
                    subsection (b)(3)(B)(viii).
                        ``(B) Requirements.--
                                ``(i) For fiscal year 2013.--For value-
                            based incentive payments made with respect to
                            discharges occurring during fiscal year 2013,
                            the Secretary shall ensure the following:
                                        ``(I) Conditions or procedures.--
                                    Measures are selected under
                                    subparagraph (A) that cover at least
                                    the following 5 specific conditions or
                                    procedures:
                                                ``(aa) Acute myocardial
                                            infarction (AMI).
                                                ``(bb) Heart failure.
                                                ``(cc) Pneumonia.
                                                ``(dd) Surgeries, as
                                            measured by the Surgical Care
                                            Improvement Project (formerly
                                            referred to as `Surgical
                                            Infection Prevention' for
                                            discharges occurring before
                                            July 2006).
                                                ``(ee) Healthcare-
                                            associated infections, as
                                            measured by the prevention
                                            metrics and targets established
                                            in the HHS Action Plan to
                                            Prevent Healthcare-Associated
                                            Infections (or any successor
                                            plan) of the Department of
                                            Health and Human Services.
                                        ``(II) HCAHPS.--Measures selected
                                    under subparagraph (A) shall be related
                                    to the Hospital Consumer Assessment of
                                    Healthcare Providers and Systems survey
                                    (HCAHPS).
                                ``(ii) Inclusion of efficiency measures.--
                            For value-based incentive payments made with
                            respect to discharges occurring during fiscal
                            year 2014 or a subsequent fiscal year, the
                            Secretary shall ensure that measures selected
                            under subparagraph (A) include efficiency
                            measures, including measures of `Medicare
                            spending per beneficiary'. Such measures shall
                            be adjusted for factors such as age, sex, race,
                            severity of illness, and other factors that the
                            Secretary determines appropriate.
                        ``(C) Limitations.--
                                ``(i) Time requirement for prior reporting
                            and notice.--The Secretary may not select a
                            measure under subparagraph (A) for use under
                            the Program with respect to a performance
                            period for a fiscal year (as established under
                            paragraph (4)) unless such measure has been
                            specified under subsection (b)(3)(B)(viii) and
                            included on the Hospital Compare Internet
                            website for at least 1 year prior to the
                            beginning of such performance period.
                                ``(ii) Measure not applicable unless
                            hospital furnishes services appropriate to the
                            measure.--A measure selected under subparagraph
                            (A) shall not apply to a hospital if such
                            hospital does not furnish services appropriate
                            to such measure.
                        ``(D) Replacing measures.--Subclause (VI) of
                    subsection (b)(3)(B)(viii) shall apply to measures
                    selected under subparagraph (A) in the same manner as
                    such subclause applies to measures selected under such
                    subsection.
                ``(3) Performance standards.--
                        ``(A) Establishment.--The Secretary shall establish
                    performance standards with respect to measures selected
                    under paragraph (2) for a performance period for a
                    fiscal year (as established under paragraph (4)).
                        ``(B) Achievement and improvement.--The performance
                    standards established under subparagraph (A) shall
                    include levels of achievement and improvement.
                        ``(C) Timing.--The Secretary shall establish and
                    announce the performance standards under subparagraph
                    (A) not later than 60 days prior to the beginning of
                    the performance period for the fiscal year involved.
                        ``(D) Considerations in establishing standards.--In
                    establishing performance standards with respect to
                    measures under this paragraph, the Secretary shall take
                    into account appropriate factors, such as--
                                ``(i) practical experience with the
                            measures involved, including whether a
                            significant proportion of hospitals failed to
                            meet the performance standard during previous
                            performance periods;
                                ``(ii) historical performance standards;
                                ``(iii) improvement rates; and
                                ``(iv) the opportunity for continued
                            improvement.
                ``(4) Performance period.--For purposes of the Program, the
            Secretary shall establish the performance period for a fiscal
            year. Such performance period shall begin and end prior to the
            beginning of such fiscal year.
                ``(5) Hospital performance score.--
                        ``(A) In general.--Subject to subparagraph (B), the
                    Secretary shall develop a methodology for assessing the
                    total performance of each hospital based on performance
                    standards with respect to the measures selected under
                    paragraph (2) for a performance period (as established
                    under paragraph (4)). Using such methodology, the
                    Secretary shall provide for an assessment (in this
                    subsection referred to as the `hospital performance
                    score') for each hospital for each performance period.
                        ``(B) Application.--
                                ``(i) Appropriate distribution.--The
                            Secretary shall ensure that the application of
                            the methodology developed under subparagraph
                            (A) results in an appropriate distribution of
                            value-based incentive payments under paragraph
                            (6) among hospitals achieving different levels
                            of hospital performance scores, with hospitals
                            achieving the highest hospital performance
                            scores receiving the largest value-based
                            incentive payments.
                                ``(ii) Higher of achievement or
                            improvement.--The methodology developed under
                            subparagraph (A) shall provide that the
                            hospital performance score is determined using
                            the higher of its achievement or improvement
                            score for each measure.
                                ``(iii) Weights.--The methodology developed
                            under subparagraph (A) shall provide for the
                            assignment of weights for categories of
                            measures as the Secretary determines
                            appropriate.
                                ``(iv) No minimum performance standard.--
                            The Secretary shall not set a minimum
                            performance standard in determining the
                            hospital performance score for any hospital.
                                ``(v) Reflection of measures applicable to
                            the hospital.--The hospital performance score
                            for a hospital shall reflect the measures that
                            apply to the hospital.
                ``(6) Calculation of value-based incentive payments.--
                        ``(A) In general.--In the case of a hospital that
                    the Secretary determines meets (or exceeds) the
                    performance standards under paragraph (3) for the
                    performance period for a fiscal year (as established
                    under paragraph (4)), the Secretary shall increase the
                    base operating DRG payment amount (as defined in
                    paragraph (7)(D)), as determined after application of
                    paragraph (7)(B)(i), for a hospital for each discharge
                    occurring in such fiscal year by the value-based
                    incentive payment amount.
                        ``(B) Value-based incentive payment amount.--The
                    value-based incentive payment amount for each discharge
                    of a hospital in a fiscal year shall be equal to the
                    product of--
                                ``(i) the base operating DRG payment amount
                            (as defined in paragraph (7)(D)) for the
                            discharge for the hospital for such fiscal
                            year; and
                                ``(ii) the value-based incentive payment
                            percentage specified under subparagraph (C) for
                            the hospital for such fiscal year.
                        ``(C) Value-based incentive payment percentage.--
                                ``(i) In general.--The Secretary shall
                            specify a value-based incentive payment
                            percentage for a hospital for a fiscal year.
                                ``(ii) Requirements.--In specifying the
                            value-based incentive payment percentage for
                            each hospital for a fiscal year under clause
                            (i), the Secretary shall ensure that--
                                        ``(I) such percentage is based on
                                    the hospital performance score of the
                                    hospital under paragraph (5); and
                                        ``(II) the total amount of value-
                                    based incentive payments under this
                                    paragraph to all hospitals in such
                                    fiscal year is equal to the total
                                    amount available for value-based
                                    incentive payments for such fiscal year
                                    under paragraph (7)(A), as estimated by
                                    the Secretary.
                ``(7) Funding for value-based incentive payments.--
                        ``(A) Amount.--The total amount available for
                    value-based incentive payments under paragraph (6) for
                    all hospitals for a fiscal year shall be equal to the
                    total amount of reduced payments for all hospitals
                    under subparagraph (B) for such fiscal year, as
                    estimated by the Secretary.
                        ``(B) Adjustment to payments.--
                                ``(i) In general.--The Secretary shall
                            reduce the base operating DRG payment amount
                            (as defined in subparagraph (D)) for a hospital
                            for each discharge in a fiscal year (beginning
                            with fiscal year 2013) by an amount equal to
                            the applicable percent (as defined in
                            subparagraph (C)) of the base operating DRG
                            payment amount for the discharge for the
                            hospital for such fiscal year. The Secretary
                            shall make such reductions for all hospitals in
                            the fiscal year involved, regardless of whether
                            or not the hospital has been determined by the
                            Secretary to have earned a value-based
                            incentive payment under paragraph (6) for such
                            fiscal year.
                                ``(ii) No effect on other payments.--
                            Payments described in items (aa) and (bb) of
                            subparagraph (D)(i)(II) for a hospital shall be
                            determined as if this subsection had not been
                            enacted.
                        ``(C) Applicable percent defined.--For purposes of
                    subparagraph (B), the term `applicable percent' means--
                                ``(i) with respect to fiscal year 2013, 1.0
                            percent;
                                ``(ii) with respect to fiscal year 2014,
                            1.25 percent;
                                ``(iii) with respect to fiscal year 2015,
                            1.5 percent;
                                ``(iv) with respect to fiscal year 2016,
                            1.75 percent; and
                                ``(v) with respect to fiscal year 2017 and
                            succeeding fiscal years, 2 percent.
                        ``(D) Base operating drg payment amount defined.--
                                ``(i) In general.--Except as provided in
                            clause (ii), in this subsection, the term `base
                            operating DRG payment amount' means, with
                            respect to a hospital for a fiscal year--
                                        ``(I) the payment amount that would
                                    otherwise be made under subsection (d)
                                    (determined without regard to
                                    subsection (q)) for a discharge if this
                                    subsection did not apply; reduced by
                                        ``(II) any portion of such payment
                                    amount that is attributable to--
                                                ``(aa) payments under
                                            paragraphs (5)(A), (5)(B),
                                            (5)(F), and (12) of subsection
                                            (d); and
                                                ``(bb) such other payments
                                            under subsection (d) determined
                                            appropriate by the Secretary.
                                ``(ii) Special rules for certain
                            hospitals.--
                                        ``(I) Sole community hospitals and
                                    medicare-dependent, small rural
                                    hospitals.--In the case of a medicare-
                                    dependent, small rural hospital (with
                                    respect to discharges occurring during
                                    fiscal year 2012 and 2013) or a sole
                                    community hospital, in applying
                                    subparagraph (A)(i), the payment amount
                                    that would otherwise be made under
                                    subsection (d) shall be determined
                                    without regard to subparagraphs (I) and
                                    (L) of subsection (b)(3) and
                                    subparagraphs (D) and (G) of subsection
                                    (d)(5).
                                        ``(II) Hospitals paid under section
                                    1814.--In the case of a hospital that
                                    is paid under section 1814(b)(3), the
                                    term `base operating DRG payment
                                    amount' means the payment amount under
                                    such section.
                ``(8) Announcement of net result of adjustments.--Under the
            Program, the Secretary shall, not later than 60 days prior to
            the fiscal year involved, inform each hospital of the
            adjustments to payments to the hospital for discharges
            occurring in such fiscal year under paragraphs (6) and
            (7)(B)(i).
                ``(9) No effect in subsequent fiscal years.--The value-
            based incentive payment under paragraph (6) and the payment
            reduction under paragraph (7)(B)(i) shall each apply only with
            respect to the fiscal year involved, and the Secretary shall
            not take into account such value-based incentive payment or
            payment reduction in making payments to a hospital under this
            section in a subsequent fiscal year.
                ``(10) Public reporting.--
                        ``(A) Hospital specific information.--
                                ``(i) In general.--The Secretary shall make
                            information available to the public regarding
                            the performance of individual hospitals under
                            the Program, including--
                                        ``(I) the performance of the
                                    hospital with respect to each measure
                                    that applies to the hospital;
                                        ``(II) the performance of the
                                    hospital with respect to each condition
                                    or procedure; and
                                        ``(III) the hospital performance
                                    score assessing the total performance
                                    of the hospital.
                                ``(ii) Opportunity to review and submit
                            corrections.--The Secretary shall ensure that a
                            hospital has the opportunity to review, and
                            submit corrections for, the information to be
                            made public with respect to the hospital under
                            clause (i) prior to such information being made
                            public.
                                ``(iii) Website.--Such information shall be
                            posted on the Hospital Compare Internet website
                            in an easily understandable format.
                        ``(B) Aggregate information.--The Secretary shall
                    periodically post on the Hospital Compare Internet
                    website aggregate information on the Program,
                    including--
                                ``(i) the number of hospitals receiving
                            value-based incentive payments under paragraph
                            (6) and the range and total amount of such
                            value-based incentive payments; and
                                ``(ii) the number of hospitals receiving
                            less than the maximum value-based incentive
                            payment available to the hospital for the
                            fiscal year involved and the range and amount
                            of such payments.
                ``(11) Implementation.--
                        ``(A) Appeals.--The Secretary shall establish a
                    process by which hospitals may appeal the calculation
                    of a hospital's performance assessment with respect to
                    the performance standards established under paragraph
                    (3)(A) and the hospital performance score under
                    paragraph (5). The Secretary shall ensure that such
                    process provides for resolution of such appeals in a
                    timely manner.
                        ``(B) Limitation on review.--Except as provided in
                    subparagraph (A), there shall be no administrative or
                    judicial review under section 1869, section 1878, or
                    otherwise of the following:
                                ``(i) The methodology used to determine the
                            amount of the value-based incentive payment
                            under paragraph (6) and the determination of
                            such amount.
                                ``(ii) The determination of the amount of
                            funding available for such value-based
                            incentive payments under paragraph (7)(A) and
                            the payment reduction under paragraph
                            (7)(B)(i).
                                ``(iii) The establishment of the
                            performance standards under paragraph (3) and
                            the performance period under paragraph (4).
                                ``(iv) The measures specified under
                            subsection (b)(3)(B)(viii) and the measures
                            selected under paragraph (2).
                                ``(v) The methodology developed under
                            paragraph (5) that is used to calculate
                            hospital performance scores and the calculation
                            of such scores.
                                ``(vi) The validation methodology specified
                            in subsection (b)(3)(B)(viii)(XI).
                        ``(C) Consultation with small hospitals.--The
                    Secretary shall consult with small rural and urban
                    hospitals on the application of the Program to such
                    hospitals.
                ``(12) Promulgation of regulations.--The Secretary shall
            promulgate regulations to carry out the Program, including the
            selection of measures under paragraph (2), the methodology
            developed under paragraph (5) that is used to calculate
            hospital performance scores, and the methodology used to
            determine the amount of value-based incentive payments under
            paragraph (6).''.
                (2) Amendments for reporting of hospital quality
            information.--Section 1886(b)(3)(B)(viii) of the Social
            Security Act (42 U.S.C. 1395ww(b)(3)(B)(viii)) is amended--
                        (A) in subclause (II), by adding at the end the
                    following sentence: ``The Secretary may require
                    hospitals to submit data on measures that are not used
                    for the determination of value-based incentive payments
                    under subsection (o).'';
                        (B) in subclause (V), by striking ``beginning with
                    fiscal year 2008'' and inserting ``for fiscal years
                    2008 through 2012'';
                        (C) in subclause (VII), in the first sentence, by
                    striking ``data submitted'' and inserting ``information
                    regarding measures submitted''; and
                        (D) by adding at the end the following new
                    subclauses:
        ``(VIII) Effective for payments beginning with fiscal year 2013,
    with respect to quality measures for outcomes of care, the Secretary
    shall provide for such risk adjustment as the Secretary determines to
    be appropriate to maintain incentives for hospitals to treat patients
    with severe illnesses or conditions.
        ``(IX)(aa) Subject to item (bb), effective for payments beginning
    with fiscal year 2013, each measure specified by the Secretary under
    this clause shall be endorsed by the entity with a contract under
    section 1890(a).
        ``(bb) In the case of a specified area or medical topic determined
    appropriate by the Secretary for which a feasible and practical measure
    has not been endorsed by the entity with a contract under section
    1890(a), the Secretary may specify a measure that is not so endorsed as
    long as due consideration is given to measures that have been endorsed
    or adopted by a consensus organization identified by the Secretary.
        ``(X) To the extent practicable, the Secretary shall, with input
    from consensus organizations and other stakeholders, take steps to
    ensure that the measures specified by the Secretary under this clause
    are coordinated and aligned with quality measures applicable to--
                ``(aa) physicians under section 1848(k); and
                ``(bb) other providers of services and suppliers under this
            title.
        ``(XI) The Secretary shall establish a process to validate measures
    specified under this clause as appropriate. Such process shall include
    the auditing of a number of randomly selected hospitals sufficient to
    ensure validity of the reporting program under this clause as a whole
    and shall provide a hospital with an opportunity to appeal the
    validation of measures reported by such hospital.''.
                (3) Website improvements.--Section 1886(b)(3)(B) of the
            Social Security Act (42 U.S.C. 1395ww(b)(3)(B)), as amended by
            section 4102(b) of the HITECH Act (Public Law 111-5), is
            amended by adding at the end the following new clause:
        ``(x)(I) The Secretary shall develop standard Internet website
    reports tailored to meet the needs of various stakeholders such as
    hospitals, patients, researchers, and policymakers. The Secretary shall
    seek input from such stakeholders in determining the type of
    information that is useful and the formats that best facilitate the use
    of the information.
        ``(II) The Secretary shall modify the Hospital Compare Internet
    website to make the use and navigation of that website readily
    available to individuals accessing it.''.
                (4) GAO study and report.--
                        (A) Study.--The Comptroller General of the United
                    States shall conduct a study on the performance of the
                    hospital value-based purchasing program established
                    under section 1886(o) of the Social Security Act, as
                    added by paragraph (1). Such study shall include an
                    analysis of the impact of such program on--
                                (i) the quality of care furnished to
                            Medicare beneficiaries, including diverse
                            Medicare beneficiary populations (such as
                            diverse in terms of race, ethnicity, and
                            socioeconomic status);
                                (ii) expenditures under the Medicare
                            program, including any reduced expenditures
                            under Part A of title XVIII of such Act that
                            are attributable to the improvement in the
                            delivery of inpatient hospital services by
                            reason of such hospital value-based purchasing
                            program;
                                (iii) the quality performance among safety
                            net hospitals and any barriers such hospitals
                            face in meeting the performance standards
                            applicable under such hospital value-based
                            purchasing program; and
                                (iv) the quality performance among small
                            rural and small urban hospitals and any
                            barriers such hospitals face in meeting the
                            performance standards applicable under such
                            hospital value-based purchasing program.
                        (B) Reports.--
                                (i) Interim report.--Not later than October
                            1, 2015, the Comptroller General of the United
                            States shall submit to Congress an interim
                            report containing the results of the study
                            conducted under subparagraph (A), together with
                            recommendations for such legislation and
                            administrative action as the Comptroller
                            General determines appropriate.
                                (ii) Final report.--Not later than July 1,
                            2017, the Comptroller General of the United
                            States shall submit to Congress a report
                            containing the results of the study conducted
                            under subparagraph (A), together with
                            recommendations for such legislation and
                            administrative action as the Comptroller
                            General determines appropriate.
                (5) HHS study and report.--
                        (A) Study.--The Secretary of Health and Human
                    Services shall conduct a study on the performance of
                    the hospital value-based purchasing program established
                    under section 1886(o) of the Social Security Act, as
                    added by paragraph (1). Such study shall include an
                    analysis--
                                (i) of ways to improve the hospital value-
                            based purchasing program and ways to address
                            any unintended consequences that may occur as a
                            result of such program;
                                (ii) of whether the hospital value-based
                            purchasing program resulted in lower spending
                            under the Medicare program under title XVIII of
                            such Act or other financial savings to
                            hospitals;
                                (iii) the appropriateness of the Medicare
                            program sharing in any savings generated
                            through the hospital value-based purchasing
                            program; and
                                (iv) any other area determined appropriate
                            by the Secretary.
                        (B) Report.--Not later than January 1, 2016, the
                    Secretary of Health and Human Services shall submit to
                    Congress a report containing the results of the study
                    conducted under subparagraph (A), together with
                    recommendations for such legislation and administrative
                    action as the Secretary determines appropriate.
        (b) Value-Based Purchasing Demonstration Programs.--
                (1) Value-based purchasing demonstration program for
            inpatient critical access hospitals.--
                        (A) Establishment.--
                                (i) In general.--Not later than 2 years
                            after the date of enactment of this Act, the
                            Secretary of Health and Human Services (in this
                            subsection referred to as the ``Secretary'')
                            shall establish a demonstration program under
                            which the Secretary establishes a value-based
                            purchasing program under the Medicare program
                            under title XVIII of the Social Security Act
                            for critical access hospitals (as defined in
                            paragraph (1) of section 1861(mm) of such Act
                            (42 U.S.C. 1395x(mm))) with respect to
                            inpatient critical access hospital services (as
                            defined in paragraph (2) of such section) in
                            order to test innovative methods of measuring
                            and rewarding quality and efficient health care
                            furnished by such hospitals.
                                (ii) Duration.--The demonstration program
                            under this paragraph shall be conducted for a
                            3-year period.
                                (iii) Sites.--The Secretary shall conduct
                            the demonstration program under this paragraph
                            at an appropriate number (as determined by the
                            Secretary) of critical access hospitals. The
                            Secretary shall ensure that such hospitals are
                            representative of the spectrum of such
                            hospitals that participate in the Medicare
                            program.
                        (B) Waiver authority.--The Secretary may waive such
                    requirements of titles XI and XVIII of the Social
                    Security Act as may be necessary to carry out the
                    demonstration program under this paragraph.
                        (C) Budget neutrality requirement.--In conducting
                    the demonstration program under this section, the
                    Secretary shall ensure that the aggregate payments made
                    by the Secretary do not exceed the amount which the
                    Secretary would have paid if the demonstration program
                    under this section was not implemented.
                        (D) Report.--Not later than 18 months after the
                    completion of the demonstration program under this
                    paragraph, the Secretary shall submit to Congress a
                    report on the demonstration program together with--
                                (i) recommendations on the establishment of
                            a permanent value-based purchasing program
                            under the Medicare program for critical access
                            hospitals with respect to inpatient critical
                            access hospital services; and
                                (ii) recommendations for such other
                            legislation and administrative action as the
                            Secretary determines appropriate.
                (2) Value-based purchasing demonstration program for
            hospitals excluded from hospital value-based purchasing program
            as a result of insufficient numbers of measures and cases.--
                        (A) Establishment.--
                                (i) In general.--Not later than 2 years
                            after the date of enactment of this Act, the
                            Secretary shall establish a demonstration
                            program under which the Secretary establishes a
                            value-based purchasing program under the
                            Medicare program under title XVIII of the
                            Social Security Act for applicable hospitals
                            (as defined in clause (ii)) with respect to
                            inpatient hospital services (as defined in
                            section 1861(b) of the Social Security Act (42
                            U.S.C. 1395x(b))) in order to test innovative
                            methods of measuring and rewarding quality and
                            efficient health care furnished by such
                            hospitals.
                                (ii) Applicable hospital defined.--For
                            purposes of this paragraph, the term
                            ``applicable hospital'' means a hospital
                            described in subclause (III) or (IV) of section
                            1886(o)(1)(C)(ii) of the Social Security Act,
                            as added by subsection (a)(1).
                                (iii) Duration.--The demonstration program
                            under this paragraph shall be conducted for a
                            3-year period.
                                (iv) Sites.--The Secretary shall conduct
                            the demonstration program under this paragraph
                            at an appropriate number (as determined by the
                            Secretary) of applicable hospitals. The
                            Secretary shall ensure that such hospitals are
                            representative of the spectrum of such
                            hospitals that participate in the Medicare
                            program.
                        (B) Waiver authority.--The Secretary may waive such
                    requirements of titles XI and XVIII of the Social
                    Security Act as may be necessary to carry out the
                    demonstration program under this paragraph.
                        (C) Budget neutrality requirement.--In conducting
                    the demonstration program under this section, the
                    Secretary shall ensure that the aggregate payments made
                    by the Secretary do not exceed the amount which the
                    Secretary would have paid if the demonstration program
                    under this section was not implemented.
                        (D) Report.--Not later than 18 months after the
                    completion of the demonstration program under this
                    paragraph, the Secretary shall submit to Congress a
                    report on the demonstration program together with--
                                (i) recommendations on the establishment of
                            a permanent value-based purchasing program
                            under the Medicare program for applicable
                            hospitals with respect to inpatient hospital
                            services; and
                                (ii) recommendations for such other
                            legislation and administrative action as the
                            Secretary determines appropriate.

    SEC. 3002. IMPROVEMENTS TO THE PHYSICIAN QUALITY REPORTING SYSTEM.

        (a) Extension.--Section 1848(m) of the Social Security Act (42
    U.S.C. 1395w-4(m)) is amended--
                (1) in paragraph (1)--
                        (A) in subparagraph (A), in the matter preceding
                    clause (i), by striking ``2010'' and inserting
                    ``2014''; and
                        (B) in subparagraph (B)--
                                (i) in clause (i), by striking ``and'' at
                            the end;
                                (ii) in clause (ii), by striking the period
                            at the end and inserting a semicolon; and
                                (iii) by adding at the end the following
                            new clauses:
                                ``(iii) for 2011, 1.0 percent; and
                                ``(iv) for 2012, 2013, and 2014, 0.5
                            percent.'';
                (2) in paragraph (3)--
                        (A) in subparagraph (A), in the matter preceding
                    clause (i), by inserting ``(or, for purposes of
                    subsection (a)(8), for the quality reporting period for
                    the year)'' after ``reporting period''; and
                        (B) in subparagraph (C)(i), by inserting ``, or,
                    for purposes of subsection (a)(8), for a quality
                    reporting period for the year'' after ``(a)(5), for a
                    reporting period for a year'';
                (3) in paragraph (5)(E)(iv), by striking ``subsection
            (a)(5)(A)'' and inserting ``paragraphs (5)(A) and (8)(A) of
            subsection (a)''; and
                (4) in paragraph (6)(C)--
                        (A) in clause (i)(II), by striking ``, 2009, 2010,
                    and 2011'' and inserting ``and subsequent years''; and
                        (B) in clause (iii)--
                                (i) by inserting ``(a)(8)'' after
                            ``(a)(5)''; and
                                (ii) by striking ``under subparagraph
                            (D)(iii) of such subsection'' and inserting
                            ``under subsection (a)(5)(D)(iii) or the
                            quality reporting period under subsection
                            (a)(8)(D)(iii), respectively''.
        (b) Incentive Payment Adjustment for Quality Reporting.--Section
    1848(a) of the Social Security Act (42 U.S.C. 1395w-4(a)) is amended by
    adding at the end the following new paragraph:
                ``(8) Incentives for quality reporting.--
                        ``(A) Adjustment.--
                                ``(i) In general.--With respect to covered
                            professional services furnished by an eligible
                            professional during 2015 or any subsequent
                            year, if the eligible professional does not
                            satisfactorily submit data on quality measures
                            for covered professional services for the
                            quality reporting period for the year (as
                            determined under subsection (m)(3)(A)), the fee
                            schedule amount for such services furnished by
                            such professional during the year (including
                            the fee schedule amount for purposes of
                            determining a payment based on such amount)
                            shall be equal to the applicable percent of the
                            fee schedule amount that would otherwise apply
                            to such services under this subsection
                            (determined after application of paragraphs
                            (3), (5), and (7), but without regard to this
                            paragraph).
                                ``(ii) Applicable percent.--For purposes of
                            clause (i), the term `applicable percent'
                            means--
                                        ``(I) for 2015, 98.5 percent; and
                                        ``(II) for 2016 and each subsequent
                                    year, 98 percent.
                        ``(B) Application.--
                                ``(i) Physician reporting system rules.--
                            Paragraphs (5), (6), and (8) of subsection (k)
                            shall apply for purposes of this paragraph in
                            the same manner as they apply for purposes of
                            such subsection.
                                ``(ii) Incentive payment validation
                            rules.--Clauses (ii) and (iii) of subsection
                            (m)(5)(D) shall apply for purposes of this
                            paragraph in a similar manner as they apply for
                            purposes of such subsection.
                        ``(C) Definitions.--For purposes of this paragraph:
                                ``(i) Eligible professional; covered
                            professional services.--The terms `eligible
                            professional' and `covered professional
                            services' have the meanings given such terms in
                            subsection (k)(3).
                                ``(ii) Physician reporting system.--The
                            term `physician reporting system' means the
                            system established under subsection (k).
                                ``(iii) Quality reporting period.--The term
                            `quality reporting period' means, with respect
                            to a year, a period specified by the
                            Secretary.''.
        (c) Maintenance of Certification Programs.--
                (1) In general.--Section 1848(k)(4) of the Social Security
            Act (42 U.S.C. 1395w-4(k)(4)) is amended by inserting ``or
            through a Maintenance of Certification program operated by a
            specialty body of the American Board of Medical Specialties
            that meets the criteria for such a registry'' after
            ``Database)''.
                (2) Effective date.--The amendment made by paragraph (1)
            shall apply for years after 2010.
        (d) Integration of Physician Quality Reporting and EHR Reporting.--
    Section 1848(m) of the Social Security Act (42 U.S.C. 1395w-4(m)) is
    amended by adding at the end the following new paragraph:
                ``(7) Integration of physician quality reporting and ehr
            reporting.--Not later than January 1, 2012, the Secretary shall
            develop a plan to integrate reporting on quality measures under
            this subsection with reporting requirements under subsection
            (o) relating to the meaningful use of electronic health
            records. Such integration shall consist of the following:
                        ``(A) The selection of measures, the reporting of
                    which would both demonstrate--
                                ``(i) meaningful use of an electronic
                            health record for purposes of subsection (o);
                            and
                                ``(ii) quality of care furnished to an
                            individual.
                        ``(B) Such other activities as specified by the
                    Secretary.''.
        (e) Feedback.--Section 1848(m)(5) of the Social Security Act (42
    U.S.C. 1395w-4(m)(5)) is amended by adding at the end the following new
    subparagraph:
                        ``(H) Feedback.--The Secretary shall provide timely
                    feedback to eligible professionals on the performance
                    of the eligible professional with respect to
                    satisfactorily submitting data on quality measures
                    under this subsection.''.
        (f) Appeals.--Such section is further amended--
                (1) in subparagraph (E), by striking ``There shall'' and
            inserting ``Except as provided in subparagraph (I), there
            shall''; and
                (2) by adding at the end the following new subparagraph:
                        ``(I) Informal appeals process.--The Secretary
                    shall, by not later than January 1, 2011, establish and
                    have in place an informal process for eligible
                    professionals to seek a review of the determination
                    that an eligible professional did not satisfactorily
                    submit data on quality measures under this
                    subsection.''.

    SEC. 3003. IMPROVEMENTS TO THE PHYSICIAN FEEDBACK PROGRAM.

        (a) In General.--Section 1848(n) of the Social Security Act (42
    U.S.C. 1395w-4(n)) is amended--
                (1) in paragraph (1)--
                        (A) in subparagraph (A)--
                                (i) by striking ``general.--The Secretary''
                            and inserting ``general.--
                                ``(i) Establishment.--The Secretary'';
                                (ii) in clause (i), as added by clause (i),
                            by striking ``the `Program')'' and all that
                            follows through the period at the end of the
                            second sentence and inserting ``the
                            `Program').''; and
                                (iii) by adding at the end the following
                            new clauses:
                                ``(ii) Reports on resources.--The Secretary
                            shall use claims data under this title (and may
                            use other data) to provide confidential reports
                            to physicians (and, as determined appropriate
                            by the Secretary, to groups of physicians) that
                            measure the resources involved in furnishing
                            care to individuals under this title.
                                ``(iii) Inclusion of certain information.--
                            If determined appropriate by the Secretary, the
                            Secretary may include information on the
                            quality of care furnished to individuals under
                            this title by the physician (or group of
                            physicians) in such reports.''; and
                        (B) in subparagraph (B), by striking ``subparagraph
                    (A)'' and inserting ``subparagraph (A)(ii)'';
                (2) in paragraph (4)--
                        (A) in the heading, by inserting ``initial'' after
                    ``focus''; and
                        (B) in the matter preceding subparagraph (A), by
                    inserting ``initial'' after ``focus the'';
                (3) in paragraph (6), by adding at the end the following
            new sentence: ``For adjustments for reports on utilization
            under paragraph (9), see subparagraph (D) of such paragraph.'';
            and
                (4) by adding at the end the following new paragraphs:
                ``(9) Reports on utilization.--
                        ``(A) Development of episode grouper.--
                                ``(i) In general.--The Secretary shall
                            develop an episode grouper that combines
                            separate but clinically related items and
                            services into an episode of care for an
                            individual, as appropriate.
                                ``(ii) Timeline for development.--The
                            episode grouper described in subparagraph (A)
                            shall be developed by not later than January 1,
                            2012.
                                ``(iii) Public availability.--The Secretary
                            shall make the details of the episode grouper
                            described in subparagraph (A) available to the
                            public.
                                ``(iv) Endorsement.--The Secretary shall
                            seek endorsement of the episode grouper
                            described in subparagraph (A) by the entity
                            with a contract under section 1890(a).
                        ``(B) Reports on utilization.--Effective beginning
                    with 2012, the Secretary shall provide reports to
                    physicians that compare, as determined appropriate by
                    the Secretary, patterns of resource use of the
                    individual physician to such patterns of other
                    physicians.
                        ``(C) Analysis of data.--The Secretary shall, for
                    purposes of preparing reports under this paragraph,
                    establish methodologies as appropriate, such as to--
                                ``(i) attribute episodes of care, in whole
                            or in part, to physicians;
                                ``(ii) identify appropriate physicians for
                            purposes of comparison under subparagraph (B);
                            and
                                ``(iii) aggregate episodes of care
                            attributed to a physician under clause (i) into
                            a composite measure per individual.
                        ``(D) Data adjustment.--In preparing reports under
                    this paragraph, the Secretary shall make appropriate
                    adjustments, including adjustments--
                                ``(i) to account for differences in
                            socioeconomic and demographic characteristics,
                            ethnicity, and health status of individuals
                            (such as to recognize that less healthy
                            individuals may require more intensive
                            interventions); and
                                ``(ii) to eliminate the effect of
                            geographic adjustments in payment rates (as
                            described in subsection (e)).
                        ``(E) Public availability of methodology.--The
                    Secretary shall make available to the public--
                                ``(i) the methodologies established under
                            subparagraph (C);
                                ``(ii) information regarding any
                            adjustments made to data under subparagraph
                            (D); and
                                ``(iii) aggregate reports with respect to
                            physicians.
                        ``(F) Definition of physician.--In this paragraph:
                                ``(i) In general.--The term `physician' has
                            the meaning given that term in section
                            1861(r)(1).
                                ``(ii) Treatment of groups.--Such term
                            includes, as the Secretary determines
                            appropriate, a group of physicians.
                        ``(G) Limitations on review.--There shall be no
                    administrative or judicial review under section 1869,
                    section 1878, or otherwise of the establishment of the
                    methodology under subparagraph (C), including the
                    determination of an episode of care under such
                    methodology.
                ``(10) Coordination with other value-based purchasing
            reforms.--The Secretary shall coordinate the Program with the
            value-based payment modifier established under subsection (p)
            and, as the Secretary determines appropriate, other similar
            provisions of this title.''.
        (b) Conforming Amendment.--Section 1890(b) of the Social Security
    Act (42 U.S.C. 1395aaa(b)) is amended by adding at the end the
    following new paragraph:
                ``(6) Review and endorsement of episode grouper under the
            physician feedback program.--The entity shall provide for the
            review and, as appropriate, the endorsement of the episode
            grouper developed by the Secretary under section 1848(n)(9)(A).
            Such review shall be conducted on an expedited basis.''.

    SEC. 3004. QUALITY REPORTING FOR LONG-TERM CARE HOSPITALS, INPATIENT
                  REHABILITATION HOSPITALS, AND HOSPICE PROGRAMS.

        (a) Long-term Care Hospitals.--Section 1886(m) of the Social
    Security Act (42 U.S.C. 1395ww(m)), as amended by section 3401(c), is
    amended by adding at the end the following new paragraph:
                ``(5) Quality reporting.--
                        ``(A) Reduction in update for failure to report.--
                                ``(i) In general.--Under the system
                            described in paragraph (1), for rate year 2014
                            and each subsequent rate year, in the case of a
                            long-term care hospital that does not submit
                            data to the Secretary in accordance with
                            subparagraph (C) with respect to such a rate
                            year, any annual update to a standard Federal
                            rate for discharges for the hospital during the
                            rate year, and after application of paragraph
                            (3), shall be reduced by 2 percentage points.
                                ``(ii) Special rule.--The application of
                            this subparagraph may result in such annual
                            update being less than 0.0 for a rate year, and
                            may result in payment rates under the system
                            described in paragraph (1) for a rate year
                            being less than such payment rates for the
                            preceding rate year.
                        ``(B) Noncumulative application.--Any reduction
                    under subparagraph (A) shall apply only with respect to
                    the rate year involved and the Secretary shall not take
                    into account such reduction in computing the payment
                    amount under the system described in paragraph (1) for
                    a subsequent rate year.
                        ``(C) Submission of quality data.--For rate year
                    2014 and each subsequent rate year, each long-term care
                    hospital shall submit to the Secretary data on quality
                    measures specified under subparagraph (D). Such data
                    shall be submitted in a form and manner, and at a time,
                    specified by the Secretary for purposes of this
                    subparagraph.
                        ``(D) Quality measures.--
                                ``(i) In general.--Subject to clause (ii),
                            any measure specified by the Secretary under
                            this subparagraph must have been endorsed by
                            the entity with a contract under section
                            1890(a).
                                ``(ii) Exception.--In the case of a
                            specified area or medical topic determined
                            appropriate by the Secretary for which a
                            feasible and practical measure has not been
                            endorsed by the entity with a contract under
                            section 1890(a), the Secretary may specify a
                            measure that is not so endorsed as long as due
                            consideration is given to measures that have
                            been endorsed or adopted by a consensus
                            organization identified by the Secretary.
                                ``(iii) Time frame.--Not later than October
                            1, 2012, the Secretary shall publish the
                            measures selected under this subparagraph that
                            will be applicable with respect to rate year
                            2014.
                        ``(E) Public availability of data submitted.--The
                    Secretary shall establish procedures for making data
                    submitted under subparagraph (C) available to the
                    public. Such procedures shall ensure that a long-term
                    care hospital has the opportunity to review the data
                    that is to be made public with respect to the hospital
                    prior to such data being made public. The Secretary
                    shall report quality measures that relate to services
                    furnished in inpatient settings in long-term care
                    hospitals on the Internet website of the Centers for
                    Medicare & Medicaid Services.''.
        (b) Inpatient Rehabilitation Hospitals.--Section 1886(j) of the
    Social Security Act (42 U.S.C. 1395ww(j)) is amended--
                (1) by redesignating paragraph (7) as paragraph (8); and
                (2) by inserting after paragraph (6) the following new
            paragraph:
                ``(7) Quality reporting.--
                        ``(A) Reduction in update for failure to report.--
                                ``(i) In general.--For purposes of fiscal
                            year 2014 and each subsequent fiscal year, in
                            the case of a rehabilitation facility that does
                            not submit data to the Secretary in accordance
                            with subparagraph (C) with respect to such a
                            fiscal year, after determining the increase
                            factor described in paragraph (3)(C), and after
                            application of paragraph (3)(D), the Secretary
                            shall reduce such increase factor for payments
                            for discharges occurring during such fiscal
                            year by 2 percentage points.
                                ``(ii) Special rule.--The application of
                            this subparagraph may result in the increase
                            factor described in paragraph (3)(C) being less
                            than 0.0 for a fiscal year, and may result in
                            payment rates under this subsection for a
                            fiscal year being less than such payment rates
                            for the preceding fiscal year.
                        ``(B) Noncumulative application.--Any reduction
                    under subparagraph (A) shall apply only with respect to
                    the fiscal year involved and the Secretary shall not
                    take into account such reduction in computing the
                    payment amount under this subsection for a subsequent
                    fiscal year.
                        ``(C) Submission of quality data.--For fiscal year
                    2014 and each subsequent rate year, each rehabilitation
                    facility shall submit to the Secretary data on quality
                    measures specified under subparagraph (D). Such data
                    shall be submitted in a form and manner, and at a time,
                    specified by the Secretary for purposes of this
                    subparagraph.
                        ``(D) Quality measures.--
                                ``(i) In general.--Subject to clause (ii),
                            any measure specified by the Secretary under
                            this subparagraph must have been endorsed by
                            the entity with a contract under section
                            1890(a).
                                ``(ii) Exception.--In the case of a
                            specified area or medical topic determined
                            appropriate by the Secretary for which a
                            feasible and practical measure has not been
                            endorsed by the entity with a contract under
                            section 1890(a), the Secretary may specify a
                            measure that is not so endorsed as long as due
                            consideration is given to measures that have
                            been endorsed or adopted by a consensus
                            organization identified by the Secretary.
                                ``(iii) Time frame.--Not later than October
                            1, 2012, the Secretary shall publish the
                            measures selected under this subparagraph that
                            will be applicable with respect to fiscal year
                            2014.
                        ``(E) Public availability of data submitted.--The
                    Secretary shall establish procedures for making data
                    submitted under subparagraph (C) available to the
                    public. Such procedures shall ensure that a
                    rehabilitation facility has the opportunity to review
                    the data that is to be made public with respect to the
                    facility prior to such data being made public. The
                    Secretary shall report quality measures that relate to
                    services furnished in inpatient settings in
                    rehabilitation facilities on the Internet website of
                    the Centers for Medicare & Medicaid Services.''.
        (c) Hospice Programs.--Section 1814(i) of the Social Security Act
    (42 U.S.C. 1395f(i)) is amended--
                (1) by redesignating paragraph (5) as paragraph (6); and
                (2) by inserting after paragraph (4) the following new
            paragraph:
                ``(5) Quality reporting.--
                        ``(A) Reduction in update for failure to report.--
                                ``(i) In general.--For purposes of fiscal
                            year 2014 and each subsequent fiscal year, in
                            the case of a hospice program that does not
                            submit data to the Secretary in accordance with
                            subparagraph (C) with respect to such a fiscal
                            year, after determining the market basket
                            percentage increase under paragraph
                            (1)(C)(ii)(VII) or paragraph (1)(C)(iii), as
                            applicable, and after application of paragraph
                            (1)(C)(iv), with respect to the fiscal year,
                            the Secretary shall reduce such market basket
                            percentage increase by 2 percentage points.
                                ``(ii) Special rule.--The application of
                            this subparagraph may result in the market
                            basket percentage increase under paragraph
                            (1)(C)(ii)(VII) or paragraph (1)(C)(iii), as
                            applicable, being less than 0.0 for a fiscal
                            year, and may result in payment rates under
                            this subsection for a fiscal year being less
                            than such payment rates for the preceding
                            fiscal year.
                        ``(B) Noncumulative application.--Any reduction
                    under subparagraph (A) shall apply only with respect to
                    the fiscal year involved and the Secretary shall not
                    take into account such reduction in computing the
                    payment amount under this subsection for a subsequent
                    fiscal year.
                        ``(C) Submission of quality data.--For fiscal year
                    2014 and each subsequent fiscal year, each hospice
                    program shall submit to the Secretary data on quality
                    measures specified under subparagraph (D). Such data
                    shall be submitted in a form and manner, and at a time,
                    specified by the Secretary for purposes of this
                    subparagraph.
                        ``(D) Quality measures.--
                                ``(i) In general.--Subject to clause (ii),
                            any measure specified by the Secretary under
                            this subparagraph must have been endorsed by
                            the entity with a contract under section
                            1890(a).
                                ``(ii) Exception.--In the case of a
                            specified area or medical topic determined
                            appropriate by the Secretary for which a
                            feasible and practical measure has not been
                            endorsed by the entity with a contract under
                            section 1890(a), the Secretary may specify a
                            measure that is not so endorsed as long as due
                            consideration is given to measures that have
                            been endorsed or adopted by a consensus
                            organization identified by the Secretary.
                                ``(iii) Time frame.--Not later than October
                            1, 2012, the Secretary shall publish the
                            measures selected under this subparagraph that
                            will be applicable with respect to fiscal year
                            2014.
                        ``(E) Public availability of data submitted.--The
                    Secretary shall establish procedures for making data
                    submitted under subparagraph (C) available to the
                    public. Such procedures shall ensure that a hospice
                    program has the opportunity to review the data that is
                    to be made public with respect to the hospice program
                    prior to such data being made public. The Secretary
                    shall report quality measures that relate to hospice
                    care provided by hospice programs on the Internet
                    website of the Centers for Medicare & Medicaid
                    Services.''.

    SEC. 3005. QUALITY REPORTING FOR PPS-EXEMPT CANCER HOSPITALS.

        Section 1866 of the Social Security Act (42 U.S.C. 1395cc) is
    amended--
                (1) in subsection (a)(1)--
                        (A) in subparagraph (U), by striking ``and'' at the
                    end;
                        (B) in subparagraph (V), by striking the period at
                    the end and inserting ``, and''; and
                        (C) by adding at the end the following new
                    subparagraph:
                        ``(W) in the case of a hospital described in
                    section 1886(d)(1)(B)(v), to report quality data to the
                    Secretary in accordance with subsection (k).''; and
                (2) by adding at the end the following new subsection:
        ``(k) Quality Reporting by Cancer Hospitals.--
                ``(1) In general.--For purposes of fiscal year 2014 and
            each subsequent fiscal year, a hospital described in section
            1886(d)(1)(B)(v) shall submit data to the Secretary in
            accordance with paragraph (2) with respect to such a fiscal
            year.
                ``(2) Submission of quality data.--For fiscal year 2014 and
            each subsequent fiscal year, each hospital described in such
            section shall submit to the Secretary data on quality measures
            specified under paragraph (3). Such data shall be submitted in
            a form and manner, and at a time, specified by the Secretary
            for purposes of this subparagraph.
                ``(3) Quality measures.--
                        ``(A) In general.--Subject to subparagraph (B), any
                    measure specified by the Secretary under this paragraph
                    must have been endorsed by the entity with a contract
                    under section 1890(a).
                        ``(B) Exception.--In the case of a specified area
                    or medical topic determined appropriate by the
                    Secretary for which a feasible and practical measure
                    has not been endorsed by the entity with a contract
                    under section 1890(a), the Secretary may specify a
                    measure that is not so endorsed as long as due
                    consideration is given to measures that have been
                    endorsed or adopted by a consensus organization
                    identified by the Secretary.
                        ``(C) Time frame.--Not later than October 1, 2012,
                    the Secretary shall publish the measures selected under
                    this paragraph that will be applicable with respect to
                    fiscal year 2014.
                ``(4) Public availability of data submitted.--The Secretary
            shall establish procedures for making data submitted under
            paragraph (4) available to the public. Such procedures shall
            ensure that a hospital described in section 1886(d)(1)(B)(v)
            has the opportunity to review the data that is to be made
            public with respect to the hospital prior to such data being
            made public. The Secretary shall report quality measures of
            process, structure, outcome, patients' perspective on care,
            efficiency, and costs of care that relate to services furnished
            in such hospitals on the Internet website of the Centers for
            Medicare & Medicaid Services.''.

    SEC. 3006. PLANS FOR A VALUE-BASED PURCHASING PROGRAM FOR SKILLED
                  NURSING FACILITIES AND HOME HEALTH AGENCIES.

        (a) Skilled Nursing Facilities.--
                (1) In general.--The Secretary of Health and Human Services
            (in this section referred to as the ``Secretary'') shall
            develop a plan to implement a value-based purchasing program
            for payments under the Medicare program under title XVIII of
            the Social Security Act for skilled nursing facilities (as
            defined in section 1819(a) of such Act (42 U.S.C. 1395i-3(a))).
                (2) Details.--In developing the plan under paragraph (1),
            the Secretary shall consider the following issues:
                        (A) The ongoing development, selection, and
                    modification process for measures (including under
                    section 1890 of the Social Security Act (42 U.S.C.
                    1395aaa) and section 1890A such Act, as added by
                    section 3014), to the extent feasible and practicable,
                    of all dimensions of quality and efficiency in skilled
                    nursing facilities.
                                (i) In general.--Subject to clause (ii),
                            any measure specified by the Secretary under
                            subparagraph (A)(iii) must have been endorsed
                            by the entity with a contract under section
                            1890(a).
                                (ii) Exception.--In the case of a specified
                            area or medical topic determined appropriate by
                            the Secretary for which a feasible and
                            practical measure has not been endorsed by the
                            entity with a contract under section 1890(a),
                            the Secretary may specify a measure that is not
                            so endorsed as long as due consideration is
                            given to measures that have been endorsed or
                            adopted by a consensus organization identified
                            by the Secretary.
                        (B) The reporting, collection, and validation of
                    quality data.
                        (C) The structure of value-based payment
                    adjustments, including the determination of thresholds
                    or improvements in quality that would substantiate a
                    payment adjustment, the size of such payments, and the
                    sources of funding for the value-based bonus payments.
                        (D) Methods for the public disclosure of
                    information on the performance of skilled nursing
                    facilities.
                        (E) Any other issues determined appropriate by the
                    Secretary.
                (3) Consultation.--In developing the plan under paragraph
            (1), the Secretary shall--
                        (A) consult with relevant affected parties; and
                        (B) consider experience with such demonstrations
                    that the Secretary determines are relevant to the
                    value-based purchasing program described in paragraph
                    (1).
                (4) Report to congress.--Not later than October 1, 2011,
            the Secretary shall submit to Congress a report containing the
            plan developed under paragraph (1).
        (b) Home Health Agencies.--
                (1) In general.--The Secretary of Health and Human Services
            (in this section referred to as the ``Secretary'') shall
            develop a plan to implement a value-based purchasing program
            for payments under the Medicare program under title XVIII of
            the Social Security Act for home health agencies (as defined in
            section 1861(o) of such Act (42 U.S.C. 1395x(o))).
                (2) Details.--In developing the plan under paragraph (1),
            the Secretary shall consider the following issues:
                        (A) The ongoing development, selection, and
                    modification process for measures (including under
                    section 1890 of the Social Security Act (42 U.S.C.
                    1395aaa) and section 1890A such Act, as added by
                    section 3014), to the extent feasible and practicable,
                    of all dimensions of quality and efficiency in home
                    health agencies.
                        (B) The reporting, collection, and validation of
                    quality data.
                        (C) The structure of value-based payment
                    adjustments, including the determination of thresholds
                    or improvements in quality that would substantiate a
                    payment adjustment, the size of such payments, and the
                    sources of funding for the value-based bonus payments.
                        (D) Methods for the public disclosure of
                    information on the performance of home health agencies.
                        (E) Any other issues determined appropriate by the
                    Secretary.
                (3) Consultation.--In developing the plan under paragraph
            (1), the Secretary shall--
                        (A) consult with relevant affected parties; and
                        (B) consider experience with such demonstrations
                    that the Secretary determines are relevant to the
                    value-based purchasing program described in paragraph
                    (1).
                (4) Report to congress.--Not later than October 1, 2011,
            the Secretary shall submit to Congress a report containing the
            plan developed under paragraph (1).

    SEC. 3007. VALUE-BASED PAYMENT MODIFIER UNDER THE PHYSICIAN FEE
                  SCHEDULE.

        Section 1848 of the Social Security Act (42 U.S.C. 1395w-4) is
    amended--
                (1) in subsection (b)(1), by inserting ``subject to
            subsection (p),'' after ``1998,''; and
                (2) by adding at the end the following new subsection:
        ``(p) Establishment of Value-based Payment Modifier.--
                ``(1) In general.--The Secretary shall establish a payment
            modifier that provides for differential payment to a physician
            or a group of physicians under the fee schedule established
            under subsection (b) based upon the quality of care furnished
            compared to cost (as determined under paragraphs (2) and (3),
            respectively) during a performance period. Such payment
            modifier shall be separate from the geographic adjustment
            factors established under subsection (e).
                ``(2) Quality.--
                        ``(A) In general.--For purposes of paragraph (1),
                    quality of care shall be evaluated, to the extent
                    practicable, based on a composite of measures of the
                    quality of care furnished (as established by the
                    Secretary under subparagraph (B)).
                        ``(B) Measures.--
                                ``(i) The Secretary shall establish
                            appropriate measures of the quality of care
                            furnished by a physician or group of physicians
                            to individuals enrolled under this part, such
                            as measures that reflect health outcomes. Such
                            measures shall be risk adjusted as determined
                            appropriate by the Secretary.
                                ``(ii) The Secretary shall seek endorsement
                            of the measures established under this
                            subparagraph by the entity with a contract
                            under section 1890(a).
                ``(3) Costs.--For purposes of paragraph (1), costs shall be
            evaluated, to the extent practicable, based on a composite of
            appropriate measures of costs established by the Secretary
            (such as the composite measure under the methodology
            established under subsection (n)(9)(C)(iii)) that eliminate the
            effect of geographic adjustments in payment rates (as described
            in subsection (e)), and take into account risk factors (such as
            socioeconomic and demographic characteristics, ethnicity, and
            health status of individuals (such as to recognize that less
            healthy individuals may require more intensive interventions)
            and other factors determined appropriate by the Secretary.
                ``(4) Implementation.--
                        ``(A) Publication of measures, dates of
                    implementation, performance period.--Not later than
                    January 1, 2012, the Secretary shall publish the
                    following:
                                ``(i) The measures of quality of care and
                            costs established under paragraphs (2) and (3),
                            respectively.
                                ``(ii) The dates for implementation of the
                            payment modifier (as determined under
                            subparagraph (B)).
                                ``(iii) The initial performance period (as
                            specified under subparagraph (B)(ii)).
                        ``(B) Deadlines for implementation.--
                                ``(i) Initial implementation.--Subject to
                            the preceding provisions of this subparagraph,
                            the Secretary shall begin implementing the
                            payment modifier established under this
                            subsection through the rulemaking process
                            during 2013 for the physician fee schedule
                            established under subsection (b).
                                ``(ii) Initial performance period.--
                                        ``(I) In general.--The Secretary
                                    shall specify an initial performance
                                    period for application of the payment
                                    modifier established under this
                                    subsection with respect to 2015.
                                        ``(II) Provision of information
                                    during initial performance period.--
                                    During the initial performance period,
                                    the Secretary shall, to the extent
                                    practicable, provide information to
                                    physicians and groups of physicians
                                    about the quality of care furnished by
                                    the physician or group of physicians to
                                    individuals enrolled under this part
                                    compared to cost (as determined under
                                    paragraphs (2) and (3), respectively)
                                    with respect to the performance period.
                                ``(iii) Application.--The Secretary shall
                            apply the payment modifier established under
                            this subsection for items and services
                            furnished--
                                        ``(I) beginning on January 1, 2015,
                                    with respect to specific physicians and
                                    groups of physicians the Secretary
                                    determines appropriate; and
                                        ``(II) beginning not later than
                                    January 1, 2017, with respect to all
                                    physicians and groups of physicians.
                        ``(C) Budget neutrality.--The payment modifier
                    established under this subsection shall be implemented
                    in a budget neutral manner.
                ``(5) Systems-based care.--The Secretary shall, as
            appropriate, apply the payment modifier established under this
            subsection in a manner that promotes systems-based care.
                ``(6) Consideration of special circumstances of certain
            providers.--In applying the payment modifier under this
            subsection, the Secretary shall, as appropriate, take into
            account the special circumstances of physicians or groups of
            physicians in rural areas and other underserved communities.
                ``(7) Application.--For purposes of the initial application
            of the payment modifier established under this subsection
            during the period beginning on January 1, 2015, and ending on
            December 31, 2016, the term `physician' has the meaning given
            such term in section 1861(r). On or after January 1, 2017, the
            Secretary may apply this subsection to eligible professionals
            (as defined in subsection (k)(3)(B)) as the Secretary
            determines appropriate.
                ``(8) Definitions.--For purposes of this subsection:
                        ``(A) Costs.--The term `costs' means expenditures
                    per individual as determined appropriate by the
                    Secretary. In making the determination under the
                    preceding sentence, the Secretary may take into account
                    the amount of growth in expenditures per individual for
                    a physician compared to the amount of such growth for
                    other physicians.
                        ``(B) Performance period.--The term `performance
                    period' means a period specified by the Secretary.
                ``(9) Coordination with other value-based purchasing
            reforms.--The Secretary shall coordinate the value-based
            payment modifier established under this subsection with the
            Physician Feedback Program under subsection (n) and, as the
            Secretary determines appropriate, other similar provisions of
            this title.
                ``(10) Limitations on review.--There shall be no
            administrative or judicial review under section 1869, section
            1878, or otherwise of--
                        ``(A) the establishment of the value-based payment
                    modifier under this subsection;
                        ``(B) the evaluation of quality of care under
                    paragraph (2), including the establishment of
                    appropriate measures of the quality of care under
                    paragraph (2)(B);
                        ``(C) the evaluation of costs under paragraph (3),
                    including the establishment of appropriate measures of
                    costs under such paragraph;
                        ``(D) the dates for implementation of the value-
                    based payment modifier;
                        ``(E) the specification of the initial performance
                    period and any other performance period under
                    paragraphs (4)(B)(ii) and (8)(B), respectively;
                        ``(F) the application of the value-based payment
                    modifier under paragraph (7); and
                        ``(G) the determination of costs under paragraph
                    (8)(A).''.

    SEC. 3008. PAYMENT ADJUSTMENT FOR CONDITIONS ACQUIRED IN HOSPITALS.

        (a) In General.--Section 1886 of the Social Security Act (42 U.S.C.
    1395ww), as amended by section 3001, is amended by adding at the end
    the following new subsection:
        ``(p) Adjustment to Hospital Payments for Hospital Acquired
    Conditions.--
                ``(1) In general.--In order to provide an incentive for
            applicable hospitals to reduce hospital acquired conditions
            under this title, with respect to discharges from an applicable
            hospital occurring during fiscal year 2015 or a subsequent
            fiscal year, the amount of payment under this section or
            section 1814(b)(3), as applicable, for such discharges during
            the fiscal year shall be equal to 99 percent of the amount of
            payment that would otherwise apply to such discharges under
            this section or section 1814(b)(3) (determined after the
            application of subsections (o) and (q) and section 1814(l)(4)
            but without regard to this subsection).
                ``(2) Applicable hospitals.--
                        ``(A) In general.--For purposes of this subsection,
                    the term `applicable hospital' means a subsection (d)
                    hospital that meets the criteria described in
                    subparagraph (B).
                        ``(B) Criteria described.--
                                ``(i) In general.--The criteria described
                            in this subparagraph, with respect to a
                            subsection (d) hospital, is that the subsection
                            (d) hospital is in the top quartile of all
                            subsection (d) hospitals, relative to the
                            national average, of hospital acquired
                            conditions during the applicable period, as
                            determined by the Secretary.
                                ``(ii) Risk adjustment.--In carrying out
                            clause (i), the Secretary shall establish and
                            apply an appropriate risk adjustment
                            methodology.
                        ``(C) Exemption.--In the case of a hospital that is
                    paid under section 1814(b)(3), the Secretary may exempt
                    such hospital from the application of this subsection
                    if the State which is paid under such section submits
                    an annual report to the Secretary describing how a
                    similar program in the State for a participating
                    hospital or hospitals achieves or surpasses the
                    measured results in terms of patient health outcomes
                    and cost savings established under this subsection.
                ``(3) Hospital acquired conditions.--For purposes of this
            subsection, the term `hospital acquired condition' means a
            condition identified for purposes of subsection (d)(4)(D)(iv)
            and any other condition determined appropriate by the Secretary
            that an individual acquires during a stay in an applicable
            hospital, as determined by the Secretary.
                ``(4) Applicable period.--In this subsection, the term
            `applicable period' means, with respect to a fiscal year, a
            period specified by the Secretary.
                ``(5) Reporting to hospitals.--Prior to fiscal year 2015
            and each subsequent fiscal year, the Secretary shall provide
            confidential reports to applicable hospitals with respect to
            hospital acquired conditions of the applicable hospital during
            the applicable period.
                ``(6) Reporting hospital specific information.--
                        ``(A) In general.--The Secretary shall make
                    information available to the public regarding hospital
                    acquired conditions of each applicable hospital.
                        ``(B) Opportunity to review and submit
                    corrections.--The Secretary shall ensure that an
                    applicable hospital has the opportunity to review, and
                    submit corrections for, the information to be made
                    public with respect to the hospital under subparagraph
                    (A) prior to such information being made public.
                        ``(C) Website.--Such information shall be posted on
                    the Hospital Compare Internet website in an easily
                    understandable format.
                ``(7) Limitations on review.--There shall be no
            administrative or judicial review under section 1869, section
            1878, or otherwise of the following:
                        ``(A) The criteria described in paragraph (2)(A).
                        ``(B) The specification of hospital acquired
                    conditions under paragraph (3).
                        ``(C) The specification of the applicable period
                    under paragraph (4).
                        ``(D) The provision of reports to applicable
                    hospitals under paragraph (5) and the information made
                    available to the public under paragraph (6).''.
        (b) Study and Report on Expansion of Healthcare Acquired Conditions
    Policy to Other Providers.--
                (1) Study.--The Secretary of Health and Human Services
            shall conduct a study on expanding the healthcare acquired
            conditions policy under subsection (d)(4)(D) of section 1886 of
            the Social Security Act (42 U.S.C. 1395ww) to payments made to
            other facilities under the Medicare program under title XVIII
            of the Social Security Act, including such payments made to
            inpatient rehabilitation facilities, long-term care hospitals
            (as described in subsection(d)(1)(B)(iv) of such section),
            hospital outpatient departments, and other hospitals excluded
            from the inpatient prospective payment system under such
            section, skilled nursing facilities, ambulatory surgical
            centers, and health clinics. Such study shall include an
            analysis of how such policies could impact quality of patient
            care, patient safety, and spending under the Medicare program.
                (2) Report.--Not later than January 1, 2012, the Secretary
            shall submit to Congress a report containing the results of the
            study conducted under paragraph (1), together with
            recommendations for such legislation and administrative action
            as the Secretary determines appropriate.

           PART II--NATIONAL STRATEGY TO IMPROVE HEALTH CARE QUALITY

    SEC. 3011. NATIONAL STRATEGY.

        Title III of the Public Health Service Act (42 U.S.C. 241 et seq.)
    is amended by adding at the end the following:

                     ``PART S--HEALTH CARE QUALITY PROGRAMS

     ``Subpart I--National Strategy for Quality Improvement in Health Care

    ``SEC. 399HH. NATIONAL STRATEGY FOR QUALITY IMPROVEMENT IN HEALTH CARE.

        ``(a) Establishment of National Strategy and Priorities.--
                ``(1) National strategy.--The Secretary, through a
            transparent collaborative process, shall establish a national
            strategy to improve the delivery of health care services,
            patient health outcomes, and population health.
                ``(2) Identification of priorities.--
                        ``(A) In general.--The Secretary shall identify
                    national priorities for improvement in developing the
                    strategy under paragraph (1).
                        ``(B) Requirements.--The Secretary shall ensure
                    that priorities identified under subparagraph (A)
                    will--
                                ``(i) have the greatest potential for
                            improving the health outcomes, efficiency, and
                            patient-centeredness of health care for all
                            populations, including children and vulnerable
                            populations;
                                ``(ii) identify areas in the delivery of
                            health care services that have the potential
                            for rapid improvement in the quality and
                            efficiency of patient care;
                                ``(iii) address gaps in quality,
                            efficiency, comparative effectiveness
                            information, and health outcomes measures and
                            data aggregation techniques;
                                ``(iv) improve Federal payment policy to
                            emphasize quality and efficiency;
                                ``(v) enhance the use of health care data
                            to improve quality, efficiency, transparency,
                            and outcomes;
                                ``(vi) address the health care provided to
                            patients with high-cost chronic diseases;
                                ``(vii) improve research and dissemination
                            of strategies and best practices to improve
                            patient safety and reduce medical errors,
                            preventable admissions and readmissions, and
                            health care-associated infections;
                                ``(viii) reduce health disparities across
                            health disparity populations (as defined in
                            section 485E) and geographic areas; and
                                ``(ix) address other areas as determined
                            appropriate by the Secretary.
                        ``(C) Considerations.--In identifying priorities
                    under subparagraph (A), the Secretary shall take into
                    consideration the recommendations submitted by the
                    entity with a contract under section 1890(a) of the
                    Social Security Act and other stakeholders.
                        ``(D) Coordination with state agencies.--The
                    Secretary shall collaborate, coordinate, and consult
                    with State agencies responsible for administering the
                    Medicaid program under title XIX of the Social Security
                    Act and the Children's Health Insurance Program under
                    title XXI of such Act with respect to developing and
                    disseminating strategies, goals, models, and timetables
                    that are consistent with the national priorities
                    identified under subparagraph (A).
        ``(b) Strategic Plan.--
                ``(1) In general.--The national strategy shall include a
            comprehensive strategic plan to achieve the priorities
            described in subsection (a).
                ``(2) Requirements.--The strategic plan shall include
            provisions for addressing, at a minimum, the following:
                        ``(A) Coordination among agencies within the
                    Department, which shall include steps to minimize
                    duplication of efforts and utilization of common
                    quality measures, where available. Such common quality
                    measures shall be measures identified by the Secretary
                    under section 1139A or 1139B of the Social Security Act
                    or endorsed under section 1890 of such Act.
                        ``(B) Agency-specific strategic plans to achieve
                    national priorities.
                        ``(C) Establishment of annual benchmarks for each
                    relevant agency to achieve national priorities.
                        ``(D) A process for regular reporting by the
                    agencies to the Secretary on the implementation of the
                    strategic plan.
                        ``(E) Strategies to align public and private payers
                    with regard to quality and patient safety efforts.
                        ``(F) Incorporating quality improvement and
                    measurement in the strategic plan for health
                    information technology required by the American
                    Recovery and Reinvestment Act of 2009 (Public Law 111-
                    5).
        ``(c) Periodic Update of National Strategy.--The Secretary shall
    update the national strategy not less than annually. Any such update
    shall include a review of short- and long-term goals.
        ``(d) Submission and Availability of National Strategy and
    Updates.--
                ``(1) Deadline for initial submission of national
            strategy.--Not later than January 1, 2011, the Secretary shall
            submit to the relevant committees of Congress the national
            strategy described in subsection (a).
                ``(2) Updates.--
                        ``(A) In general.--The Secretary shall submit to
                    the relevant committees of Congress an annual update to
                    the strategy described in paragraph (1).
                        ``(B) Information submitted.--Each update submitted
                    under subparagraph (A) shall include--
                                ``(i) a review of the short- and long-term
                            goals of the national strategy and any gaps in
                            such strategy;
                                ``(ii) an analysis of the progress, or lack
                            of progress, in meeting such goals and any
                            barriers to such progress;
                                ``(iii) the information reported under
                            section 1139A of the Social Security Act,
                            consistent with the reporting requirements of
                            such section; and
                                ``(iv) in the case of an update required to
                            be submitted on or after January 1, 2014, the
                            information reported under section 1139B(b)(4)
                            of the Social Security Act, consistent with the
                            reporting requirements of such section.
                        ``(C) Satisfaction of other reporting
                    requirements.--Compliance with the requirements of
                    clauses (iii) and (iv) of subparagraph (B) shall
                    satisfy the reporting requirements under sections
                    1139A(a)(6) and 1139B(b)(4), respectively, of the
                    Social Security Act.
        ``(e) Health Care Quality Internet Website.--Not later than January
    1, 2011, the Secretary shall create an Internet website to make public
    information regarding--
                ``(1) the national priorities for health care quality
            improvement established under subsection (a)(2);
                ``(2) the agency-specific strategic plans for health care
            quality described in subsection (b)(2)(B); and
                ``(3) other information, as the Secretary determines to be
            appropriate.''.

    SEC. 3012. INTERAGENCY WORKING GROUP ON HEALTH CARE QUALITY.

        (a) In General.--The President shall convene a working group to be
    known as the Interagency Working Group on Health Care Quality (referred
    to in this section as the ``Working Group'').
        (b) Goals.--The goals of the Working Group shall be to achieve the
    following:
                (1) Collaboration, cooperation, and consultation between
            Federal departments and agencies with respect to developing and
            disseminating strategies, goals, models, and timetables that
            are consistent with the national priorities identified under
            section 399HH(a)(2) of the Public Health Service Act (as added
            by section 3011).
                (2) Avoidance of inefficient duplication of quality
            improvement efforts and resources, where practicable, and a
            streamlined process for quality reporting and compliance
            requirements.
                (3) Assess alignment of quality efforts in the public
            sector with private sector initiatives.
        (c) Composition.--
                (1) In general.--The Working Group shall be composed of
            senior level representatives of--
                        (A) the Department of Health and Human Services;
                        (B) the Centers for Medicare & Medicaid Services;
                        (C) the National Institutes of Health;
                        (D) the Centers for Disease Control and Prevention;
                        (E) the Food and Drug Administration;
                        (F) the Health Resources and Services
                    Administration;
                        (G) the Agency for Healthcare Research and Quality;
                        (H) the Office of the National Coordinator for
                    Health Information Technology;
                        (I) the Substance Abuse and Mental Health Services
                    Administration;
                        (J) the Administration for Children and Families;
                        (K) the Department of Commerce;
                        (L) the Office of Management and Budget;
                        (M) the United States Coast Guard;
                        (N) the Federal Bureau of Prisons;
                        (O) the National Highway Traffic Safety
                    Administration;
                        (P) the Federal Trade Commission;
                        (Q) the Social Security Administration;
                        (R) the Department of Labor;
                        (S) the United States Office of Personnel
                    Management;
                        (T) the Department of Defense;
                        (U) the Department of Education;
                        (V) the Department of Veterans Affairs;
                        (W) the Veterans Health Administration; and
                        (X) any other Federal agencies and departments with
                    activities relating to improving health care quality
                    and safety, as determined by the President.
                (2) Chair and vice-chair.--
                        (A) Chair.--The Working Group shall be chaired by
                    the Secretary of Health and Human Services.
                        (B) Vice chair.--Members of the Working Group,
                    other than the Secretary of Health and Human Services,
                    shall serve as Vice Chair of the Group on a rotating
                    basis, as determined by the Group.
        (d) Report to Congress.--Not later than December 31, 2010, and
    annually thereafter, the Working Group shall submit to the relevant
    Committees of Congress, and make public on an Internet website, a
    report describing the progress and recommendations of the Working Group
    in meeting the goals described in subsection (b).

    SEC. 3013. QUALITY MEASURE DEVELOPMENT.

        (a) Public Health Service Act.--Title IX of the Public Health
    Service Act (42 U.S.C. 299 et seq.) is amended--
                (1) by redesignating part D as part E;
                (2) by redesignating sections 931 through 938 as sections
            941 through 948, respectively;
                (3) in section 948(1), as so redesignated, by striking
            ``931'' and inserting ``941''; and
                (4) by inserting after section 926 the following:

                   ``PART D--HEALTH CARE QUALITY IMPROVEMENT

                    ``Subpart I--Quality Measure Development

    ``SEC. 931. QUALITY MEASURE DEVELOPMENT.

        ``(a) Quality Measure.--In this subpart, the term `quality measure'
    means a standard for measuring the performance and improvement of
    population health or of health plans, providers of services, and other
    clinicians in the delivery of health care services.
        ``(b) Identification of Quality Measures.--
                ``(1) Identification.--The Secretary, in consultation with
            the Director of the Agency for Healthcare Research and Quality
            and the Administrator of the Centers for Medicare & Medicaid
            Services, shall identify, not less often than triennially, gaps
            where no quality measures exist and existing quality measures
            that need improvement, updating, or expansion, consistent with
            the national strategy under section 399HH, to the extent
            available, for use in Federal health programs. In identifying
            such gaps and existing quality measures that need improvement,
            the Secretary shall take into consideration--
                        ``(A) the gaps identified by the entity with a
                    contract under section 1890(a) of the Social Security
                    Act and other stakeholders;
                        ``(B) quality measures identified by the pediatric
                    quality measures program under section 1139A of the
                    Social Security Act; and
                        ``(C) quality measures identified through the
                    Medicaid Quality Measurement Program under section
                    1139B of the Social Security Act.
                ``(2) Publication.--The Secretary shall make available to
            the public on an Internet website a report on any gaps
            identified under paragraph (1) and the process used to make
            such identification.
        ``(c) Grants or Contracts for Quality Measure Development.--
                ``(1) In general.--The Secretary shall award grants,
            contracts, or intergovernmental agreements to eligible entities
            for purposes of developing, improving, updating, or expanding
            quality measures identified under subsection (b).
                ``(2) Prioritization in the development of quality
            measures.--In awarding grants, contracts, or agreements under
            this subsection, the Secretary shall give priority to the
            development of quality measures that allow the assessment of--
                        ``(A) health outcomes and functional status of
                    patients;
                        ``(B) the management and coordination of health
                    care across episodes of care and care transitions for
                    patients across the continuum of providers, health care
                    settings, and health plans;
                        ``(C) the experience, quality, and use of
                    information provided to and used by patients,
                    caregivers, and authorized representatives to inform
                    decisionmaking about treatment options, including the
                    use of shared decisionmaking tools and preference
                    sensitive care (as defined in section 936);
                        ``(D) the meaningful use of health information
                    technology;
                        ``(E) the safety, effectiveness, patient-
                    centeredness, appropriateness, and timeliness of care;
                        ``(F) the efficiency of care;
                        ``(G) the equity of health services and health
                    disparities across health disparity populations (as
                    defined in section 485E) and geographic areas;
                        ``(H) patient experience and satisfaction;
                        ``(I) the use of innovative strategies and
                    methodologies identified under section 933; and
                        ``(J) other areas determined appropriate by the
                    Secretary.
                ``(3) Eligible entities.--To be eligible for a grant or
            contract under this subsection, an entity shall--
                        ``(A) have demonstrated expertise and capacity in
                    the development and evaluation of quality measures;
                        ``(B) have adopted procedures to include in the
                    quality measure development process--
                                ``(i) the views of those providers or
                            payers whose performance will be assessed by
                            the measure; and
                                ``(ii) the views of other parties who also
                            will use the quality measures (such as
                            patients, consumers, and health care
                            purchasers);
                        ``(C) collaborate with the entity with a contract
                    under section 1890(a) of the Social Security Act and
                    other stakeholders, as practicable, and the Secretary
                    so that quality measures developed by the eligible
                    entity will meet the requirements to be considered for
                    endorsement by the entity with a contract under such
                    section 1890(a);
                        ``(D) have transparent policies regarding
                    governance and conflicts of interest; and
                        ``(E) submit an application to the Secretary at
                    such time and in such manner, as the Secretary may
                    require.
                ``(4) Use of funds.--An entity that receives a grant,
            contract, or agreement under this subsection shall use such
            award to develop quality measures that meet the following
            requirements:
                        ``(A) Such measures support measures required to be
                    reported under the Social Security Act, where
                    applicable, and in support of gaps and existing quality
                    measures that need improvement, as described in
                    subsection (b)(1)(A).
                        ``(B) Such measures support measures developed
                    under section 1139A of the Social Security Act and the
                    Medicaid Quality Measurement Program under section
                    1139B of such Act, where applicable.
                        ``(C) To the extent practicable, data on such
                    quality measures is able to be collected using health
                    information technologies.
                        ``(D) Each quality measure is free of charge to
                    users of such measure.
                        ``(E) Each quality measure is publicly available on
                    an Internet website.
        ``(d) Other Activities by the Secretary.--The Secretary may use
    amounts available under this section to update and test, where
    applicable, quality measures endorsed by the entity with a contract
    under section 1890(a) of the Social Security Act or adopted by the
    Secretary.
        ``(e) Coordination of Grants.--The Secretary shall ensure that
    grants or contracts awarded under this section are coordinated with
    grants and contracts awarded under sections 1139A(5) and 1139B(4)(A) of
    the Social Security Act.''.
        (b) Social Security Act.--Section 1890A of the Social Security Act,
    as added by section 3014(b), is amended by adding at the end the
    following new subsection:
        ``(e) Development of Quality Measures.--The Administrator of the
    Center for Medicare & Medicaid Services shall through contracts develop
    quality measures (as determined appropriate by the Administrator) for
    use under this Act. In developing such measures, the Administrator
    shall consult with the Director of the Agency for Healthcare Research
    and Quality.''.
        (c) Funding.--There are authorized to be appropriated to the
    Secretary of Health and Human Services to carry out this section,
    $75,000,000 for each of fiscal years 2010 through 2014. Of the amounts
    appropriated under the preceding sentence in a fiscal year, not less
    than 50 percent of such amounts shall be used pursuant to subsection
    (e) of section 1890A of the Social Security Act, as added by subsection
    (b), with respect to programs under such Act. Amounts appropriated
    under this subsection for a fiscal year shall remain available until
    expended.

    SEC. 3014. QUALITY MEASUREMENT.

        (a) New Duties for Consensus-based Entity.--
                (1) Multi-stakeholder group input.--Section 1890(b) of the
            Social Security Act (42 U.S.C. 1395aaa(b)), as amended by
            section 3003, is amended by adding at the end the following new
            paragraphs:
                ``(7) Convening multi-stakeholder groups.--
                        ``(A) In general.--The entity shall convene multi-
                    stakeholder groups to provide input on--
                                ``(i) the selection of quality measures
                            described in subparagraph (B), from among--
                                        ``(I) such measures that have been
                                    endorsed by the entity; and
                                        ``(II) such measures that have not
                                    been considered for endorsement by such
                                    entity but are used or proposed to be
                                    used by the Secretary for the
                                    collection or reporting of quality
                                    measures; and
                                ``(ii) national priorities (as identified
                            under section 399HH of the Public Health
                            Service Act) for improvement in population
                            health and in the delivery of health care
                            services for consideration under the national
                            strategy established under section 399HH of the
                            Public Health Service Act.
                        ``(B) Quality measures.--
                                ``(i) In general.--Subject to clause (ii),
                            the quality measures described in this
                            subparagraph are quality measures--
                                        ``(I) for use pursuant to sections
                                    1814(i)(5)(D), 1833(i)(7), 1833(t)(17),
                                    1848(k)(2)(C), 1866(k)(3),
                                    1881(h)(2)(A)(iii),
                                    1886(b)(3)(B)(viii), 1886(j)(7)(D),
                                    1886(m)(5)(D), 1886(o)(2), and
                                    1895(b)(3)(B)(v);
                                        ``(II) for use in reporting
                                    performance information to the public;
                                    and
                                        ``(III) for use in health care
                                    programs other than for use under this
                                    Act.
                                ``(ii) Exclusion.--Data sets (such as the
                            outcome and assessment information set for home
                            health services and the minimum data set for
                            skilled nursing facility services) that are
                            used for purposes of classification systems
                            used in establishing payment rates under this
                            title shall not be quality measures described
                            in this subparagraph.
                        ``(C) Requirement for transparency in process.--
                                ``(i) In general.--In convening multi-
                            stakeholder groups under subparagraph (A) with
                            respect to the selection of quality measures,
                            the entity shall provide for an open and
                            transparent process for the activities
                            conducted pursuant to such convening.
                                ``(ii) Selection of organizations
                            participating in multi-stakeholder groups.--The
                            process described in clause (i) shall ensure
                            that the selection of representatives
                            comprising such groups provides for public
                            nominations for, and the opportunity for public
                            comment on, such selection.
                        ``(D) Multi-stakeholder group defined.--In this
                    paragraph, the term `multi-stakeholder group' means,
                    with respect to a quality measure, a voluntary
                    collaborative of organizations representing a broad
                    group of stakeholders interested in or affected by the
                    use of such quality measure.
                ``(8) Transmission of multi-stakeholder input.--Not later
            than February 1 of each year (beginning with 2012), the entity
            shall transmit to the Secretary the input of multi-stakeholder
            groups provided under paragraph (7).''.
                (2) Annual report.--Section 1890(b)(5)(A) of the Social
            Security Act (42 U.S.C. 1395aaa(b)(5)(A)) is amended--
                        (A) in clause (ii), by striking ``and'' at the end;
                        (B) in clause (iii), by striking the period at the
                    end and inserting a semicolon; and
                        (C) by adding at the end the following new clauses:
                                ``(iv) gaps in endorsed quality measures,
                            which shall include measures that are within
                            priority areas identified by the Secretary
                            under the national strategy established under
                            section 399HH of the Public Health Service Act,
                            and where quality measures are unavailable or
                            inadequate to identify or address such gaps;
                                ``(v) areas in which evidence is
                            insufficient to support endorsement of quality
                            measures in priority areas identified by the
                            Secretary under the national strategy
                            established under section 399HH of the Public
                            Health Service Act and where targeted research
                            may address such gaps; and
                                ``(vi) the matters described in clauses (i)
                            and (ii) of paragraph (7)(A).''.
        (b) Multi-stakeholder Group Input Into Selection of Quality
    Measures.--Title XVIII of the Social Security Act (42 U.S.C. 1395 et
    seq.) is amended by inserting after section 1890 the following:

                             ``quality measurement

        ``Sec. 1890A.  (a) Multi-stakeholder Group Input Into Selection of
    Quality Measures.--The Secretary shall establish a pre-rulemaking
    process under which the following steps occur with respect to the
    selection of quality measures described in section 1890(b)(7)(B):
                ``(1) Input.--Pursuant to section 1890(b)(7), the entity
            with a contract under section 1890 shall convene multi-
            stakeholder groups to provide input to the Secretary on the
            selection of quality measures described in subparagraph (B) of
            such paragraph.
                ``(2) Public availability of measures considered for
            selection.--Not later than December 1 of each year (beginning
            with 2011), the Secretary shall make available to the public a
            list of quality measures described in section 1890(b)(7)(B)
            that the Secretary is considering under this title.
                ``(3) Transmission of multi-stakeholder input.--Pursuant to
            section 1890(b)(8), not later than February 1 of each year
            (beginning with 2012), the entity shall transmit to the
            Secretary the input of multi-stakeholder groups described in
            paragraph (1).
                ``(4) Consideration of multi-stakeholder input.--The
            Secretary shall take into consideration the input from multi-
            stakeholder groups described in paragraph (1) in selecting
            quality measures described in section 1890(b)(7)(B) that have
            been endorsed by the entity with a contract under section 1890
            and measures that have not been endorsed by such entity.
                ``(5) Rationale for use of quality measures.--The Secretary
            shall publish in the Federal Register the rationale for the use
            of any quality measure described in section 1890(b)(7)(B) that
            has not been endorsed by the entity with a contract under
            section 1890.
                ``(6) Assessment of impact.--Not later than March 1, 2012,
            and at least once every three years thereafter, the Secretary
            shall--
                        ``(A) conduct an assessment of the quality impact
                    of the use of endorsed measures described in section
                    1890(b)(7)(B); and
                        ``(B) make such assessment available to the public.
        ``(b) Process for Dissemination of Measures Used by the
    Secretary.--
                ``(1) In general.--The Secretary shall establish a process
            for disseminating quality measures used by the Secretary. Such
            process shall include the following:
                        ``(A) The incorporation of such measures, where
                    applicable, in workforce programs, training curricula,
                    and any other means of dissemination determined
                    appropriate by the Secretary.
                        ``(B) The dissemination of such quality measures
                    through the national strategy developed under section
                    399HH of the Public Health Service Act.
                ``(2) Existing methods.--To the extent practicable, the
            Secretary shall utilize and expand existing dissemination
            methods in disseminating quality measures under the process
            established under paragraph (1).
        ``(c) Review of Quality Measures Used by the Secretary.--
                ``(1) In general.--The Secretary shall--
                        ``(A) periodically (but in no case less often than
                    once every 3 years) review quality measures described
                    in section 1890(b)(7)(B); and
                        ``(B) with respect to each such measure, determine
                    whether to--
                                ``(i) maintain the use of such measure; or
                                ``(ii) phase out such measure.
                ``(2) Considerations.--In conducting the review under
            paragraph (1), the Secretary shall take steps to--
                        ``(A) seek to avoid duplication of measures used;
                    and
                        ``(B) take into consideration current innovative
                    methodologies and strategies for quality improvement
                    practices in the delivery of health care services that
                    represent best practices for such quality improvement
                    and measures endorsed by the entity with a contract
                    under section 1890 since the previous review by the
                    Secretary.
        ``(d) Rule of Construction.--Nothing in this section shall preclude
    a State from using the quality measures identified under sections 1139A
    and 1139B.''.
        (c) Funding.--For purposes of carrying out the amendments made by
    this section, the Secretary shall provide for the transfer, from the
    Federal Hospital Insurance Trust Fund under section 1817 of the Social
    Security Act (42 U.S.C. 1395i) and the Federal Supplementary Medical
    Insurance Trust Fund under section 1841 of such Act (42 U.S.C. 1395t),
    in such proportion as the Secretary determines appropriate, of
    $20,000,000, to the Centers for Medicare & Medicaid Services Program
    Management Account for each of fiscal years 2010 through 2014. Amounts
    transferred under the preceding sentence shall remain available until
    expended.

    SEC. 3015. DATA COLLECTION; PUBLIC REPORTING.

        Title III of the Public Health Service Act (42 U.S.C. 241 et seq.),
    as amended by section 3011, is further amended by adding at the end the
    following:

    ``SEC. 399II. COLLECTION AND ANALYSIS OF DATA FOR QUALITY AND RESOURCE
                  USE MEASURES.

        ``(a) In General.--The Secretary shall collect and aggregate
    consistent data on quality and resource use measures from information
    systems used to support health care delivery to implement the public
    reporting of performance information, as described in section 399JJ,
    and may award grants or contracts for this purpose. The Secretary shall
    ensure that such collection, aggregation, and analysis systems span an
    increasingly broad range of patient populations, providers, and
    geographic areas over time.
        ``(b) Grants or Contracts for Data Collection.--
                ``(1) In general.--The Secretary may award grants or
            contracts to eligible entities to support new, or improve
            existing, efforts to collect and aggregate quality and resource
            use measures described under subsection (c).
                ``(2) Eligible entities.--To be eligible for a grant or
            contract under this subsection, an entity shall--
                        ``(A) be--
                                ``(i) a multi-stakeholder entity that
                            coordinates the development of methods and
                            implementation plans for the consistent
                            reporting of summary quality and cost
                            information;
                                ``(ii) an entity capable of submitting such
                            summary data for a particular population and
                            providers, such as a disease registry, regional
                            collaboration, health plan collaboration, or
                            other population-wide source; or
                                ``(iii) a Federal Indian Health Service
                            program or a health program operated by an
                            Indian tribe (as defined in section 4 of the
                            Indian Health Care Improvement Act);
                        ``(B) promote the use of the systems that provide
                    data to improve and coordinate patient care;
                        ``(C) support the provision of timely, consistent
                    quality and resource use information to health care
                    providers, and other groups and organizations as
                    appropriate, with an opportunity for providers to
                    correct inaccurate measures; and
                        ``(D) agree to report, as determined by the
                    Secretary, measures on quality and resource use to the
                    public in accordance with the public reporting process
                    established under section 399JJ.
        ``(c) Consistent Data Aggregation.--The Secretary may award grants
    or contracts under this section only to entities that enable summary
    data that can be integrated and compared across multiple sources. The
    Secretary shall provide standards for the protection of the security
    and privacy of patient data.
        ``(d) Matching Funds.--The Secretary may not award a grant or
    contract under this section to an entity unless the entity agrees that
    it will make available (directly or through contributions from other
    public or private entities) non-Federal contributions toward the
    activities to be carried out under the grant or contract in an amount
    equal to $1 for each $5 of Federal funds provided under the grant or
    contract. Such non-Federal matching funds may be provided directly or
    through donations from public or private entities and may be in cash or
    in-kind, fairly evaluated, including plant, equipment, or services.
        ``(e) Authorization of Appropriations.--To carry out this section,
    there are authorized to be appropriated such sums as may be necessary
    for fiscal years 2010 through 2014.

    ``SEC. 399JJ. PUBLIC REPORTING OF PERFORMANCE INFORMATION.

        ``(a) Development of Performance Websites.--The Secretary shall
    make available to the public, through standardized Internet websites,
    performance information summarizing data on quality measures. Such
    information shall be tailored to respond to the differing needs of
    hospitals and other institutional health care providers, physicians and
    other clinicians, patients, consumers, researchers, policymakers,
    States, and other stakeholders, as the Secretary may specify.
        ``(b) Information on Conditions.--The performance information made
    publicly available on an Internet website, as described in subsection
    (a), shall include information regarding clinical conditions to the
    extent such information is available, and the information shall, where
    appropriate, be provider-specific and sufficiently disaggregated and
    specific to meet the needs of patients with different clinical
    conditions.
        ``(c) Consultation.--
                ``(1) In general.--In carrying out this section, the
            Secretary shall consult with the entity with a contract under
            section 1890(a) of the Social Security Act, and other entities,
            as appropriate, to determine the type of information that is
            useful to stakeholders and the format that best facilitates use
            of the reports and of performance reporting Internet websites.
                ``(2) Consultation with stakeholders.--The entity with a
            contract under section 1890(a) of the Social Security Act shall
            convene multi-stakeholder groups, as described in such section,
            to review the design and format of each Internet website made
            available under subsection (a) and shall transmit to the
            Secretary the views of such multi-stakeholder groups with
            respect to each such design and format.
        ``(d) Coordination.--Where appropriate, the Secretary shall
    coordinate the manner in which data are presented through Internet
    websites described in subsection (a) and for public reporting of other
    quality measures by the Secretary, including such quality measures
    under title XVIII of the Social Security Act.
        ``(e) Authorization of Appropriations.--To carry out this section,
    there are authorized to be appropriated such sums as may be necessary
    for fiscal years 2010 through 2014.''.

          PART III--ENCOURAGING DEVELOPMENT OF NEW PATIENT CARE MODELS

    SEC. 3021. ESTABLISHMENT OF CENTER FOR MEDICARE AND MEDICAID INNOVATION
                  WITHIN CMS.

        (a) In General.--Title XI of the Social Security Act is amended by
    inserting after section 1115 the following new section:

                 ``center for medicare and medicaid innovation

        ``Sec. 1115A.  (a) Center for Medicare and Medicaid Innovation
    Established.--
                ``(1) In general.--There is created within the Centers for
            Medicare & Medicaid Services a Center for Medicare and Medicaid
            Innovation (in this section referred to as the `CMI') to carry
            out the duties described in this section. The purpose of the
            CMI is to test innovative payment and service delivery models
            to reduce program expenditures under the applicable titles
            while preserving or enhancing the quality of care furnished to
            individuals under such titles. In selecting such models, the
            Secretary shall give preference to models that also improve the
            coordination, quality, and efficiency of health care services
            furnished to applicable individuals defined in paragraph
            (4)(A).
                ``(2) Deadline.--The Secretary shall ensure that the CMI is
            carrying out the duties described in this section by not later
            than January 1, 2011.
                ``(3) Consultation.--In carrying out the duties under this
            section, the CMI shall consult representatives of relevant
            Federal agencies, and clinical and analytical experts with
            expertise in medicine and health care management. The CMI shall
            use open door forums or other mechanisms to seek input from
            interested parties.
                ``(4) Definitions.--In this section:
                        ``(A) Applicable individual.--The term `applicable
                    individual' means--
                                ``(i) an individual who is entitled to, or
                            enrolled for, benefits under part A of title
                            XVIII or enrolled for benefits under part B of
                            such title;
                                ``(ii) an individual who is eligible for
                            medical assistance under title XIX, under a
                            State plan or waiver; or
                                ``(iii) an individual who meets the
                            criteria of both clauses (i) and (ii).
                        ``(B) Applicable title.--The term `applicable
                    title' means title XVIII, title XIX, or both.
        ``(b) Testing of Models (Phase I).--
                ``(1) In general.--The CMI shall test payment and service
            delivery models in accordance with selection criteria under
            paragraph (2) to determine the effect of applying such models
            under the applicable title (as defined in subsection (a)(4)(B))
            on program expenditures under such titles and the quality of
            care received by individuals receiving benefits under such
            title.
                ``(2) Selection of models to be tested.--
                        ``(A) In general.--The Secretary shall select
                    models to be tested from models where the Secretary
                    determines that there is evidence that the model
                    addresses a defined population for which there are
                    deficits in care leading to poor clinical outcomes or
                    potentially avoidable expenditures. The models selected
                    under the preceding sentence may include the models
                    described in subparagraph (B).
                        ``(B) Opportunities.--The models described in this
                    subparagraph are the following models:
                                ``(i) Promoting broad payment and practice
                            reform in primary care, including patient-
                            centered medical home models for high-need
                            applicable individuals, medical homes that
                            address women's unique health care needs, and
                            models that transition primary care practices
                            away from fee-for-service based reimbursement
                            and toward comprehensive payment or salary-
                            based payment.
                                ``(ii) Contracting directly with groups of
                            providers of services and suppliers to promote
                            innovative care delivery models, such as
                            through risk-based comprehensive payment or
                            salary-based payment.
                                ``(iii) Utilizing geriatric assessments and
                            comprehensive care plans to coordinate the care
                            (including through interdisciplinary teams) of
                            applicable individuals with multiple chronic
                            conditions and at least one of the following:
                                        ``(I) An inability to perform 2 or
                                    more activities of daily living.
                                        ``(II) Cognitive impairment,
                                    including dementia.
                                ``(iv) Promote care coordination between
                            providers of services and suppliers that
                            transition health care providers away from fee-
                            for-service based reimbursement and toward
                            salary-based payment.
                                ``(v) Supporting care coordination for
                            chronically-ill applicable individuals at high
                            risk of hospitalization through a health
                            information technology-enabled provider network
                            that includes care coordinators, a chronic
                            disease registry, and home tele-health
                            technology.
                                ``(vi) Varying payment to physicians who
                            order advanced diagnostic imaging services (as
                            defined in section 1834(e)(1)(B)) according to
                            the physician's adherence to appropriateness
                            criteria for the ordering of such services, as
                            determined in consultation with physician
                            specialty groups and other relevant
                            stakeholders.
                                ``(vii) Utilizing medication therapy
                            management services, such as those described in
                            section 935 of the Public Health Service Act.
                                ``(viii) Establishing community-based
                            health teams to support small-practice medical
                            homes by assisting the primary care
                            practitioner in chronic care management,
                            including patient self-management, activities.
                                ``(ix) Assisting applicable individuals in
                            making informed health care choices by paying
                            providers of services and suppliers for using
                            patient decision-support tools, including tools
                            that meet the standards developed and
                            identified under section 936(c)(2)(A) of the
                            Public Health Service Act, that improve
                            applicable individual and caregiver
                            understanding of medical treatment options.
                                ``(x) Allowing States to test and evaluate
                            fully integrating care for dual eligible
                            individuals in the State, including the
                            management and oversight of all funds under the
                            applicable titles with respect to such
                            individuals.
                                ``(xi) Allowing States to test and evaluate
                            systems of all-payer payment reform for the
                            medical care of residents of the State,
                            including dual eligible individuals.
                                ``(xii) Aligning nationally recognized,
                            evidence-based guidelines of cancer care with
                            payment incentives under title XVIII in the
                            areas of treatment planning and follow-up care
                            planning for applicable individuals described
                            in clause (i) or (iii) of subsection (a)(4)(A)
                            with cancer, including the identification of
                            gaps in applicable quality measures.
                                ``(xiii) Improving post-acute care through
                            continuing care hospitals that offer inpatient
                            rehabilitation, long-term care hospitals, and
                            home health or skilled nursing care during an
                            inpatient stay and the 30 days immediately
                            following discharge.
                                ``(xiv) Funding home health providers who
                            offer chronic care management services to
                            applicable individuals in cooperation with
                            interdisciplinary teams.
                                ``(xv) Promoting improved quality and
                            reduced cost by developing a collaborative of
                            high-quality, low-cost health care institutions
                            that is responsible for--
                                        ``(I) developing, documenting, and
                                    disseminating best practices and proven
                                    care methods;
                                        ``(II) implementing such best
                                    practices and proven care methods
                                    within such institutions to demonstrate
                                    further improvements in quality and
                                    efficiency; and
                                        ``(III) providing assistance to
                                    other health care institutions on how
                                    best to employ such best practices and
                                    proven care methods to improve health
                                    care quality and lower costs.
                                ``(xvi) Facilitate inpatient care,
                            including intensive care, of hospitalized
                            applicable individuals at their local hospital
                            through the use of electronic monitoring by
                            specialists, including intensivists and
                            critical care specialists, based at integrated
                            health systems.
                                ``(xvii) Promoting greater efficiencies and
                            timely access to outpatient services (such as
                            outpatient physical therapy services) through
                            models that do not require a physician or other
                            health professional to refer the service or be
                            involved in establishing the plan of care for
                            the service, when such service is furnished by
                            a health professional who has the authority to
                            furnish the service under existing State law.
                                ``(xviii) Establishing comprehensive
                            payments to Healthcare Innovation Zones,
                            consisting of groups of providers that include
                            a teaching hospital, physicians, and other
                            clinical entities, that, through their
                            structure, operations, and joint-activity
                            deliver a full spectrum of integrated and
                            comprehensive health care services to
                            applicable individuals while also incorporating
                            innovative methods for the clinical training of
                            future health care professionals.
                        ``(C) Additional factors for consideration.--In
                    selecting models for testing under subparagraph (A),
                    the CMI may consider the following additional factors:
                                ``(i) Whether the model includes a regular
                            process for monitoring and updating patient
                            care plans in a manner that is consistent with
                            the needs and preferences of applicable
                            individuals.
                                ``(ii) Whether the model places the
                            applicable individual, including family members
                            and other informal caregivers of the applicable
                            individual, at the center of the care team of
                            the applicable individual.
                                ``(iii) Whether the model provides for in-
                            person contact with applicable individuals.
                                ``(iv) Whether the model utilizes
                            technology, such as electronic health records
                            and patient-based remote monitoring systems, to
                            coordinate care over time and across settings.
                                ``(v) Whether the model provides for the
                            maintenance of a close relationship between
                            care coordinators, primary care practitioners,
                            specialist physicians, community-based
                            organizations, and other providers of services
                            and suppliers.
                                ``(vi) Whether the model relies on a team-
                            based approach to interventions, such as
                            comprehensive care assessments, care planning,
                            and self-management coaching.
                                ``(vii) Whether, under the model, providers
                            of services and suppliers are able to share
                            information with patients, caregivers, and
                            other providers of services and suppliers on a
                            real time basis.
                ``(3) Budget neutrality.--
                        ``(A) Initial period.--The Secretary shall not
                    require, as a condition for testing a model under
                    paragraph (1), that the design of such model ensure
                    that such model is budget neutral initially with
                    respect to expenditures under the applicable title.
                        ``(B) Termination or modification.--The Secretary
                    shall terminate or modify the design and implementation
                    of a model unless the Secretary determines (and the
                    Chief Actuary of the Centers for Medicare & Medicaid
                    Services, with respect to program spending under the
                    applicable title, certifies), after testing has begun,
                    that the model is expected to--
                                ``(i) improve the quality of care (as
                            determined by the Administrator of the Centers
                            for Medicare & Medicaid Services) without
                            increasing spending under the applicable title;
                                ``(ii) reduce spending under the applicable
                            title without reducing the quality of care; or
                                ``(iii) improve the quality of care and
                            reduce spending.
                    Such termination may occur at any time after such
                    testing has begun and before completion of the testing.
                ``(4) Evaluation.--
                        ``(A) In general.--The Secretary shall conduct an
                    evaluation of each model tested under this subsection.
                    Such evaluation shall include an analysis of--
                                ``(i) the quality of care furnished under
                            the model, including the measurement of
                            patient-level outcomes and patient-centeredness
                            criteria determined appropriate by the
                            Secretary; and
                                ``(ii) the changes in spending under the
                            applicable titles by reason of the model.
                        ``(B) Information.--The Secretary shall make the
                    results of each evaluation under this paragraph
                    available to the public in a timely fashion and may
                    establish requirements for States and other entities
                    participating in the testing of models under this
                    section to collect and report information that the
                    Secretary determines is necessary to monitor and
                    evaluate such models.
        ``(c) Expansion of Models (Phase II).--Taking into account the
    evaluation under subsection (b)(4), the Secretary may, through
    rulemaking, expand (including implementation on a nationwide basis) the
    duration and the scope of a model that is being tested under subsection
    (b) or a demonstration project under section 1866C, to the extent
    determined appropriate by the Secretary, if--
                ``(1) the Secretary determines that such expansion is
            expected to--
                        ``(A) reduce spending under applicable title
                    without reducing the quality of care; or
                        ``(B) improve the quality of care and reduce
                    spending; and
                ``(2) the Chief Actuary of the Centers for Medicare &
            Medicaid Services certifies that such expansion would reduce
            program spending under applicable titles.
        ``(d) Implementation.--
                ``(1) Waiver authority.--The Secretary may waive such
            requirements of titles XI and XVIII and of sections 1902(a)(1),
            1902(a)(13), and 1903(m)(2)(A)(iii) as may be necessary solely
            for purposes of carrying out this section with respect to
            testing models described in subsection (b).
                ``(2) Limitations on review.--There shall be no
            administrative or judicial review under section 1869, section
            1878, or otherwise of--
                        ``(A) the selection of models for testing or
                    expansion under this section;
                        ``(B) the selection of organizations, sites, or
                    participants to test those models selected;
                        ``(C) the elements, parameters, scope, and duration
                    of such models for testing or dissemination;
                        ``(D) determinations regarding budget neutrality
                    under subsection (b)(3);
                        ``(E) the termination or modification of the design
                    and implementation of a model under subsection
                    (b)(3)(B); and
                        ``(F) determinations about expansion of the
                    duration and scope of a model under subsection (c),
                    including the determination that a model is not
                    expected to meet criteria described in paragraph (1) or
                    (2) of such subsection.
                ``(3) Administration.--Chapter 35 of title 44, United
            States Code, shall not apply to the testing and evaluation of
            models or expansion of such models under this section.
        ``(e) Application to CHIP.--The Center may carry out activities
    under this section with respect to title XXI in the same manner as
    provided under this section with respect to the program under the
    applicable titles.
        ``(f) Funding.--
                ``(1) In general.--There are appropriated, from amounts in
            the Treasury not otherwise appropriated--
                        ``(A) $5,000,000 for the design, implementation,
                    and evaluation of models under subsection (b) for
                    fiscal year 2010;
                        ``(B) $10,000,000,000 for the activities initiated
                    under this section for the period of fiscal years 2011
                    through 2019; and
                        ``(C) the amount described in subparagraph (B) for
                    the activities initiated under this section for each
                    subsequent 10-year fiscal period (beginning with the
                    10-year fiscal period beginning with fiscal year 2020).
            Amounts appropriated under the preceding sentence shall remain
            available until expended.
                ``(2) Use of certain funds.--Out of amounts appropriated
            under subparagraphs (B) and (C) of paragraph (1), not less than
            $25,000,000 shall be made available each such fiscal year to
            design, implement, and evaluate models under subsection (b).
        ``(g) Report to Congress.--Beginning in 2012, and not less than
    once every other year thereafter, the Secretary shall submit to
    Congress a report on activities under this section. Each such report
    shall describe the models tested under subsection (b), including the
    number of individuals described in subsection (a)(4)(A)(i) and of
    individuals described in subsection (a)(4)(A)(ii) participating in such
    models and payments made under applicable titles for services on behalf
    of such individuals, any models chosen for expansion under subsection
    (c), and the results from evaluations under subsection (b)(4). In
    addition, each such report shall provide such recommendations as the
    Secretary determines are appropriate for legislative action to
    facilitate the development and expansion of successful payment
    models.''.
        (b) Medicaid Conforming Amendment.--Section 1902(a) of the Social
    Security Act (42 U.S.C. 1396a(a)), as amended by section 8002(b), is
    amended--
                (1) in paragraph (81), by striking ``and'' at the end;
                (2) in paragraph (82), by striking the period at the end
            and inserting ``; and''; and
                (3) by inserting after paragraph (82) the following new
            paragraph:
                ``(83) provide for implementation of the payment models
            specified by the Secretary under section 1115A(c) for
            implementation on a nationwide basis unless the State
            demonstrates to the satisfaction of the Secretary that
            implementation would not be administratively feasible or
            appropriate to the health care delivery system of the State.''.
        (c) Revisions to Health Care Quality Demonstration Program.--
    Subsections (b) and (f) of section 1866C of the Social Security Act (42
    U.S.C. 1395cc-3) are amended by striking ``5-year'' each place it
    appears.

    SEC. 3022. MEDICARE SHARED SAVINGS PROGRAM.

        Title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.) is
    amended by adding at the end the following new section:

                            ``shared savings program

        ``Sec. 1899.  (a) Establishment.--
                ``(1) In general.--Not later than January 1, 2012, the
            Secretary shall establish a shared savings program (in this
            section referred to as the `program') that promotes
            accountability for a patient population and coordinates items
            and services under parts A and B, and encourages investment in
            infrastructure and redesigned care processes for high quality
            and efficient service delivery. Under such program--
                        ``(A) groups of providers of services and suppliers
                    meeting criteria specified by the Secretary may work
                    together to manage and coordinate care for Medicare
                    fee-for-service beneficiaries through an accountable
                    care organization (referred to in this section as an
                    `ACO'); and
                        ``(B) ACOs that meet quality performance standards
                    established by the Secretary are eligible to receive
                    payments for shared savings under subsection (d)(2).
        ``(b) Eligible ACOs.--
                ``(1) In general.--Subject to the succeeding provisions of
            this subsection, as determined appropriate by the Secretary,
            the following groups of providers of services and suppliers
            which have established a mechanism for shared governance are
            eligible to participate as ACOs under the program under this
            section:
                        ``(A) ACO professionals in group practice
                    arrangements.
                        ``(B) Networks of individual practices of ACO
                    professionals.
                        ``(C) Partnerships or joint venture arrangements
                    between hospitals and ACO professionals.
                        ``(D) Hospitals employing ACO professionals.
                        ``(E) Such other groups of providers of services
                    and suppliers as the Secretary determines appropriate.
                ``(2) Requirements.--An ACO shall meet the following
            requirements:
                        ``(A) The ACO shall be willing to become
                    accountable for the quality, cost, and overall care of
                    the Medicare fee-for-service beneficiaries assigned to
                    it.
                        ``(B) The ACO shall enter into an agreement with
                    the Secretary to participate in the program for not
                    less than a 3-year period (referred to in this section
                    as the `agreement period').
                        ``(C) The ACO shall have a formal legal structure
                    that would allow the organization to receive and
                    distribute payments for shared savings under subsection
                    (d)(2) to participating providers of services and
                    suppliers.
                        ``(D) The ACO shall include primary care ACO
                    professionals that are sufficient for the number of
                    Medicare fee-for-service beneficiaries assigned to the
                    ACO under subsection (c). At a minimum, the ACO shall
                    have at least 5,000 such beneficiaries assigned to it
                    under subsection (c) in order to be eligible to
                    participate in the ACO program.
                        ``(E) The ACO shall provide the Secretary with such
                    information regarding ACO professionals participating
                    in the ACO as the Secretary determines necessary to
                    support the assignment of Medicare fee-for-service
                    beneficiaries to an ACO, the implementation of quality
                    and other reporting requirements under paragraph (3),
                    and the determination of payments for shared savings
                    under subsection (d)(2).
                        ``(F) The ACO shall have in place a leadership and
                    management structure that includes clinical and
                    administrative systems.
                        ``(G) The ACO shall define processes to promote
                    evidence-based medicine and patient engagement, report
                    on quality and cost measures, and coordinate care, such
                    as through the use of telehealth, remote patient
                    monitoring, and other such enabling technologies.
                        ``(H) The ACO shall demonstrate to the Secretary
                    that it meets patient-centeredness criteria specified
                    by the Secretary, such as the use of patient and
                    caregiver assessments or the use of individualized care
                    plans.
                ``(3) Quality and other reporting requirements.--
                        ``(A) In general.--The Secretary shall determine
                    appropriate measures to assess the quality of care
                    furnished by the ACO, such as measures of--
                                ``(i) clinical processes and outcomes;
                                ``(ii) patient and, where practicable,
                            caregiver experience of care; and
                                ``(iii) utilization (such as rates of
                            hospital admissions for ambulatory care
                            sensitive conditions).
                        ``(B) Reporting requirements.--An ACO shall submit
                    data in a form and manner specified by the Secretary on
                    measures the Secretary determines necessary for the ACO
                    to report in order to evaluate the quality of care
                    furnished by the ACO. Such data may include care
                    transitions across health care settings, including
                    hospital discharge planning and post-hospital discharge
                    follow-up by ACO professionals, as the Secretary
                    determines appropriate.
                        ``(C) Quality performance standards.--The Secretary
                    shall establish quality performance standards to assess
                    the quality of care furnished by ACOs. The Secretary
                    shall seek to improve the quality of care furnished by
                    ACOs over time by specifying higher standards, new
                    measures, or both for purposes of assessing such
                    quality of care.
                        ``(D) Other reporting requirements.--The Secretary
                    may, as the Secretary determines appropriate,
                    incorporate reporting requirements and incentive
                    payments related to the physician quality reporting
                    initiative (PQRI) under section 1848, including such
                    requirements and such payments related to electronic
                    prescribing, electronic health records, and other
                    similar initiatives under section 1848, and may use
                    alternative criteria than would otherwise apply under
                    such section for determining whether to make such
                    payments. The incentive payments described in the
                    preceding sentence shall not be taken into
                    consideration when calculating any payments otherwise
                    made under subsection (d).
                ``(4) No duplication in participation in shared savings
            programs.--A provider of services or supplier that participates
            in any of the following shall not be eligible to participate in
            an ACO under this section:
                        ``(A) A model tested or expanded under section
                    1115A that involves shared savings under this title, or
                    any other program or demonstration project that
                    involves such shared savings.
                        ``(B) The independence at home medical practice
                    pilot program under section 1866E.
        ``(c) Assignment of Medicare Fee-for-service Beneficiaries to
    ACOs.--The Secretary shall determine an appropriate method to assign
    Medicare fee-for-service beneficiaries to an ACO based on their
    utilization of primary care services provided under this title by an
    ACO professional described in subsection (h)(1)(A).
        ``(d) Payments and Treatment of Savings.--
                ``(1) Payments.--
                        ``(A) In general.--Under the program, subject to
                    paragraph (3), payments shall continue to be made to
                    providers of services and suppliers participating in an
                    ACO under the original Medicare fee-for-service program
                    under parts A and B in the same manner as they would
                    otherwise be made except that a participating ACO is
                    eligible to receive payment for shared savings under
                    paragraph (2) if--
                                ``(i) the ACO meets quality performance
                            standards established by the Secretary under
                            subsection (b)(3); and
                                ``(ii) the ACO meets the requirement under
                            subparagraph (B)(i).
                        ``(B) Savings requirement and benchmark.--
                                ``(i) Determining savings.--In each year of
                            the agreement period, an ACO shall be eligible
                            to receive payment for shared savings under
                            paragraph (2) only if the estimated average per
                            capita Medicare expenditures under the ACO for
                            Medicare fee-for-service beneficiaries for
                            parts A and B services, adjusted for
                            beneficiary characteristics, is at least the
                            percent specified by the Secretary below the
                            applicable benchmark under clause (ii). The
                            Secretary shall determine the appropriate
                            percent described in the preceding sentence to
                            account for normal variation in expenditures
                            under this title, based upon the number of
                            Medicare fee-for-service beneficiaries assigned
                            to an ACO.
                                ``(ii) Establish and update benchmark.--The
                            Secretary shall estimate a benchmark for each
                            agreement period for each ACO using the most
                            recent available 3 years of per-beneficiary
                            expenditures for parts A and B services for
                            Medicare fee-for-service beneficiaries assigned
                            to the ACO. Such benchmark shall be adjusted
                            for beneficiary characteristics and such other
                            factors as the Secretary determines appropriate
                            and updated by the projected absolute amount of
                            growth in national per capita expenditures for
                            parts A and B services under the original
                            Medicare fee-for-service program, as estimated
                            by the Secretary. Such benchmark shall be reset
                            at the start of each agreement period.
                ``(2) Payments for shared savings.--Subject to performance
            with respect to the quality performance standards established
            by the Secretary under subsection (b)(3), if an ACO meets the
            requirements under paragraph (1), a percent (as determined
            appropriate by the Secretary) of the difference between such
            estimated average per capita Medicare expenditures in a year,
            adjusted for beneficiary characteristics, under the ACO and
            such benchmark for the ACO may be paid to the ACO as shared
            savings and the remainder of such difference shall be retained
            by the program under this title. The Secretary shall establish
            limits on the total amount of shared savings that may be paid
            to an ACO under this paragraph.
                ``(3) Monitoring avoidance of at-risk patients.--If the
            Secretary determines that an ACO has taken steps to avoid
            patients at risk in order to reduce the likelihood of
            increasing costs to the ACO the Secretary may impose an
            appropriate sanction on the ACO, including termination from the
            program.
                ``(4) Termination.--The Secretary may terminate an
            agreement with an ACO if it does not meet the quality
            performance standards established by the Secretary under
            subsection (b)(3).
        ``(e) Administration.--Chapter 35 of title 44, United States Code,
    shall not apply to the program.
        ``(f) Waiver Authority.--The Secretary may waive such requirements
    of sections 1128A and 1128B and title XVIII of this Act as may be
    necessary to carry out the provisions of this section.
        ``(g) Limitations on Review.--There shall be no administrative or
    judicial review under section 1869, section 1878, or otherwise of--
                ``(1) the specification of criteria under subsection
            (a)(1)(B);
                ``(2) the assessment of the quality of care furnished by an
            ACO and the establishment of performance standards under
            subsection (b)(3);
                ``(3) the assignment of Medicare fee-for-service
            beneficiaries to an ACO under subsection (c);
                ``(4) the determination of whether an ACO is eligible for
            shared savings under subsection (d)(2) and the amount of such
            shared savings, including the determination of the estimated
            average per capita Medicare expenditures under the ACO for
            Medicare fee-for-service beneficiaries assigned to the ACO and
            the average benchmark for the ACO under subsection (d)(1)(B);
                ``(5) the percent of shared savings specified by the
            Secretary under subsection (d)(2) and any limit on the total
            amount of shared savings established by the Secretary under
            such subsection; and
                ``(6) the termination of an ACO under subsection (d)(4).
        ``(h) Definitions.--In this section:
                ``(1) ACO professional.--The term `ACO professional'
            means--
                        ``(A) a physician (as defined in section
                    1861(r)(1)); and
                        ``(B) a practitioner described in section
                    1842(b)(18)(C)(i).
                ``(2) Hospital.--The term `hospital' means a subsection (d)
            hospital (as defined in section 1886(d)(1)(B)).
                ``(3) Medicare fee-for-service beneficiary.--The term
            `Medicare fee-for-service beneficiary' means an individual who
            is enrolled in the original Medicare fee-for-service program
            under parts A and B and is not enrolled in an MA plan under
            part C, an eligible organization under section 1876, or a PACE
            program under section 1894.''.

    SEC. 3023. NATIONAL PILOT PROGRAM ON PAYMENT BUNDLING.

        Title XVIII of the Social Security Act, as amended by section 3021,
    is amended by inserting after section 1886C the following new section:

                  ``national pilot program on payment bundling

        ``Sec. 1866D.  (a) Implementation.--
                ``(1) In general.--The Secretary shall establish a pilot
            program for integrated care during an episode of care provided
            to an applicable beneficiary around a hospitalization in order
            to improve the coordination, quality, and efficiency of health
            care services under this title.
                ``(2) Definitions.--In this section:
                        ``(A) Applicable beneficiary.--The term `applicable
                    beneficiary' means an individual who--
                                ``(i) is entitled to, or enrolled for,
                            benefits under part A and enrolled for benefits
                            under part B of such title, but not enrolled
                            under part C or a PACE program under section
                            1894; and
                                ``(ii) is admitted to a hospital for an
                            applicable condition.
                        ``(B) Applicable condition.--The term `applicable
                    condition' means 1 or more of 8 conditions selected by
                    the Secretary. In selecting conditions under the
                    preceding sentence, the Secretary shall take into
                    consideration the following factors:
                                ``(i) Whether the conditions selected
                            include a mix of chronic and acute conditions.
                                ``(ii) Whether the conditions selected
                            include a mix of surgical and medical
                            conditions.
                                ``(iii) Whether a condition is one for
                            which there is evidence of an opportunity for
                            providers of services and suppliers to improve
                            the quality of care furnished while reducing
                            total expenditures under this title.
                                ``(iv) Whether a condition has significant
                            variation in--
                                        ``(I) the number of readmissions;
                                    and
                                        ``(II) the amount of expenditures
                                    for post-acute care spending under this
                                    title.
                                ``(v) Whether a condition is high-volume
                            and has high post-acute care expenditures under
                            this title.
                                ``(vi) Which conditions the Secretary
                            determines are most amenable to bundling across
                            the spectrum of care given practice patterns
                            under this title.
                        ``(C) Applicable services.--The term `applicable
                    services' means the following:
                                ``(i) Acute care inpatient services.
                                ``(ii) Physicians' services delivered in
                            and outside of an acute care hospital setting.
                                ``(iii) Outpatient hospital services,
                            including emergency department services.
                                ``(iv) Post-acute care services, including
                            home health services, skilled nursing services,
                            inpatient rehabilitation services, and
                            inpatient hospital services furnished by a
                            long-term care hospital.
                                ``(v) Other services the Secretary
                            determines appropriate.
                        ``(D) Episode of care.--
                                ``(i) In general.--Subject to clause (ii),
                            the term `episode of care' means, with respect
                            to an applicable condition and an applicable
                            beneficiary, the period that includes--
                                        ``(I) the 3 days prior to the
                                    admission of the applicable beneficiary
                                    to a hospital for the applicable
                                    condition;
                                        ``(II) the length of stay of the
                                    applicable beneficiary in such
                                    hospital; and
                                        ``(III) the 30 days following the
                                    discharge of the applicable beneficiary
                                    from such hospital.
                                ``(ii) Establishment of period by the
                            secretary.--The Secretary, as appropriate, may
                            establish a period (other than the period
                            described in clause (i)) for an episode of care
                            under the pilot program.
                        ``(E) Physicians' services.--The term `physicians'
                    services' has the meaning given such term in section
                    1861(q).
                        ``(F) Pilot program.--The term `pilot program'
                    means the pilot program under this section.
                        ``(G) Provider of services.--The term `provider of
                    services' has the meaning given such term in section
                    1861(u).
                        ``(H) Readmission.--The term `readmission' has the
                    meaning given such term in section 1886(q)(5)(E).
                        ``(I) Supplier.--The term `supplier' has the
                    meaning given such term in section 1861(d).
                ``(3) Deadline for implementation.--The Secretary shall
            establish the pilot program not later than January 1, 2013.
        ``(b) Developmental Phase.--
                ``(1) Determination of patient assessment instrument.--The
            Secretary shall determine which patient assessment instrument
            (such as the Continuity Assessment Record and Evaluation (CARE)
            tool) shall be used under the pilot program to evaluate the
            applicable condition of an applicable beneficiary for purposes
            of determining the most clinically appropriate site for the
            provision of post-acute care to the applicable beneficiary.
                ``(2) Development of quality measures for an episode of
            care and for post-acute care.--
                        ``(A) In general.--The Secretary, in consultation
                    with the Agency for Healthcare Research and Quality and
                    the entity with a contract under section 1890(a) of the
                    Social Security Act, shall develop quality measures for
                    use in the pilot program--
                                ``(i) for episodes of care; and
                                ``(ii) for post-acute care.
                        ``(B) Site-neutral post-acute care quality
                    measures.--Any quality measures developed under
                    subparagraph (A)(ii) shall be site-neutral.
                        ``(C) Coordination with quality measure development
                    and endorsement procedures.--The Secretary shall ensure
                    that the development of quality measures under
                    subparagraph (A) is done in a manner that is consistent
                    with the measures developed and endorsed under section
                    1890 and 1890A that are applicable to all post-acute
                    care settings.
        ``(c) Details.--
                ``(1) Duration.--
                        ``(A) In general.--Subject to subparagraph (B), the
                    pilot program shall be conducted for a period of 5
                    years.
                        ``(B) Extension.--The Secretary may extend the
                    duration of the pilot program for providers of services
                    and suppliers participating in the pilot program as of
                    the day before the end of the 5-year period described
                    in subparagraph (A), for a period determined
                    appropriate by the Secretary, if the Secretary
                    determines that such extension will result in improving
                    or not reducing the quality of patient care and
                    reducing spending under this title.
                ``(2) Participating providers of services and suppliers.--
                        ``(A) In general.--An entity comprised of providers
                    of services and suppliers, including a hospital, a
                    physician group, a skilled nursing facility, and a home
                    health agency, who are otherwise participating under
                    this title, may submit an application to the Secretary
                    to provide applicable services to applicable
                    individuals under this section.
                        ``(B) Requirements.--The Secretary shall develop
                    requirements for entities to participate in the pilot
                    program under this section. Such requirements shall
                    ensure that applicable beneficiaries have an adequate
                    choice of providers of services and suppliers under the
                    pilot program.
                ``(3) Payment methodology.--
                        ``(A) In general.--
                                ``(i) Establishment of payment methods.--
                            The Secretary shall develop payment methods for
                            the pilot program for entities participating in
                            the pilot program. Such payment methods may
                            include bundled payments and bids from entities
                            for episodes of care. The Secretary shall make
                            payments to the entity for services covered
                            under this section.
                                ``(ii) No additional program
                            expenditures.--Payments under this section for
                            applicable items and services under this title
                            (including payment for services described in
                            subparagraph (B)) for applicable beneficiaries
                            for a year shall be established in a manner
                            that does not result in spending more for such
                            entity for such beneficiaries than would
                            otherwise be expended for such entity for such
                            beneficiaries for such year if the pilot
                            program were not implemented, as estimated by
                            the Secretary.
                        ``(B) Inclusion of certain services.--A payment
                    methodology tested under the pilot program shall
                    include payment for the furnishing of applicable
                    services and other appropriate services, such as care
                    coordination, medication reconciliation, discharge
                    planning, transitional care services, and other
                    patient-centered activities as determined appropriate
                    by the Secretary.
                        ``(C) Bundled payments.--
                                ``(i) In general.--A bundled payment under
                            the pilot program shall--
                                        ``(I) be comprehensive, covering
                                    the costs of applicable services and
                                    other appropriate services furnished to
                                    an individual during an episode of care
                                    (as determined by the Secretary); and
                                        ``(II) be made to the entity which
                                    is participating in the pilot program.
                                ``(ii) Requirement for provision of
                            applicable services and other appropriate
                            services.--Applicable services and other
                            appropriate services for which payment is made
                            under this subparagraph shall be furnished or
                            directed by the entity which is participating
                            in the pilot program.
                        ``(D) Payment for post-acute care services after
                    the episode of care.--The Secretary shall establish
                    procedures, in the case where an applicable beneficiary
                    requires continued post-acute care services after the
                    last day of the episode of care, under which payment
                    for such services shall be made.
                ``(4) Quality measures.--
                        ``(A) In general.--The Secretary shall establish
                    quality measures (including quality measures of
                    process, outcome, and structure) related to care
                    provided by entities participating in the pilot
                    program. Quality measures established under the
                    preceding sentence shall include measures of the
                    following:
                                ``(i) Functional status improvement.
                                ``(ii) Reducing rates of avoidable hospital
                            readmissions.
                                ``(iii) Rates of discharge to the
                            community.
                                ``(iv) Rates of admission to an emergency
                            room after a hospitalization.
                                ``(v) Incidence of health care acquired
                            infections.
                                ``(vi) Efficiency measures.
                                ``(vii) Measures of patient-centeredness of
                            care.
                                ``(viii) Measures of patient perception of
                            care.
                                ``(ix) Other measures, including measures
                            of patient outcomes, determined appropriate by
                            the Secretary.
                        ``(B) Reporting on quality measures.--
                                ``(i) In general.--A entity shall submit
                            data to the Secretary on quality measures
                            established under subparagraph (A) during each
                            year of the pilot program (in a form and
                            manner, subject to clause (iii), specified by
                            the Secretary).
                                ``(ii) Submission of data through
                            electronic health record.--To the extent
                            practicable, the Secretary shall specify that
                            data on measures be submitted under clause (i)
                            through the use of an qualified electronic
                            health record (as defined in section 3000(13)
                            of the Public Health Service Act (42 U.S.C.
                            300jj-11(13)) in a manner specified by the
                            Secretary.
        ``(d) Waiver.--The Secretary may waive such provisions of this
    title and title XI as may be necessary to carry out the pilot program.
        ``(e) Independent Evaluation and Reports on Pilot Program.--
                ``(1) Independent evaluation.--The Secretary shall conduct
            an independent evaluation of the pilot program, including the
            extent to which the pilot program has--
                        ``(A) improved quality measures established under
                    subsection (c)(4)(A);
                        ``(B) improved health outcomes;
                        ``(C) improved applicable beneficiary access to
                    care; and
                        ``(D) reduced spending under this title.
                ``(2) Reports.--
                        ``(A) Interim report.--Not later than 2 years after
                    the implementation of the pilot program, the Secretary
                    shall submit to Congress a report on the initial
                    results of the independent evaluation conducted under
                    paragraph (1).
                        ``(B) Final report.--Not later than 3 years after
                    the implementation of the pilot program, the Secretary
                    shall submit to Congress a report on the final results
                    of the independent evaluation conducted under paragraph
                    (1).
        ``(f) Consultation.--The Secretary shall consult with
    representatives of small rural hospitals, including critical access
    hospitals (as defined in section 1861(mm)(1)), regarding their
    participation in the pilot program. Such consultation shall include
    consideration of innovative methods of implementing bundled payments in
    hospitals described in the preceding sentence, taking into
    consideration any difficulties in doing so as a result of the low
    volume of services provided by such hospitals.
        ``(g) Implementation Plan.--
                ``(1) In general.--Not later than January 1, 2016, the
            Secretary shall submit a plan for the implementation of an
            expansion of the pilot program if the Secretary determines that
            such expansion will result in improving or not reducing the
            quality of patient care and reducing spending under this title.
        ``(h) Administration.--Chapter 35 of title 44, United States Code,
    shall not apply to the selection, testing, and evaluation of models or
    the expansion of such models under this section.''.

    SEC. 3024. INDEPENDENCE AT HOME DEMONSTRATION PROGRAM.

        Title XVIII of the Social Security Act is amended by inserting
    after section 1866D, as inserted by section 3023, the following new
    section:

         ``independence at home medical practice demonstration program

        ``Sec. 1866D.  (a) Establishment.--
                ``(1) In general.--The Secretary shall conduct a
            demonstration program (in this section referred to as the
            `demonstration program') to test a payment incentive and
            service delivery model that utilizes physician and nurse
            practitioner directed home-based primary care teams designed to
            reduce expenditures and improve health outcomes in the
            provision of items and services under this title to applicable
            beneficiaries (as defined in subsection (d)).
                ``(2) Requirement.--The demonstration program shall test
            whether a model described in paragraph (1), which is
            accountable for providing comprehensive, coordinated,
            continuous, and accessible care to high-need populations at
            home and coordinating health care across all treatment
            settings, results in--
                        ``(A) reducing preventable hospitalizations;
                        ``(B) preventing hospital readmissions;
                        ``(C) reducing emergency room visits;
                        ``(D) improving health outcomes commensurate with
                    the beneficiaries' stage of chronic illness;
                        ``(E) improving the efficiency of care, such as by
                    reducing duplicative diagnostic and laboratory tests;
                        ``(F) reducing the cost of health care services
                    covered under this title; and
                        ``(G) achieving beneficiary and family caregiver
                    satisfaction.
        ``(b) Independence at Home Medical Practice.--
                ``(1) Independence at home medical practice defined.--In
            this section:
                        ``(A) In general.--The term `independence at home
                    medical practice' means a legal entity that--
                                ``(i) is comprised of an individual
                            physician or nurse practitioner or group of
                            physicians and nurse practitioners that
                            provides care as part of a team that includes
                            physicians, nurses, physician assistants,
                            pharmacists, and other health and social
                            services staff as appropriate who have
                            experience providing home-based primary care to
                            applicable beneficiaries, make in-home visits,
                            and are available 24 hours per day, 7 days per
                            week to carry out plans of care that are
                            tailored to the individual beneficiary's
                            chronic conditions and designed to achieve the
                            results in subsection (a);
                                ``(ii) is organized at least in part for
                            the purpose of providing physicians' services;
                                ``(iii) has documented experience in
                            providing home-based primary care services to
                            high-cost chronically ill beneficiaries, as
                            determined appropriate by the Secretary;
                                ``(iv) furnishes services to at least 200
                            applicable beneficiaries (as defined in
                            subsection (d)) during each year of the
                            demonstration program;
                                ``(v) has entered into an agreement with
                            the Secretary;
                                ``(vi) uses electronic health information
                            systems, remote monitoring, and mobile
                            diagnostic technology; and
                                ``(vii) meets such other criteria as the
                            Secretary determines to be appropriate to
                            participate in the demonstration program.
                    The entity shall report on quality measures (in such
                    form, manner, and frequency as specified by the
                    Secretary, which may be for the group, for providers of
                    services and suppliers, or both) and report to the
                    Secretary (in a form, manner, and frequency as
                    specified by the Secretary) such data as the Secretary
                    determines appropriate to monitor and evaluate the
                    demonstration program.
                        ``(B) Physician.--The term `physician' includes,
                    except as the Secretary may otherwise provide, any
                    individual who furnishes services for which payment may
                    be made as physicians' services and has the medical
                    training or experience to fulfill the physician's role
                    described in subparagraph (A)(i).
                ``(2) Participation of nurse practitioners and physician
            assistants.--Nothing in this section shall be construed to
            prevent a nurse practitioner or physician assistant from
            participating in, or leading, a home-based primary care team as
            part of an independence at home medical practice if--
                        ``(A) all the requirements of this section are met;
                        ``(B) the nurse practitioner or physician
                    assistant, as the case may be, is acting consistent
                    with State law; and
                        ``(C) the nurse practitioner or physician assistant
                    has the medical training or experience to fulfill the
                    nurse practitioner or physician assistant role
                    described in paragraph (1)(A)(i).
                ``(3) Inclusion of providers and practitioners.--Nothing in
            this subsection shall be construed as preventing an
            independence at home medical practice from including a provider
            of services or a participating practitioner described in
            section 1842(b)(18)(C) that is affiliated with the practice
            under an arrangement structured so that such provider of
            services or practitioner participates in the demonstration
            program and shares in any savings under the demonstration
            program.
                ``(4) Quality and performance standards.--The Secretary
            shall develop quality performance standards for independence at
            home medical practices participating in the demonstration
            program.
        ``(c) Payment Methodology.--
                ``(1) Establishment of target spending level.--The
            Secretary shall establish an estimated annual spending target,
            for the amount the Secretary estimates would have been spent in
            the absence of the demonstration, for items and services
            covered under parts A and B furnished to applicable
            beneficiaries for each qualifying independence at home medical
            practice under this section. Such spending targets shall be
            determined on a per capita basis. Such spending targets shall
            include a risk corridor that takes into account normal
            variation in expenditures for items and services covered under
            parts A and B furnished to such beneficiaries with the size of
            the corridor being related to the number of applicable
            beneficiaries furnished services by each independence at home
            medical practice. The spending targets may also be adjusted for
            other factors as the Secretary determines appropriate.
                ``(2) Incentive payments.--Subject to performance on
            quality measures, a qualifying independence at home medical
            practice is eligible to receive an incentive payment under this
            section if actual expenditures for a year for the applicable
            beneficiaries it enrolls are less than the estimated spending
            target established under paragraph (1) for such year. An
            incentive payment for such year shall be equal to a portion (as
            determined by the Secretary) of the amount by which actual
            expenditures (including incentive payments under this
            paragraph) for applicable beneficiaries under parts A and B for
            such year are estimated to be less than 5 percent less than the
            estimated spending target for such year, as determined under
            paragraph (1).
        ``(d) Applicable Beneficiaries.--
                ``(1) Definition.--In this section, the term `applicable
            beneficiary' means, with respect to a qualifying independence
            at home medical practice, an individual who the practice has
            determined--
                        ``(A) is entitled to benefits under part A and
                    enrolled for benefits under part B;
                        ``(B) is not enrolled in a Medicare Advantage plan
                    under part C or a PACE program under section 1894;
                        ``(C) has 2 or more chronic illnesses, such as
                    congestive heart failure, diabetes, other dementias
                    designated by the Secretary, chronic obstructive
                    pulmonary disease, ischemic heart disease, stroke,
                    Alzheimer's Disease and neurodegenerative diseases, and
                    other diseases and conditions designated by the
                    Secretary which result in high costs under this title;
                        ``(D) within the past 12 months has had a
                    nonelective hospital admission;
                        ``(E) within the past 12 months has received acute
                    or subacute rehabilitation services;
                        ``(F) has 2 or more functional dependencies
                    requiring the assistance of another person (such as
                    bathing, dressing, toileting, walking, or feeding); and
                        ``(G) meets such other criteria as the Secretary
                    determines appropriate.
                ``(2) Patient election to participate.--The Secretary shall
            determine an appropriate method of ensuring that applicable
            beneficiaries have agreed to enroll in an independence at home
            medical practice under the demonstration program. Enrollment in
            the demonstration program shall be voluntary.
                ``(3) Beneficiary access to services.--Nothing in this
            section shall be construed as encouraging physicians or nurse
            practitioners to limit applicable beneficiary access to
            services covered under this title and applicable beneficiaries
            shall not be required to relinquish access to any benefit under
            this title as a condition of receiving services from an
            independence at home medical practice.
        ``(e) Implementation.--
                ``(1) Starting date.--The demonstration program shall begin
            no later than January 1, 2012. An agreement with an
            independence at home medical practice under the demonstration
            program may cover not more than a 3-year period.
                ``(2) No physician duplication in demonstration
            participation.--The Secretary shall not pay an independence at
            home medical practice under this section that participates in
            section 1899.
                ``(3) No beneficiary duplication in demonstration
            participation.--The Secretary shall ensure that no applicable
            beneficiary enrolled in an independence at home medical
            practice under this section is participating in the programs
            under section 1899.
                ``(4) Preference.--In approving an independence at home
            medical practice, the Secretary shall give preference to
            practices that are--
                        ``(A) located in high-cost areas of the country;
                        ``(B) have experience in furnishing health care
                    services to applicable beneficiaries in the home; and
                        ``(C) use electronic medical records, health
                    information technology, and individualized plans of
                    care.
                ``(5) Limitation on number of practices.--In selecting
            qualified independence at home medical practices to participate
            under the demonstration program, the Secretary shall limit the
            number of such practices so that the number of applicable
            beneficiaries that may participate in the demonstration program
            does not exceed 10,000.
                ``(6) Waiver.--The Secretary may waive such provisions of
            this title and title XI as the Secretary determines necessary
            in order to implement the demonstration program.
                ``(7) Administration.--Chapter 35 of title 44, United
            States Code, shall not apply to this section.
        ``(f) Evaluation and Monitoring.--
                ``(1) In general.--The Secretary shall evaluate each
            independence at home medical practice under the demonstration
            program to assess whether the practice achieved the results
            described in subsection (a).
                ``(2) Monitoring applicable beneficiaries.--The Secretary
            may monitor data on expenditures and quality of services under
            this title after an applicable beneficiary discontinues
            receiving services under this title through a qualifying
            independence at home medical practice.
        ``(g) Reports to Congress.--The Secretary shall conduct an
    independent evaluation of the demonstration program and submit to
    Congress a final report, including best practices under the
    demonstration program. Such report shall include an analysis of the
    demonstration program on coordination of care, expenditures under this
    title, applicable beneficiary access to services, and the quality of
    health care services provided to applicable beneficiaries.
        ``(h) Funding.--For purposes of administering and carrying out the
    demonstration program, other than for payments for items and services
    furnished under this title and incentive payments under subsection (c),
    in addition to funds otherwise appropriated, there shall be transferred
    to the Secretary for the Center for Medicare & Medicaid Services
    Program Management Account from the Federal Hospital Insurance Trust
    Fund under section 1817 and the Federal Supplementary Medical Insurance
    Trust Fund under section 1841 (in proportions determined appropriate by
    the Secretary) $5,000,000 for each of fiscal years 2010 through 2015.
    Amounts transferred under this subsection for a fiscal year shall be
    available until expended.
        ``(i) Termination.--
                ``(1) Mandatory termination.--The Secretary shall terminate
            an agreement with an independence at home medical practice if--
                        ``(A) the Secretary estimates or determines that
                    such practice will not receive an incentive payment for
                    the second of 2 consecutive years under the
                    demonstration program; or
                        ``(B) such practice fails to meet quality standards
                    during any year of the demonstration program.
                ``(2) Permissive termination.--The Secretary may terminate
            an agreement with an independence at home medical practice for
            such other reasons determined appropriate by the Secretary.''.

    SEC. 3025. HOSPITAL READMISSIONS REDUCTION PROGRAM.

        (a) In General.--Section 1886 of the Social Security Act (42 U.S.C.
    1395ww), as amended by sections 3001 and 3008, is amended by adding at
    the end the following new subsection:
        ``(q) Hospital Readmissions Reduction Program.--
                ``(1) In general.--With respect to payment for discharges
            from an applicable hospital (as defined in paragraph (5)(C))
            occurring during a fiscal year beginning on or after October 1,
            2012, in order to account for excess readmissions in the
            hospital, the Secretary shall reduce the payments that would
            otherwise be made to such hospital under subsection (d) (or
            section 1814(b)(3), as the case may be) for such a discharge by
            an amount equal to the product of--
                        ``(A) the base operating DRG payment amount (as
                    defined in paragraph (2)) for the discharge; and
                        ``(B) the adjustment factor (described in paragraph
                    (3)(A)) for the hospital for the fiscal year.
                ``(2) Base operating drg payment amount defined.--
                        ``(A) In general.--Except as provided in
                    subparagraph (B), in this subsection, the term `base
                    operating DRG payment amount' means, with respect to a
                    hospital for a fiscal year--
                                ``(i) the payment amount that would
                            otherwise be made under subsection (d)
                            (determined without regard to subsection (o))
                            for a discharge if this subsection did not
                            apply; reduced by
                                ``(ii) any portion of such payment amount
                            that is attributable to payments under
                            paragraphs (5)(A), (5)(B), (5)(F), and (12) of
                            subsection (d).
                        ``(B) Special rules for certain hospitals.--
                                ``(i) Sole community hospitals and
                            medicare-dependent, small rural hospitals.--In
                            the case of a medicare-dependent, small rural
                            hospital (with respect to discharges occurring
                            during fiscal years 2012 and 2013) or a sole
                            community hospital, in applying subparagraph
                            (A)(i), the payment amount that would otherwise
                            be made under subsection (d) shall be
                            determined without regard to subparagraphs (I)
                            and (L) of subsection (b)(3) and subparagraphs
                            (D) and (G) of subsection (d)(5).
                                ``(ii) Hospitals paid under section 1814.--
                            In the case of a hospital that is paid under
                            section 1814(b)(3), the Secretary may exempt
                            such hospitals provided that States paid under
                            such section submit an annual report to the
                            Secretary describing how a similar program in
                            the State for a participating hospital or
                            hospitals achieves or surpasses the measured
                            results in terms of patient health outcomes and
                            cost savings established herein with respect to
                            this section.
                ``(3) Adjustment factor.--
                        ``(A) In general.--For purposes of paragraph (1),
                    the adjustment factor under this paragraph for an
                    applicable hospital for a fiscal year is equal to the
                    greater of--
                                ``(i) the ratio described in subparagraph
                            (B) for the hospital for the applicable period
                            (as defined in paragraph (5)(D)) for such
                            fiscal year; or
                                ``(ii) the floor adjustment factor
                            specified in subparagraph (C).
                        ``(B) Ratio.--The ratio described in this
                    subparagraph for a hospital for an applicable period is
                    equal to 1 minus the ratio of--
                                ``(i) the aggregate payments for excess
                            readmissions (as defined in paragraph (4)(A))
                            with respect to an applicable hospital for the
                            applicable period; and
                                ``(ii) the aggregate payments for all
                            discharges (as defined in paragraph (4)(B))
                            with respect to such applicable hospital for
                            such applicable period.
                        ``(C) Floor adjustment factor.--For purposes of
                    subparagraph (A), the floor adjustment factor specified
                    in this subparagraph for--
                                ``(i) fiscal year 2013 is 0.99;
                                ``(ii) fiscal year 2014 is 0.98; or
                                ``(iii) fiscal year 2015 and subsequent
                            fiscal years is 0.97.
                ``(4) Aggregate payments, excess readmission ratio
            defined.--For purposes of this subsection:
                        ``(A) Aggregate payments for excess readmissions.--
                    The term `aggregate payments for excess readmissions'
                    means, for a hospital for an applicable period, the
                    sum, for applicable conditions (as defined in paragraph
                    (5)(A)), of the product, for each applicable condition,
                    of--
                                ``(i) the base operating DRG payment amount
                            for such hospital for such applicable period
                            for such condition;
                                ``(ii) the number of admissions for such
                            condition for such hospital for such applicable
                            period; and
                                ``(iii) the excess readmissions ratio (as
                            defined in subparagraph (C)) for such hospital
                            for such applicable period minus 1.
                        ``(B) Aggregate payments for all discharges.--The
                    term `aggregate payments for all discharges' means, for
                    a hospital for an applicable period, the sum of the
                    base operating DRG payment amounts for all discharges
                    for all conditions from such hospital for such
                    applicable period.
                        ``(C) Excess readmission ratio.--
                                ``(i) In general.--Subject to clause (ii),
                            the term `excess readmissions ratio' means,
                            with respect to an applicable condition for a
                            hospital for an applicable period, the ratio
                            (but not less than 1.0) of--
                                        ``(I) the risk adjusted
                                    readmissions based on actual
                                    readmissions, as determined consistent
                                    with a readmission measure methodology
                                    that has been endorsed under paragraph
                                    (5)(A)(ii)(I), for an applicable
                                    hospital for such condition with
                                    respect to such applicable period; to
                                        ``(II) the risk adjusted expected
                                    readmissions (as determined consistent
                                    with such a methodology) for such
                                    hospital for such condition with
                                    respect to such applicable period.
                                ``(ii) Exclusion of certain readmissions.--
                            For purposes of clause (i), with respect to a
                            hospital, excess readmissions shall not include
                            readmissions for an applicable condition for
                            which there are fewer than a minimum number (as
                            determined by the Secretary) of discharges for
                            such applicable condition for the applicable
                            period and such hospital.
                ``(5) Definitions.--For purposes of this subsection:
                        ``(A) Applicable condition.--The term `applicable
                    condition' means, subject to subparagraph (B), a
                    condition or procedure selected by the Secretary among
                    conditions and procedures for which--
                                ``(i) readmissions (as defined in
                            subparagraph (E)) that represent conditions or
                            procedures that are high volume or high
                            expenditures under this title (or other
                            criteria specified by the Secretary); and
                                ``(ii) measures of such readmissions--
                                        ``(I) have been endorsed by the
                                    entity with a contract under section
                                    1890(a); and
                                        ``(II) such endorsed measures have
                                    exclusions for readmissions that are
                                    unrelated to the prior discharge (such
                                    as a planned readmission or transfer to
                                    another applicable hospital).
                        ``(B) Expansion of applicable conditions.--
                    Beginning with fiscal year 2015, the Secretary shall,
                    to the extent practicable, expand the applicable
                    conditions beyond the 3 conditions for which measures
                    have been endorsed as described in subparagraph
                    (A)(ii)(I) as of the date of the enactment of this
                    subsection to the additional 4 conditions that have
                    been identified by the Medicare Payment Advisory
                    Commission in its report to Congress in June 2007 and
                    to other conditions and procedures as determined
                    appropriate by the Secretary. In expanding such
                    applicable conditions, the Secretary shall seek the
                    endorsement described in subparagraph (A)(ii)(I) but
                    may apply such measures without such an endorsement in
                    the case of a specified area or medical topic
                    determined appropriate by the Secretary for which a
                    feasible and practical measure has not been endorsed by
                    the entity with a contract under section 1890(a) as
                    long as due consideration is given to measures that
                    have been endorsed or adopted by a consensus
                    organization identified by the Secretary.
                        ``(C) Applicable hospital.--The term `applicable
                    hospital' means a subsection (d) hospital or a hospital
                    that is paid under section 1814(b)(3), as the case may
                    be.
                        ``(D) Applicable period.--The term `applicable
                    period' means, with respect to a fiscal year, such
                    period as the Secretary shall specify.
                        ``(E) Readmission.--The term `readmission' means,
                    in the case of an individual who is discharged from an
                    applicable hospital, the admission of the individual to
                    the same or another applicable hospital within a time
                    period specified by the Secretary from the date of such
                    discharge. Insofar as the discharge relates to an
                    applicable condition for which there is an endorsed
                    measure described in subparagraph (A)(ii)(I), such time
                    period (such as 30 days) shall be consistent with the
                    time period specified for such measure.
                ``(6) Reporting hospital specific information.--
                        ``(A) In general.--The Secretary shall make
                    information available to the public regarding
                    readmission rates of each subsection (d) hospital under
                    the program.
                        ``(B) Opportunity to review and submit
                    corrections.--The Secretary shall ensure that a
                    subsection (d) hospital has the opportunity to review,
                    and submit corrections for, the information to be made
                    public with respect to the hospital under subparagraph
                    (A) prior to such information being made public.
                        ``(C) Website.--Such information shall be posted on
                    the Hospital Compare Internet website in an easily
                    understandable format.
                ``(7) Limitations on review.--There shall be no
            administrative or judicial review under section 1869, section
            1878, or otherwise of the following:
                        ``(A) The determination of base operating DRG
                    payment amounts.
                        ``(B) The methodology for determining the
                    adjustment factor under paragraph (3), including excess
                    readmissions ratio under paragraph (4)(C), aggregate
                    payments for excess readmissions under paragraph
                    (4)(A), and aggregate payments for all discharges under
                    paragraph (4)(B), and applicable periods and applicable
                    conditions under paragraph (5).
                        ``(C) The measures of readmissions as described in
                    paragraph (5)(A)(ii).
                ``(8) Readmission rates for all patients.--
                        ``(A) Calculation of readmission.--The Secretary
                    shall calculate readmission rates for all patients (as
                    defined in subparagraph (D)) for a specified hospital
                    (as defined in subparagraph (D)(ii)) for an applicable
                    condition (as defined in paragraph (5)(B)) and other
                    conditions deemed appropriate by the Secretary for an
                    applicable period (as defined in paragraph (5)(D)) in
                    the same manner as used to calculate such readmission
                    rates for hospitals with respect to this title and
                    posted on the CMS Hospital Compare website.
                        ``(B) Posting of hospital specific all patient
                    readmission rates.--The Secretary shall make
                    information on all patient readmission rates calculated
                    under subparagraph (A) available on the CMS Hospital
                    Compare website in a form and manner determined
                    appropriate by the Secretary. The Secretary may also
                    make other information determined appropriate by the
                    Secretary available on such website.
                        ``(C) Hospital submission of all patient data.--
                                ``(i) Except as provided for in clause
                            (ii), each specified hospital (as defined in
                            subparagraph (D)(ii)) shall submit to the
                            Secretary, in a form, manner and time specified
                            by the Secretary, data and information
                            determined necessary by the Secretary for the
                            Secretary to calculate the all patient
                            readmission rates described in subparagraph
                            (A).
                                ``(ii) Instead of a specified hospital
                            submitting to the Secretary the data and
                            information described in clause (i), such data
                            and information may be submitted to the
                            Secretary, on behalf of such a specified
                            hospital, by a state or an entity determined
                            appropriate by the Secretary.
                        ``(D) Definitions.--For purposes of this paragraph:
                                ``(i) The term `all patients' means
                            patients who are treated on an inpatient basis
                            and discharged from a specified hospital (as
                            defined in clause (ii)).
                                ``(ii) The term `specified hospital' means
                            a subsection (d) hospital, hospitals described
                            in clauses (i) through (v) of subsection
                            (d)(1)(B) and, as determined feasible and
                            appropriate by the Secretary, other hospitals
                            not otherwise described in this
                            subparagraph.''.
        (b) Quality Improvement.--Part S of title III of the Public Health
    Service Act, as amended by section 3015, is further amended by adding
    at the end the following:

    ``SEC. 399KK. QUALITY IMPROVEMENT PROGRAM FOR HOSPITALS WITH A HIGH
                  SEVERITY ADJUSTED READMISSION RATE.

        ``(a) Establishment.--
                ``(1) In general.--Not later than 2 years after the date of
            enactment of this section, the Secretary shall make available a
            program for eligible hospitals to improve their readmission
            rates through the use of patient safety organizations (as
            defined in section 921(4)).
                ``(2) Eligible hospital defined.--In this subsection, the
            term `eligible hospital' means a hospital that the Secretary
            determines has a high rate of risk adjusted readmissions for
            the conditions described in section 1886(q)(8)(A) of the Social
            Security Act and has not taken appropriate steps to reduce such
            readmissions and improve patient safety as evidenced through
            historically high rates of readmissions, as determined by the
            Secretary.
                ``(3) Risk adjustment.--The Secretary shall utilize
            appropriate risk adjustment measures to determine eligible
            hospitals.
        ``(b) Report to the Secretary.--As determined appropriate by the
    Secretary, eligible hospitals and patient safety organizations working
    with those hospitals shall report to the Secretary on the processes
    employed by the hospital to improve readmission rates and the impact of
    such processes on readmission rates.''.

    SEC. 3026. COMMUNITY-BASED CARE TRANSITIONS PROGRAM.

        (a) In General.--The Secretary shall establish a Community-Based
    Care Transitions Program under which the Secretary provides funding to
    eligible entities that furnish improved care transition services to
    high-risk Medicare beneficiaries.
        (b) Definitions.--In this section:
                (1) Eligible entity.--The term ``eligible entity'' means
            the following:
                        (A) A subsection (d) hospital (as defined in
                    section 1886(d)(1)(B) of the Social Security Act (42
                    U.S.C. 1395ww(d)(1)(B))) identified by the Secretary as
                    having a high readmission rate, such as under section
                    1886(q) of the Social Security Act, as added by section
                    3025.
                        (B) An appropriate community-based organization
                    that provides care transition services under this
                    section across a continuum of care through arrangements
                    with subsection (d) hospitals (as so defined) to
                    furnish the services described in subsection
                    (c)(2)(B)(i) and whose governing body includes
                    sufficient representation of multiple health care
                    stakeholders (including consumers).
                (2) High-risk medicare beneficiary.--The term ``high-risk
            Medicare beneficiary'' means a Medicare beneficiary who has
            attained a minimum hierarchical condition category score, as
            determined by the Secretary, based on a diagnosis of multiple
            chronic conditions or other risk factors associated with a
            hospital readmission or substandard transition into post-
            hospitalization care, which may include 1 or more of the
            following:
                        (A) Cognitive impairment.
                        (B) Depression.
                        (C) A history of multiple readmissions.
                        (D) Any other chronic disease or risk factor as
                    determined by the Secretary.
                (3) Medicare beneficiary.--The term ``Medicare
            beneficiary'' means an individual who is entitled to benefits
            under part A of title XVIII of the Social Security Act (42
            U.S.C. 1395 et seq.) and enrolled under part B of such title,
            but not enrolled under part C of such title.
                (4) Program.--The term ``program'' means the program
            conducted under this section.
                (5) Readmission.--The term ``readmission'' has the meaning
            given such term in section 1886(q)(5)(E) of the Social Security
            Act, as added by section 3025.
                (6) Secretary.--The term ``Secretary'' means the Secretary
            of Health and Human Services.
        (c) Requirements.--
                (1) Duration.--
                        (A) In general.--The program shall be conducted for
                    a 5-year period, beginning January 1, 2011.
                        (B) Expansion.--The Secretary may expand the
                    duration and the scope of the program, to the extent
                    determined appropriate by the Secretary, if the
                    Secretary determines (and the Chief Actuary of the
                    Centers for Medicare & Medicaid Services, with respect
                    to spending under this title, certifies) that such
                    expansion would reduce spending under this title
                    without reducing quality.
                (2) Application; participation.--
                        (A) In general.--
                                (i) Application.--An eligible entity
                            seeking to participate in the program shall
                            submit an application to the Secretary at such
                            time, in such manner, and containing such
                            information as the Secretary may require.
                                (ii) Partnership.--If an eligible entity is
                            a hospital, such hospital shall enter into a
                            partnership with a community-based organization
                            to participate in the program.
                        (B) Intervention proposal.--Subject to subparagraph
                    (C), an application submitted under subparagraph (A)(i)
                    shall include a detailed proposal for at least 1 care
                    transition intervention, which may include the
                    following:
                                (i) Initiating care transition services for
                            a high-risk Medicare beneficiary not later than
                            24 hours prior to the discharge of the
                            beneficiary from the eligible entity.
                                (ii) Arranging timely post-discharge
                            follow-up services to the high-risk Medicare
                            beneficiary to provide the beneficiary (and, as
                            appropriate, the primary caregiver of the
                            beneficiary) with information regarding
                            responding to symptoms that may indicate
                            additional health problems or a deteriorating
                            condition.
                                (iii) Providing the high-risk Medicare
                            beneficiary (and, as appropriate, the primary
                            caregiver of the beneficiary) with assistance
                            to ensure productive and timely interactions
                            between patients and post-acute and outpatient
                            providers.
                                (iv) Assessing and actively engaging with a
                            high-risk Medicare beneficiary (and, as
                            appropriate, the primary caregiver of the
                            beneficiary) through the provision of self-
                            management support and relevant information
                            that is specific to the beneficiary's
                            condition.
                                (v) Conducting comprehensive medication
                            review and management (including, if
                            appropriate, counseling and self-management
                            support).
                        (C) Limitation.--A care transition intervention
                    proposed under subparagraph (B) may not include payment
                    for services required under the discharge planning
                    process described in section 1861(ee) of the Social
                    Security Act (42 U.S.C. 1395x(ee)).
                (3) Selection.--In selecting eligible entities to
            participate in the program, the Secretary shall give priority
            to eligible entities that--
                        (A) participate in a program administered by the
                    Administration on Aging to provide concurrent care
                    transitions interventions with multiple hospitals and
                    practitioners; or
                        (B) provide services to medically underserved
                    populations, small communities, and rural areas.
        (d) Implementation.--Notwithstanding any other provision of law,
    the Secretary may implement the provisions of this section by program
    instruction or otherwise.
        (e) Waiver Authority.--The Secretary may waive such requirements of
    titles XI and XVIII of the Social Security Act as may be necessary to
    carry out the program.
        (f) Funding.--For purposes of carrying out this section, the
    Secretary of Health and Human Services shall provide for the transfer,
    from the Federal Hospital Insurance Trust Fund under section 1817 of
    the Social Security Act (42 U.S.C. 1395i) and the Federal Supplementary
    Medical Insurance Trust Fund under section 1841 of such Act (42 U.S.C.
    1395t), in such proportion as the Secretary determines appropriate, of
    $500,000,000, to the Centers for Medicare & Medicaid Services Program
    Management Account for the period of fiscal years 2011 through 2015.
    Amounts transferred under the preceding sentence shall remain available
    until expended.

    SEC. 3027. EXTENSION OF GAINSHARING DEMONSTRATION.

        (a) In General.--Subsection (d)(3) of section 5007 of the Deficit
    Reduction Act of 2005 (Public Law 109-171) is amended by inserting
    ``(or September 30, 2011, in the case of a demonstration project in
    operation as of October 1, 2008)'' after ``December 31, 2009''.
        (b) Funding.--
                (1) In general.--Subsection (f)(1) of such section is
            amended by inserting ``and for fiscal year 2010, $1,600,000,''
            after ``$6,000,000,''.
                (2) Availability.--Subsection (f)(2) of such section is
            amended by striking ``2010'' and inserting ``2014 or until
            expended''.
        (c) Reports.--
                (1) Quality improvement and savings.--Subsection (e)(3) of
            such section is amended by striking ``December 1, 2008'' and
            inserting ``March 31, 2011''.
                (2) Final report.--Subsection (e)(4) of such section is
            amended by striking ``May 1, 2010'' and inserting ``March 31,
            2013''.

           Subtitle B--Improving Medicare for Patients and Providers

        PART I--ENSURING BENEFICIARY ACCESS TO PHYSICIAN CARE AND OTHER
                                    SERVICES

    SEC. 3101. INCREASE IN THE PHYSICIAN PAYMENT UPDATE.

        Section 1848(d) of the Social Security Act (42 U.S.C. 1395w-4(d))
    is amended by adding at the end the following new paragraph:
                ``(10) Update for 2010.--
                        ``(A) In general.--Subject to paragraphs (7)(B),
                    (8)(B), and (9)(B), in lieu of the update to the single
                    conversion factor established in paragraph (1)(C) that
                    would otherwise apply for 2010, the update to the
                    single conversion factor shall be 0.5 percent.
                        ``(B) No effect on computation of conversion factor
                    for 2011 and subsequent years.--The conversion factor
                    under this subsection shall be computed under paragraph
                    (1)(A) for 2011 and subsequent years as if subparagraph
                    (A) had never applied.''.

    SEC. 3102. EXTENSION OF THE WORK GEOGRAPHIC INDEX FLOOR AND REVISIONS
                  TO THE PRACTICE EXPENSE GEOGRAPHIC ADJUSTMENT UNDER THE
                  MEDICARE PHYSICIAN FEE SCHEDULE.

        (a) Extension of Work GPCI Floor.--Section 1848(e)(1)(E) of the
    Social Security Act (42 U.S.C. 1395w-4(e)(1)(E)) is amended by striking
    ``before January 1, 2010'' and inserting ``before January 1, 2011''.
        (b) Practice Expense Geographic Adjustment for 2010 and Subsequent
    Years.--Section 1848(e)(1) of the Social Security Act (42 U.S.C.
    1395w4(e)(1)) is amended--
                (1) in subparagraph (A), by striking ``and (G)'' and
            inserting ``(G), and (H)''; and
                (2) by adding at the end the following new subparagraph:
                        ``(H) Practice expense geographic adjustment for
                    2010 and subsequent years.--
                                ``(i) For 2010.--Subject to clause (iii),
                            for services furnished during 2010, the
                            employee wage and rent portions of the practice
                            expense geographic index described in
                            subparagraph (A)(i) shall reflect \3/4\ of the
                            difference between the relative costs of
                            employee wages and rents in each of the
                            different fee schedule areas and the national
                            average of such employee wages and rents.
                                ``(ii) For 2011.--Subject to clause (iii),
                            for services furnished during 2011, the
                            employee wage and rent portions of the practice
                            expense geographic index described in
                            subparagraph (A)(i) shall reflect \1/2\ of the
                            difference between the relative costs of
                            employee wages and rents in each of the
                            different fee schedule areas and the national
                            average of such employee wages and rents.
                                ``(iii) Hold harmless.--The practice
                            expense portion of the geographic adjustment
                            factor applied in a fee schedule area for
                            services furnished in 2010 or 2011 shall not,
                            as a result of the application of clause (i) or
                            (ii), be reduced below the practice expense
                            portion of the geographic adjustment factor
                            under subparagraph (A)(i) (as calculated prior
                            to the application of such clause (i) or (ii),
                            respectively) for such area for such year.
                                ``(iv) Analysis.--The Secretary shall
                            analyze current methods of establishing
                            practice expense geographic adjustments under
                            subparagraph (A)(i) and evaluate data that
                            fairly and reliably establishes distinctions in
                            the costs of operating a medical practice in
                            the different fee schedule areas. Such analysis
                            shall include an evaluation of the following:
                                        ``(I) The feasibility of using
                                    actual data or reliable survey data
                                    developed by medical organizations on
                                    the costs of operating a medical
                                    practice, including office rents and
                                    non-physician staff wages, in different
                                    fee schedule areas.
                                        ``(II) The office expense portion
                                    of the practice expense geographic
                                    adjustment described in subparagraph
                                    (A)(i), including the extent to which
                                    types of office expenses are determined
                                    in local markets instead of national
                                    markets.
                                        ``(III) The weights assigned to
                                    each of the categories within the
                                    practice expense geographic adjustment
                                    described in subparagraph (A)(i).
                                ``(v) Revision for 2012 and subsequent
                            years.--As a result of the analysis described
                            in clause (iv), the Secretary shall, not later
                            than January 1, 2012, make appropriate
                            adjustments to the practice expense geographic
                            adjustment described in subparagraph (A)(i) to
                            ensure accurate geographic adjustments across
                            fee schedule areas, including--
                                        ``(I) basing the office rents
                                    component and its weight on office
                                    expenses that vary among fee schedule
                                    areas; and
                                        ``(II) considering a representative
                                    range of professional and non-
                                    professional personnel employed in a
                                    medical office based on the use of the
                                    American Community Survey data or other
                                    reliable data for wage adjustments.
                            Such adjustments shall be made without regard
                            to adjustments made pursuant to clauses (i) and
                            (ii) and shall be made in a budget neutral
                            manner.''.

    SEC. 3103. EXTENSION OF EXCEPTIONS PROCESS FOR MEDICARE THERAPY CAPS.

        Section 1833(g)(5) of the Social Security Act (42 U.S.C.
    1395l(g)(5)) is amended by striking ``December 31, 2009'' and inserting
    ``December 31, 2010''.

    SEC. 3104. EXTENSION OF PAYMENT FOR TECHNICAL COMPONENT OF CERTAIN
                  PHYSICIAN PATHOLOGY SERVICES.

        Section 542(c) of the Medicare, Medicaid, and SCHIP Benefits
    Improvement and Protection Act of 2000 (as enacted into law by section
    1(a)(6) of Public Law 106-554), as amended by section 732 of the
    Medicare Prescription Drug, Improvement, and Modernization Act of 2003
    (42 U.S.C. 1395w-4 note), section 104 of division B of the Tax Relief
    and Health Care Act of 2006 (42 U.S.C. 1395w-4 note), section 104 of
    the Medicare, Medicaid, and SCHIP Extension Act of 2007 (Public Law
    110-173), and section 136 of the Medicare Improvements for Patients and
    Providers Act of 2008 (Public Law 110-275), is amended by striking
    ``and 2009'' and inserting ``2009, and 2010''.

    SEC. 3105. EXTENSION OF AMBULANCE ADD-ONS.

        (a) Ground Ambulance.--Section 1834(l)(13)(A) of the Social
    Security Act (42 U.S.C. 1395m(l)(13)(A)) is amended--
                (1) in the matter preceding clause (i)--
                        (A) by striking ``2007, and for'' and inserting
                    ``2007, for''; and
                        (B) by striking ``2010'' and inserting ``2010, and
                    for such services furnished on or after April 1, 2010,
                    and before January 1, 2011,''; and
                (2) in each of clauses (i) and (ii), by inserting ``, and
            on or after April 1, 2010, and before January 1, 2011'' after
            ``January 1, 2010'' each place it appears.
        (b) Air Ambulance.--Section 146(b)(1) of the Medicare Improvements
    for Patients and Providers Act of 2008 (Public Law 110-275) is amended
    by striking ``December 31, 2009'' and inserting ``December 31, 2009,
    and during the period beginning on April 1, 2010, and ending on January
    1, 2011''.
        (c) Super Rural Ambulance.--Section 1834(l)(12)(A) of the Social
    Security Act (42 U.S.C. 1395m(l)(12)(A)) is amended by striking
    ``2010'' and inserting ``2010, and on or after April 1, 2010, and
    before January 1, 2011''.

    SEC. 3106. EXTENSION OF CERTAIN PAYMENT RULES FOR LONG-TERM CARE
                  HOSPITAL SERVICES AND OF MORATORIUM ON THE ESTABLISHMENT
                  OF CERTAIN HOSPITALS AND FACILITIES.

        (a) Extension of Certain Payment Rules.--Section 114(c) of the
    Medicare, Medicaid, and SCHIP Extension Act of 2007 (42 U.S.C. 1395ww
    note), as amended by section 4302(a) of the American Recovery and
    Reinvestment Act (Public Law 111-5), is further amended by striking
    ``3-year period'' each place it appears and inserting ``4-year
    period''.
        (b) Extension of Moratorium.--Section 114(d)(1) of such Act (42
    U.S.C. 1395ww note), in the matter preceding subparagraph (A), is
    amended by striking ``3-year period'' and inserting ``4-year period''.

    SEC. 3107. EXTENSION OF PHYSICIAN FEE SCHEDULE MENTAL HEALTH ADD-ON.

        Section 138(a)(1) of the Medicare Improvements for Patients and
    Providers Act of 2008 (Public Law 110-275) is amended by striking
    ``December 31, 2009'' and inserting ``December 31, 2010''.

    SEC. 3108. PERMITTING PHYSICIAN ASSISTANTS TO ORDER POST-HOSPITAL
                  EXTENDED CARE SERVICES.

        (a) Ordering Post-Hospital Extended Care Services.--
                (1) In general.--Section 1814(a)(2) of the Social Security
            Act (42 U.S.C. 1395f(a)(2)), in the matter preceding
            subparagraph (A), is amended by striking ``or clinical nurse
            specialist'' and inserting ``, a clinical nurse specialist, or
            a physician assistant (as those terms are defined in section
            1861(aa)(5))'' after ``nurse practitioner''.
                (2) Conforming amendment.--Section 1814(a) of the Social
            Security Act (42 U.S.C. 1395f(a)) is amended, in the second
            sentence, by striking ``or clinical nurse specialist'' and
            inserting ``clinical nurse specialist, or physician assistant''
            after ``nurse practitioner,''.
        (b) Effective Date.--The amendments made by this section shall
    apply to items and services furnished on or after January 1, 2011.

    SEC. 3109. EXEMPTION OF CERTAIN PHARMACIES FROM ACCREDITATION
                  REQUIREMENTS.

        (a) In General.--Section 1834(a)(20) of the Social Security Act (42
    U.S.C. 1395m(a)(20)), as added by section 154(b)(1)(A) of the Medicare
    Improvements for Patients and Providers Act of 2008 (Public Law 100-
    275), is amended--
                (1) in subparagraph (F)(i)--
                        (A) by inserting ``and subparagraph (G)'' after
                    ``clause (ii)''; and
                        (B) by inserting ``, except that the Secretary
                    shall not require a pharmacy to have submitted to the
                    Secretary such evidence of accreditation prior to
                    January 1, 2011'' before the semicolon at the end; and
                (2) by adding at the end the following new subparagraph:
                        ``(G) Application of accreditation requirement to
                    certain pharmacies.--
                                ``(i) In general.--With respect to items
                            and services furnished on or after January 1,
                            2011, in implementing quality standards under
                            this paragraph--
                                        ``(I) subject to subclause (II), in
                                    applying such standards and the
                                    accreditation requirement of
                                    subparagraph (F)(i) with respect to
                                    pharmacies described in clause (ii)
                                    furnishing such items and services,
                                    such standards and accreditation
                                    requirement shall not apply to such
                                    pharmacies; and
                                        ``(II) the Secretary may apply to
                                    such pharmacies an alternative
                                    accreditation requirement established
                                    by the Secretary if the Secretary
                                    determines such alternative
                                    accreditation requirement is more
                                    appropriate for such pharmacies.
                                ``(ii) Pharmacies described.--A pharmacy
                            described in this clause is a pharmacy that
                            meets each of the following criteria:
                                        ``(I) The total billings by the
                                    pharmacy for such items and services
                                    under this title are less than 5
                                    percent of total pharmacy sales, as
                                    determined based on the average total
                                    pharmacy sales for the previous 3
                                    calendar years, 3 fiscal years, or
                                    other yearly period specified by the
                                    Secretary.
                                        ``(II) The pharmacy has been
                                    enrolled under section 1866(j) as a
                                    supplier of durable medical equipment,
                                    prosthetics, orthotics, and supplies,
                                    has been issued (which may include the
                                    renewal of) a provider number for at
                                    least 5 years, and for which a final
                                    adverse action (as defined in section
                                    424.57(a) of title 42, Code of Federal
                                    Regulations) has not been imposed in
                                    the past 5 years.
                                        ``(III) The pharmacy submits to the
                                    Secretary an attestation, in a form and
                                    manner, and at a time, specified by the
                                    Secretary, that the pharmacy meets the
                                    criteria described in subclauses (I)
                                    and (II). Such attestation shall be
                                    subject to section 1001 of title 18,
                                    United States Code.
                                        ``(IV) The pharmacy agrees to
                                    submit materials as requested by the
                                    Secretary, or during the course of an
                                    audit conducted on a random sample of
                                    pharmacies selected annually, to verify
                                    that the pharmacy meets the criteria
                                    described in subclauses (I) and (II).
                                    Materials submitted under the preceding
                                    sentence shall include a certification
                                    by an accountant on behalf of the
                                    pharmacy or the submission of tax
                                    returns filed by the pharmacy during
                                    the relevant periods, as requested by
                                    the Secretary.''.
        (b) Administration.--Notwithstanding any other provision of law,
    the Secretary may implement the amendments made by subsection (a) by
    program instruction or otherwise.
        (c) Rule of Construction.--Nothing in the provisions of or
    amendments made by this section shall be construed as affecting the
    application of an accreditation requirement for pharmacies to qualify
    for bidding in a competitive acquisition area under section 1847 of the
    Social Security Act (42 U.S.C. 1395w-3).

    SEC. 3110. PART B SPECIAL ENROLLMENT PERIOD FOR DISABLED TRICARE
                  BENEFICIARIES.

        (a) In General.--
                (1) In general.--Section 1837 of the Social Security Act
            (42 U.S.C. 1395p) is amended by adding at the end the following
            new subsection:
        ``(l)(1) In the case of any individual who is a covered beneficiary
    (as defined in section 1072(5) of title 10, United States Code) at the
    time the individual is entitled to part A under section 226(b) or
    section 226A and who is eligible to enroll but who has elected not to
    enroll (or to be deemed enrolled) during the individual's initial
    enrollment period, there shall be a special enrollment period described
    in paragraph (2).
        ``(2) The special enrollment period described in this paragraph,
    with respect to an individual, is the 12-month period beginning on the
    day after the last day of the initial enrollment period of the
    individual or, if later, the 12-month period beginning with the month
    the individual is notified of enrollment under this section.
        ``(3) In the case of an individual who enrolls during the special
    enrollment period provided under paragraph (1), the coverage period
    under this part shall begin on the first day of the month in which the
    individual enrolls, or, at the option of the individual, the first
    month after the end of the individual's initial enrollment period.
        ``(4) An individual may only enroll during the special enrollment
    period provided under paragraph (1) one time during the individual's
    lifetime.
        ``(5) The Secretary shall ensure that the materials relating to
    coverage under this part that are provided to an individual described
    in paragraph (1) prior to the individual's initial enrollment period
    contain information concerning the impact of not enrolling under this
    part, including the impact on health care benefits under the TRICARE
    program under chapter 55 of title 10, United States Code.
        ``(6) The Secretary of Defense shall collaborate with the Secretary
    of Health and Human Services and the Commissioner of Social Security to
    provide for the accurate identification of individuals described in
    paragraph (1). The Secretary of Defense shall provide such individuals
    with notification with respect to this subsection. The Secretary of
    Defense shall collaborate with the Secretary of Health and Human
    Services and the Commissioner of Social Security to ensure appropriate
    follow up pursuant to any notification provided under the preceding
    sentence.''.
                (2) Effective date.--The amendment made by paragraph (1)
            shall apply to elections made with respect to initial
            enrollment periods that end after the date of the enactment of
            this Act.
        (b) Waiver of Increase of Premium.--Section 1839(b) of the Social
    Security Act (42 U.S.C. 1395r(b)) is amended by striking ``section
    1837(i)(4)'' and inserting ``subsection (i)(4) or (l) of section
    1837''.

    SEC. 3111. PAYMENT FOR BONE DENSITY TESTS.

        (a) Payment.--
                (1) In general.--Section 1848 of the Social Security Act
            (42 U.S.C. 1395w-4) is amended--
                        (A) in subsection (b)--
                                (i) in paragraph (4)(B), by inserting ``,
                            and for 2010 and 2011, dual-energy x-ray
                            absorptiometry services (as described in
                            paragraph (6))'' before the period at the end;
                            and
                                (ii) by adding at the end the following new
                            paragraph:
                ``(6) Treatment of bone mass scans.--For dual-energy x-ray
            absorptiometry services (identified in 2006 by HCPCS codes
            76075 and 76077 (and any succeeding codes)) furnished during
            2010 and 2011, instead of the payment amount that would
            otherwise be determined under this section for such years, the
            payment amount shall be equal to 70 percent of the product of--
                        ``(A) the relative value for the service (as
                    determined in subsection (c)(2)) for 2006;
                        ``(B) the conversion factor (established under
                    subsection (d)) for 2006; and
                        ``(C) the geographic adjustment factor (established
                    under subsection (e)(2)) for the service for the fee
                    schedule area for 2010 and 2011, respectively.''; and
                        (B) in subsection (c)(2)(B)(iv)--
                                (i) in subclause (II), by striking ``and''
                            at the end;
                                (ii) in subclause (III), by striking the
                            period at the end and inserting ``; and''; and
                                (iii) by adding at the end the following
                            new subclause:
                                        ``(IV) subsection (b)(6) shall not
                                    be taken into account in applying
                                    clause (ii)(II) for 2010 or 2011.''.
                (2) Implementation.--Notwithstanding any other provision of
            law, the Secretary may implement the amendments made by
            paragraph (1) by program instruction or otherwise.
        (b) Study and Report by the Institute of Medicine.--
                (1) In general.--The Secretary of Health and Human Services
            is authorized to enter into an agreement with the Institute of
            Medicine of the National Academies to conduct a study on the
            ramifications of Medicare payment reductions for dual-energy x-
            ray absorptiometry (as described in section 1848(b)(6) of the
            Social Security Act, as added by subsection (a)(1)) during
            2007, 2008, and 2009 on beneficiary access to bone mass density
            tests.
                (2) Report.--An agreement entered into under paragraph (1)
            shall provide for the Institute of Medicine to submit to the
            Secretary and to Congress a report containing the results of
            the study conducted under such paragraph.

    SEC. 3112. REVISION TO THE MEDICARE IMPROVEMENT FUND.

        Section 1898(b)(1)(A) of the Social Security Act (42 U.S.C.
    1395iii) is amended by striking ``$22,290,000,000'' and inserting
    ``$0''.

    SEC. 3113. TREATMENT OF CERTAIN COMPLEX DIAGNOSTIC LABORATORY TESTS.

        (a) Demonstration Project.--
                (1) In general.--The Secretary of Health and Human Services
            (in this section referred to as the ``Secretary'') shall
            conduct a demonstration project under part B title XVIII of the
            Social Security Act under which separate payments are made
            under such part for complex diagnostic laboratory tests
            provided to individuals under such part. Under the
            demonstration project, the Secretary shall establish
            appropriate payment rates for such tests.
                (2) Covered complex diagnostic laboratory test defined.--In
            this section, the term ``complex diagnostic laboratory test''
            means a diagnostic laboratory test--
                        (A) that is an analysis of gene protein expression,
                    topographic genotyping, or a cancer chemotherapy
                    sensitivity assay;
                        (B) that is determined by the Secretary to be a
                    laboratory test for which there is not an alternative
                    test having equivalent performance characteristics;
                        (C) which is billed using a Health Care Procedure
                    Coding System (HCPCS) code other than a not otherwise
                    classified code under such Coding System;
                        (D) which is approved or cleared by the Food and
                    Drug Administration or is covered under title XVIII of
                    the Social Security Act; and
                        (E) is described in section 1861(s)(3) of the
                    Social Security Act (42 U.S.C. 1395x(s)(3)).
                (3) Separate payment defined.--In this section, the term
            ``separate payment'' means direct payment to a laboratory
            (including a hospital-based or independent laboratory) that
            performs a complex diagnostic laboratory test with respect to a
            specimen collected from an individual during a period in which
            the individual is a patient of a hospital if the test is
            performed after such period of hospitalization and if separate
            payment would not otherwise be made under title XVIII of the
            Social Security Act by reason of sections 1862(a)(14) and
            1866(a)(1)(H)(i) of the such Act (42 U.S.C. 1395y(a)(14); 42
            U.S.C. 1395cc(a)(1)(H)(i)).
        (b) Duration.--Subject to subsection (c)(2), the Secretary shall
    conduct the demonstration project under this section for the 2-year
    period beginning on July 1, 2011.
        (c) Payments and Limitation.--Payments under the demonstration
    project under this section shall--
                (1) be made from the Federal Supplemental Medical Insurance
            Trust Fund under section 1841 of the Social Security Act (42
            U.S.C. 1395t); and
                (2) may not exceed $100,000,000.
        (d) Report.--Not later than 2 years after the completion of the
    demonstration project under this section, the Secretary shall submit to
    Congress a report on the project. Such report shall include--
                (1) an assessment of the impact of the demonstration
            project on access to care, quality of care, health outcomes,
            and expenditures under title XVIII of the Social Security Act
            (including any savings under such title); and
                (2) such recommendations as the Secretary determines
            appropriate.
        (e) Implementation Funding.--For purposes of administering this
    section (including preparing and submitting the report under subsection
    (d)), the Secretary shall provide for the transfer, from the Federal
    Supplemental Medical Insurance Trust Fund under section 1841 of the
    Social Security Act (42 U.S.C. 1395t), to the Centers for Medicare &
    Medicaid Services Program Management Account, of $5,000,000. Amounts
    transferred under the preceding sentence shall remain available until
    expended.

    SEC. 3114. IMPROVED ACCESS FOR CERTIFIED NURSE-MIDWIFE SERVICES.

        Section 1833(a)(1)(K) of the Social Security Act (42 U.S.C.
    1395l(a)(1)(K)) is amended by inserting ``(or 100 percent for services
    furnished on or after January 1, 2011)'' after ``1992, 65 percent''.

                           PART II--RURAL PROTECTIONS

    SEC. 3121. EXTENSION OF OUTPATIENT HOLD HARMLESS PROVISION.

        (a) In General.--Section 1833(t)(7)(D)(i) of the Social Security
    Act (42 U.S.C. 1395l(t)(7)(D)(i)) is amended--
                (1) in subclause (II)--
                        (A) in the first sentence, by striking ``2010''and
                    inserting ``2011''; and
                        (B) in the second sentence, by striking ``or 2009''
                    and inserting ``, 2009, or 2010''; and
                (2) in subclause (III), by striking ``January 1, 2010'' and
            inserting ``January 1, 2011''.
        (b) Permitting All Sole Community Hospitals To Be Eligible for Hold
    Harmless.--Section 1833(t)(7)(D)(i)(III) of the Social Security Act (42
    U.S.C. 1395l(t)(7)(D)(i)(III)) is amended by adding at the end the
    following new sentence: ``In the case of covered OPD services furnished
    on or after January 1, 2010, and before January 1, 2011, the preceding
    sentence shall be applied without regard to the 100-bed limitation.''.

    SEC. 3122. EXTENSION OF MEDICARE REASONABLE COSTS PAYMENTS FOR CERTAIN
                  CLINICAL DIAGNOSTIC LABORATORY TESTS FURNISHED TO
                  HOSPITAL PATIENTS IN CERTAIN RURAL AREAS.

        Section 416(b) of the Medicare Prescription Drug, Improvement, and
    Modernization Act of 2003 (42 U.S.C. 1395l-4), as amended by section
    105 of division B of the Tax Relief and Health Care Act of 2006 (42
    U.S.C. 1395l note) and section 107 of the Medicare, Medicaid, and SCHIP
    Extension Act of 2007 (42 U.S.C. 1395l note), is amended by inserting
    ``or during the 1-year period beginning on July 1, 2010'' before the
    period at the end.

    SEC. 3123. EXTENSION OF THE RURAL COMMUNITY HOSPITAL DEMONSTRATION
                  PROGRAM.

        (a) One-year Extension.--Section 410A of the Medicare Prescription
    Drug, Improvement, and Modernization Act of 2003 (Public Law 108-173;
    117 Stat. 2272) is amended by adding at the end the following new
    subsection:
        ``(g) One-Year Extension of Demonstration Program.--
                ``(1) In general.--Subject to the succeeding provisions of
            this subsection, the Secretary shall conduct the demonstration
            program under this section for an additional 1-year period (in
            this section referred to as the `1-year extension period') that
            begins on the date immediately following the last day of the
            initial 5-year period under subsection (a)(5).
                ``(2) Expansion of demonstration states.--Notwithstanding
            subsection (a)(2), during the 1-year extension period, the
            Secretary shall expand the number of States with low population
            densities determined by the Secretary under such subsection to
            20. In determining which States to include in such expansion,
            the Secretary shall use the same criteria and data that the
            Secretary used to determine the States under such subsection
            for purposes of the initial 5-year period.
                ``(3) Increase in maximum number of hospitals participating
            in the demonstration program.--Notwithstanding subsection
            (a)(4), during the 1-year extension period, not more than 30
            rural community hospitals may participate in the demonstration
            program under this section.
                ``(4) No affect on hospitals in demonstration program on
            date of enactment.--In the case of a rural community hospital
            that is participating in the demonstration program under this
            section as of the last day of the initial 5-year period, the
            Secretary shall provide for the continued participation of such
            rural community hospital in the demonstration program during
            the 1-year extension period unless the rural community hospital
            makes an election, in such form and manner as the Secretary may
            specify, to discontinue such participation.''.
        (b) Conforming Amendments.--Subsection (a)(5) of section 410A of
    the Medicare Prescription Drug, Improvement, and Modernization Act of
    2003 (Public Law 108-173; 117 Stat. 2272) is amended by inserting ``(in
    this section referred to as the `initial 5-year period') and, as
    provided in subsection (g), for the 1-year extension period'' after
    ``5-year period''.
        (c) Technical Amendments.--
                (1) Subsection (b) of section 410A of the Medicare
            Prescription Drug, Improvement, and Modernization Act of 2003
            (Public Law 108-173; 117 Stat. 2272) is amended--
                        (A) in paragraph (1)(B)(ii), by striking ``2)'' and
                    inserting ``2))''; and
                        (B) in paragraph (2), by inserting ``cost'' before
                    ``reporting period'' the first place such term appears
                    in each of subparagraphs (A) and (B).
                (2) Subsection (f)(1) of section 410A of the Medicare
            Prescription Drug, Improvement, and Modernization Act of 2003
            (Public Law 108-173; 117 Stat. 2272) is amended--
                        (A) in subparagraph (A)(ii), by striking
                    ``paragraph (2)'' and inserting ``subparagraph (B)'';
                    and
                        (B) in subparagraph (B), by striking ``paragraph
                    (1)(B)'' and inserting ``subparagraph (A)(ii)''.

    SEC. 3124. EXTENSION OF THE MEDICARE-DEPENDENT HOSPITAL (MDH) PROGRAM.

        (a) Extension of Payment Methodology.--Section 1886(d)(5)(G) of the
    Social Security Act (42 U.S.C. 1395ww(d)(5)(G)) is amended--
                (1) in clause (i), by striking ``October 1, 2011'' and
            inserting ``October 1, 2012''; and
                (2) in clause (ii)(II), by striking ``October 1, 2011'' and
            inserting ``October 1, 2012''.
        (b) Conforming Amendments.--
                (1) Extension of target amount.--Section 1886(b)(3)(D) of
            the Social Security Act (42 U.S.C. 1395ww(b)(3)(D)) is
            amended--
                        (A) in the matter preceding clause (i), by striking
                    ``October 1, 2011'' and inserting ``October 1, 2012'';
                    and
                        (B) in clause (iv), by striking ``through fiscal
                    year 2011'' and inserting ``through fiscal year 2012''.
                (2) Permitting hospitals to decline reclassification.--
            Section 13501(e)(2) of the Omnibus Budget Reconciliation Act of
            1993 (42 U.S.C. 1395ww note) is amended by striking ``through
            fiscal year 2011'' and inserting ``through fiscal year 2012''.

    SEC. 3125. TEMPORARY IMPROVEMENTS TO THE MEDICARE INPATIENT HOSPITAL
                  PAYMENT ADJUSTMENT FOR LOW-VOLUME HOSPITALS.

        Section 1886(d)(12) of the Social Security Act (42 U.S.C.
    1395ww(d)(12)) is amended--
                (1) in subparagraph (A), by inserting ``or (D)'' after
            ``subparagraph (B)'';
                (2) in subparagraph (B), in the matter preceding clause
            (i), by striking ``The Secretary'' and inserting ``For
            discharges occurring in fiscal years 2005 through 2010 and for
            discharges occurring in fiscal year 2013 and subsequent fiscal
            years, the Secretary'';
                (3) in subparagraph (C)(i)--
                        (A) by inserting ``(or, with respect to fiscal
                    years 2011 and 2012, 15 road miles)'' after ``25 road
                    miles''; and
                        (B) by inserting ``(or, with respect to fiscal
                    years 2011 and 2012, 1,500 discharges of individuals
                    entitled to, or enrolled for, benefits under part A)''
                    after ``800 discharges''; and
                (4) by adding at the end the following new subparagraph:
                        ``(D) Temporary applicable percentage increase.--
                    For discharges occurring in fiscal years 2011 and 2012,
                    the Secretary shall determine an applicable percentage
                    increase for purposes of subparagraph (A) using a
                    continuous linear sliding scale ranging from 25 percent
                    for low-volume hospitals with 200 or fewer discharges
                    of individuals entitled to, or enrolled for, benefits
                    under part A in the fiscal year to 0 percent for low-
                    volume hospitals with greater than 1,500 discharges of
                    such individuals in the fiscal year.''.

    SEC. 3126. IMPROVEMENTS TO THE DEMONSTRATION PROJECT ON COMMUNITY
                  HEALTH INTEGRATION MODELS IN CERTAIN RURAL COUNTIES.

        (a) Removal of Limitation on Number of Eligible Counties
    Selected.--Subsection (d)(3) of section 123 of the Medicare
    Improvements for Patients and Providers Act of 2008 (42 U.S.C. 1395i-4
    note) is amended by striking ``not more than 6''.
        (b) Removal of References to Rural Health Clinic Services and
    Inclusion of Physicians' Services in Scope of Demonstration Project.--
    Such section 123 is amended--
                (1) in subsection (d)(4)(B)(i)(3), by striking subclause
            (III); and
                (2) in subsection (j)--
                        (A) in paragraph (8), by striking subparagraph (B)
                    and inserting the following:
                        ``(B) Physicians' services (as defined in section
                    1861(q) of the Social Security Act (42 U.S.C.
                    1395x(q)).'';
                        (B) by striking paragraph (9); and
                        (C) by redesignating paragraph (10) as paragraph
                    (9).

    SEC. 3127. MEDPAC STUDY ON ADEQUACY OF MEDICARE PAYMENTS FOR HEALTH
                  CARE PROVIDERS SERVING IN RURAL AREAS.

        (a) Study.--The Medicare Payment Advisory Commission shall conduct
    a study on the adequacy of payments for items and services furnished by
    providers of services and suppliers in rural areas under the Medicare
    program under title XVIII of the Social Security Act (42 U.S.C. 1395 et
    seq.). Such study shall include an analysis of--
                (1) any adjustments in payments to providers of services
            and suppliers that furnish items and services in rural areas;
                (2) access by Medicare beneficiaries to items and services
            in rural areas;
                (3) the adequacy of payments to providers of services and
            suppliers that furnish items and services in rural areas; and
                (4) the quality of care furnished in rural areas.
        (b) Report.--Not later than January 1, 2011, the Medicare Payment
    Advisory Commission shall submit to Congress a report containing the
    results of the study conducted under subsection (a). Such report shall
    include recommendations on appropriate modifications to any adjustments
    in payments to providers of services and suppliers that furnish items
    and services in rural areas, together with recommendations for such
    legislation and administrative action as the Medicare Payment Advisory
    Commission determines appropriate.

    SEC. 3128. TECHNICAL CORRECTION RELATED TO CRITICAL ACCESS HOSPITAL
                  SERVICES.

        (a) In General.--Subsections (g)(2)(A) and (l)(8) of section 1834
    of the Social Security Act (42 U.S.C. 1395m) are each amended by
    inserting ``101 percent of'' before ``the reasonable costs''.
        (b) Effective Date.--The amendments made by subsection (a) shall
    take effect as if included in the enactment of section 405(a) of the
    Medicare Prescription Drug, Improvement, and Modernization Act of 2003
    (Public Law 108-173; 117 Stat. 2266).

    SEC. 3129. EXTENSION OF AND REVISIONS TO MEDICARE RURAL HOSPITAL
                  FLEXIBILITY PROGRAM.

        (a) Authorization.--Section 1820(j) of the Social Security Act (42
    U.S.C. 1395i-4(j)) is amended--
                (1) by striking ``2010, and for'' and inserting ``2010,
            for''; and
                (2) by inserting ``and for making grants to all States
            under subsection (g), such sums as may be necessary in each of
            fiscal years 2011 and 2012, to remain available until
            expended'' before the period at the end.
        (b) Use of Funds.--Section 1820(g)(3) of the Social Security Act
    (42 U.S.C. 1395i-4(g)(3)) is amended--
                (1) in subparagraph (A), by inserting ``and to assist such
            hospitals in participating in delivery system reforms under the
            provisions of and amendments made by the Patient Protection and
            Affordable Care Act, such as value-based purchasing programs,
            accountable care organizations under section 1899, the National
            pilot program on payment bundling under section 1866D, and
            other delivery system reform programs determined appropriate by
            the Secretary'' before the period at the end; and
                (2) in subparagraph (E)--
                        (A) by striking ``, and to offset'' and inserting
                    ``, to offset''; and
                        (B) by inserting ``and to participate in delivery
                    system reforms under the provisions of and amendments
                    made by the Patient Protection and Affordable Care Act,
                    such as value-based purchasing programs, accountable
                    care organizations under section 1899, the National
                    pilot program on payment bundling under section 1866D,
                    and other delivery system reform programs determined
                    appropriate by the Secretary'' before the period at the
                    end.
        (c) Effective Date.--The amendments made by this section shall
    apply to grants made on or after January 1, 2010.

                      PART III--IMPROVING PAYMENT ACCURACY

    SEC. 3131. PAYMENT ADJUSTMENTS FOR HOME HEALTH CARE.

        (a) Rebasing Home Health Prospective Payment Amount.--
                (1) In general.--Section 1895(b)(3)(A) of the Social
            Security Act (42 U.S.C. 1395fff(b)(3)(A)) is amended--
                        (A) in clause (i)(III), by striking ``For periods''
                    and inserting ``Subject to clause (iii), for periods'';
                    and
                        (B) by adding at the end the following new clause:
                                ``(iii) Adjustment for 2013 and subsequent
                            years.--
                                        ``(I) In general.--Subject to
                                    subclause (II), for 2013 and subsequent
                                    years, the amount (or amounts) that
                                    would otherwise be applicable under
                                    clause (i)(III) shall be adjusted by a
                                    percentage determined appropriate by
                                    the Secretary to reflect such factors
                                    as changes in the number of visits in
                                    an episode, the mix of services in an
                                    episode, the level of intensity of
                                    services in an episode, the average
                                    cost of providing care per episode, and
                                    other factors that the Secretary
                                    considers to be relevant. In conducting
                                    the analysis under the preceding
                                    sentence, the Secretary may consider
                                    differences between hospital-based and
                                    freestanding agencies, between for-
                                    profit and nonprofit agencies, and
                                    between the resource costs of urban and
                                    rural agencies. Such adjustment shall
                                    be made before the update under
                                    subparagraph (B) is applied for the
                                    year.
                                        ``(II) Transition.--The Secretary
                                    shall provide for a 4-year phase-in (in
                                    equal increments) of the adjustment
                                    under subclause (I), with such
                                    adjustment being fully implemented for
                                    2016. During each year of such phase-
                                    in, the amount of any adjustment under
                                    subclause (I) for the year may not
                                    exceed 3.5 percent of the amount (or
                                    amounts) applicable under clause
                                    (i)(III) as of the date of enactment of
                                    the Patient Protection and Affordable
                                    Care Act.''.
                (2) MedPAC study and report.--
                        (A) Study.--The Medicare Payment Advisory
                    Commission shall conduct a study on the implementation
                    of the amendments made by paragraph (1). Such study
                    shall include an analysis of the impact of such
                    amendments on--
                                (i) access to care;
                                (ii) quality outcomes;
                                (iii) the number of home health agencies;
                            and
                                (iv) rural agencies, urban agencies, for-
                            profit agencies, and nonprofit agencies.
                        (B) Report.--Not later than January 1, 2015, the
                    Medicare Payment Advisory Commission shall submit to
                    Congress a report on the study conducted under
                    subparagraph (A), together with recommendations for
                    such legislation and administrative action as the
                    Commission determines appropriate.
        (b) Program-specific Outlier Cap.--Section 1895(b) of the Social
    Security Act (42 U.S.C. 1395fff(b)) is amended--
                (1) in paragraph (3)(C), by striking ``the aggregate'' and
            all that follows through the period at the end and inserting
            ``5 percent of the total payments estimated to be made based on
            the prospective payment system under this subsection for the
            period.''; and
                (2) in paragraph (5)--
                        (A) by striking ``Outliers.--The Secretary'' and
                    inserting the following: ``Outliers.--
                        ``(A) In general.--Subject to subparagraph (B), the
                    Secretary'';
                        (B) in subparagraph (A), as added by subparagraph
                    (A), by striking ``5 percent'' and inserting ``2.5
                    percent''; and
                        (C) by adding at the end the following new
                    subparagraph:
                        ``(B) Program specific outlier cap.--The estimated
                    total amount of additional payments or payment
                    adjustments made under subparagraph (A) with respect to
                    a home health agency for a year (beginning with 2011)
                    may not exceed an amount equal to 10 percent of the
                    estimated total amount of payments made under this
                    section (without regard to this paragraph) with respect
                    to the home health agency for the year.''.
        (c) Application of the Medicare Rural Home Health Add-on Policy.--
    Section 421 of the Medicare Prescription Drug, Improvement, and
    Modernization Act of 2003 (Public Law 108-173; 117 Stat. 2283), as
    amended by section 5201(b) of the Deficit Reduction Act of 2005 (Public
    Law 109-171; 120 Stat. 46), is amended--
                (1) in the section heading, by striking ``one-year'' and
            inserting ``temporary''; and
                (2) in subsection (a)--
                        (A) by striking ``, and episodes'' and inserting
                    ``, episodes'';
                        (B) by inserting ``and episodes and visits ending
                    on or after April 1, 2010, and before January 1,
                    2016,'' after ``January 1, 2007,''; and
                        (C) by inserting ``(or, in the case of episodes and
                    visits ending on or after April 1, 2010, and before
                    January 1, 2016, 3 percent)'' before the period at the
                    end.
        (d) Study and Report on the Development of Home Health Payment
    Reforms in Order To Ensure Access to Care and Quality Services.--
                (1) In general.--The Secretary of Health and Human Services
            (in this section referred to as the ``Secretary'') shall
            conduct a study to evaluate the costs and quality of care among
            efficient home health agencies relative to other such agencies
            in providing ongoing access to care and in treating Medicare
            beneficiaries with varying severity levels of illness. Such
            study shall include an analysis of the following:
                        (A) Methods to revise the home health prospective
                    payment system under section 1895 of the Social
                    Security Act (42 U.S.C. 1395fff) to more accurately
                    account for the costs related to patient severity of
                    illness or to improving beneficiary access to care,
                    including--
                                (i) payment adjustments for services that
                            may be under- or over-valued;
                                (ii) necessary changes to reflect the
                            resource use relative to providing home health
                            services to low-income Medicare beneficiaries
                            or Medicare beneficiaries living in medically
                            underserved areas;
                                (iii) ways the outlier payment may be
                            improved to more accurately reflect the cost of
                            treating Medicare beneficiaries with high
                            severity levels of illness;
                                (iv) the role of quality of care incentives
                            and penalties in driving provider and patient
                            behavior;
                                (v) improvements in the application of a
                            wage index; and
                                (vi) other areas determined appropriate by
                            the Secretary.
                        (B) The validity and reliability of responses on
                    the OASIS instrument with particular emphasis on
                    questions that relate to higher payment under the home
                    health prospective payment system and higher outcome
                    scores under Home Care Compare.
                        (C) Additional research or payment revisions under
                    the home health prospective payment system that may be
                    necessary to set the payment rates for home health
                    services based on costs of high-quality and efficient
                    home health agencies or to improve Medicare beneficiary
                    access to care.
                        (D) A timetable for implementation of any
                    appropriate changes based on the analysis of the
                    matters described in subparagraphs (A), (B), and (C).
                        (E) Other areas determined appropriate by the
                    Secretary.
                (2) Considerations.--In conducting the study under
            paragraph (1), the Secretary shall consider whether certain
            factors should be used to measure patient severity of illness
            and access to care, such as--
                        (A) population density and relative patient access
                    to care;
                        (B) variations in service costs for providing care
                    to individuals who are dually eligible under the
                    Medicare and Medicaid programs;
                        (C) the presence of severe or chronic diseases, as
                    evidenced by multiple, discontinuous home health
                    episodes;
                        (D) poverty status, as evidenced by the receipt of
                    Supplemental Security Income under title XVI of the
                    Social Security Act;
                        (E) the absence of caregivers;
                        (F) language barriers;
                        (G) atypical transportation costs;
                        (H) security costs; and
                        (I) other factors determined appropriate by the
                    Secretary.
                (3) Report.--Not later than March 1, 2011, the Secretary
            shall submit to Congress a report on the study conducted under
            paragraph (1), together with recommendations for such
            legislation and administrative action as the Secretary
            determines appropriate.
                (4) Consultations.--In conducting the study under paragraph
            (1) and preparing the report under paragraph (3), the Secretary
            shall consult with--
                        (A) stakeholders representing home health agencies;
                        (B) groups representing Medicare beneficiaries;
                        (C) the Medicare Payment Advisory Commission;
                        (D) the Inspector General of the Department of
                    Health and Human Services; and
                        (E) the Comptroller General of the United States.

    SEC. 3132. HOSPICE REFORM.

        (a) Hospice Care Payment Reforms.--
                (1) In general.--Section 1814(i) of the Social Security Act
            (42 U.S.C. 1395f(i)), as amended by section 3004(c), is
            amended--
                        (A) by redesignating paragraph (6) as paragraph
                    (7); and
                        (B) by inserting after paragraph (5) the following
                    new paragraph:
                ``(6)(A) The Secretary shall collect additional data and
            information as the Secretary determines appropriate to revise
            payments for hospice care under this subsection pursuant to
            subparagraph (D) and for other purposes as determined
            appropriate by the Secretary. The Secretary shall begin to
            collect such data by not later than January 1, 2011.
                ``(B) The additional data and information to be collected
            under subparagraph (A) may include data and information on--
                        ``(i) charges and payments;
                        ``(ii) the number of days of hospice care which are
                    attributable to individuals who are entitled to, or
                    enrolled for, benefits under part A; and
                        ``(iii) with respect to each type of service
                    included in hospice care--
                                ``(I) the number of days of hospice care
                            attributable to the type of service;
                                ``(II) the cost of the type of service; and
                                ``(III) the amount of payment for the type
                            of service;
                        ``(iv) charitable contributions and other revenue
                    of the hospice program;
                        ``(v) the number of hospice visits;
                        ``(vi) the type of practitioner providing the
                    visit; and
                        ``(vii) the length of the visit and other basic
                    information with respect to the visit.
                ``(C) The Secretary may collect the additional data and
            information under subparagraph (A) on cost reports, claims, or
            other mechanisms as the Secretary determines to be appropriate.
                ``(D)(i) Notwithstanding the preceding paragraphs of this
            subsection, not earlier than October 1, 2013, the Secretary
            shall, by regulation, implement revisions to the methodology
            for determining the payment rates for routine home care and
            other services included in hospice care under this part, as the
            Secretary determines to be appropriate. Such revisions may be
            based on an analysis of data and information collected under
            subparagraph (A). Such revisions may include adjustments to per
            diem payments that reflect changes in resource intensity in
            providing such care and services during the course of the
            entire episode of hospice care.
                ``(ii) Revisions in payment implemented pursuant to clause
            (i) shall result in the same estimated amount of aggregate
            expenditures under this title for hospice care furnished in the
            fiscal year in which such revisions in payment are implemented
            as would have been made under this title for such care in such
            fiscal year if such revisions had not been implemented.
                ``(E) The Secretary shall consult with hospice programs and
            the Medicare Payment Advisory Commission regarding the
            additional data and information to be collected under
            subparagraph (A) and the payment revisions under subparagraph
            (D).''.
                (2) Conforming amendments.--Section 1814(i)(1)(C) of the
            Social Security Act (42 U.S.C. 1395f(i)(1)(C)) is amended--
                        (A) in clause (ii)--
                                (i) in the matter preceding subclause (I),
                            by inserting ``(before the first fiscal year in
                            which the payment revisions described in
                            paragraph (6)(D) are implemented)'' after
                            ``subsequent fiscal year''; and
                                (ii) in subclause (VII), by inserting
                            ``(before the first fiscal year in which the
                            payment revisions described in paragraph (6)(D)
                            are implemented), subject to clause (iv),''
                            after ``subsequent fiscal year''; and
                        (B) by adding at the end the following new clause:
                                ``(iii) With respect to routine home care
                            and other services included in hospice care
                            furnished during fiscal years subsequent to the
                            first fiscal year in which payment revisions
                            described in paragraph (6)(D) are implemented,
                            the payment rates for such care and services
                            shall be the payment rates in effect under this
                            clause during the preceding fiscal year
                            increased by, subject to clause (iv), the
                            market basket percentage increase (as defined
                            in section 1886(b)(3)(B)(iii)) for the fiscal
                            year.''.
        (b) Adoption of MedPAC Hospice Program Eligibility Recertification
    Recommendations.--Section 1814(a)(7) of the Social Security Act (42
    U.S.C. 1395f(a)(7)) is amended--
                (1) in subparagraph (B), by striking ``and'' at the end;
            and
                (2) by adding at the end the following new subparagraph:
                        ``(D) on and after January 1, 2011--
                                ``(i) a hospice physician or nurse
                            practitioner has a face-to-face encounter with
                            the individual to determine continued
                            eligibility of the individual for hospice care
                            prior to the 180th-day recertification and each
                            subsequent recertification under subparagraph
                            (A)(ii) and attests that such visit took place
                            (in accordance with procedures established by
                            the Secretary); and
                                ``(ii) in the case of hospice care provided
                            an individual for more than 180 days by a
                            hospice program for which the number of such
                            cases for such program comprises more than a
                            percent (specified by the Secretary) of the
                            total number of such cases for all programs
                            under this title, the hospice care provided to
                            such individual is medically reviewed (in
                            accordance with procedures established by the
                            Secretary); and''.

    SEC. 3133. IMPROVEMENT TO MEDICARE DISPROPORTIONATE SHARE HOSPITAL
                  (DSH) PAYMENTS.

        Section 1886 of the Social Security Act (42 U.S.C. 1395ww), as
    amended by sections 3001, 3008, and 3025, is amended--
                (1) in subsection (d)(5)(F)(i), by striking ``For'' and
            inserting ``Subject to subsection (r), for''; and
                (2) by adding at the end the following new subsection:
        ``(r) Adjustments to Medicare DSH Payments.--
                ``(1) Empirically justified dsh payments.--For fiscal year
            2015 and each subsequent fiscal year, instead of the amount of
            disproportionate share hospital payment that would otherwise be
            made under subsection (d)(5)(F) to a subsection (d) hospital
            for the fiscal year, the Secretary shall pay to the subsection
            (d) hospital 25 percent of such amount (which represents the
            empirically justified amount for such payment, as determined by
            the Medicare Payment Advisory Commission in its March 2007
            Report to the Congress).
                ``(2) Additional payment.--In addition to the payment made
            to a subsection (d) hospital under paragraph (1), for fiscal
            year 2015 and each subsequent fiscal year, the Secretary shall
            pay to such subsection (d) hospitals an additional amount equal
            to the product of the following factors:
                        ``(A) Factor one.--A factor equal to the difference
                    between--
                                ``(i) the aggregate amount of payments that
                            would be made to subsection (d) hospitals under
                            subsection (d)(5)(F) if this subsection did not
                            apply for such fiscal year (as estimated by the
                            Secretary); and
                                ``(ii) the aggregate amount of payments
                            that are made to subsection (d) hospitals under
                            paragraph (1) for such fiscal year (as so
                            estimated).
                        ``(B) Factor two.--
                                ``(i) Fiscal years 2015, 2016, and 2017.--
                            For each of fiscal years 2015, 2016, and 2017,
                            a factor equal to 1 minus the percent change
                            (divided by 100) in the percent of individuals
                            under the age of 65 who are uninsured, as
                            determined by comparing the percent of such
                            individuals--
                                        ``(I) who are uninsured in 2012,
                                    the last year before coverage expansion
                                    under the Patient Protection and
                                    Affordable Care Act (as calculated by
                                    the Secretary based on the most recent
                                    estimates available from the Director
                                    of the Congressional Budget Office
                                    before a vote in either House on such
                                    Act that, if determined in the
                                    affirmative, would clear such Act for
                                    enrollment); and
                                        ``(II) who are uninsured in the
                                    most recent period for which data is
                                    available (as so calculated).
                                ``(ii) 2018 and subsequent years.--For
                            fiscal year 2018 and each subsequent fiscal
                            year, a factor equal to 1 minus the percent
                            change (divided by 100) in the percent of
                            individuals who are uninsured, as determined by
                            comparing the percent of individuals--
                                        ``(I) who are uninsured in 2012 (as
                                    estimated by the Secretary, based on
                                    data from the Census Bureau or other
                                    sources the Secretary determines
                                    appropriate, and certified by the Chief
                                    Actuary of the Centers for Medicare &
                                    Medicaid Services); and
                                        ``(II) who are uninsured in the
                                    most recent period for which data is
                                    available (as so estimated and
                                    certified).
                        ``(C) Factor three.--A factor equal to the percent,
                    for each subsection (d) hospital, that represents the
                    quotient of--
                                ``(i) the amount of uncompensated care for
                            such hospital for a period selected by the
                            Secretary (as estimated by the Secretary, based
                            on appropriate data (including, in the case
                            where the Secretary determines that alternative
                            data is available which is a better proxy for
                            the costs of subsection (d) hospitals for
                            treating the uninsured, the use of such
                            alternative data)); and
                                ``(ii) the aggregate amount of
                            uncompensated care for all subsection (d)
                            hospitals that receive a payment under this
                            subsection for such period (as so estimated,
                            based on such data).
                ``(3) Limitations on review.--There shall be no
            administrative or judicial review under section 1869, section
            1878, or otherwise of the following:
                        ``(A) Any estimate of the Secretary for purposes of
                    determining the factors described in paragraph (2).
                        ``(B) Any period selected by the Secretary for such
                    purposes.''.

    SEC. 3134. MISVALUED CODES UNDER THE PHYSICIAN FEE SCHEDULE.

        (a) In General.--Section 1848(c)(2) of the Social Security Act (42
    U.S.C. 1395w-4(c)(2)) is amended by adding at the end the following new
    subparagraphs:
                        ``(K) Potentially misvalued codes.--
                                ``(i) In general.--The Secretary shall--
                                        ``(I) periodically identify
                                    services as being potentially misvalued
                                    using criteria specified in clause
                                    (ii); and
                                        ``(II) review and make appropriate
                                    adjustments to the relative values
                                    established under this paragraph for
                                    services identified as being
                                    potentially misvalued under subclause
                                    (I).
                                ``(ii) Identification of potentially
                            misvalued codes.--For purposes of identifying
                            potentially misvalued services pursuant to
                            clause (i)(I), the Secretary shall examine (as
                            the Secretary determines to be appropriate)
                            codes (and families of codes as appropriate)
                            for which there has been the fastest growth;
                            codes (and families of codes as appropriate)
                            that have experienced substantial changes in
                            practice expenses; codes for new technologies
                            or services within an appropriate period (such
                            as 3 years) after the relative values are
                            initially established for such codes; multiple
                            codes that are frequently billed in conjunction
                            with furnishing a single service; codes with
                            low relative values, particularly those that
                            are often billed multiple times for a single
                            treatment; codes which have not been subject to
                            review since the implementation of the RBRVS
                            (the so-called `Harvard-valued codes'); and
                            such other codes determined to be appropriate
                            by the Secretary.
                                ``(iii) Review and adjustments.--
                                        ``(I) The Secretary may use
                                    existing processes to receive
                                    recommendations on the review and
                                    appropriate adjustment of potentially
                                    misvalued services described in clause
                                    (i)(II).
                                        ``(II) The Secretary may conduct
                                    surveys, other data collection
                                    activities, studies, or other analyses
                                    as the Secretary determines to be
                                    appropriate to facilitate the review
                                    and appropriate adjustment described in
                                    clause (i)(II).
                                        ``(III) The Secretary may use
                                    analytic contractors to identify and
                                    analyze services identified under
                                    clause (i)(I), conduct surveys or
                                    collect data, and make recommendations
                                    on the review and appropriate
                                    adjustment of services described in
                                    clause (i)(II).
                                        ``(IV) The Secretary may coordinate
                                    the review and appropriate adjustment
                                    described in clause (i)(II) with the
                                    periodic review described in
                                    subparagraph (B).
                                        ``(V) As part of the review and
                                    adjustment described in clause (i)(II),
                                    including with respect to codes with
                                    low relative values described in clause
                                    (ii), the Secretary may make
                                    appropriate coding revisions (including
                                    using existing processes for
                                    consideration of coding changes) which
                                    may include consolidation of individual
                                    services into bundled codes for payment
                                    under the fee schedule under subsection
                                    (b).
                                        ``(VI) The provisions of
                                    subparagraph (B)(ii)(II) shall apply to
                                    adjustments to relative value units
                                    made pursuant to this subparagraph in
                                    the same manner as such provisions
                                    apply to adjustments under subparagraph
                                    (B)(ii)(II).
                        ``(L) Validating relative value units.--
                                ``(i) In general.--The Secretary shall
                            establish a process to validate relative value
                            units under the fee schedule under subsection
                            (b).
                                ``(ii) Components and elements of work.--
                            The process described in clause (i) may include
                            validation of work elements (such as time,
                            mental effort and professional judgment,
                            technical skill and physical effort, and stress
                            due to risk) involved with furnishing a service
                            and may include validation of the pre-, post-,
                            and intra-service components of work.
                                ``(iii) Scope of codes.--The validation of
                            work relative value units shall include a
                            sampling of codes for services that is the same
                            as the codes listed under subparagraph (K)(ii).
                                ``(iv) Methods.--The Secretary may conduct
                            the validation under this subparagraph using
                            methods described in subclauses (I) through (V)
                            of subparagraph (K)(iii) as the Secretary
                            determines to be appropriate.
                                ``(v) Adjustments.--The Secretary shall
                            make appropriate adjustments to the work
                            relative value units under the fee schedule
                            under subsection (b). The provisions of
                            subparagraph (B)(ii)(II) shall apply to
                            adjustments to relative value units made
                            pursuant to this subparagraph in the same
                            manner as such provisions apply to adjustments
                            under subparagraph (B)(ii)(II).''.
        (b) Implementation.--
                (1) Administration.--
                        (A) Chapter 35 of title 44, United States Code and
                    the provisions of the Federal Advisory Committee Act (5
                    U.S.C. App.) shall not apply to this section or the
                    amendment made by this section.
                        (B) Notwithstanding any other provision of law, the
                    Secretary may implement subparagraphs (K) and (L) of
                    1848(c)(2) of the Social Security Act, as added by
                    subsection (a), by program instruction or otherwise.
                        (C) Section 4505(d) of the Balanced Budget Act of
                    1997 is repealed.
                        (D) Except for provisions related to
                    confidentiality of information, the provisions of the
                    Federal Acquisition Regulation shall not apply to this
                    section or the amendment made by this section.
                (2) Focusing cms resources on potentially overvalued
            codes.--Section 1868(a) of the Social Security Act (42 U.S.C.
            1395ee(a)) is repealed.

    SEC. 3135. MODIFICATION OF EQUIPMENT UTILIZATION FACTOR FOR ADVANCED
                  IMAGING SERVICES.

        (a) Adjustment in Practice Expense To Reflect Higher Presumed
    Utilization.--Section 1848 of the Social Security Act (42 U.S.C. 1395w-
    4) is amended--
                (1) in subsection (b)(4)--
                        (A) in subparagraph (B), by striking ``subparagraph
                    (A)'' and inserting ``this paragraph''; and
                        (B) by adding at the end the following new
                    subparagraph:
                        ``(C) Adjustment in practice expense to reflect
                    higher presumed utilization.--Consistent with the
                    methodology for computing the number of practice
                    expense relative value units under subsection
                    (c)(2)(C)(ii) with respect to advanced diagnostic
                    imaging services (as defined in section 1834(e)(1)(B))
                    furnished on or after January 1, 2010, the Secretary
                    shall adjust such number of units so it reflects--
                                ``(i) in the case of services furnished on
                            or after January 1, 2010, and before January 1,
                            2013, a 65 percent (rather than 50 percent)
                            presumed rate of utilization of imaging
                            equipment;
                                ``(ii) in the case of services furnished on
                            or after January 1, 2013, and before January 1,
                            2014, a 70 percent (rather than 50 percent)
                            presumed rate of utilization of imaging
                            equipment; and
                                ``(iii) in the case of services furnished
                            on or after January 1, 2014, a 75 percent
                            (rather than 50 percent) presumed rate of
                            utilization of imaging equipment.''; and
                (2) in subsection (c)(2)(B)(v), by adding at the end the
            following new subclauses:
                                        ``(III) Change in presumed
                                    utilization level of certain advanced
                                    diagnostic imaging services for 2010
                                    through 2012.--Effective for fee
                                    schedules established beginning with
                                    2010 and ending with 2012, reduced
                                    expenditures attributable to the
                                    presumed rate of utilization of imaging
                                    equipment of 65 percent under
                                    subsection (b)(4)(C)(i) instead of a
                                    presumed rate of utilization of such
                                    equipment of 50 percent.
                                        ``(IV) Change in presumed
                                    utilization level of certain advanced
                                    diagnostic imaging services for 2013.--
                                    Effective for fee schedules established
                                    for 2013, reduced expenditures
                                    attributable to the presumed rate of
                                    utilization of imaging equipment of 70
                                    percent under subsection (b)(4)(C)(ii)
                                    instead of a presumed rate of
                                    utilization of such equipment of 50
                                    percent.
                                        ``(V) Change in presumed
                                    utilization level of certain advanced
                                    diagnostic imaging services for 2014
                                    and subsequent years.--Effective for
                                    fee schedules established beginning
                                    with 2014, reduced expenditures
                                    attributable to the presumed rate of
                                    utilization of imaging equipment of 75
                                    percent under subsection (b)(4)(C)(iii)
                                    instead of a presumed rate of
                                    utilization of such equipment of 50
                                    percent.''.
        (b) Adjustment in Technical Component ``discount'' on Single-
    session Imaging to Consecutive Body Parts.--Section 1848 of the Social
    Security Act (42 U.S.C. 1395w-4), as amended by subsection (a), is
    amended--
                (1) in subsection (b)(4), by adding at the end the
            following new subparagraph:
                        ``(D) Adjustment in technical component discount on
                    single-session imaging involving consecutive body
                    parts.--For services furnished on or after July 1,
                    2010, the Secretary shall increase the reduction in
                    payments attributable to the multiple procedure payment
                    reduction applicable to the technical component for
                    imaging under the final rule published by the Secretary
                    in the Federal Register on November 21, 2005 (part 405
                    of title 42, Code of Federal Regulations) from 25
                    percent to 50 percent.''; and
                (2) in subsection (c)(2)(B)(v), by adding at the end the
            following new subclause:
                                        ``(VI) Additional reduced payment
                                    for multiple imaging procedures.--
                                    Effective for fee schedules established
                                    beginning with 2010 (but not applied
                                    for services furnished prior to July 1,
                                    2010), reduced expenditures
                                    attributable to the increase in the
                                    multiple procedure payment reduction
                                    from 25 to 50 percent (as described in
                                    subsection (b)(4)(D)).''.
        (c) Analysis by the Chief Actuary of the Centers for Medicare &
    Medicaid Services.--Not later than January 1, 2013, the Chief Actuary
    of the Centers for Medicare & Medicaid Services shall make publicly
    available an analysis of whether, for the period of 2010 through 2019,
    the cumulative expenditure reductions under title XVIII of the Social
    Security Act that are attributable to the adjustments under the
    amendments made by this section are projected to exceed $3,000,000,000.

    SEC. 3136. REVISION OF PAYMENT FOR POWER-DRIVEN WHEELCHAIRS.

        (a) In General.--Section 1834(a)(7)(A) of the Social Security Act
    (42 U.S.C. 1395m(a)(7)(A)) is amended--
                (1) in clause (i)--
                        (A) in subclause (II), by inserting ``subclause
                    (III) and'' after ``Subject to''; and
                        (B) by adding at the end the following new
                    subclause:
                                        ``(III) Special rule for power-
                                    driven wheelchairs.--For purposes of
                                    payment for power-driven wheelchairs,
                                    subclause (II) shall be applied by
                                    substituting `15 percent' and `6
                                    percent' for `10 percent' and `7.5
                                    percent', respectively.''; and
                (2) in clause (iii)--
                        (A) in the heading, by inserting ``complex,
                    rehabilitative'' before ``power-driven''; and
                        (B) by inserting ``complex, rehabilitative'' before
                    ``power-driven''.
        (b) Technical Amendment.--Section 1834(a)(7)(C)(ii)(II) of the
    Social Security Act (42 U.S.C. 1395m(a)(7)(C)(ii)(II)) is amended by
    striking ``(A)(ii) or''.
        (c) Effective Date.--
                (1) In general.--Subject to paragraph (2), the amendments
            made by subsection (a) shall take effect on January 1, 2011,
            and shall apply to power-driven wheelchairs furnished on or
            after such date.
                (2) Application to competitive bidding.--The amendments
            made by subsection (a) shall not apply to payment made for
            items and services furnished pursuant to contracts entered into
            under section 1847 of the Social Security Act (42 U.S.C. 1395w-
            3) prior to January 1, 2011, pursuant to the implementation of
            subsection (a)(1)(B)(i)(I) of such section 1847.

    SEC. 3137. HOSPITAL WAGE INDEX IMPROVEMENT.

        (a) Extension of Section 508 Hospital Reclassifications.--
                (1) In general.--Subsection (a) of section 106 of division
            B of the Tax Relief and Health Care Act of 2006 (42 U.S.C. 1395
            note), as amended by section 117 of the Medicare, Medicaid, and
            SCHIP Extension Act of 2007 (Public Law 110-173) and section
            124 of the Medicare Improvements for Patients and Providers Act
            of 2008 (Public Law 110-275), is amended by striking
            ``September 30, 2009'' and inserting ``September 30, 2010''.
                (2) Use of particular wage index in fiscal year 2010.--For
            purposes of implementation of the amendment made by this
            subsection during fiscal year 2010, the Secretary shall use the
            hospital wage index that was promulgated by the Secretary in
            the Federal Register on August 27, 2009 (74 Fed. Reg. 43754),
            and any subsequent corrections.
        (b) Plan for Reforming the Medicare Hospital Wage Index System.--
                (1) In general.--Not later than December 31, 2011, the
            Secretary of Health and Human Services (in this section
            referred to as the ``Secretary'') shall submit to Congress a
            report that includes a plan to reform the hospital wage index
            system under section 1886 of the Social Security Act.
                (2) Details.--In developing the plan under paragraph (1),
            the Secretary shall take into account the goals for reforming
            such system set forth in the Medicare Payment Advisory
            Commission June 2007 report entitled ``Report to Congress:
            Promoting Greater Efficiency in Medicare'', including
            establishing a new hospital compensation index system that--
                        (A) uses Bureau of Labor Statistics data, or other
                    data or methodologies, to calculate relative wages for
                    each geographic area involved;
                        (B) minimizes wage index adjustments between and
                    within metropolitan statistical areas and statewide
                    rural areas;
                        (C) includes methods to minimize the volatility of
                    wage index adjustments that result from implementation
                    of policy, while maintaining budget neutrality in
                    applying such adjustments;
                        (D) takes into account the effect that
                    implementation of the system would have on health care
                    providers and on each region of the country;
                        (E) addresses issues related to occupational mix,
                    such as staffing practices and ratios, and any evidence
                    on the effect on quality of care or patient safety as a
                    result of the implementation of the system; and
                        (F) provides for a transition.
                (3) Consultation.--In developing the plan under paragraph
            (1), the Secretary shall consult with relevant affected
            parties.
        (c) Use of Particular Criteria for Determining Reclassifications.--
    Notwithstanding any other provision of law, in making decisions on
    applications for reclassification of a subsection (d) hospital (as
    defined in paragraph (1)(B) of section 1886(d) of the Social Security
    Act (42 U.S.C. 1395ww(d)) for the purposes described in paragraph
    (10)(D)(v) of such section for fiscal year 2011 and each subsequent
    fiscal year (until the first fiscal year beginning on or after the date
    that is 1 year after the Secretary of Health and Human Services submits
    the report to Congress under subsection (b)), the Geographic
    Classification Review Board established under paragraph (10) of such
    section shall use the average hourly wage comparison criteria used in
    making such decisions as of September 30, 2008. The preceding sentence
    shall be effected in a budget neutral manner.

    SEC. 3138. TREATMENT OF CERTAIN CANCER HOSPITALS.

        Section 1833(t) of the Social Security Act (42 U.S.C. 1395l(t)) is
    amended by adding at the end the following new paragraph:
                ``(18) Authorization of adjustment for cancer hospitals.--
                        ``(A) Study.--The Secretary shall conduct a study
                    to determine if, under the system under this
                    subsection, costs incurred by hospitals described in
                    section 1886(d)(1)(B)(v) with respect to ambulatory
                    payment classification groups exceed those costs
                    incurred by other hospitals furnishing services under
                    this subsection (as determined appropriate by the
                    Secretary). In conducting the study under this
                    subparagraph, the Secretary shall take into
                    consideration the cost of drugs and biologicals
                    incurred by such hospitals.
                        ``(B) Authorization of adjustment.--Insofar as the
                    Secretary determines under subparagraph (A) that costs
                    incurred by hospitals described in section
                    1886(d)(1)(B)(v) exceed those costs incurred by other
                    hospitals furnishing services under this subsection,
                    the Secretary shall provide for an appropriate
                    adjustment under paragraph (2)(E) to reflect those
                    higher costs effective for services furnished on or
                    after January 1, 2011.''.

    SEC. 3139. PAYMENT FOR BIOSIMILAR BIOLOGICAL PRODUCTS.

        (a) In General.--Section 1847A of the Social Security Act (42
    U.S.C. 1395w-3a) is amended--
                (1) in subsection (b)--
                        (A) in paragraph (1)--
                                (i) in subparagraph (A), by striking ``or''
                            at the end;
                                (ii) in subparagraph (B), by striking the
                            period at the end and inserting ``; or''; and
                                (iii) by adding at the end the following
                            new subparagraph:
                        ``(C) in the case of a biosimilar biological
                    product (as defined in subsection (c)(6)(H)), the
                    amount determined under paragraph (8).''; and
                        (B) by adding at the end the following new
                    paragraph:
                ``(8) Biosimilar biological product.--The amount specified
            in this paragraph for a biosimilar biological product described
            in paragraph (1)(C) is the sum of--
                        ``(A) the average sales price as determined using
                    the methodology described under paragraph (6) applied
                    to a biosimilar biological product for all National
                    Drug Codes assigned to such product in the same manner
                    as such paragraph is applied to drugs described in such
                    paragraph; and
                        ``(B) 6 percent of the amount determined under
                    paragraph (4) for the reference biological product (as
                    defined in subsection (c)(6)(I)).''; and
                (2) in subsection (c)(6), by adding at the end the
            following new subparagraph:
                        ``(H) Biosimilar biological product.--The term
                    `biosimilar biological product' means a biological
                    product approved under an abbreviated application for a
                    license of a biological product that relies in part on
                    data or information in an application for another
                    biological product licensed under section 351 of the
                    Public Health Service Act.
                        ``(I) Reference biological product.--The term
                    `reference biological product' means the biological
                    product licensed under such section 351 that is
                    referred to in the application described in
                    subparagraph (H) of the biosimilar biological
                    product.''.
        (b) Effective Date.--The amendments made by subsection (a) shall
    apply to payments for biosimilar biological products beginning with the
    first day of the second calendar quarter after enactment of legislation
    providing for a biosimilar pathway (as determined by the Secretary).

    SEC. 3140. MEDICARE HOSPICE CONCURRENT CARE DEMONSTRATION PROGRAM.

        (a) Establishment.--
                (1) In general.--The Secretary of Health and Human Services
            (in this section referred to as the ``Secretary'') shall
            establish a Medicare Hospice Concurrent Care demonstration
            program at participating hospice programs under which Medicare
            beneficiaries are furnished, during the same period, hospice
            care and any other items or services covered under title XVIII
            of the Social Security Act (42 U.S.C. 1395 et seq.) from funds
            otherwise paid under such title to such hospice programs.
                (2) Duration.--The demonstration program under this section
            shall be conducted for a 3-year period.
                (3) Sites.--The Secretary shall select not more than 15
            hospice programs at which the demonstration program under this
            section shall be conducted. Such hospice programs shall be
            located in urban and rural areas.
        (b) Independent Evaluation and Reports.--
                (1) Independent evaluation.--The Secretary shall provide
            for the conduct of an independent evaluation of the
            demonstration program under this section. Such independent
            evaluation shall determine whether the demonstration program
            has improved patient care, quality of life, and cost-
            effectiveness for Medicare beneficiaries participating in the
            demonstration program.
                (2) Reports.--The Secretary shall submit to Congress a
            report containing the results of the evaluation conducted under
            paragraph (1), together with such recommendations as the
            Secretary determines appropriate.
        (c) Budget Neutrality.--With respect to the 3-year period of the
    demonstration program under this section, the Secretary shall ensure
    that the aggregate expenditures under title XVIII for such period shall
    not exceed the aggregate expenditures that would have been expended
    under such title if the demonstration program under this section had
    not been implemented.

    SEC. 3141. APPLICATION OF BUDGET NEUTRALITY ON A NATIONAL BASIS IN THE
                  CALCULATION OF THE MEDICARE HOSPITAL WAGE INDEX FLOOR.

        In the case of discharges occurring on or after October 1, 2010,
    for purposes of applying section 4410 of the Balanced Budget Act of
    1997 (42 U.S.C. 1395ww note) and paragraph (h)(4) of section 412.64 of
    title 42, Code of Federal Regulations, the Secretary of Health and
    Human Services shall administer subsection (b) of such section 4410 and
    paragraph (e) of such section 412.64 in the same manner as the
    Secretary administered such subsection (b) and paragraph (e) for
    discharges occurring during fiscal year 2008 (through a uniform,
    national adjustment to the area wage index).

    SEC. 3142. HHS STUDY ON URBAN MEDICARE-DEPENDENT HOSPITALS.

        (a) Study.--
                (1) In general.--The Secretary of Health and Human Services
            (in this section referred to as the ``Secretary'') shall
            conduct a study on the need for an additional payment for urban
            Medicare-dependent hospitals for inpatient hospital services
            under section 1886 of the Social Security Act (42 U.S.C.
            1395ww). Such study shall include an analysis of--
                        (A) the Medicare inpatient margins of urban
                    Medicare-dependent hospitals, as compared to other
                    hospitals which receive 1 or more additional payments
                    or adjustments under such section (including those
                    payments or adjustments described in paragraph (2)(A));
                    and
                        (B) whether payments to medicare-dependent, small
                    rural hospitals under subsection (d)(5)(G) of such
                    section should be applied to urban Medicare-dependent
                    hospitals.
                (2) Urban medicare-dependent hospital defined.--For
            purposes of this section, the term ``urban Medicare-dependent
            hospital'' means a subsection (d) hospital (as defined in
            subsection (d)(1)(B) of such section) that--
                        (A) does not receive any additional payment or
                    adjustment under such section, such as payments for
                    indirect medical education costs under subsection
                    (d)(5)(B) of such section, disproportionate share
                    payments under subsection (d)(5)(A) of such section,
                    payments to a rural referral center under subsection
                    (d)(5)(C) of such section, payments to a critical
                    access hospital under section 1814(l) of such Act (42
                    U.S.C. 1395f(l)), payments to a sole community hospital
                    under subsection (d)(5)(D) of such section 1886, or
                    payments to a medicare-dependent, small rural hospital
                    under subsection (d)(5)(G) of such section 1886; and
                        (B) for which more than 60 percent of its inpatient
                    days or discharges during 2 of the 3 most recently
                    audited cost reporting periods for which the Secretary
                    has a settled cost report were attributable to
                    inpatients entitled to benefits under part A of title
                    XVIII of such Act.
        (b) Report.--Not later than 9 months after the date of enactment of
    this Act, the Secretary shall submit to Congress a report containing
    the results of the study conducted under subsection (a), together with
    recommendations for such legislation and administrative action as the
    Secretary determines appropriate.

    SEC. 3143. PROTECTING HOME HEALTH BENEFITS.

        Nothing in the provisions of, or amendments made by, this Act shall
    result in the reduction of guaranteed home health benefits under title
    XVIII of the Social Security Act.

                   Subtitle C--Provisions Relating to Part C

    SEC. 3201. MEDICARE ADVANTAGE PAYMENT.

        (a) MA Benchmark Based on Plan's Competitive Bids.--
                (1) In general.--Section 1853(j) of the Social Security Act
            (42 U.S.C. 1395w-23(j)) is amended--
                        (A) by striking ``Amounts.--For purposes'' and
                    inserting ``Amounts.--
                ``(1) In general.--For purposes'';
                        (B) by redesignating paragraphs (1) and (2) as
                    subparagraphs (A) and (B), respectively, and indenting
                    the subparagraphs appropriately;
                        (C) in subparagraph (A), as redesignated by
                    subparagraph (B)--
                                (i) by redesignating subparagraphs (A) and
                            (B) as clauses (i) and (ii), respectively, and
                            indenting the clauses appropriately; and
                                (ii) in clause (i), as redesignated by
                            clause (i), by striking ``an amount equal to''
                            and all that follows through the end and
                            inserting ``an amount equal to--
                                        ``(I) for years before 2007, \1/12\
                                    of the annual MA capitation rate under
                                    section 1853(c)(1) for the area for the
                                    year, adjusted as appropriate for the
                                    purpose of risk adjustment;
                                        ``(II) for 2007 through 2011, \1/
                                    12\ of the applicable amount determined
                                    under subsection (k)(1) for the area
                                    for the year;
                                        ``(III) for 2012, the sum of--
                                                ``(aa) \2/3\ of the
                                            quotient of--

                                                        ``(AA) the
                                                    applicable amount
                                                    determined under
                                                    subsection (k)(1) for
                                                    the area for the year;
                                                    and

                                                        ``(BB) 12; and

                                                ``(bb) \1/3\ of the MA
                                            competitive benchmark amount
                                            (determined under paragraph
                                            (2)) for the area for the
                                            month;
                                        ``(IV) for 2013, the sum of--
                                                ``(aa) \1/3\ of the
                                            quotient of--

                                                        ``(AA) the
                                                    applicable amount
                                                    determined under
                                                    subsection (k)(1) for
                                                    the area for the year;
                                                    and

                                                        ``(BB) 12; and

                                                ``(bb) \2/3\ of the MA
                                            competitive benchmark amount
                                            (as so determined) for the area
                                            for the month;
                                        ``(V) for 2014, the MA competitive
                                    benchmark amount for the area for a
                                    month in 2013 (as so determined),
                                    increased by the national per capita MA
                                    growth percentage, described in
                                    subsection (c)(6) for 2014, but not
                                    taking into account any adjustment
                                    under subparagraph (C) of such
                                    subsection for a year before 2004; and
                                        ``(VI) for 2015 and each subsequent
                                    year, the MA competitive benchmark
                                    amount (as so determined) for the area
                                    for the month; or'';
                                (iii) in clause (ii), as redesignated by
                            clause (i), by striking ``subparagraph (A)''
                            and inserting ``clause (i)'';
                        (D) by adding at the end the following new
                    paragraphs:
                ``(2) Computation of ma competitive benchmark amount.--
                        ``(A) In general.--Subject to subparagraph (B) and
                    paragraph (3), for months in each year (beginning with
                    2012) for each MA payment area the Secretary shall
                    compute an MA competitive benchmark amount equal to the
                    weighted average of the unadjusted MA statutory non-
                    drug monthly bid amount (as defined in section
                    1854(b)(2)(E)) for each MA plan in the area, with the
                    weight for each plan being equal to the average number
                    of beneficiaries enrolled under such plan in the
                    reference month (as defined in section 1858(f)(4),
                    except that, in applying such definition for purposes
                    of this paragraph, `to compute the MA competitive
                    benchmark amount under section 1853(j)(2)' shall be
                    substituted for `to compute the percentage specified in
                    subparagraph (A) and other relevant percentages under
                    this part').
                        ``(B) Weighting rules.--
                                ``(i) Single plan rule.--In the case of an
                            MA payment area in which only a single MA plan
                            is being offered, the weight under subparagraph
                            (A) shall be equal to 1.
                                ``(ii) Use of simple average among multiple
                            plans if no plans offered in previous year.--In
                            the case of an MA payment area in which no MA
                            plan was offered in the previous year and more
                            than 1 MA plan is offered in the current year,
                            the Secretary shall use a simple average of the
                            unadjusted MA statutory non-drug monthly bid
                            amount (as so defined) for purposes of
                            computing the MA competitive benchmark amount
                            under subparagraph (A).
                ``(3) Cap on ma competitive benchmark amount.--In no case
            shall the MA competitive benchmark amount for an area for a
            month in a year be greater than the applicable amount that
            would (but for the application of this subsection) be
            determined under subsection (k)(1) for the area for the month
            in the year.''; and
                        (E) in subsection (k)(2)(B)(ii)(III), by striking
                    ``(j)(1)(A)'' and inserting ``(j)(1)(A)(i)''.
                (2) Conforming amendments.--
                        (A) Section 1853(k)(2) of the Social Security Act
                    (42 U.S.C. 1395w-23(k)(2)) is amended--
                                (i) in subparagraph (A), by striking
                            ``through 2010'' and inserting ``and subsequent
                            years''; and
                                (ii) in subparagraph (C)--
                                        (I) in clause (iii), by striking
                                    ``and'' at the end;
                                        (II) in clause (iv), by striking
                                    the period at the end and inserting ``;
                                    and''; and
                                        (III) by adding at the end the
                                    following new clause:
                                ``(v) for 2011 and subsequent years,
                            0.00.''.
                        (B) Section 1854(b) of the Social Security Act (42
                    U.S.C. 1395w-24(b)) is amended--
                                (i) in paragraph (3)(B)(i), by striking
                            ``1853(j)(1)'' and inserting ``1853(j)(1)(A)'';
                            and
                                (ii) in paragraph (4)(B)(i), by striking
                            ``1853(j)(2)'' and inserting ``1853(j)(1)(B)''.
                        (C) Section 1858(f) of the Social Security Act (42
                    U.S.C. 1395w-27(f)) is amended--
                                (i) in paragraph (1), by striking
                            ``1853(j)(2)'' and inserting ``1853(j)(1)(B)'';
                            and
                                (ii) in paragraph (3)(A), by striking
                            ``1853(j)(1)(A)'' and inserting
                            ``1853(j)(1)(A)(i)''.
                        (D) Section 1860C-1(d)(1)(A) of the Social Security
                    Act (42 U.S.C. 1395w-29(d)(1)(A)) is amended by
                    striking ``1853(j)(1)(A)'' and inserting
                    ``1853(j)(1)(A)(i)''.
        (b) Reduction of National Per Capita Growth Percentage for 2011.--
    Section 1853(c)(6) of the Social Security Act (42 U.S.C. 1395w-
    23(c)(6)) is amended--
                (1) in clause (v), by striking ``and'' at the end;
                (2) in clause (vi)--
                        (A) by striking ``for a year after 2002'' and
                    inserting ``for 2003 through 2010''; and
                        (B) by striking the period at the end and inserting
                    a comma; and
                        (C) by adding at the end the following new clauses:
                                ``(vii) for 2011, 3 percentage points; and
                                ``(viii) for a year after 2011, 0
                            percentage points.''.
        (c) Enhancement of Beneficiary Rebates.--Section 1854(b)(1)(C)(i)
    of the Social Security Act (42 U.S.C. 1395w-24(b)(1)(C)(i)) is amended
    by inserting ``(or 100 percent in the case of plan years beginning on
    or after January 1, 2014)'' after ``75 percent''.
        (d) Bidding Rules.--
                (1) Requirements for information submitted.--Section
            1854(a)(6)(A) of the Social Security Act (42 U.S.C. 1395w-
            24(a)(6)(A)) is amended, in the flush matter following clause
            (v), by adding at the end the following sentence: ``Information
            to be submitted under this paragraph shall be certified by a
            qualified member of the American Academy of Actuaries and shall
            meet actuarial guidelines and rules established by the
            Secretary under subparagraph (B)(v).''.
                (2) Establishment of actuarial guidelines.--Section
            1854(a)(6)(B) of the Social Security Act (42 U.S.C. 1395w-
            24(a)(6)(B)) is amended--
                        (A) in clause (i), by striking ``(iii) and (iv)''
                    and inserting ``(iii), (iv), and (v)''; and
                        (B) by adding at the end the following new clause:
                                ``(v) Establishment of actuarial
                            guidelines.--
                                        ``(I) In general.--In order to
                                    establish fair MA competitive
                                    benchmarks under section
                                    1853(j)(1)(A)(i), the Secretary, acting
                                    through the Chief Actuary of the
                                    Centers for Medicare & Medicaid
                                    Services (in this clause referred to as
                                    the `Chief Actuary'), shall establish--
                                                ``(aa) actuarial guidelines
                                            for the submission of bid
                                            information under this
                                            paragraph; and
                                                ``(bb) bidding rules that
                                            are appropriate to ensure
                                            accurate bids and fair
                                            competition among MA plans.
                                        ``(II) Denial of bid amounts.--The
                                    Secretary shall deny monthly bid
                                    amounts submitted under subparagraph
                                    (A) that do not meet the actuarial
                                    guidelines and rules established under
                                    subclause (I).
                                        ``(III) Refusal to accept certain
                                    bids due to misrepresentations and
                                    failures to adequately meet
                                    requirements.--In the case where the
                                    Secretary determines that information
                                    submitted by an MA organization under
                                    subparagraph (A) contains consistent
                                    misrepresentations and failures to
                                    adequately meet requirements of the
                                    organization, the Secretary may refuse
                                    to accept any additional such bid
                                    amounts from the organization for the
                                    plan year and the Chief Actuary shall,
                                    if the Chief Actuary determines that
                                    the actuaries of the organization were
                                    complicit in those misrepresentations
                                    and failures, report those actuaries to
                                    the Actuarial Board for Counseling and
                                    Discipline.''.
                (3) Effective date.--The amendments made by this subsection
            shall apply to bid amounts submitted on or after January 1,
            2012.
        (e) MA Local Plan Service Areas.--
                (1) In general.--Section 1853(d) of the Social Security Act
            (42 U.S.C. 1395w-23(d)) is amended--
                        (A) in the subsection heading, by striking ``MA
                    Region'' and inserting ``MA Region; MA Local Plan
                    Service Area'';
                        (B) in paragraph (1), by striking subparagraph (A)
                    and inserting the following:
                        ``(A) with respect to an MA local plan--
                                ``(i) for years before 2012, an MA local
                            area (as defined in paragraph (2)); and
                                ``(ii) for 2012 and succeeding years, a
                            service area that is an entire urban or rural
                            area, as applicable (as described in paragraph
                            (5)); and''; and
                        (C) by adding at the end the following new
                    paragraph:
                ``(5) MA local plan service area.--For 2012 and succeeding
            years, the service area for an MA local plan shall be an entire
            urban or rural area in each State as follows:
                        ``(A) Urban areas.--
                                ``(i) In general.--Subject to clause (ii)
                            and subparagraphs (C) and (D), the service area
                            for an MA local plan in an urban area shall be
                            the Core Based Statistical Area (in this
                            paragraph referred to as a `CBSA') or, if
                            applicable, a conceptually similar alternative
                            classification, as defined by the Director of
                            the Office of Management and Budget.
                                ``(ii) CBSA covering more than one state.--
                            In the case of a CBSA (or alternative
                            classification) that covers more than one
                            State, the Secretary shall divide the CBSA (or
                            alternative classification) into separate
                            service areas with respect to each State
                            covered by the CBSA (or alternative
                            classification).
                        ``(B) Rural areas.--Subject to subparagraphs (C)
                    and (D), the service area for an MA local plan in a
                    rural area shall be a county that does not qualify for
                    inclusion in a CBSA (or alternative classification), as
                    defined by the Director of the Office of Management and
                    Budget.
                        ``(C) Refinements to service areas.--For 2015 and
                    succeeding years, in order to reflect actual patterns
                    of health care service utilization, the Secretary may
                    adjust the boundaries of service areas for MA local
                    plans in urban areas and rural areas under
                    subparagraphs (A) and (B), respectively, but may only
                    do so based on recent analyses of actual patterns of
                    care.
                        ``(D) Additional authority to make limited
                    exceptions to service area requirements for ma local
                    plans.--The Secretary may, in addition to any
                    adjustments under subparagraph (C), make limited
                    exceptions to service area requirements otherwise
                    applicable under this part for MA local plans that have
                    in effect (as of the date of enactment of the Patient
                    Protection and Affordable Care Act)--
                                ``(i) agreements with another MA
                            organization or MA plan that preclude the
                            offering of benefits throughout an entire
                            service area; or
                                ``(ii) limitations in their structural
                            capacity to support adequate networks
                            throughout an entire service area as a result
                            of the delivery system model of the MA local
                            plan.''.
                (2) Conforming amendments.--
                        (A) In general.--
                                (i) Section 1851(b)(1) of the Social
                            Security Act (42 U.S.C. 1395w-21(b)(1)) is
                            amended by striking subparagraph (C).
                                (ii) Section 1853(b)(1)(B)(i) of such Act
                            (42 U.S.C. 1395w-23(b)(1)(B)(i))--
                                        (I) in the matter preceding
                                    subclause (I), by striking ``MA payment
                                    area'' and inserting ``MA local area
                                    (as defined in subsection (d)(2))'';
                                    and
                                        (II) in subclause (I), by striking
                                    ``MA payment area'' and inserting ``MA
                                    local area (as so defined)''.
                                (iii) Section 1853(b)(4) of such Act (42
                            U.S.C. 1395w-23(b)(4)) is amended by striking
                            ``Medicare Advantage payment area'' and
                            inserting ``MA local area (as so defined)''.
                                (iv) Section 1853(c)(1) of such Act (42
                            U.S.C. 1395w-23(c)(1)) is amended--
                                        (I) in the matter preceding
                                    subparagraph (A), by striking ``a
                                    Medicare Advantage payment area that
                                    is''; and
                                        (II) in subparagraph (D)(i), by
                                    striking ``MA payment area'' and
                                    inserting ``MA local area (as defined
                                    in subsection (d)(2))''.
                                (v) Section 1854 of such Act (42 U.S.C.
                            1395w-24) is amended by striking subsection
                            (h).
                        (B) Effective date.--The amendments made by this
                    paragraph shall take effect on January 1, 2012.
        (f) Performance Bonuses.--
                (1) MA plans.--
                        (A) In general.--Section 1853 of the Social
                    Security Act (42 U.S.C. 1395w-23) is amended by adding
                    at the end the following new subsection:
        ``(n) Performance Bonuses.--
                ``(1) Care coordination and management performance bonus.--
                        ``(A) In general.--For years beginning with 2014,
                    subject to subparagraph (B), in the case of an MA plan
                    that conducts 1 or more programs described in
                    subparagraph (C) with respect to the year, the
                    Secretary shall, in addition to any other payment
                    provided under this part, make monthly payments, with
                    respect to coverage of an individual under this part,
                    to the MA plan in an amount equal to the product of--
                                ``(i) 0.5 percent of the national monthly
                            per capita cost for expenditures for
                            individuals enrolled under the original
                            medicare fee-for-service program for the year;
                            and
                                ``(ii) the total number of programs
                            described in clauses (i) through (ix) of
                            subparagraph (C) that the Secretary determines
                            the plan is conducting for the year under such
                            subparagraph.
                        ``(B) Limitation.--In no case may the total amount
                    of payment with respect to a year under subparagraph
                    (A) be greater than 2 percent of the national monthly
                    per capita cost for expenditures for individuals
                    enrolled under the original medicare fee-for-service
                    program for the year, as determined prior to the
                    application of risk adjustment under paragraph (4).
                        ``(C) Programs described.--The following programs
                    are described in this paragraph:
                                ``(i) Care management programs that--
                                        ``(I) target individuals with 1 or
                                    more chronic conditions;
                                        ``(II) identify gaps in care; and
                                        ``(III) facilitate improved care by
                                    using additional resources like nurses,
                                    nurse practitioners, and physician
                                    assistants.
                                ``(ii) Programs that focus on patient
                            education and self-management of health
                            conditions, including interventions that--
                                        ``(I) help manage chronic
                                    conditions;
                                        ``(II) reduce declines in health
                                    status; and
                                        ``(III) foster patient and provider
                                    collaboration.
                                ``(iii) Transitional care interventions
                            that focus on care provided around a hospital
                            inpatient episode, including programs that
                            target post-discharge patient care in order to
                            reduce unnecessary health complications and
                            readmissions.
                                ``(iv) Patient safety programs, including
                            provisions for hospital-based patient safety
                            programs in contracts that the Medicare
                            Advantage organization offering the MA plan has
                            with hospitals.
                                ``(v) Financial policies that promote
                            systematic coordination of care by primary care
                            physicians across the full spectrum of
                            specialties and sites of care, such as medical
                            homes, capitation arrangements, or pay-for-
                            performance programs.
                                ``(vi) Programs that address, identify, and
                            ameliorate health care disparities among
                            principal at-risk subpopulations.
                                ``(vii) Medication therapy management
                            programs that are more extensive than is
                            required under section 1860D-4(c) (as
                            determined by the Secretary).
                                ``(viii) Health information technology
                            programs, including clinical decision support
                            and other tools to facilitate data collection
                            and ensure patient-centered, appropriate care.
                                ``(ix) Such other care management and
                            coordination programs as the Secretary
                            determines appropriate.
                        ``(D) Conduct of program in urban and rural
                    areas.--An MA plan may conduct a program described in
                    subparagraph (C) in a manner appropriate for an urban
                    or rural area, as applicable.
                        ``(E) Reporting of data.--Each Medicare Advantage
                    organization shall provide to the Secretary the
                    information needed to determine whether they are
                    eligible for a care coordination and management
                    performance bonus at a time and in a manner specified
                    by the Secretary.
                        ``(F) Periodic auditing.--The Secretary shall
                    provide for the annual auditing of programs described
                    in subparagraph (C) for which an MA plan receives a
                    care coordination and management performance bonus
                    under this paragraph. The Comptroller General shall
                    monitor auditing activities conducted under this
                    subparagraph.
                ``(2) Quality performance bonuses.--
                        ``(A) Quality bonus.--For years beginning with
                    2014, the Secretary shall, in addition to any other
                    payment provided under this part, make monthly
                    payments, with respect to coverage of an individual
                    under this part, to an MA plan that achieves at least a
                    3 star rating (or comparable rating) on a rating system
                    described in subparagraph (C) in an amount equal to--
                                ``(i) in the case of a plan that achieves a
                            3 star rating (or comparable rating) on such
                            system 2 percent of the national monthly per
                            capita cost for expenditures for individuals
                            enrolled under the original medicare fee-for-
                            service program for the year; and
                                ``(ii) in the case of a plan that achieves
                            a 4 or 5 star rating (or comparable rating on
                            such system, 4 percent of such national monthly
                            per capita cost for the year.
                        ``(B) Improved quality bonus.--For years beginning
                    with 2014, in the case of an MA plan that does not
                    receive a quality bonus under subparagraph (A) and is
                    an improved quality MA plan with respect to the year
                    (as identified by the Secretary), the Secretary shall,
                    in addition to any other payment provided under this
                    part, make monthly payments, with respect to coverage
                    of an individual under this part, to the MA plan in an
                    amount equal to 1 percent of such national monthly per
                    capita cost for the year.
                        ``(C) Use of rating system.--For purposes of
                    subparagraph (A), a rating system described in this
                    paragraph is--
                                ``(i) a rating system that uses up to 5
                            stars to rate clinical quality and enrollee
                            satisfaction and performance at the Medicare
                            Advantage contract or MA plan level; or
                                ``(ii) such other system established by the
                            Secretary that provides for the determination
                            of a comparable quality performance rating to
                            the rating system described in clause (i).
                        ``(D) Data used in determining score.--
                                ``(i) In general.--The rating of an MA plan
                            under the rating system described in
                            subparagraph (C) with respect to a year shall
                            be based on based on the most recent data
                            available.
                                ``(ii) Plans that fail to report data.--An
                            MA plan which does not report data that enables
                            the Secretary to rate the plan for purposes of
                            subparagraph (A) or identify the plan for
                            purposes of subparagraph (B) shall be counted,
                            for purposes of such rating or identification,
                            as having the lowest plan performance rating
                            and the lowest percentage improvement,
                            respectively.
                ``(3) Quality bonus for new and low enrollment ma plans.--
                        ``(A) New ma plans.--For years beginning with 2014,
                    in the case of an MA plan that first submits a bid
                    under section 1854(a)(1)(A) for 2012 or a subsequent
                    year, only receives enrollments made during the
                    coverage election periods described in section 1851(e),
                    and is not able to receive a bonus under subparagraph
                    (A) or (B) of paragraph (2) for the year, the Secretary
                    shall, in addition to any other payment provided under
                    this part, make monthly payments, with respect to
                    coverage of an individual under this part, to the MA
                    plan in an amount equal to 2 percent of national
                    monthly per capita cost for expenditures for
                    individuals enrolled under the original medicare fee-
                    for-service program for the year. In its fourth year of
                    operation, the MA plan shall be paid in the same manner
                    as other MA plans with comparable enrollment.
                        ``(B) Low enrollment plans.--For years beginning
                    with 2014, in the case of an MA plan that has low
                    enrollment (as defined by the Secretary) and would not
                    otherwise be able to receive a bonus under subparagraph
                    (A) or (B) of paragraph (2) or subparagraph (A) of this
                    paragraph for the year (referred to in this
                    subparagraph as a `low enrollment plan'), the Secretary
                    shall use a regional or local mean of the rating of all
                    MA plans in the region or local area, as determined
                    appropriate by the Secretary, on measures used to
                    determine whether MA plans are eligible for a quality
                    or an improved quality bonus, as applicable, to
                    determine whether the low enrollment plan is eligible
                    for a bonus under such a subparagraph.
                ``(4) Risk adjustment.--The Secretary shall risk adjust a
            performance bonus under this subsection in the same manner as
            the Secretary risk adjusts beneficiary rebates described in
            section 1854(b)(1)(C).
                ``(5) Notification.--The Secretary, in the annual
            announcement required under subsection (b)(1)(B) for 2014 and
            each succeeding year, shall notify the Medicare Advantage
            organization of any performance bonus (including a care
            coordination and management performance bonus under paragraph
            (1), a quality performance bonus under paragraph (2), and a
            quality bonus for new and low enrollment plans under paragraph
            (3)) that the organization will receive under this subsection
            with respect to the year. The Secretary shall provide for the
            publication of the information described in the previous
            sentence on the Internet website of the Centers for Medicare &
            Medicaid Services.''
                        (B) Conforming amendment.--Section 1853(a)(1)(B) of
                    the Social Security Act (42 U.S.C. 1395w-23(a)(1)(B))
                    is amended--
                                (i) in clause (i), by inserting ``and any
                            performance bonus under subsection (n)'' before
                            the period at the end; and
                                (ii) in clause (ii), by striking ``(G)''
                            and inserting ``(G), plus the amount (if any)
                            of any performance bonus under subsection
                            (n)''.
                (2) Application of performance bonuses to ma regional
            plans.--Section 1858 of the Social Security Act (42 U.S.C.
            1395w-27a) is amended--
                        (A) in subsection (f)(1), by striking ``subsection
                    (e)'' and inserting ``subsections (e) and (i)''; and
                        (B) by adding at the end the following new
                    subsection:
        ``(i) Application of Performance Bonuses to MA Regional Plans.--For
    years beginning with 2014, the Secretary shall apply the performance
    bonuses under section 1853(n) (relating to bonuses for care
    coordination and management, quality performance, and new and low
    enrollment MA plans) to MA regional plans in a similar manner as such
    performance bonuses apply to MA plans under such subsection.''.
        (g) Grandfathering Supplemental Benefits for Current Enrollees
    After Implementation of Competitive Bidding.--Section 1853 of the
    Social Security Act (42 U.S.C. 1395w-23), as amended by subsection (f),
    is amended by adding at the end the following new subsection:
        ``(o) Grandfathering Supplemental Benefits for Current Enrolles
    After Implementation of Competitive Bidding.--
                ``(1) Identification of areas.--The Secretary shall
            identify MA local areas in which, with respect to 2009, average
            bids submitted by an MA organization under section 1854(a) for
            MA local plans in the area are not greater than 75 percent of
            the adjusted average per capita cost for the year involved,
            determined under section 1876(a)(4), for the area for
            individuals who are not enrolled in an MA plan under this part
            for the year, but adjusted to exclude costs attributable to
            payments under section 1848(o), 1886(n), and 1886(h).
                ``(2) Election to provide rebates to grandfathered
            enrollees.--
                        ``(A) In general.--For years beginning with 2012,
                    each Medicare Advantage organization offering an MA
                    local plan in an area identified by the Secretary under
                    paragraph (1) may elect to provide rebates to
                    grandfathered enrollees under section 1854(b)(1)(C). In
                    the case where an MA organization makes such an
                    election, the monthly per capita dollar amount of such
                    rebates shall not exceed the applicable amount for the
                    year (as defined in subparagraph (B)).
                        ``(B) Applicable amount.--For purposes of this
                    subsection, the term `applicable amount' means--
                                ``(i) for 2012, the monthly per capita
                            dollar amount of such rebates provided to
                            enrollees under the MA local plan with respect
                            to 2011; and
                                ``(ii) for a subsequent year, 95 percent of
                            the amount determined under this subparagraph
                            for the preceding year.
                ``(3) Special rules for plans in identified areas.--
            Notwithstanding any other provision of this part, the following
            shall apply with respect to each Medicare Advantage
            organization offering an MA local plan in an area identified by
            the Secretary under paragraph (1) that makes an election
            described in paragraph (2):
                        ``(A) Payments.--The amount of the monthly payment
                    under this section to the Medicare Advantage
                    organization, with respect to coverage of a
                    grandfathered enrollee under this part in the area for
                    a month, shall be equal to--
                                ``(i) for 2012 and 2013, the sum of--
                                        ``(I) the bid amount under section
                                    1854(a) for the MA local plan; and
                                        ``(II) the applicable amount (as
                                    defined in paragraph (2)(B)) for the MA
                                    local plan for the year.
                                ``(ii) for 2014 and subsequent years, the
                            sum of--
                                        ``(I) the MA competitive benchmark
                                    amount under subsection (j)(1)(A)(i)
                                    for the area for the month, adjusted,
                                    only to the extent the Secretary
                                    determines necessary, to account for
                                    induced utilization as a result of
                                    rebates provided to grandfathered
                                    enrollees (except that such adjustment
                                    shall not exceed 0.5 percent of such MA
                                    competitive benchmark amount); and
                                        ``(II) the applicable amount (as so
                                    defined) for the MA local plan for the
                                    year.
                        ``(B) Requirement to submit bids under competitive
                    bidding.--The Medicare Advantage organization shall
                    submit a single bid amount under section 1854(a) for
                    the MA local plan. The Medicare Advantage organization
                    shall remove from such bid amount any effects of
                    induced demand for care that may result from the higher
                    rebates available to grandfathered enrollees under this
                    subsection.
                        ``(C) Nonapplication of bonus payments and any
                    other rebates.--The Medicare Advantage organization
                    offering the MA local plan shall not be eligible for
                    any bonus payment under subsection (n) or any rebate
                    under this part (other than as provided under this
                    subsection) with respect to grandfathered enrollees.
                        ``(D) Nonapplication of uniform bid and premium
                    amounts to grandfathered enrollees.--Section 1854(c)
                    shall not apply with respect to the MA local plan.
                        ``(E) Nonapplication of limitation on application
                    of plan rebates toward payment of part b premium.--
                    Notwithstanding clause (iii) of section 1854(b)(1)(C),
                    in the case of a grandfathered enrollee, a rebate under
                    such section may be used for the purpose described in
                    clause (ii)(III) of such section.
                        ``(F) Risk adjustment.--The Secretary shall risk
                    adjust rebates to grandfathered enrollees under this
                    subsection in the same manner as the Secretary risk
                    adjusts beneficiary rebates described in section
                    1854(b)(1)(C).
                ``(4) Definition of grandfathered enrollee.--In this
            subsection, the term `grandfathered enrollee' means an
            individual who is enrolled (effective as of the date of
            enactment of this subsection) in an MA local plan in an area
            that is identified by the Secretary under paragraph (1).''.
        (h) Transitional Extra Benefits.--Section 1853 of the Social
    Security Act (42 U.S.C. 1395w-23), as amended by subsections (f) and
    (g), is amended by adding at the end the following new subsection:
        ``(p) Transitional Extra Benefits.--
                ``(1) In general.--For years beginning with 2012, the
            Secretary shall provide transitional rebates under section
            1854(b)(1)(C) for the provision of extra benefits (as specified
            by the Secretary) to enrollees described in paragraph (2).
                ``(2) Enrollees described.--An enrollee described in this
            paragraph is an individual who--
                        ``(A) enrolls in an MA local plan in an applicable
                    area; and
                        ``(B) experiences a significant reduction in extra
                    benefits described in clause (ii) of section
                    1854(b)(1)(C) as a result of competitive bidding under
                    this part (as determined by the Secretary).
                ``(3) Applicable areas.--In this subsection, the term
            `applicable area' means the following:
                        ``(A) The 2 largest metropolitan statistical areas,
                    if the Secretary determines that the total amount of
                    such extra benefits for each enrollee for the month in
                    those areas is greater than $100.
                        ``(B) A county where--
                                ``(i) the MA area-specific non-drug monthly
                            benchmark amount for a month in 2011 is equal
                            to the legacy urban floor amount (as described
                            in subsection (c)(1)(B)(iii)), as determined by
                            the Secretary for the area for 2011;
                                ``(ii) the percentage of Medicare Advantage
                            eligible beneficiaries in the county who are
                            enrolled in an MA plan for 2009 is greater than
                            30 percent (as determined by the Secretary);
                            and
                                ``(iii) average bids submitted by an MA
                            organization under section 1854(a) for MA local
                            plans in the county for 2011 are not greater
                            than the adjusted average per capita cost for
                            the year involved, determined under section
                            1876(a)(4), for the county for individuals who
                            are not enrolled in an MA plan under this part
                            for the year, but adjusted to exclude costs
                            attributable to payments under section 1848(o),
                            1886(n), and 1886(h).
                        ``(C) If the Secretary determines appropriate, a
                    county contiguous to an area or county described in
                    subparagraph (A) or (B), respectively.
                ``(4) Review of plan bids.--In the case of a bid submitted
            by an MA organization under section 1854(a) for an MA local
            plan in an applicable area, the Secretary shall review such bid
            in order to ensure that extra benefits (as specified by the
            Secretary) are provided to enrollees described in paragraph
            (2).
                ``(5) Funding.--The Secretary shall provide for the
            transfer from the Federal Hospital Insurance Trust Fund under
            section 1817 and the Federal Supplementary Medical Insurance
            Trust Fund established under section 1841, in such proportion
            as the Secretary determines appropriate, of an amount not to
            exceed $5,000,000,000 for the period of fiscal years 2012
            through 2019 for the purpose of providing transitional rebates
            under section 1854(b)(1)(C) for the provision of extra benefits
            under this subsection.''.
        (i) Nonapplication of Competitive Bidding and Related Provisions
    and Clarification of MA Payment Area for PACE Programs.--
                (1) Nonapplication of competitive bidding and related
            provisions for pace programs.--Section 1894 of the Social
            Security Act (42 U.S.C. 1395eee) is amended--
                        (A) by redesignating subsections (h) and (i) as
                    subsections (i) and (j), respectively;
                        (B) by inserting after subsection (g) the following
                    new subsection:
        ``(h) Nonapplication of Competitive Bidding and Related Provisions
    Under Part C.--With respect to a PACE program under this section, the
    following provisions (and regulations relating to such provisions)
    shall not apply:
                ``(1) Section 1853(j)(1)(A)(i), relating to MA area-
            specific non-drug monthly benchmark amount being based on
            competitive bids.
                ``(2) Section 1853(d)(5), relating to the establishment of
            MA local plan service areas.
                ``(3) Section 1853(n), relating to the payment of
            performance bonuses.
                ``(4) Section 1853(o), relating to grandfathering
            supplemental benefits for current enrollees after
            implementation of competitive bidding.
                ``(5) Section 1853(p), relating to transitional extra
            benefits.''.
                (2) Special rule for ma payment area for pace programs.--
            Section 1853(d) of the Social Security Act (42 U.S.C. 1395w-
            23(d)), as amended by subsection (e), is amended by adding at
            the end the following new paragraph:
                ``(6) Special rule for ma payment area for pace programs.--
            For years beginning with 2012, in the case of a PACE program
            under section 1894, the MA payment area shall be the MA local
            area (as defined in paragraph (2)).''.

    SEC. 3202. BENEFIT PROTECTION AND SIMPLIFICATION.

        (a) Limitation on Variation of Cost Sharing for Certain Benefits.--
                (1) In general.--Section 1852(a)(1)(B) of the Social
            Security Act (42 U.S.C. 1395w-22(a)(1)(B)) is amended--
                        (A) in clause (i), by inserting ``, subject to
                    clause (iii),'' after ``and B or''; and
                        (B) by adding at the end the following new clauses:
                                ``(iii) Limitation on variation of cost
                            sharing for certain benefits.--Subject to
                            clause (v), cost-sharing for services described
                            in clause (iv) shall not exceed the cost-
                            sharing required for those services under parts
                            A and B.
                                ``(iv) Services described.--The following
                            services are described in this clause:
                                        ``(I) Chemotherapy administration
                                    services.
                                        ``(II) Renal dialysis services (as
                                    defined in section 1881(b)(14)(B)).
                                        ``(III) Skilled nursing care.
                                        ``(IV) Such other services that the
                                    Secretary determines appropriate
                                    (including services that the Secretary
                                    determines require a high level of
                                    predictability and transparency for
                                    beneficiaries).
                                ``(v) Exception.--In the case of services
                            described in clause (iv) for which there is no
                            cost-sharing required under parts A and B,
                            cost-sharing may be required for those services
                            in accordance with clause (i).''.
                (2) Effective date.--The amendments made by this subsection
            shall apply to plan years beginning on or after January 1,
            2011.
        (b) Application of Rebates, Performance Bonuses, and Premiums.--
                (1) Application of rebates.--Section 1854(b)(1)(C) of the
            Social Security Act (42 U.S.C. 1395w-24(b)(1)(C)) is amended--
                        (A) in clause (ii), by striking ``rebate.--A
                    rebate'' and inserting ``rebate for plan years before
                    2012.--For plan years before 2012, a rebate'';
                        (B) by redesignating clauses (iii) and (iv) as
                    clauses (iv) and (v); and
                        (C) by inserting after clause (ii) the following
                    new clause:
                                ``(iii) Form of rebate for plan year 2012
                            and subsequent plan years.--For plan years
                            beginning on or after January 1, 2012, a rebate
                            required under this subparagraph may not be
                            used for the purpose described in clause
                            (ii)(III) and shall be provided through the
                            application of the amount of the rebate in the
                            following priority order:
                                        ``(I) First, to use the most
                                    significant share to meaningfully
                                    reduce cost-sharing otherwise
                                    applicable for benefits under the
                                    original medicare fee-for-service
                                    program under parts A and B and for
                                    qualified prescription drug coverage
                                    under part D, including the reduction
                                    of any deductibles, copayments, and
                                    maximum limitations on out-of-pocket
                                    expenses otherwise applicable. Any
                                    reduction of maximum limitations on
                                    out-of-pocket expenses under the
                                    preceding sentence shall apply to all
                                    benefits under the original medicare
                                    fee-for-service program option. The
                                    Secretary may provide guidance on
                                    meaningfully reducing cost-sharing
                                    under this subclause, except that such
                                    guidance may not require a particular
                                    amount of cost-sharing or reduction in
                                    cost-sharing.
                                        ``(II) Second, to use the next most
                                    significant share to meaningfully
                                    provide coverage of preventive and
                                    wellness health care benefits (as
                                    defined by the Secretary) which are not
                                    benefits under the original medicare
                                    fee-for-service program, such as
                                    smoking cessation, a free flu shot, and
                                    an annual physical examination.
                                        ``(III) Third, to use the remaining
                                    share to meaningfully provide coverage
                                    of other health care benefits which are
                                    not benefits under the original
                                    medicare fee-for-service program, such
                                    as eye examinations and dental
                                    coverage, and are not benefits
                                    described in subclause (II).''.
                (2) Application of performance bonuses.--Section 1853(n) of
            the Social Security Act, as added by section 3201(f), is
            amended by adding at the end the following new paragraph:
                ``(6) Application of performance bonuses.--For plan years
            beginning on or after January 1, 2014, any performance bonus
            paid to an MA plan under this subsection shall be used for the
            purposes, and in the priority order, described in subclauses
            (I) through (III) of section 1854(b)(1)(C)(iii).''.
                (3) Application of ma monthly supplementary beneficiary
            premium.--Section 1854(b)(2)(C) of the Social Security Act (42
            U.S.C. 1395w-24(b)(2)(C)) is amended--
                        (A) by striking ``Premium.--The term'' and
                    inserting ``premium.--
                                ``(i) In general.--The term''; and
                        (B) by adding at the end the following new clause:
                                ``(ii) Application of ma monthly
                            supplementary beneficiary premium.--For plan
                            years beginning on or after January 1, 2012,
                            any MA monthly supplementary beneficiary
                            premium charged to an individual enrolled in an
                            MA plan shall be used for the purposes, and in
                            the priority order, described in subclauses (I)
                            through (III) of paragraph (1)(C)(iii).''.

    SEC. 3203. APPLICATION OF CODING INTENSITY ADJUSTMENT DURING MA PAYMENT
                  TRANSITION.

        Section 1853(a)(1)(C) of the Social Security Act (42 U.S.C. 1395w-
    23(a)(1)(C)) is amended by adding at the end the following new clause:
                                ``(iii) Application of coding intensity
                            adjustment for 2011 and subsequent years.--
                                        ``(I) Requirement to apply in 2011
                                    through 2013.--In order to ensure
                                    payment accuracy, the Secretary shall
                                    conduct an analysis of the differences
                                    described in clause (ii)(I). The
                                    Secretary shall ensure that the results
                                    of such analysis are incorporated into
                                    the risk scores for 2011, 2012, and
                                    2013.
                                        ``(II) Authority to apply in 2014
                                    and subsequent years.--The Secretary
                                    may, as appropriate, incorporate the
                                    results of such analysis into the risk
                                    scores for 2014 and subsequent
                                    years.''.

    SEC. 3204. SIMPLIFICATION OF ANNUAL BENEFICIARY ELECTION PERIODS.

        (a) Annual 45-day Period for Disenrollment From MA Plans To Elect
    To Receive Benefits Under the Original Medicare Fee-for-service
    Program.--
                (1) In general.--Section 1851(e)(2)(C) of the Social
            Security Act (42 U.S.C. 1395w-1(e)(2)(C)) is amended to read as
            follows:
                        ``(C) Annual 45-day period for disenrollment from
                    ma plans to elect to receive benefits under the
                    original medicare fee-for-service program.--Subject to
                    subparagraph (D), at any time during the first 45 days
                    of a year (beginning with 2011), an individual who is
                    enrolled in a Medicare Advantage plan may change the
                    election under subsection (a)(1), but only with respect
                    to coverage under the original medicare fee-for-service
                    program under parts A and B, and may elect qualified
                    prescription drug coverage in accordance with section
                    1860D-1.''.
                (2) Effective date.--The amendment made by paragraph (1)
            shall apply with respect to 2011 and succeeding years.
        (b) Timing of the Annual, Coordinated Election Period Under Parts C
    and D.--Section 1851(e)(3)(B) of the Social Security Act (42 U.S.C.
    1395w-1(e)(3)(B)) is amended--
                (1) in clause (iii), by striking ``and'' at the end;
                (2) in clause (iv)--
                        (A) by striking ``and succeeding years'' and
                    inserting ``, 2008, 2009, and 2010''; and
                        (B) by striking the period at the end and inserting
                    ``; and''; and
                (3) by adding at the end the following new clause:
                                ``(v) with respect to 2012 and succeeding
                            years, the period beginning on October 15 and
                            ending on December 7 of the year before such
                            year.''.

    SEC. 3205. EXTENSION FOR SPECIALIZED MA PLANS FOR SPECIAL NEEDS
                  INDIVIDUALS.

        (a) Extension of SNP Authority.--Section 1859(f)(1) of the Social
    Security Act (42 U.S.C. 1395w-28(f)(1)), as amended by section 164(a)
    of the Medicare Improvements for Patients and Providers Act of 2008
    (Public Law 110-275), is amended by striking ``2011'' and inserting
    ``2014''.
        (b) Authority To Apply Frailty Adjustment Under PACE Payment
    Rules.--Section 1853(a)(1)(B) of the Social Security Act (42 U.S.C.
    1395w-23(a)(1)(B)) is amended by adding at the end the following new
    clause:
                                ``(iv) Authority to apply frailty
                            adjustment under pace payment rules for certain
                            specialized ma plans for special needs
                            individuals.--
                                        ``(I) In general.--Notwithstanding
                                    the preceding provisions of this
                                    paragraph, for plan year 2011 and
                                    subsequent plan years, in the case of a
                                    plan described in subclause (II), the
                                    Secretary may apply the payment rules
                                    under section 1894(d) (other than
                                    paragraph (3) of such section) rather
                                    than the payment rules that would
                                    otherwise apply under this part, but
                                    only to the extent necessary to reflect
                                    the costs of treating high
                                    concentrations of frail individuals.
                                        ``(II) Plan described.--A plan
                                    described in this subclause is a
                                    specialized MA plan for special needs
                                    individuals described in section
                                    1859(b)(6)(B)(ii) that is fully
                                    integrated with capitated contracts
                                    with States for Medicaid benefits,
                                    including long-term care, and that have
                                    similar average levels of frailty (as
                                    determined by the Secretary) as the
                                    PACE program.''.
        (c) Transition and Exception Regarding Restriction on Enrollment.--
    Section 1859(f) of the Social Security Act (42 U.S.C. 1395w-28(f)) is
    amended by adding at the end the following new paragraph:
                ``(6) Transition and exception regarding restriction on
            enrollment.--
                        ``(A) In general.--Subject to subparagraph (C), the
                    Secretary shall establish procedures for the transition
                    of applicable individuals to--
                                ``(i) a Medicare Advantage plan that is not
                            a specialized MA plan for special needs
                            individuals (as defined in subsection (b)(6));
                            or
                                ``(ii) the original medicare fee-for-
                            service program under parts A and B.
                        ``(B) Applicable individuals.--For purposes of
                    clause (i), the term `applicable individual' means an
                    individual who--
                                ``(i) is enrolled under a specialized MA
                            plan for special needs individuals (as defined
                            in subsection (b)(6)); and
                                ``(ii) is not within the 1 or more of the
                            classes of special needs individuals to which
                            enrollment under the plan is restricted to.
                        ``(C) Exception.--The Secretary shall provide for
                    an exception to the transition described in
                    subparagraph (A) for a limited period of time for
                    individuals enrolled under a specialized MA plan for
                    special needs individuals described in subsection
                    (b)(6)(B)(ii) who are no longer eligible for medical
                    assistance under title XIX.
                        ``(D) Timeline for initial transition.--The
                    Secretary shall ensure that applicable individuals
                    enrolled in a specialized MA plan for special needs
                    individuals (as defined in subsection (b)(6)) prior to
                    January 1, 2010, are transitioned to a plan or the
                    program described in subparagraph (A) by not later than
                    January 1, 2013.''.
        (d) Temporary Extension of Authority To Operate but No Service Area
    Expansion for Dual Special Needs Plans That Do Not Meet Certain
    Requirements.--Section 164(c)(2) of the Medicare Improvements for
    Patients and Providers Act of 2008 (Public Law 110-275) is amended by
    striking ``December 31, 2010'' and inserting ``December 31, 2012''.
        (e) Authority To Require Special Needs Plans Be NCQA Approved.--
    Section 1859(f) of the Social Security Act (42 U.S.C. 1395w-28(f)), as
    amended by subsections (a) and (c), is amended--
                (1) in paragraph (2), by adding at the end the following
            new subparagraph:
                        ``(C) If applicable, the plan meets the requirement
                    described in paragraph (7).'';
                (2) in paragraph (3), by adding at the end the following
            new subparagraph:
                        ``(E) If applicable, the plan meets the requirement
                    described in paragraph (7).'';
                (3) in paragraph (4), by adding at the end the following
            new subparagraph:
                        ``(C) If applicable, the plan meets the requirement
                    described in paragraph (7).''; and
                (4) by adding at the end the following new paragraph:
                ``(7) Authority to require special needs plans be ncqa
            approved.--For 2012 and subsequent years, the Secretary shall
            require that a Medicare Advantage organization offering a
            specialized MA plan for special needs individuals be approved
            by the National Committee for Quality Assurance (based on
            standards established by the Secretary).''.
        (f) Risk Adjustment.--Section 1853(a)(1)(C) of the Social Security
    Act (42 U.S.C. 1395i-23(a)(1)(C)) is amended by adding at the end the
    following new clause:
                                ``(iii) Improvements to risk adjustment for
                            special needs individuals with chronic health
                            conditions.--
                                        ``(I) In general.--For 2011 and
                                    subsequent years, for purposes of the
                                    adjustment under clause (i) with
                                    respect to individuals described in
                                    subclause (II), the Secretary shall use
                                    a risk score that reflects the known
                                    underlying risk profile and chronic
                                    health status of similar individuals.
                                    Such risk score shall be used instead
                                    of the default risk score for new
                                    enrollees in Medicare Advantage plans
                                    that are not specialized MA plans for
                                    special needs individuals (as defined
                                    in section 1859(b)(6)).
                                        ``(II) Individuals described.--An
                                    individual described in this subclause
                                    is a special needs individual described
                                    in subsection (b)(6)(B)(iii) who
                                    enrolls in a specialized MA plan for
                                    special needs individuals on or after
                                    January 1, 2011.
                                        ``(III) Evaluation.--For 2011 and
                                    periodically thereafter, the Secretary
                                    shall evaluate and revise the risk
                                    adjustment system under this
                                    subparagraph in order to, as accurately
                                    as possible, account for higher medical
                                    and care coordination costs associated
                                    with frailty, individuals with
                                    multiple, comorbid chronic conditions,
                                    and individuals with a diagnosis of
                                    mental illness, and also to account for
                                    costs that may be associated with
                                    higher concentrations of beneficiaries
                                    with those conditions.
                                        ``(IV) Publication of evaluation
                                    and revisions.--The Secretary shall
                                    publish, as part of an announcement
                                    under subsection (b), a description of
                                    any evaluation conducted under
                                    subclause (III) during the preceding
                                    year and any revisions made under such
                                    subclause as a result of such
                                    evaluation.''.
        (g) Technical Correction.--Section 1859(f)(5) of the Social
    Security Act (42 U.S.C. 1395w-28(f)(5)) is amended, in the matter
    preceding subparagraph (A), by striking ``described in subsection
    (b)(6)(B)(i)''.

    SEC. 3206. EXTENSION OF REASONABLE COST CONTRACTS.

        Section 1876(h)(5)(C)(ii) of the Social Security Act (42 U.S.C.
    1395mm(h)(5)(C)(ii)) is amended, in the matter preceding subclause (I),
    by striking ``January 1, 2010'' and inserting ``January 1, 2013''.

    SEC. 3207. TECHNICAL CORRECTION TO MA PRIVATE FEE-FOR-SERVICE PLANS.

        For plan year 2011 and subsequent plan years, to the extent that
    the Secretary of Health and Human Services is applying the 2008 service
    area extension waiver policy (as modified in the April 11, 2008,
    Centers for Medicare & Medicaid Services' memorandum with the subject
    ``2009 Employer Group Waiver-Modification of the 2008 Service Area
    Extension Waiver Granted to Certain MA Local Coordinated Care Plans'')
    to Medicare Advantage coordinated care plans, the Secretary shall
    extend the application of such waiver policy to employers who contract
    directly with the Secretary as a Medicare Advantage private fee-for-
    service plan under section 1857(i)(2) of the Social Security Act (42
    U.S.C. 1395w-27(i)(2)) and that had enrollment as of October 1, 2009.

    SEC. 3208. MAKING SENIOR HOUSING FACILITY DEMONSTRATION PERMANENT.

        (a) In General.--Section 1859 of the Social Security Act (42 U.S.C.
    1395w-28) is amended by adding at the end the following new subsection:
        ``(g) Special Rules for Senior Housing Facility Plans.--
                ``(1) In general.--In the case of a Medicare Advantage
            senior housing facility plan described in paragraph (2),
            notwithstanding any other provision of this part to the
            contrary and in accordance with regulations of the Secretary,
            the service area of such plan may be limited to a senior
            housing facility in a geographic area.
                ``(2) Medicare advantage senior housing facility plan
            described.--For purposes of this subsection, a Medicare
            Advantage senior housing facility plan is a Medicare Advantage
            plan that--
                        ``(A) restricts enrollment of individuals under
                    this part to individuals who reside in a continuing
                    care retirement community (as defined in section
                    1852(l)(4)(B));
                        ``(B) provides primary care services onsite and has
                    a ratio of accessible physicians to beneficiaries that
                    the Secretary determines is adequate;
                        ``(C) provides transportation services for
                    beneficiaries to specialty providers outside of the
                    facility; and
                        ``(D) has participated (as of December 31, 2009) in
                    a demonstration project established by the Secretary
                    under which such a plan was offered for not less than 1
                    year.''.
        (b) Effective Date.--The amendment made by this section shall take
    effect on January 1, 2010, and shall apply to plan years beginning on
    or after such date.

    SEC. 3209. AUTHORITY TO DENY PLAN BIDS.

        (a) In General.--Section 1854(a)(5) of the Social Security Act (42
    U.S.C. 1395w-24(a)(5)) is amended by adding at the end the following
    new subparagraph:
                        ``(C) Rejection of bids.--
                                ``(i) In general.--Nothing in this section
                            shall be construed as requiring the Secretary
                            to accept any or every bid submitted by an MA
                            organization under this subsection.
                                ``(ii) Authority to deny bids that propose
                            significant increases in cost sharing or
                            decreases in benefits.--The Secretary may deny
                            a bid submitted by an MA organization for an MA
                            plan if it proposes significant increases in
                            cost sharing or decreases in benefits offered
                            under the plan.''.
        (b) Application Under Part D.--Section 1860D-11(d) of such Act (42
    U.S.C. 1395w-111(d)) is amended by adding at the end the following new
    paragraph:
                ``(3) Rejection of bids.--Paragraph (5)(C) of section
            1854(a) shall apply with respect to bids submitted by a PDP
            sponsor under subsection (b) in the same manner as such
            paragraph applies to bids submitted by an MA organization under
            such section 1854(a).''.
        (c) Effective Date.--The amendments made by this section shall
    apply to bids submitted for contract years beginning on or after
    January 1, 2011.

    SEC. 3210. DEVELOPMENT OF NEW STANDARDS FOR CERTAIN MEDIGAP PLANS.

        (a) In General.--Section 1882 of the Social Security Act (42 U.S.C.
    1395ss) is amended by adding at the end the following new subsection:
        ``(y) Development of New Standards for Certain Medicare
    Supplemental Policies.--
                ``(1) In general.--The Secretary shall request the National
            Association of Insurance Commissioners to review and revise the
            standards for benefit packages described in paragraph (2) under
            subsection (p)(1), to otherwise update standards to include
            requirements for nominal cost sharing to encourage the use of
            appropriate physicians' services under part B. Such revisions
            shall be based on evidence published in peer-reviewed journals
            or current examples used by integrated delivery systems and
            made consistent with the rules applicable under subsection
            (p)(1)(E) with the reference to the `1991 NAIC Model
            Regulation' deemed a reference to the NAIC Model Regulation as
            published in the Federal Register on December 4, 1998, and as
            subsequently updated by the National Association of Insurance
            Commissioners to reflect previous changes in law and the
            reference to `date of enactment of this subsection' deemed a
            reference to the date of enactment of the Patient Protection
            and Affordable Care Act. To the extent practicable, such
            revision shall provide for the implementation of revised
            standards for benefit packages as of January 1, 2015.
                ``(2) Benefit packages described.--The benefit packages
            described in this paragraph are benefit packages classified as
            `C' and `F'.''.
        (b) Conforming Amendment.--Section 1882(o)(1) of the Social
    Security Act (42 U.S.C. 1395ss(o)(1)) is amended by striking ``, and
    (w)'' and inserting ``(w), and (y)''.

     Subtitle D--Medicare Part D Improvements for Prescription Drug Plans
                                and MA-PD Plans

    SEC. 3301. MEDICARE COVERAGE GAP DISCOUNT PROGRAM.

        (a) Condition for Coverage of Drugs Under Part D.--Part D of Title
    XVIII of the Social Security Act (42 U.S.C. 1395w-101 et seq.), is
    amended by adding at the end the following new section:

               ``condition for coverage of drugs under this part

        ``Sec. 1860D-43.  (a) In General.--In order for coverage to be
    available under this part for covered part D drugs (as defined in
    section 1860D-2(e)) of a manufacturer, the manufacturer must--
                ``(1) participate in the Medicare coverage gap discount
            program under section 1860D-14A;
                ``(2) have entered into and have in effect an agreement
            described in subsection (b) of such section with the Secretary;
            and
                ``(3) have entered into and have in effect, under terms and
            conditions specified by the Secretary, a contract with a third
            party that the Secretary has entered into a contract with under
            subsection (d)(3) of such section.
        ``(b) Effective Date.--Subsection (a) shall apply to covered part D
    drugs dispensed under this part on or after July 1, 2010.
        ``(c) Authorizing Coverage for Drugs Not Covered Under
    Agreements.--Subsection (a) shall not apply to the dispensing of a
    covered part D drug if--
                ``(1) the Secretary has made a determination that the
            availability of the drug is essential to the health of
            beneficiaries under this part; or
                ``(2) the Secretary determines that in the period beginning
            on July 1, 2010, and ending on December 31, 2010, there were
            extenuating circumstances.
        ``(d) Definition of Manufacturer.--In this section, the term
    `manufacturer' has the meaning given such term in section 1860D-
    14A(g)(5).''.
        (b) Medicare Coverage Gap Discount Program.--Part D of title XVIII
    of the Social Security Act (42 U.S.C. 1395w-101) is amended by
    inserting after section 1860D-14 the following new section:

                    ``medicare coverage gap discount program

        ``Sec. 1860D-14A.  (a) Establishment.--The Secretary shall
    establish a Medicare coverage gap discount program (in this section
    referred to as the `program') by not later than July 1, 2010. Under the
    program, the Secretary shall enter into agreements described in
    subsection (b) with manufacturers and provide for the performance of
    the duties described in subsection (c)(1). The Secretary shall
    establish a model agreement for use under the program by not later than
    April 1, 2010, in consultation with manufacturers, and allow for
    comment on such model agreement.
        ``(b) Terms of Agreement.--
                ``(1) In general.--
                        ``(A) Agreement.--An agreement under this section
                    shall require the manufacturer to provide applicable
                    beneficiaries access to discounted prices for
                    applicable drugs of the manufacturer.
                        ``(B) Provision of discounted prices at the point-
                    of-sale.--Except as provided in subsection
                    (c)(1)(A)(iii), such discounted prices shall be
                    provided to the applicable beneficiary at the pharmacy
                    or by the mail order service at the point-of-sale of an
                    applicable drug.
                        ``(C) Timing of agreement.--
                                ``(i) Special rule for 2010 and 2011.--In
                            order for an agreement with a manufacturer to
                            be in effect under this section with respect to
                            the period beginning on July 1, 2010, and
                            ending on December 31, 2011, the manufacturer
                            shall enter into such agreement not later than
                            May 1, 2010.
                                ``(ii) 2012 and subsequent years.--In order
                            for an agreement with a manufacturer to be in
                            effect under this section with respect to plan
                            year 2012 or a subsequent plan year, the
                            manufacturer shall enter into such agreement
                            (or such agreement shall be renewed under
                            paragraph (4)(A)) not later than January 30 of
                            the preceding year.
                ``(2) Provision of appropriate data.--Each manufacturer
            with an agreement in effect under this section shall collect
            and have available appropriate data, as determined by the
            Secretary, to ensure that it can demonstrate to the Secretary
            compliance with the requirements under the program.
                ``(3) Compliance with requirements for administration of
            program.--Each manufacturer with an agreement in effect under
            this section shall comply with requirements imposed by the
            Secretary or a third party with a contract under subsection
            (d)(3), as applicable, for purposes of administering the
            program, including any determination under clause (i) of
            subsection (c)(1)(A) or procedures established under such
            subsection (c)(1)(A).
                ``(4) Length of agreement.--
                        ``(A) In general.--An agreement under this section
                    shall be effective for an initial period of not less
                    than 18 months and shall be automatically renewed for a
                    period of not less than 1 year unless terminated under
                    subparagraph (B).
                        ``(B) Termination.--
                                ``(i) By the secretary.--The Secretary may
                            provide for termination of an agreement under
                            this section for a knowing and willful
                            violation of the requirements of the agreement
                            or other good cause shown. Such termination
                            shall not be effective earlier than 30 days
                            after the date of notice to the manufacturer of
                            such termination. The Secretary shall provide,
                            upon request, a manufacturer with a hearing
                            concerning such a termination, and such hearing
                            shall take place prior to the effective date of
                            the termination with sufficient time for such
                            effective date to be repealed if the Secretary
                            determines appropriate.
                                ``(ii) By a manufacturer.--A manufacturer
                            may terminate an agreement under this section
                            for any reason. Any such termination shall be
                            effective, with respect to a plan year--
                                        ``(I) if the termination occurs
                                    before January 30 of a plan year, as of
                                    the day after the end of the plan year;
                                    and
                                        ``(II) if the termination occurs on
                                    or after January 30 of a plan year, as
                                    of the day after the end of the
                                    succeeding plan year.
                                ``(iii) Effectiveness of termination.--Any
                            termination under this subparagraph shall not
                            affect discounts for applicable drugs of the
                            manufacturer that are due under the agreement
                            before the effective date of its termination.
                                ``(iv) Notice to third party.--The
                            Secretary shall provide notice of such
                            termination to a third party with a contract
                            under subsection (d)(3) within not less than 30
                            days before the effective date of such
                            termination.
        ``(c) Duties Described and Special Rule for Supplemental
    Benefits.--
                ``(1) Duties described.--The duties described in this
            subsection are the following:
                        ``(A) Administration of program.--Administering the
                    program, including--
                                ``(i) the determination of the amount of
                            the discounted price of an applicable drug of a
                            manufacturer;
                                ``(ii) except as provided in clause (iii),
                            the establishment of procedures under which
                            discounted prices are provided to applicable
                            beneficiaries at pharmacies or by mail order
                            service at the point-of-sale of an applicable
                            drug;
                                ``(iii) in the case where, during the
                            period beginning on July 1, 2010, and ending on
                            December 31, 2011, it is not practicable to
                            provide such discounted prices at the point-of-
                            sale (as described in clause (ii)), the
                            establishment of procedures to provide such
                            discounted prices as soon as practicable after
                            the point-of-sale;
                                ``(iv) the establishment of procedures to
                            ensure that, not later than the applicable
                            number of calendar days after the dispensing of
                            an applicable drug by a pharmacy or mail order
                            service, the pharmacy or mail order service is
                            reimbursed for an amount equal to the
                            difference between--
                                        ``(I) the negotiated price of the
                                    applicable drug; and
                                        ``(II) the discounted price of the
                                    applicable drug;
                                ``(v) the establishment of procedures to
                            ensure that the discounted price for an
                            applicable drug under this section is applied
                            before any coverage or financial assistance
                            under other health benefit plans or programs
                            that provide coverage or financial assistance
                            for the purchase or provision of prescription
                            drug coverage on behalf of applicable
                            beneficiaries as the Secretary may specify;
                                ``(vi) the establishment of procedures to
                            implement the special rule for supplemental
                            benefits under paragraph (2); and
                                ``(vii) providing a reasonable dispute
                            resolution mechanism to resolve disagreements
                            between manufacturers, applicable
                            beneficiaries, and the third party with a
                            contract under subsection (d)(3).
                        ``(B) Monitoring compliance.--
                                ``(i) In general.--The Secretary shall
                            monitor compliance by a manufacturer with the
                            terms of an agreement under this section.
                                ``(ii) Notification.--If a third party with
                            a contract under subsection (d)(3) determines
                            that the manufacturer is not in compliance with
                            such agreement, the third party shall notify
                            the Secretary of such noncompliance for
                            appropriate enforcement under subsection (e).
                        ``(C) Collection of data from prescription drug
                    plans and ma-pd plans.--The Secretary may collect
                    appropriate data from prescription drug plans and MA-PD
                    plans in a timeframe that allows for discounted prices
                    to be provided for applicable drugs under this section.
                ``(2) Special rule for supplemental benefits.--For plan
            year 2010 and each subsequent plan year, in the case where an
            applicable beneficiary has supplemental benefits with respect
            to applicable drugs under the prescription drug plan or MA-PD
            plan that the applicable beneficiary is enrolled in, the
            applicable beneficiary shall not be provided a discounted price
            for an applicable drug under this section until after such
            supplemental benefits have been applied with respect to the
            applicable drug.
        ``(d) Administration.--
                ``(1) In general.--Subject to paragraph (2), the Secretary
            shall provide for the implementation of this section, including
            the performance of the duties described in subsection (c)(1).
                ``(2) Limitation.--
                        ``(A) In general.--Subject to subparagraph (B), in
                    providing for such implementation, the Secretary shall
                    not receive or distribute any funds of a manufacturer
                    under the program.
                        ``(B) Exception.--The limitation under subparagraph
                    (A) shall not apply to the Secretary with respect to
                    drugs dispensed during the period beginning on July 1,
                    2010, and ending on December 31, 2010, but only if the
                    Secretary determines that the exception to such
                    limitation under this subparagraph is necessary in
                    order for the Secretary to begin implementation of this
                    section and provide applicable beneficiaries timely
                    access to discounted prices during such period.
                ``(3) Contract with third parties.--The Secretary shall
            enter into a contract with 1 or more third parties to
            administer the requirements established by the Secretary in
            order to carry out this section. At a minimum, the contract
            with a third party under the preceding sentence shall require
            that the third party--
                        ``(A) receive and transmit information between the
                    Secretary, manufacturers, and other individuals or
                    entities the Secretary determines appropriate;
                        ``(B) receive, distribute, or facilitate the
                    distribution of funds of manufacturers to appropriate
                    individuals or entities in order to meet the
                    obligations of manufacturers under agreements under
                    this section;
                        ``(C) provide adequate and timely information to
                    manufacturers, consistent with the agreement with the
                    manufacturer under this section, as necessary for the
                    manufacturer to fulfill its obligations under this
                    section; and
                        ``(D) permit manufacturers to conduct periodic
                    audits, directly or through contracts, of the data and
                    information used by the third party to determine
                    discounts for applicable drugs of the manufacturer
                    under the program.
                ``(4) Performance requirements.--The Secretary shall
            establish performance requirements for a third party with a
            contract under paragraph (3) and safeguards to protect the
            independence and integrity of the activities carried out by the
            third party under the program under this section.
                ``(5) Implementation.--The Secretary may implement the
            program under this section by program instruction or otherwise.
                ``(6) Administration.--Chapter 35 of title 44, United
            States Code, shall not apply to the program under this section.
        ``(e) Enforcement.--
                ``(1) Audits.--Each manufacturer with an agreement in
            effect under this section shall be subject to periodic audit by
            the Secretary.
                ``(2) Civil money penalty.--
                        ``(A) In general.--The Secretary shall impose a
                    civil money penalty on a manufacturer that fails to
                    provide applicable beneficiaries discounts for
                    applicable drugs of the manufacturer in accordance with
                    such agreement for each such failure in an amount the
                    Secretary determines is commensurate with the sum of--
                                ``(i) the amount that the manufacturer
                            would have paid with respect to such discounts
                            under the agreement, which will then be used to
                            pay the discounts which the manufacturer had
                            failed to provide; and
                                ``(ii) 25 percent of such amount.
                        ``(B) Application.--The provisions of section 1128A
                    (other than subsections (a) and (b)) shall apply to a
                    civil money penalty under this paragraph in the same
                    manner as such provisions apply to a penalty or
                    proceeding under section 1128A(a).
        ``(f) Clarification Regarding Availability of Other Covered Part D
    Drugs.--Nothing in this section shall prevent an applicable beneficiary
    from purchasing a covered part D drug that is not an applicable drug
    (including a generic drug or a drug that is not on the formulary of the
    prescription drug plan or MA-PD plan that the applicable beneficiary is
    enrolled in).
        ``(g) Definitions.--In this section:
                ``(1) Applicable beneficiary.--The term `applicable
            beneficiary' means an individual who, on the date of dispensing
            an applicable drug--
                        ``(A) is enrolled in a prescription drug plan or an
                    MA-PD plan;
                        ``(B) is not enrolled in a qualified retiree
                    prescription drug plan;
                        ``(C) is not entitled to an income-related subsidy
                    under section 1860D-14(a);
                        ``(D) is not subject to a reduction in premium
                    subsidy under section 1839(i); and
                        ``(E) who--
                                ``(i) has reached or exceeded the initial
                            coverage limit under section 1860D-2(b)(3)
                            during the year; and
                                ``(ii) has not incurred costs for covered
                            part D drugs in the year equal to the annual
                            out-of-pocket threshold specified in section
                            1860D-2(b)(4)(B).
                ``(2) Applicable drug.--The term `applicable drug' means,
            with respect to an applicable beneficiary, a covered part D
            drug--
                        ``(A) approved under a new drug application under
                    section 505(b) of the Federal Food, Drug, and Cosmetic
                    Act or, in the case of a biologic product, licensed
                    under section 351 of the Public Health Service Act
                    (other than a product licensed under subsection (k) of
                    such section 351); and
                        ``(B)(i) if the PDP sponsor of the prescription
                    drug plan or the MA organization offering the MA-PD
                    plan uses a formulary, which is on the formulary of the
                    prescription drug plan or MA-PD plan that the
                    applicable beneficiary is enrolled in;
                        ``(ii) if the PDP sponsor of the prescription drug
                    plan or the MA organization offering the MA-PD plan
                    does not use a formulary, for which benefits are
                    available under the prescription drug plan or MA-PD
                    plan that the applicable beneficiary is enrolled in; or
                        ``(iii) is provided through an exception or appeal.
                ``(3) Applicable number of calendar days.--The term
            `applicable number of calendar days' means--
                        ``(A) with respect to claims for reimbursement
                    submitted electronically, 14 days; and
                        ``(B) with respect to claims for reimbursement
                    submitted otherwise, 30 days.
                ``(4) Discounted price.--
                        ``(A) In general.--The term `discounted price'
                    means 50 percent of the negotiated price of the
                    applicable drug of a manufacturer.
                        ``(B) Clarification.--Nothing in this section shall
                    be construed as affecting the responsibility of an
                    applicable beneficiary for payment of a dispensing fee
                    for an applicable drug.
                        ``(C) Special case for certain claims.--In the case
                    where the entire amount of the negotiated price of an
                    individual claim for an applicable drug with respect to
                    an applicable beneficiary does not fall at or above the
                    initial coverage limit under section 1860D-2(b)(3) and
                    below the annual out-of-pocket threshold specified in
                    section 1860D-2(b)(4)(B) for the year, the manufacturer
                    of the applicable drug shall provide the discounted
                    price under this section on only the portion of the
                    negotiated price of the applicable drug that falls at
                    or above such initial coverage limit and below such
                    annual out-of-pocket threshold.
                ``(5) Manufacturer.--The term `manufacturer' means any
            entity which is engaged in the production, preparation,
            propagation, compounding, conversion, or processing of
            prescription drug products, either directly or indirectly by
            extraction from substances of natural origin, or independently
            by means of chemical synthesis, or by a combination of
            extraction and chemical synthesis. Such term does not include a
            wholesale distributor of drugs or a retail pharmacy licensed
            under State law.
                ``(6) Negotiated price.--The term `negotiated price' has
            the meaning given such term in section 423.100 of title 42,
            Code of Federal Regulations (as in effect on the date of
            enactment of this section), except that such negotiated price
            shall not include any dispensing fee for the applicable drug.
                ``(7) Qualified retiree prescription drug plan.--The term
            `qualified retiree prescription drug plan' has the meaning
            given such term in section 1860D-22(a)(2).''.
        (c) Inclusion in Incurred Costs.--
                (1) In general.--Section 1860D-2(b)(4) of the Social
            Security Act (42 U.S.C. 1395w-102(b)(4)) is amended--
                        (A) in subparagraph (C), in the matter preceding
                    clause (i), by striking ``In applying'' and inserting
                    ``Except as provided in subparagraph (E), in
                    applying''; and
                        (B) by adding at the end the following new
                    subparagraph:
                        ``(E) Inclusion of costs of applicable drugs under
                    medicare coverage gap discount program.--In applying
                    subparagraph (A), incurred costs shall include the
                    negotiated price (as defined in paragraph (6) of
                    section 1860D-14A(g)) of an applicable drug (as defined
                    in paragraph (2) of such section) of a manufacturer
                    that is furnished to an applicable beneficiary (as
                    defined in paragraph (1) of such section) under the
                    Medicare coverage gap discount program under section
                    1860D-14A, regardless of whether part of such costs
                    were paid by a manufacturer under such program.''.
                (2) Effective date.--The amendments made by this subsection
            shall apply to costs incurred on or after July 1, 2010.
        (d) Conforming Amendment Permitting Prescription Drug Discounts.--
                (1) In general.--Section 1128B(b)(3) of the Social Security
            Act (42 U.S.C. 1320a-7b(b)(3)) is amended--
                        (A) by striking ``and'' at the end of subparagraph
                    (G);
                        (B) 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)--
                                (i) by moving such subparagraph 2 ems to
                            the left; and
                                (ii) by striking the period at the end and
                            inserting a semicolon;
                        (C) in the subparagraph (H) added by section 431(a)
                    of such Act (117 Stat. 2287)--
                                (i) by redesignating such subparagraph as
                            subparagraph (I);
                                (ii) by moving such subparagraph 2 ems to
                            the left; and
                                (iii) by striking the period at the end and
                            inserting ``; and''; and
                        (D) by adding at the end the following new
                    subparagraph:
                        ``(J) a discount in the price of an applicable drug
                    (as defined in paragraph (2) of section 1860D-14A(g))
                    of a manufacturer that is furnished to an applicable
                    beneficiary (as defined in paragraph (1) of such
                    section) under the Medicare coverage gap discount
                    program under section 1860D-14A.''.
                (2) Conforming amendment to definition of best price under
            medicaid.--Section 1927(c)(1)(C)(i)(VI) of the Social Security
            Act (42 U.S.C. 1396r-8(c)(1)(C)(i)(VI)) is amended by inserting
            ``, or any discounts provided by manufacturers under the
            Medicare coverage gap discount program under section 1860D-
            14A'' before the period at the end.
                (3) Effective date.--The amendments made by this subsection
            shall apply to drugs dispensed on or after July 1, 2010.

    SEC. 3302. IMPROVEMENT IN DETERMINATION OF MEDICARE PART D LOW-INCOME
                  BENCHMARK PREMIUM.

        (a) In General.--Section 1860D-14(b)(2)(B)(iii) of the Social
    Security Act (42 U.S.C. 1395w-114(b)(2)(B)(iii)) is amended by
    inserting ``, determined without regard to any reduction in such
    premium as a result of any beneficiary rebate under section
    1854(b)(1)(C) or bonus payment under section 1853(n)'' before the
    period at the end.
        (b) Effective Date.--The amendment made by subsection (a) shall
    apply to premiums for months beginning on or after January 1, 2011.

    SEC. 3303. VOLUNTARY DE MINIMIS POLICY FOR SUBSIDY ELIGIBLE INDIVIDUALS
                  UNDER PRESCRIPTION DRUG PLANS AND MA-PD PLANS.

        (a) In General.--Section 1860D-14(a) of the Social Security Act (42
    U.S.C. 1395w-114(a)) is amended by adding at the end the following new
    paragraph:
                ``(5) Waiver of de minimis premiums.--The Secretary shall,
            under procedures established by the Secretary, permit a
            prescription drug plan or an MA-PD plan to waive the monthly
            beneficiary premium for a subsidy eligible individual if the
            amount of such premium is de minimis. If such premium is waived
            under the plan, the Secretary shall not reassign subsidy
            eligible individuals enrolled in the plan to other plans based
            on the fact that the monthly beneficiary premium under the plan
            was greater than the low-income benchmark premium amount.''.
        (b) Authorizing the Secretary To Auto-enroll Subsidy Eligible
    Individuals in Plans That Waive De Minimis Premiums.--Section 1860D-
    1(b)(1) of the Social Security Act (42 U.S.C. 1395w-101(b)(1)) is
    amended--
                (1) in subparagraph (C), by inserting ``except as provided
            in subparagraph (D),'' after ``shall include,''
                (2) by adding at the end the following new subparagraph:
                        ``(D) Special rule for plans that waive de minimis
                    premiums.--The process established under subparagraph
                    (A) may include, in the case of a part D eligible
                    individual who is a subsidy eligible individual (as
                    defined in section 1860D-14(a)(3)) who has failed to
                    enroll in a prescription drug plan or an MA-PD plan,
                    for the enrollment in a prescription drug plan or MA-PD
                    plan that has waived the monthly beneficiary premium
                    for such subsidy eligible individual under section
                    1860D-14(a)(5). If there is more than one such plan
                    available, the Secretary shall enroll such an
                    individual under the preceding sentence on a random
                    basis among all such plans in the PDP region. Nothing
                    in the previous sentence shall prevent such an
                    individual from declining or changing such
                    enrollment.''.
        (c) Effective Date.--The amendments made by this subsection shall
    apply to premiums for months, and enrollments for plan years, beginning
    on or after January 1, 2011.

    SEC. 3304. SPECIAL RULE FOR WIDOWS AND WIDOWERS REGARDING ELIGIBILITY
                  FOR LOW-INCOME ASSISTANCE.

        (a) In General.--Section 1860D-14(a)(3)(B) of the Social Security
    Act (42 U.S.C. 1395w-114(a)(3)(B)) is amended by adding at the end the
    following new clause:
                                ``(vi) Special rule for widows and
                            widowers.--Notwithstanding the preceding
                            provisions of this subparagraph, in the case of
                            an individual whose spouse dies during the
                            effective period for a determination or
                            redetermination that has been made under this
                            subparagraph, such effective period shall be
                            extended through the date that is 1 year after
                            the date on which the determination or
                            redetermination would (but for the application
                            of this clause) otherwise cease to be
                            effective.''.
        (b) Effective Date.--The amendment made by subsection (a) shall
    take effect on January 1, 2011.

    SEC. 3305. IMPROVED INFORMATION FOR SUBSIDY ELIGIBLE INDIVIDUALS
                  REASSIGNED TO PRESCRIPTION DRUG PLANS AND MA-PD PLANS.

        Section 1860D-14 of the Social Security Act (42 U.S.C. 1395w-114)
    is amended--
                (1) by redesignating subsection (d) as subsection (e); and
                (2) by inserting after subsection (c) the following new
            subsection:
        ``(d) Facilitation of Reassignments.--Beginning not later than
    January 1, 2011, the Secretary shall, in the case of a subsidy eligible
    individual who is enrolled in one prescription drug plan and is
    subsequently reassigned by the Secretary to a new prescription drug
    plan, provide the individual, within 30 days of such reassignment,
    with--
                ``(1) information on formulary differences between the
            individual's former plan and the plan to which the individual
            is reassigned with respect to the individual's drug regimens;
            and
                ``(2) a description of the individual's right to request a
            coverage determination, exception, or reconsideration under
            section 1860D-4(g), bring an appeal under section 1860D-4(h),
            or resolve a grievance under section 1860D-4(f).''.

    SEC. 3306. FUNDING OUTREACH AND ASSISTANCE FOR LOW-INCOME PROGRAMS.

        (a) Additional Funding for State Health Insurance Programs.--
    Subsection (a)(1)(B) of section 119 of the Medicare Improvements for
    Patients and Providers Act of 2008 (42 U.S.C. 1395b-3 note) is amended
    by striking ``(42 U.S.C. 1395w-23(f))'' and all that follows through
    the period at the end and inserting ``(42 U.S.C. 1395w-23(f)), to the
    Centers for Medicare & Medicaid Services Program Management Account--
                                ``(i) for fiscal year 2009, of $7,500,000;
                            and
                                ``(ii) for the period of fiscal years 2010
                            through 2012, of $15,000,000.
                    Amounts appropriated under this subparagraph shall
                    remain available until expended.''.
        (b) Additional Funding for Area Agencies on Aging.--Subsection
    (b)(1)(B) of such section 119 is amended by striking ``(42 U.S.C.
    1395w-23(f))'' and all that follows through the period at the end and
    inserting ``(42 U.S.C. 1395w-23(f)), to the Administration on Aging--
                                ``(i) for fiscal year 2009, of $7,500,000;
                            and
                                ``(ii) for the period of fiscal years 2010
                            through 2012, of $15,000,000.
                    Amounts appropriated under this subparagraph shall
                    remain available until expended.''.
        (c) Additional Funding for Aging and Disability Resource Centers.--
    Subsection (c)(1)(B) of such section 119 is amended by striking ``(42
    U.S.C. 1395w-23(f))'' and all that follows through the period at the
    end and inserting ``(42 U.S.C. 1395w-23(f)), to the Administration on
    Aging--
                                ``(i) for fiscal year 2009, of $5,000,000;
                            and
                                ``(ii) for the period of fiscal years 2010
                            through 2012, of $10,000,000.
                    Amounts appropriated under this subparagraph shall
                    remain available until expended.''.
        (d) Additional Funding for Contract With the National Center for
    Benefits and Outreach Enrollment.--Subsection (d)(2) of such section
    119 is amended by striking ``(42 U.S.C. 1395w-23(f))'' and all that
    follows through the period at the end and inserting ``(42 U.S.C. 1395w-
    23(f)), to the Administration on Aging--
                                ``(i) for fiscal year 2009, of $5,000,000;
                            and
                                ``(ii) for the period of fiscal years 2010
                            through 2012, of $5,000,000.
                    Amounts appropriated under this subparagraph shall
                    remain available until expended.''.
        (e) Secretarial Authority To Enlist Support in Conducting Certain
    Outreach Activities.--Such section 119 is amended by adding at the end
    the following new subsection:
        ``(g) Secretarial Authority To Enlist Support in Conducting Certain
    Outreach Activities.--The Secretary may request that an entity awarded
    a grant under this section support the conduct of outreach activities
    aimed at preventing disease and promoting wellness. Notwithstanding any
    other provision of this section, an entity may use a grant awarded
    under this subsection to support the conduct of activities described in
    the preceding sentence.''.

    SEC. 3307. IMPROVING FORMULARY REQUIREMENTS FOR PRESCRIPTION DRUG PLANS
                  AND MA-PD PLANS WITH RESPECT TO CERTAIN CATEGORIES OR
                  CLASSES OF DRUGS.

        (a) Improving Formulary Requirements.--Section 1860D-4(b)(3)(G) of
    the Social Security Act is amended to read as follows:
                        ``(G) Required inclusion of drugs in certain
                    categories and classes.--
                                ``(i) Formulary requirements.--
                                        ``(I) In general.--Subject to
                                    subclause (II), a PDP sponsor offering
                                    a prescription drug plan shall be
                                    required to include all covered part D
                                    drugs in the categories and classes
                                    identified by the Secretary under
                                    clause (ii)(I).
                                        ``(II) Exceptions.--The Secretary
                                    may establish exceptions that permit a
                                    PDP sponsor offering a prescription
                                    drug plan to exclude from its formulary
                                    a particular covered part D drug in a
                                    category or class that is otherwise
                                    required to be included in the
                                    formulary under subclause (I) (or to
                                    otherwise limit access to such a drug,
                                    including through prior authorization
                                    or utilization management).
                                ``(ii) Identification of drugs in certain
                            categories and classes.--
                                        ``(I) In general.--Subject to
                                    clause (iv), the Secretary shall
                                    identify, as appropriate, categories
                                    and classes of drugs for which the
                                    Secretary determines are of clinical
                                    concern.
                                        ``(II) Criteria.--The Secretary
                                    shall use criteria established by the
                                    Secretary in making any determination
                                    under subclause (I).
                                ``(iii) Implementation.--The Secretary
                            shall establish the criteria under clause
                            (ii)(II) and any exceptions under clause
                            (i)(II) through the promulgation of a
                            regulation which includes a public notice and
                            comment period.
                                ``(iv) Requirement for certain categories
                            and classes until criteria established.--Until
                            such time as the Secretary establishes the
                            criteria under clause (ii)(II) the following
                            categories and classes of drugs shall be
                            identified under clause (ii)(I):
                                        ``(I) Anticonvulsants.
                                        ``(II) Antidepressants.
                                        ``(III) Antineoplastics.
                                        ``(IV) Antipsychotics.
                                        ``(V) Antiretrovirals.
                                        ``(VI) Immunosuppressants for the
                                    treatment of transplant rejection.''.
        (b) Effective Date.--The amendments made by this section shall
    apply to plan year 2011 and subsequent plan years.

    SEC. 3308. REDUCING PART D PREMIUM SUBSIDY FOR HIGH-INCOME
                  BENEFICIARIES.

        (a) Income-Related Increase in Part D Premium.--
                (1) In general.--Section 1860D-13(a) of the Social Security
            Act (42 U.S.C. 1395w-113(a)) is amended by adding at the end
            the following new paragraph:
                ``(7) Increase in base beneficiary premium based on
            income.--
                        ``(A) In general.--In the case of an individual
                    whose modified adjusted gross income exceeds the
                    threshold amount applicable under paragraph (2) of
                    section 1839(i) (including application of paragraph (5)
                    of such section) for the calendar year, the monthly
                    amount of the beneficiary premium applicable under this
                    section for a month after December 2010 shall be
                    increased by the monthly adjustment amount specified in
                    subparagraph (B).
                        ``(B) Monthly adjustment amount.--The monthly
                    adjustment amount specified in this subparagraph for an
                    individual for a month in a year is equal to the
                    product of--
                                ``(i) the quotient obtained by dividing--
                                        ``(I) the applicable percentage
                                    determined under paragraph (3)(C) of
                                    section 1839(i) (including application
                                    of paragraph (5) of such section) for
                                    the individual for the calendar year
                                    reduced by 25.5 percent; by
                                        ``(II) 25.5 percent; and
                                ``(ii) the base beneficiary premium (as
                            computed under paragraph (2)).
                        ``(C) Modified adjusted gross income.--For purposes
                    of this paragraph, the term `modified adjusted gross
                    income' has the meaning given such term in subparagraph
                    (A) of section 1839(i)(4), determined for the taxable
                    year applicable under subparagraphs (B) and (C) of such
                    section.
                        ``(D) Determination by commissioner of social
                    security.--The Commissioner of Social Security shall
                    make any determination necessary to carry out the
                    income-related increase in the base beneficiary premium
                    under this paragraph.
                        ``(E) Procedures to assure correct income-related
                    increase in base beneficiary premium.--
                                ``(i) Disclosure of base beneficiary
                            premium.--Not later than September 15 of each
                            year beginning with 2010, the Secretary shall
                            disclose to the Commissioner of Social Security
                            the amount of the base beneficiary premium (as
                            computed under paragraph (2)) for the purpose
                            of carrying out the income-related increase in
                            the base beneficiary premium under this
                            paragraph with respect to the following year.
                                ``(ii) Additional disclosure.--Not later
                            than October 15 of each year beginning with
                            2010, the Secretary shall disclose to the
                            Commissioner of Social Security the following
                            information for the purpose of carrying out the
                            income-related increase in the base beneficiary
                            premium under this paragraph with respect to
                            the following year:
                                        ``(I) The modified adjusted gross
                                    income threshold applicable under
                                    paragraph (2) of section 1839(i)
                                    (including application of paragraph (5)
                                    of such section).
                                        ``(II) The applicable percentage
                                    determined under paragraph (3)(C) of
                                    section 1839(i) (including application
                                    of paragraph (5) of such section).
                                        ``(III) The monthly adjustment
                                    amount specified in subparagraph (B).
                                        ``(IV) Any other information the
                                    Commissioner of Social Security
                                    determines necessary to carry out the
                                    income-related increase in the base
                                    beneficiary premium under this
                                    paragraph.
                        ``(F) Rule of construction.--The formula used to
                    determine the monthly adjustment amount specified under
                    subparagraph (B) shall only be used for the purpose of
                    determining such monthly adjustment amount under such
                    subparagraph.''.
                (2) Collection of monthly adjustment amount.--Section
            1860D-13(c) of the Social Security Act (42 U.S.C. 1395w-113(c))
            is amended--
                        (A) in paragraph (1), by striking ``(2) and (3)''
                    and inserting ``(2), (3), and (4)''; and
                        (B) by adding at the end the following new
                    paragraph:
                ``(4) Collection of monthly adjustment amount.--
                        ``(A) In general.--Notwithstanding any provision of
                    this subsection or section 1854(d)(2), subject to
                    subparagraph (B), the amount of the income-related
                    increase in the base beneficiary premium for an
                    individual for a month (as determined under subsection
                    (a)(7)) shall be paid through withholding from benefit
                    payments in the manner provided under section 1840.
                        ``(B) Agreements.--In the case where the monthly
                    benefit payments of an individual that are withheld
                    under subparagraph (A) are insufficient to pay the
                    amount described in such subparagraph, the Commissioner
                    of Social Security shall enter into agreements with the
                    Secretary, the Director of the Office of Personnel
                    Management, and the Railroad Retirement Board as
                    necessary in order to allow other agencies to collect
                    the amount described in subparagraph (A) that was not
                    withheld under such subparagraph.''.
        (b) Conforming Amendments.--
                (1) Medicare.--Section 1860D-13(a)(1) of the Social
            Security Act (42 U.S.C. 1395w-113(a)(1)) is amended--
                        (A) by redesignating subparagraph (F) as
                    subparagraph (G);
                        (B) in subparagraph (G), as redesignated by
                    subparagraph (A), by striking ``(D) and (E)'' and
                    inserting ``(D), (E), and (F)''; and
                        (C) by inserting after subparagraph (E) the
                    following new subparagraph:
                        ``(F) Increase based on income.--The monthly
                    beneficiary premium shall be increased pursuant to
                    paragraph (7).''.
                (2) Internal revenue code.--Section 6103(l)(20) of the
            Internal Revenue Code of 1986 (relating to disclosure of return
            information to carry out Medicare part B premium subsidy
            adjustment) is amended--
                        (A) in the heading, by inserting ``and part d base
                    beneficiary premium increase'' after ``part b premium
                    subsidy adjustment'';
                        (B) in subparagraph (A)--
                                (i) in the matter preceding clause (i), by
                            inserting ``or increase under section 1860D-
                            13(a)(7)'' after ``1839(i)''; and
                                (ii) in clause (vii), by inserting after
                            ``subsection (i) of such section'' the
                            following: ``or increase under section 1860D-
                            13(a)(7) of such Act''; and
                        (C) in subparagraph (B)--
                                (i) by striking ``Return information'' and
                            inserting the following:
                                ``(i) In general.--Return information'';
                                (ii) by inserting ``or increase under such
                            section 1860D-13(a)(7)'' before the period at
                            the end;
                                (iii) as amended by clause (i), by
                            inserting ``or for the purpose of resolving
                            taxpayer appeals with respect to any such
                            premium adjustment or increase'' before the
                            period at the end; and
                                (iv) by adding at the end the following new
                            clause:
                                ``(ii) Disclosure to other agencies.--
                            Officers, employees, and contractors of the
                            Social Security Administration may disclose--
                                        ``(I) the taxpayer identity
                                    information and the amount of the
                                    premium subsidy adjustment or premium
                                    increase with respect to a taxpayer
                                    described in subparagraph (A) to
                                    officers, employees, and contractors of
                                    the Centers for Medicare and Medicaid
                                    Services, to the extent that such
                                    disclosure is necessary for the
                                    collection of the premium subsidy
                                    amount or the increased premium amount,
                                        ``(II) the taxpayer identity
                                    information and the amount of the
                                    premium subsidy adjustment or the
                                    increased premium amount with respect
                                    to a taxpayer described in subparagraph
                                    (A) to officers and employees of the
                                    Office of Personnel Management and the
                                    Railroad Retirement Board, to the
                                    extent that such disclosure is
                                    necessary for the collection of the
                                    premium subsidy amount or the increased
                                    premium amount,
                                        ``(III) return information with
                                    respect to a taxpayer described in
                                    subparagraph (A) to officers and
                                    employees of the Department of Health
                                    and Human Services to the extent
                                    necessary to resolve administrative
                                    appeals of such premium subsidy
                                    adjustment or increased premium, and
                                        ``(IV) return information with
                                    respect to a taxpayer described in
                                    subparagraph (A) to officers and
                                    employees of the Department of Justice
                                    for use in judicial proceedings to the
                                    extent necessary to carry out the
                                    purposes described in clause (i).''.

    SEC. 3309. ELIMINATION OF COST SHARING FOR CERTAIN DUAL ELIGIBLE
                  INDIVIDUALS.

        Section 1860D-14(a)(1)(D)(i) of the Social Security Act (42 U.S.C.
    1395w-114(a)(1)(D)(i)) is amended by inserting ``or, effective on a
    date specified by the Secretary (but in no case earlier than January 1,
    2012), who would be such an institutionalized individual or couple, if
    the full-benefit dual eligible individual were not receiving services
    under a home and community-based waiver authorized for a State under
    section 1115 or subsection (c) or (d) of section 1915 or under a State
    plan amendment under subsection (i) of such section or services
    provided through enrollment in a medicaid managed care organization
    with a contract under section 1903(m) or under section 1932'' after
    ``1902(q)(1)(B))''.

    SEC. 3310. REDUCING WASTEFUL DISPENSING OF OUTPATIENT PRESCRIPTION
                  DRUGS IN LONG-TERM CARE FACILITIES UNDER PRESCRIPTION
                  DRUG PLANS AND MA-PD PLANS.

        (a) In General.--Section 1860D-4(c) of the Social Security Act (42
    U.S.C. 1395w-104(c)) is amended by adding at the end the following new
    paragraph:
                ``(3) Reducing wasteful dispensing of outpatient
            prescription drugs in long-term care facilities.--The Secretary
            shall require PDP sponsors of prescription drug plans to
            utilize specific, uniform dispensing techniques, as determined
            by the Secretary, in consultation with relevant stakeholders
            (including representatives of nursing facilities, residents of
            nursing facilities, pharmacists, the pharmacy industry
            (including retail and long-term care pharmacy), prescription
            drug plans, MA-PD plans, and any other stakeholders the
            Secretary determines appropriate), such as weekly, daily, or
            automated dose dispensing, when dispensing covered part D drugs
            to enrollees who reside in a long-term care facility in order
            to reduce waste associated with 30-day fills.''.
        (b) Effective Date.--The amendment made by subsection (a) shall
    apply to plan years beginning on or after January 1, 2012.

    SEC. 3311. IMPROVED MEDICARE PRESCRIPTION DRUG PLAN AND MA-PD PLAN
                  COMPLAINT SYSTEM.

        (a) In General.--The Secretary shall develop and maintain a
    complaint system, that is widely known and easy to use, to collect and
    maintain information on MA-PD plan and prescription drug plan
    complaints that are received (including by telephone, letter, e-mail,
    or any other means) by the Secretary (including by a regional office of
    the Department of Health and Human Services, the Medicare Beneficiary
    Ombudsman, a subcontractor, a carrier, a fiscal intermediary, and a
    Medicare administrative contractor under section 1874A of the Social
    Security Act (42 U.S.C. 1395kk)) through the date on which the
    complaint is resolved. The system shall be able to report and initiate
    appropriate interventions and monitoring based on substantial
    complaints and to guide quality improvement.
        (b) Model Electronic Complaint Form.--The Secretary shall develop a
    model electronic complaint form to be used for reporting plan
    complaints under the system. Such form shall be prominently displayed
    on the front page of the Medicare.gov Internet website and on the
    Internet website of the Medicare Beneficiary Ombudsman.
        (c) Annual Reports by the Secretary.--The Secretary shall submit to
    Congress annual reports on the system. Such reports shall include an
    analysis of the number and types of complaints reported in the system,
    geographic variations in such complaints, the timeliness of agency or
    plan responses to such complaints, and the resolution of such
    complaints.
        (d) Definitions.--In this section:
                (1) MA-PD plan.--The term ``MA-PD plan'' has the meaning
            given such term in section 1860D-41(a)(9) of such Act (42
            U.S.C. 1395w-151(a)(9)).
                (2) Prescription drug plan.--The term ``prescription drug
            plan'' has the meaning given such term in section 1860D-
            41(a)(14) of such Act (42 U.S.C. 1395w-151(a)(14)).
                (3) Secretary.--The term ``Secretary'' means the Secretary
            of Health and Human Services.
                (4) System.--The term ``system'' means the plan complaint
            system developed and maintained under subsection (a).

    SEC. 3312. UNIFORM EXCEPTIONS AND APPEALS PROCESS FOR PRESCRIPTION DRUG
                  PLANS AND MA-PD PLANS.

        (a) In General.--Section 1860D-4(b)(3) of the Social Security Act
    (42 U.S.C. 1395w-104(b)(3)) is amended by adding at the end the
    following new subparagraph:
                        ``(H) Use of single, uniform exceptions and appeals
                    process.--Notwithstanding any other provision of this
                    part, each PDP sponsor of a prescription drug plan
                    shall--
                                ``(i) use a single, uniform exceptions and
                            appeals process (including, to the extent the
                            Secretary determines feasible, a single,
                            uniform model form for use under such process)
                            with respect to the determination of
                            prescription drug coverage for an enrollee
                            under the plan; and
                                ``(ii) provide instant access to such
                            process by enrollees through a toll-free
                            telephone number and an Internet website.''.
        (b) Effective Date.--The amendment made by subsection (a) shall
    apply to exceptions and appeals on or after January 1, 2012.

    SEC. 3313. OFFICE OF THE INSPECTOR GENERAL STUDIES AND REPORTS.

        (a) Study and Annual Report on Part D Formularies' Inclusion of
    Drugs Commonly Used by Dual Eligibles.--
                (1) Study.--The Inspector General of the Department of
            Health and Human Services shall conduct a study of the extent
            to which formularies used by prescription drug plans and MA-PD
            plans under part D include drugs commonly used by full-benefit
            dual eligible individuals (as defined in section 1935(c)(6) of
            the Social Security Act (42 U.S.C. 1396u-5(c)(6))).
                (2) Annual reports.--Not later than July 1 of each year
            (beginning with 2011), the Inspector General shall submit to
            Congress a report on the study conducted under paragraph (1),
            together with such recommendations as the Inspector General
            determines appropriate.
        (b) Study and Report on Prescription Drug Prices Under Medicare
    Part D and Medicaid.--
                (1) Study.--
                        (A) In general.--The Inspector General of the
                    Department of Health and Human Services shall conduct a
                    study on prices for covered part D drugs under the
                    Medicare prescription drug program under part D of
                    title XVIII of the Social Security Act and for covered
                    outpatient drugs under title XIX. Such study shall
                    include the following:
                                (i) A comparison, with respect to the 200
                            most frequently dispensed covered part D drugs
                            under such program and covered outpatient drugs
                            under such title (as determined by the
                            Inspector General based on volume and
                            expenditures), of--
                                        (I) the prices paid for covered
                                    part D drugs by PDP sponsors of
                                    prescription drug plans and Medicare
                                    Advantage organizations offering MA-PD
                                    plans; and
                                        (II) the prices paid for covered
                                    outpatient drugs by a State plan under
                                    title XIX.
                                (ii) An assessment of--
                                        (I) the financial impact of any
                                    discrepancies in such prices on the
                                    Federal Government; and
                                        (II) the financial impact of any
                                    such discrepancies on enrollees under
                                    part D or individuals eligible for
                                    medical assistance under a State plan
                                    under title XIX.
                        (B) Price.--For purposes of subparagraph (A), the
                    price of a covered part D drug or a covered outpatient
                    drug shall include any rebate or discount under such
                    program or such title, respectively, including any
                    negotiated price concession described in section 1860D-
                    2(d)(1)(B) of the Social Security Act (42 U.S.C. 1395w-
                    102(d)(1)(B)) or rebate under an agreement under
                    section 1927 of the Social Security Act (42 U.S.C.
                    1396r-8).
                        (C) Authority to collect any necessary
                    information.--Notwithstanding any other provision of
                    law, the Inspector General of the Department of Health
                    and Human Services shall be able to collect any
                    information related to the prices of covered part D
                    drugs under such program and covered outpatient drugs
                    under such title XIX necessary to carry out the
                    comparison under subparagraph (A).
                (2) Report.--
                        (A) In general.--Not later than October 1, 2011,
                    subject to subparagraph (B), the Inspector General
                    shall submit to Congress a report containing the
                    results of the study conducted under paragraph (1),
                    together with recommendations for such legislation and
                    administrative action as the Inspector General
                    determines appropriate.
                        (B) Limitation on information contained in
                    report.--The report submitted under subparagraph (A)
                    shall not include any information that the Inspector
                    General determines is proprietary or is likely to
                    negatively impact the ability of a PDP sponsor or a
                    State plan under title XIX to negotiate prices for
                    covered part D drugs or covered outpatient drugs,
                    respectively.
                (3) Definitions.--In this section:
                        (A) Covered part d drug.--The term ``covered part D
                    drug'' has the meaning given such term in section
                    1860D-2(e) of the Social Security Act (42 U.S.C. 1395w-
                    102(e)).
                        (B) Covered outpatient drug.--The term ``covered
                    outpatient drug'' has the meaning given such term in
                    section 1927(k) of such Act (42 U.S.C. 1396r(k)).
                        (C) MA-PD plan.--The term ``MA-PD plan'' has the
                    meaning given such term in section 1860D-41(a)(9) of
                    such Act (42 U.S.C. 1395w-151(a)(9)).
                        (D) Medicare advantage organization.--The term
                    ``Medicare Advantage organization'' has the meaning
                    given such term in section 1859(a)(1) of such Act (42
                    U.S.C. 1395w-28)(a)(1)).
                        (E) PDP sponsor.--The term ``PDP sponsor'' has the
                    meaning given such term in section 1860D-41(a)(13) of
                    such Act (42 U.S.C. 1395w-151(a)(13)).
                        (F) Prescription drug plan.--The term
                    ``prescription drug plan'' has the meaning given such
                    term in section 1860D-41(a)(14) of such Act (42 U.S.C.
                    1395w-151(a)(14)).

    SEC. 3314. INCLUDING COSTS INCURRED BY AIDS DRUG ASSISTANCE PROGRAMS
                  AND INDIAN HEALTH SERVICE IN PROVIDING PRESCRIPTION DRUGS
                  TOWARD THE ANNUAL OUT-OF-POCKET THRESHOLD UNDER PART D.

        (a) In General.--Section 1860D-2(b)(4)(C) of the Social Security
    Act (42 U.S.C. 1395w-102(b)(4)(C)) is amended--
                (1) in clause (i), by striking ``and'' at the end;
                (2) in clause (ii)--
                        (A) by striking ``such costs shall be treated as
                    incurred only if'' and inserting ``subject to clause
                    (iii), such costs shall be treated as incurred only
                    if'';
                        (B) by striking ``, under section 1860D-14, or
                    under a State Pharmaceutical Assistance Program''; and
                        (C) by striking the period at the end and inserting
                    ``; and''; and
                (3) by inserting after clause (ii) the following new
            clause:
                                ``(iii) such costs shall be treated as
                            incurred and shall not be considered to be
                            reimbursed under clause (ii) if such costs are
                            borne or paid--
                                        ``(I) under section 1860D-14;
                                        ``(II) under a State Pharmaceutical
                                    Assistance Program;
                                        ``(III) by the Indian Health
                                    Service, an Indian tribe or tribal
                                    organization, or an urban Indian
                                    organization (as defined in section 4
                                    of the Indian Health Care Improvement
                                    Act); or
                                        ``(IV) under an AIDS Drug
                                    Assistance Program under part B of
                                    title XXVI of the Public Health Service
                                    Act.''.
        (b) Effective Date.--The amendments made by subsection (a) shall
    apply to costs incurred on or after January 1, 2011.

    SEC. 3315. IMMEDIATE REDUCTION IN COVERAGE GAP IN 2010.

        Section 1860D-2(b) of the Social Security Act (42 U.S.C. 1395w-
    102(b)) is amended--
                (1) in paragraph (3)(A), by striking ``paragraph (4)'' and
            inserting ``paragraphs (4) and (7)''; and
                (2) by adding at the end the following new paragraph:
                ``(7) Increase in initial coverage limit in 2010.--
                        ``(A) In general.--For the plan year beginning on
                    January 1, 2010, the initial coverage limit described
                    in paragraph (3)(B) otherwise applicable shall be
                    increased by $500.
                        ``(B) Application.--In applying subparagraph (A)--
                                ``(i) except as otherwise provided in this
                            subparagraph, there shall be no change in the
                            premiums, bids, or any other parameters under
                            this part or part C;
                                ``(ii) costs that would be treated as
                            incurred costs for purposes of applying
                            paragraph (4) but for the application of
                            subparagraph (A) shall continue to be treated
                            as incurred costs;
                                ``(iii) the Secretary shall establish
                            procedures, which may include a reconciliation
                            process, to fully reimburse PDP sponsors with
                            respect to prescription drug plans and MA
                            organizations with respect to MA-PD plans for
                            the reduction in beneficiary cost sharing
                            associated with the application of subparagraph
                            (A);
                                ``(iv) the Secretary shall develop an
                            estimate of the additional increased costs
                            attributable to the application of this
                            paragraph for increased drug utilization and
                            financing and administrative costs and shall
                            use such estimate to adjust payments to PDP
                            sponsors with respect to prescription drug
                            plans under this part and MA organizations with
                            respect to MA-PD plans under part C; and
                                ``(v) the Secretary shall establish
                            procedures for retroactive reimbursement of
                            part D eligible individuals who are covered
                            under such a plan for costs which are incurred
                            before the date of initial implementation of
                            subparagraph (A) and which would be reimbursed
                            under such a plan if such implementation
                            occurred as of January 1, 2010.
                        ``(C) No effect on subsequent years.--The increase
                    under subparagraph (A) shall only apply with respect to
                    the plan year beginning on January 1, 2010, and the
                    initial coverage limit for plan years beginning on or
                    after January 1, 2011, shall be determined as if
                    subparagraph (A) had never applied.''.

                  Subtitle E--Ensuring Medicare Sustainability

    SEC. 3401. REVISION OF CERTAIN MARKET BASKET UPDATES AND INCORPORATION
                  OF PRODUCTIVITY IMPROVEMENTS INTO MARKET BASKET UPDATES
                  THAT DO NOT ALREADY INCORPORATE SUCH IMPROVEMENTS.

        (a) Inpatient Acute Hospitals.--Section 1886(b)(3)(B) of the Social
    Security Act (42 U.S.C. 1395ww(b)(3)(B)), as amended by section
    3001(a)(3), is further amended--
                (1) in clause (i)(XX), by striking ``clause (viii)'' and
            inserting ``clauses (viii), (ix), (xi), and (xii)'';
                (2) in the first sentence of clause (viii), by inserting
            ``of such applicable percentage increase (determined without
            regard to clause (ix), (xi), or (xii))'' after ``one-quarter'';
                (3) in the first sentence of clause (ix)(I), by inserting
            ``(determined without regard to clause (viii), (xi), or
            (xii))'' after ``clause (i)'' the second time it appears; and
                (4) by adding at the end the following new clauses:
        ``(xi)(I) For 2012 and each subsequent fiscal year, after
    determining the applicable percentage increase described in clause (i)
    and after application of clauses (viii) and (ix), such percentage
    increase shall be reduced by the productivity adjustment described in
    subclause (II).
        ``(II) The productivity adjustment described in this subclause,
    with respect to a percentage, factor, or update for a fiscal year,
    year, cost reporting period, or other annual period, is a productivity
    adjustment equal to the 10-year moving average of changes in annual
    economy-wide private nonfarm business multi-factor productivity (as
    projected by the Secretary for the 10-year period ending with the
    applicable fiscal year, year, cost reporting period, or other annual
    period).
        ``(III) The application of subclause (I) may result in the
    applicable percentage increase described in clause (i) being less than
    0.0 for a fiscal year, and may result in payment rates under this
    section for a fiscal year being less than such payment rates for the
    preceding fiscal year.
        ``(xii) After determining the applicable percentage increase
    described in clause (i), and after application of clauses (viii), (ix),
    and (xi), the Secretary shall reduce such applicable percentage
    increase--
                ``(I) for each of fiscal years 2010 and 2011, by 0.25
            percentage point; and
                ``(II) subject to clause (xiii), for each of fiscal years
            2012 through 2019, by 0.2 percentage point.
    The application of this clause may result in the applicable percentage
    increase described in clause (i) being less than 0.0 for a fiscal year,
    and may result in payment rates under this section for a fiscal year
    being less than such payment rates for the preceding fiscal year.
        ``(xiii) Clause (xii) shall be applied with respect to any of
    fiscal years 2014 through 2019 by substituting `0.0 percentage points'
    for `0.2 percentage point', if for such fiscal year--
                ``(I) the excess (if any) of--
                        ``(aa) the total percentage of the non-elderly
                    insured population for the preceding fiscal year (based
                    on the most recent estimates available from the
                    Director of the Congressional Budget Office before a
                    vote in either House on the Patient Protection and
                    Affordable Care Act that, if determined in the
                    affirmative, would clear such Act for enrollment); over
                        ``(bb) the total percentage of the non-elderly
                    insured population for such preceding fiscal year (as
                    estimated by the Secretary); exceeds
                ``(II) 5 percentage points.''.
        (b) Skilled Nursing Facilities.--Section 1888(e)(5)(B) of the
    Social Security Act (42 U.S.C. 1395yy(e)(5)(B)) is amended--
                (1) by striking ``percentage.--The term'' and inserting
            ``percentage.--
                                ``(i) In general.--Subject to clause (ii),
                            the term''; and
                (2) by adding at the end the following new clause:
                                ``(ii) Adjustment.--For fiscal year 2012
                            and each subsequent fiscal year, after
                            determining the percentage described in clause
                            (i), the Secretary shall reduce such percentage
                            by the productivity adjustment described in
                            section 1886(b)(3)(B)(xi)(II). The application
                            of the preceding sentence may result in such
                            percentage being less than 0.0 for a fiscal
                            year, and may result in payment rates under
                            this subsection for a fiscal year being less
                            than such payment rates for the preceding
                            fiscal year.''.
        (c) Long-term Care Hospitals.--Section 1886(m) of the Social
    Security Act (42 U.S.C. 1395ww(m)) is amended by adding at the end the
    following new paragraphs:
                ``(3) Implementation for rate year 2010 and subsequent
            years.--
                        ``(A) In general.--In implementing the system
                    described in paragraph (1) for rate year 2010 and each
                    subsequent rate year, any annual update to a standard
                    Federal rate for discharges for the hospital during the
                    rate year, shall be reduced--
                                ``(i) for rate year 2012 and each
                            subsequent rate year, by the productivity
                            adjustment described in section
                            1886(b)(3)(B)(xi)(II); and
                                ``(ii) for each of rate years 2010 through
                            2019, by the other adjustment described in
                            paragraph (4).
                        ``(B) Special rule.--The application of this
                    paragraph may result in such annual update being less
                    than 0.0 for a rate year, and may result in payment
                    rates under the system described in paragraph (1) for a
                    rate year being less than such payment rates for the
                    preceding rate year.
                ``(4) Other adjustment.--
                        ``(A) In general.--For purposes of paragraph
                    (3)(A)(ii), the other adjustment described in this
                    paragraph is--
                                ``(i) for each of rate years 2010 and 2011,
                            0.25 percentage point; and
                                ``(ii) subject to subparagraph (B), for
                            each of rate years 2012 through 2019, 0.2
                            percentage point.
                        ``(B) Reduction of other adjustment.--Subparagraph
                    (A)(ii) shall be applied with respect to any of rate
                    years 2014 through 2019 by substituting `0.0 percentage
                    points' for `0.2 percentage point', if for such rate
                    year--
                                ``(i) the excess (if any) of--
                                        ``(I) the total percentage of the
                                    non-elderly insured population for the
                                    preceding rate year (based on the most
                                    recent estimates available from the
                                    Director of the Congressional Budget
                                    Office before a vote in either House on
                                    the Patient Protection and Affordable
                                    Care Act that, if determined in the
                                    affirmative, would clear such Act for
                                    enrollment); over
                                        ``(II) the total percentage of the
                                    non-elderly insured population for such
                                    preceding rate year (as estimated by
                                    the Secretary); exceeds
                                ``(ii) 5 percentage points.''.
        (d) Inpatient Rehabilitation Facilities.--Section 1886(j)(3) of the
    Social Security Act (42 U.S.C. 1395ww(j)(3)) is amended--
                (1) in subparagraph (C)--
                        (A) by striking ``factor.--For purposes'' and
                    inserting ``factor.--
                                ``(i) In general.--For purposes'';
                        (B) by inserting ``subject to clause (ii)'' before
                    the period at the end of the first sentence of clause
                    (i), as added by paragraph (1); and
                        (C) by adding at the end the following new clause:
                                ``(ii) Productivity and other adjustment.--
                            After establishing the increase factor
                            described in clause (i) for a fiscal year, the
                            Secretary shall reduce such increase factor--
                                        ``(I) for fiscal year 2012 and each
                                    subsequent fiscal year, by the
                                    productivity adjustment described in
                                    section 1886(b)(3)(B)(xi)(II); and
                                        ``(II) for each of fiscal years
                                    2010 through 2019, by the other
                                    adjustment described in subparagraph
                                    (D).
                            The application of this clause may result in
                            the increase factor under this subparagraph
                            being less than 0.0 for a fiscal year, and may
                            result in payment rates under this subsection
                            for a fiscal year being less than such payment
                            rates for the preceding fiscal year.''; and
                (2) by adding at the end the following new subparagraph:
                        ``(D) Other adjustment.--
                                ``(i) In general.--For purposes of
                            subparagraph (C)(ii)(II), the other adjustment
                            described in this subparagraph is--
                                        ``(I) for each of fiscal years 2010
                                    and 2011, 0.25 percentage point; and
                                        ``(II) subject to clause (ii), for
                                    each of fiscal years 2012 through 2019,
                                    0.2 percentage point.
                                ``(ii) Reduction of other adjustment.--
                            Clause (i)(II) shall be applied with respect to
                            any of fiscal years 2014 through 2019 by
                            substituting `0.0 percentage points' for `0.2
                            percentage point', if for such fiscal year--
                                        ``(I) the excess (if any) of--
                                                ``(aa) the total percentage
                                            of the non-elderly insured
                                            population for the preceding
                                            fiscal year (based on the most
                                            recent estimates available from
                                            the Director of the
                                            Congressional Budget Office
                                            before a vote in either House
                                            on the Patient Protection and
                                            Affordable Care Act that, if
                                            determined in the affirmative,
                                            would clear such Act for
                                            enrollment); over
                                                ``(bb) the total percentage
                                            of the non-elderly insured
                                            population for such preceding
                                            fiscal year (as estimated by
                                            the Secretary); exceeds
                                        ``(II) 5 percentage points.''.
        (e) Home Health Agencies.--Section 1895(b)(3)(B) of the Social
    Security Act (42 U.S.C. 1395fff(b)(3)(B)) is amended--
                (1) in clause (ii)(V), by striking ``clause (v)'' and
            inserting ``clauses (v) and (vi)''; and
                (2) by adding at the end the following new clause:
                                ``(vi) Adjustments.--After determining the
                            home health market basket percentage increase
                            under clause (iii), and after application of
                            clause (v), the Secretary shall reduce such
                            percentage--
                                        ``(I) for 2015 and each subsequent
                                    year, by the productivity adjustment
                                    described in section
                                    1886(b)(3)(B)(xi)(II); and
                                        ``(II) for each of 2011 and 2012,
                                    by 1 percentage point.
                            The application of this clause may result in
                            the home health market basket percentage
                            increase under clause (iii) being less than 0.0
                            for a year, and may result in payment rates
                            under the system under this subsection for a
                            year being less than such payment rates for the
                            preceding year.''.
        (f) Psychiatric Hospitals.--Section 1886 of the Social Security
    Act, as amended by sections 3001, 3008, 3025, and 3133, is amended by
    adding at the end the following new subsection:
        ``(s) Prospective Payment for Psychiatric Hospitals.--
                ``(1) Reference to establishment and implementation of
            system.--For provisions related to the establishment and
            implementation of a prospective payment system for payments
            under this title for inpatient hospital services furnished by
            psychiatric hospitals (as described in clause (i) of subsection
            (d)(1)(B)) and psychiatric units (as described in the matter
            following clause (v) of such subsection), see section 124 of
            the Medicare, Medicaid, and SCHIP Balanced Budget Refinement
            Act of 1999.
                ``(2) Implementation for rate year beginning in 2010 and
            subsequent rate years.--
                        ``(A) In general.--In implementing the system
                    described in paragraph (1) for the rate year beginning
                    in 2010 and any subsequent rate year, any update to a
                    base rate for days during the rate year for a
                    psychiatric hospital or unit, respectively, shall be
                    reduced--
                                ``(i) for the rate year beginning in 2012
                            and each subsequent rate year, by the
                            productivity adjustment described in section
                            1886(b)(3)(B)(xi)(II); and
                                ``(ii) for each of the rate years beginning
                            in 2010 through 2019, by the other adjustment
                            described in paragraph (3).
                        ``(B) Special rule.--The application of this
                    paragraph may result in such update being less than 0.0
                    for a rate year, and may result in payment rates under
                    the system described in paragraph (1) for a rate year
                    being less than such payment rates for the preceding
                    rate year.
                ``(3) Other adjustment.--
                        ``(A) In general.--For purposes of paragraph
                    (2)(A)(ii), the other adjustment described in this
                    paragraph is--
                                ``(i) for each of the rate years beginning
                            in 2010 and 2011, 0.25 percentage point; and
                                ``(ii) subject to subparagraph (B), for
                            each of the rate years beginning in 2012
                            through 2019, 0.2 percentage point.
                        ``(B) Reduction of other adjustment.--Subparagraph
                    (A)(ii) shall be applied with respect to any of rate
                    years 2014 through 2019 by substituting `0.0 percentage
                    points' for `0.2 percentage point', if for such rate
                    year--
                                ``(i) the excess (if any) of--
                                        ``(I) the total percentage of the
                                    non-elderly insured population for the
                                    preceding rate year (based on the most
                                    recent estimates available from the
                                    Director of the Congressional Budget
                                    Office before a vote in either House on
                                    the Patient Protection and Affordable
                                    Care Act that, if determined in the
                                    affirmative, would clear such Act for
                                    enrollment); over
                                        ``(II) the total percentage of the
                                    non-elderly insured population for such
                                    preceding rate year (as estimated by
                                    the Secretary); exceeds
                                ``(ii) 5 percentage points.''.
        (g) Hospice Care.--Section 1814(i)(1)(C) of the Social Security Act
    (42 U.S.C. 1395f(i)(1)(C)), as amended by section 3132, is amended by
    adding at the end the following new clauses:
        ``(iv) After determining the market basket percentage increase
    under clause (ii)(VII) or (iii), as applicable, with respect to fiscal
    year 2013 and each subsequent fiscal year, the Secretary shall reduce
    such percentage--
                ``(I) for 2013 and each subsequent fiscal year, by the
            productivity adjustment described in section
            1886(b)(3)(B)(xi)(II); and
                ``(II) subject to clause (v), for each of fiscal years 2013
            through 2019, by 0.5 percentage point.
    The application of this clause may result in the market basket
    percentage increase under clause (ii)(VII) or (iii), as applicable,
    being less than 0.0 for a fiscal year, and may result in payment rates
    under this subsection for a fiscal year being less than such payment
    rates for the preceding fiscal year.
        ``(v) Clause (iv)(II) shall be applied with respect to any of
    fiscal years 2014 through 2019 by substituting `0.0 percentage points'
    for `0.5 percentage point', if for such fiscal year--
                ``(I) the excess (if any) of--
                        ``(aa) the total percentage of the non-elderly
                    insured population for the preceding fiscal year (based
                    on the most recent estimates available from the
                    Director of the Congressional Budget Office before a
                    vote in either House on the Patient Protection and
                    Affordable Care Act that, if determined in the
                    affirmative, would clear such Act for enrollment); over
                        ``(bb) the total percentage of the non-elderly
                    insured population for such preceding fiscal year (as
                    estimated by the Secretary); exceeds
                ``(II) 5 percentage points.''.
        (h) Dialysis.--Section 1881(b)(14)(F) of the Social Security Act
    (42 U.S.C. 1395rr(b)(14)(F)) is amended--
                (1) in clause (i)--
                        (A) by inserting ``(I)'' after ``(F)(i)''
                        (B) in subclause (I), as inserted by subparagraph
                    (A)--
                                (i) by striking ``clause (ii)'' and
                            inserting ``subclause (II) and clause (ii)'';
                            and
                                (ii) by striking ``minus 1.0 percentage
                            point''; and
                        (C) by adding at the end the following new
                    subclause:
        ``(II) For 2012 and each subsequent year, after determining the
    increase factor described in subclause (I), the Secretary shall reduce
    such increase factor by the productivity adjustment described in
    section 1886(b)(3)(B)(xi)(II). The application of the preceding
    sentence may result in such increase factor being less than 0.0 for a
    year, and may result in payment rates under the payment system under
    this paragraph for a year being less than such payment rates for the
    preceding year.''; and
                (2) in clause (ii)(II)--
                        (A) by striking ``The'' and inserting ``Subject to
                    clause (i)(II), the''; and
                        (B) by striking ``clause (i) minus 1.0 percentage
                    point'' and inserting ``clause (i)(I)''.
        (i) Outpatient Hospitals.--Section 1833(t)(3) of the Social
    Security Act (42 U.S.C. 1395l(t)(3)) is amended--
                (1) in subparagraph (C)(iv), by inserting ``and
            subparagraph (F) of this paragraph'' after ``(17)''; and
                (2) by adding at the end the following new subparagraphs:
                        ``(F) Productivity and other adjustment.--After
                    determining the OPD fee schedule increase factor under
                    subparagraph (C)(iv), the Secretary shall reduce such
                    increase factor--
                                ``(i) for 2012 and subsequent years, by the
                            productivity adjustment described in section
                            1886(b)(3)(B)(xi)(II); and
                                ``(ii) for each of 2010 through 2019, by
                            the adjustment described in subparagraph (G).
                    The application of this subparagraph may result in the
                    increase factor under subparagraph (C)(iv) being less
                    than 0.0 for a year, and may result in payment rates
                    under the payment system under this subsection for a
                    year being less than such payment rates for the
                    preceding year.
                        ``(G) Other adjustment.--
                                ``(i) Adjustment.--For purposes of
                            subparagraph (F)(ii), the adjustment described
                            in this subparagraph is--
                                        ``(I) for each of 2010 and 2011,
                                    0.25 percentage point; and
                                        ``(II) subject to clause (ii), for
                                    each of 2012 through 2019, 0.2
                                    percentage point.
                                ``(ii) Reduction of other adjustment.--
                            Clause (i)(II) shall be applied with respect to
                            any of 2014 through 2019 by substituting `0.0
                            percentage points' for `0.2 percentage point',
                            if for such year--
                                        ``(I) the excess (if any) of--
                                                ``(aa) the total percentage
                                            of the non-elderly insured
                                            population for the preceding
                                            year (based on the most recent
                                            estimates available from the
                                            Director of the Congressional
                                            Budget Office before a vote in
                                            either House on the Patient
                                            Protection and Affordable Care
                                            Act that, if determined in the
                                            affirmative, would clear such
                                            Act for enrollment); over
                                                ``(bb) the total percentage
                                            of the non-elderly insured
                                            population for such preceding
                                            year (as estimated by the
                                            Secretary); exceeds
                                        ``(II) 5 percentage points.''.
        (j) Ambulance Services.--Section 1834(l)(3) of the Social Security
    Act (42 U.S.C. 1395m(l)(3)) is amended--
                (1) in subparagraph (A), by striking ``and'' at the end;
                (2) in subparagraph (B)--
                        (A) by inserting ``, subject to subparagraph (C)
                    and the succeeding sentence of this paragraph,'' after
                    ``increased''; and
                        (B) by striking the period at the end and inserting
                    ``; and'';
                (3) by adding at the end the following new subparagraph:
                        ``(C) for 2011 and each subsequent year, after
                    determining the percentage increase under subparagraph
                    (B) for the year, reduce such percentage increase by
                    the productivity adjustment described in section
                    1886(b)(3)(B)(xi)(II).''; and
                (4) by adding at the end the following flush sentence:
            ``The application of subparagraph (C) may result in the
            percentage increase under subparagraph (B) being less than 0.0
            for a year, and may result in payment rates under the fee
            schedule under this subsection for a year being less than such
            payment rates for the preceding year.''.
        (k) Ambulatory Surgical Center Services.--Section 1833(i)(2)(D) of
    the Social Security Act (42 U.S.C. 1395l(i)(2)(D)) is amended--
                (1) by redesignating clause (v) as clause (vi); and
                (2) by inserting after clause (iv) the following new
            clause:
                                ``(v) In implementing the system described
                            in clause (i) for 2011 and each subsequent
                            year, any annual update under such system for
                            the year, after application of clause (iv),
                            shall be reduced by the productivity adjustment
                            described in section 1886(b)(3)(B)(xi)(II). The
                            application of the preceding sentence may
                            result in such update being less than 0.0 for a
                            year, and may result in payment rates under the
                            system described in clause (i) for a year being
                            less than such payment rates for the preceding
                            year.''.
        (l) Laboratory Services.--Section 1833(h)(2)(A) of the Social
    Security Act (42 U.S.C. 1395l(h)(2)(A)) is amended--
                (1) in clause (i)--
                        (A) by inserting ``, subject to clause (iv),''
                    after ``year) by''; and
                        (B) by striking ``through 2013'' and inserting
                    ``and 2010''; and
                (2) by adding at the end the following new clause:
                                ``(iv) After determining the adjustment to
                            the fee schedules under clause (i), the
                            Secretary shall reduce such adjustment--
                                        ``(I) for 2011 and each subsequent
                                    year, by the productivity adjustment
                                    described in section
                                    1886(b)(3)(B)(xi)(II); and
                                        ``(II) for each of 2011 through
                                    2015, by 1.75 percentage points.
                            Subclause (I) shall not apply in a year where
                            the adjustment to the fee schedules determined
                            under clause (i) is 0.0 or a percentage
                            decrease for a year. The application of the
                            productivity adjustment under subclause (I)
                            shall not result in an adjustment to the fee
                            schedules under clause (i) being less than 0.0
                            for a year. The application of subclause (II)
                            may result in an adjustment to the fee
                            schedules under clause (i) being less than 0.0
                            for a year, and may result in payment rates for
                            a year being less than such payment rates for
                            the preceding year.''.
        (m) Certain Durable Medical Equipment.--Section 1834(a)(14) of the
    Social Security Act (42 U.S.C. 1395m(a)(14)) is amended--
                (1) in subparagraph (K)--
                        (A) by striking ``2011, 2012, and 2013,''; and
                        (B) by inserting ``and'' after the semicolon at the
                    end;
                (2) by striking subparagraphs (L) and (M) and inserting the
            following new subparagraph:
                        ``(L) for 2011 and each subsequent year--
                                ``(i) the percentage increase in the
                            consumer price index for all urban consumers
                            (United States city average) for the 12-month
                            period ending with June of the previous year,
                            reduced by--
                                ``(ii) the productivity adjustment
                            described in section 1886(b)(3)(B)(xi)(II).'';
                            and
                (3) by adding at the end the following flush sentence:
            ``The application of subparagraph (L)(ii) may result in the
            covered item update under this paragraph being less than 0.0
            for a year, and may result in payment rates under this
            subsection for a year being less than such payment rates for
            the preceding year.''.
        (n) Prosthetic Devices, Orthotics, and Prosthetics.--Section
    1834(h)(4) of the Social Security Act (42 U.S.C. 1395m(h)(4)) is
    amended--
                (1) in subparagraph (A)--
                        (A) in clause (ix), by striking ``and'' at the end;
                        (B) in clause (x)--
                                (i) by striking ``a subsequent year'' and
                            inserting ``for each of 2007 through 2010'';
                            and
                                (ii) by inserting ``and'' after the
                            semicolon at the end;
                        (C) by adding at the end the following new clause:
                                ``(xi) for 2011 and each subsequent year--
                                        ``(I) the percentage increase in
                                    the consumer price index for all urban
                                    consumers (United States city average)
                                    for the 12-month period ending with
                                    June of the previous year, reduced by--
                                        ``(II) the productivity adjustment
                                    described in section
                                    1886(b)(3)(B)(xi)(II).''; and
                        (D) by adding at the end the following flush
                    sentence:
            ``The application of subparagraph (A)(xi)(II) may result in the
            applicable percentage increase under subparagraph (A) being
            less than 0.0 for a year, and may result in payment rates under
            this subsection for a year being less than such payment rates
            for the preceding year.''.
        (o) Other Items.--Section 1842(s)(1) of the Social Security Act (42
    U.S.C. 1395u(s)(1)) is amended--
                (1) in the first sentence, by striking ``Subject to'' and
            inserting ``(A) Subject to'';
                (2) by striking the second sentence and inserting the
            following new subparagraph:
                        ``(B) Any fee schedule established under this
                    paragraph for such item or service shall be updated--
                                ``(i) for years before 2011--
                                        ``(I) subject to subclause (II), by
                                    the percentage increase in the consumer
                                    price index for all urban consumers
                                    (United States city average) for the
                                    12-month period ending with June of the
                                    preceding year; and
                                        ``(II) for items and services
                                    described in paragraph (2)(D) for 2009,
                                    section 1834(a)(14)(J) shall apply
                                    under this paragraph instead of the
                                    percentage increase otherwise
                                    applicable; and
                                ``(ii) for 2011 and subsequent years--
                                        ``(I) the percentage increase in
                                    the consumer price index for all urban
                                    consumers (United States city average)
                                    for the 12-month period ending with
                                    June of the previous year, reduced by--
                                        ``(II) the productivity adjustment
                                    described in section
                                    1886(b)(3)(B)(xi)(II).''; and
                (3) by adding at the end the following flush sentence:
            ``The application of subparagraph (B)(ii)(II) may result in the
            update under this paragraph being less than 0.0 for a year, and
            may result in payment rates under any fee schedule established
            under this paragraph for a year being less than such payment
            rates for the preceding year.''.
        (p) No Application Prior to April 1, 2010.--Notwithstanding the
    preceding provisions of this section, the amendments made by
    subsections (a), (c), and (d) shall not apply to discharges occurring
    before April 1, 2010.

    SEC. 3402. TEMPORARY ADJUSTMENT TO THE CALCULATION OF PART B PREMIUMS.

        Section 1839(i) of the Social Security Act (42 U.S.C. 1395r(i)) is
    amended--
                (1) in paragraph (2), in the matter preceding subparagraph
            (A), by inserting ``subject to paragraph (6),'' after
            ``subsection,'';
                (2) in paragraph (3)(A)(i), by striking ``The applicable''
            and inserting ``Subject to paragraph (6), the applicable'';
                (3) by redesignating paragraph (6) as paragraph (7); and
                (4) by inserting after paragraph (5) the following new
            paragraph:
                ``(6) Temporary adjustment to income thresholds.--
            Notwithstanding any other provision of this subsection, during
            the period beginning on January 1, 2011, and ending on December
            31, 2019--
                        ``(A) the threshold amount otherwise applicable
                    under paragraph (2) shall be equal to such amount for
                    2010; and
                        ``(B) the dollar amounts otherwise applicable under
                    paragraph (3)(C)(i) shall be equal to such dollar
                    amounts for 2010.''.

    SEC. 3403. INDEPENDENT MEDICARE ADVISORY BOARD.

        (a) Board.--
                (1) In general.--Title XVIII of the Social Security Act (42
            U.S.C. 1395 et seq.), as amended by section 3022, is amended by
            adding at the end the following new section:

                     ``independent medicare advisory board

        ``Sec. 1899A.  (a) Establishment.--There is established an
    independent board to be known as the `Independent Medicare Advisory
    Board'.
        ``(b) Purpose.--It is the purpose of this section to, in accordance
    with the following provisions of this section, reduce the per capita
    rate of growth in Medicare spending--
                ``(1) by requiring the Chief Actuary of the Centers for
            Medicare & Medicaid Services to determine in each year to which
            this section applies (in this section referred to as `a
            determination year') the projected per capita growth rate under
            Medicare for the second year following the determination year
            (in this section referred to as `an implementation year');
                ``(2) if the projection for the implementation year exceeds
            the target growth rate for that year, by requiring the Board to
            develop and submit during the first year following the
            determination year (in this section referred to as `a proposal
            year') a proposal containing recommendations to reduce the
            Medicare per capita growth rate to the extent required by this
            section; and
                ``(3) by requiring the Secretary to implement such
            proposals unless Congress enacts legislation pursuant to this
            section.
        ``(c) Board Proposals.--
                ``(1) Development.--
                        ``(A) In general.--The Board shall develop detailed
                    and specific proposals related to the Medicare program
                    in accordance with the succeeding provisions of this
                    section.
                        ``(B) Advisory reports.--Beginning January 15,
                    2014, the Board may develop and submit to Congress
                    advisory reports on matters related to the Medicare
                    program, regardless of whether or not the Board
                    submitted a proposal for such year. Such a report may,
                    for years prior to 2020, include recommendations
                    regarding improvements to payment systems for providers
                    of services and suppliers who are not otherwise subject
                    to the scope of the Board's recommendations in a
                    proposal under this section. Any advisory report
                    submitted under this subparagraph shall not be subject
                    to the rules for congressional consideration under
                    subsection (d).
                ``(2) Proposals.--
                        ``(A) Requirements.--Each proposal submitted under
                    this section in a proposal year shall meet each of the
                    following requirements:
                                ``(i) If the Chief Actuary of the Centers
                            for Medicare & Medicaid Services has made a
                            determination under paragraph (7)(A) in the
                            determination year, the proposal shall include
                            recommendations so that the proposal as a whole
                            (after taking into account recommendations
                            under clause (v)) will result in a net
                            reduction in total Medicare program spending in
                            the implementation year that is at least equal
                            to the applicable savings target established
                            under paragraph (7)(B) for such implementation
                            year. In determining whether a proposal meets
                            the requirement of the preceding sentence,
                            reductions in Medicare program spending during
                            the 3-month period immediately preceding the
                            implementation year shall be counted to the
                            extent that such reductions are a result of the
                            implementation of recommendations contained in
                            the proposal for a change in the payment rate
                            for an item or service that was effective
                            during such period pursuant to subsection
                            (e)(2)(A).
                                ``(ii) The proposal shall not include any
                            recommendation to ration health care, raise
                            revenues or Medicare beneficiary premiums under
                            section 1818, 1818A, or 1839, increase Medicare
                            beneficiary cost-sharing (including
                            deductibles, coinsurance, and copayments), or
                            otherwise restrict benefits or modify
                            eligibility criteria.
                                ``(iii) In the case of proposals submitted
                            prior to December 31, 2018, the proposal shall
                            not include any recommendation that would
                            reduce payment rates for items and services
                            furnished, prior to December 31, 2019, by
                            providers of services (as defined in section
                            1861(u)) and suppliers (as defined in section
                            1861(d)) scheduled, pursuant to the amendments
                            made by section 3401 of the Patient Protection
                            and Affordable Care Act, to receive a reduction
                            to the inflationary payment updates of such
                            providers of services and suppliers in excess
                            of a reduction due to productivity in a year in
                            which such recommendations would take effect.
                                ``(iv) As appropriate, the proposal shall
                            include recommendations to reduce Medicare
                            payments under parts C and D, such as
                            reductions in direct subsidy payments to
                            Medicare Advantage and prescription drug plans
                            specified under paragraph (1) and (2) of
                            section 1860D-15(a) that are related to
                            administrative expenses (including profits) for
                            basic coverage, denying high bids or removing
                            high bids for prescription drug coverage from
                            the calculation of the national average monthly
                            bid amount under section 1860D-13(a)(4), and
                            reductions in payments to Medicare Advantage
                            plans under clauses (i) and (ii) of section
                            1853(a)(1)(B) that are related to
                            administrative expenses (including profits) and
                            performance bonuses for Medicare Advantage
                            plans under section 1853(n). Any such
                            recommendation shall not affect the base
                            beneficiary premium percentage specified under
                            1860D-13(a).
                                ``(v) The proposal shall include
                            recommendations with respect to administrative
                            funding for the Secretary to carry out the
                            recommendations contained in the proposal.
                                ``(vi) The proposal shall only include
                            recommendations related to the Medicare
                            program.
                        ``(B) Additional considerations.--In developing and
                    submitting each proposal under this section in a
                    proposal year, the Board shall, to the extent
                    feasible--
                                ``(i) give priority to recommendations that
                            extend Medicare solvency;
                                ``(ii) include recommendations that--
                                        ``(I) improve the health care
                                    delivery system and health outcomes,
                                    including by promoting integrated care,
                                    care coordination, prevention and
                                    wellness, and quality and efficiency
                                    improvement; and
                                        ``(II) protect and improve Medicare
                                    beneficiaries' access to necessary and
                                    evidence-based items and services,
                                    including in rural and frontier areas;
                                ``(iii) include recommendations that target
                            reductions in Medicare program spending to
                            sources of excess cost growth;
                                ``(iv) consider the effects on Medicare
                            beneficiaries of changes in payments to
                            providers of services (as defined in section
                            1861(u)) and suppliers (as defined in section
                            1861(d));
                                ``(v) consider the effects of the
                            recommendations on providers of services and
                            suppliers with actual or projected negative
                            cost margins or payment updates; and
                                ``(vi) consider the unique needs of
                            Medicare beneficiaries who are dually eligible
                            for Medicare and the Medicaid program under
                            title XIX.
                        ``(C) No increase in total medicare program
                    spending.--Each proposal submitted under this section
                    shall be designed in such a manner that implementation
                    of the recommendations contained in the proposal would
                    not be expected to result, over the 10-year period
                    starting with the implementation year, in any increase
                    in the total amount of net Medicare program spending
                    relative to the total amount of net Medicare program
                    spending that would have occurred absent such
                    implementation.
                        ``(D) Consultation with medpac.--The Board shall
                    submit a draft copy of each proposal to be submitted
                    under this section to the Medicare Payment Advisory
                    Commission established under section 1805 for its
                    review. The Board shall submit such draft copy by not
                    later than September 1 of the determination year.
                        ``(E) Review and comment by the secretary.--The
                    Board shall submit a draft copy of each proposal to be
                    submitted to Congress under this section to the
                    Secretary for the Secretary's review and comment. The
                    Board shall submit such draft copy by not later than
                    September 1 of the determination year. Not later than
                    March 1 of the submission year, the Secretary shall
                    submit a report to Congress on the results of such
                    review, unless the Secretary submits a proposal under
                    paragraph (5)(A) in that year.
                        ``(F) Consultations.--In carrying out its duties
                    under this section, the Board shall engage in regular
                    consultations with the Medicaid and CHIP Payment and
                    Access Commission under section 1900.
                ``(3) Transmission of board proposal to president.--
                        ``(A) In general.--
                                ``(i) In general.--Except as provided in
                            clause (ii) and subsection (f)(3)(B), the Board
                            shall transmit a proposal under this section to
                            the President on January 15 of each year
                            (beginning with 2014).
                                ``(ii) Exception.--The Board shall not
                            submit a proposal under clause (i) in a
                            proposal year if the year is--
                                        ``(I) a year for which the Chief
                                    Actuary of the Centers for Medicare &
                                    Medicaid Services makes a determination
                                    in the determination year under
                                    paragraph (6)(A) that the growth rate
                                    described in clause (i) of such
                                    paragraph does not exceed the growth
                                    rate described in clause (ii) of such
                                    paragraph;
                                        ``(II) a year in which the Chief
                                    Actuary of the Centers for Medicare &
                                    Medicaid Services makes a determination
                                    in the determination year that the
                                    projected percentage increase (if any)
                                    for the medical care expenditure
                                    category of the Consumer Price Index
                                    for All Urban Consumers (United States
                                    city average) for the implementation
                                    year is less than the projected
                                    percentage increase (if any) in the
                                    Consumer Price Index for All Urban
                                    Consumers (all items; United States
                                    city average) for such implementation
                                    year; or
                                        ``(III) for proposal year 2019 and
                                    subsequent proposal years, a year in
                                    which the Chief Actuary of the Centers
                                    for Medicare & Medicaid Services makes
                                    a determination in the determination
                                    year that the growth rate described in
                                    paragraph (8) exceeds the growth rate
                                    described in paragraph (6)(A)(i).
                                ``(iii) Start-up period.--The Board may not
                            submit a proposal under clause (i) prior to
                            January 15, 2014.
                        ``(B) Required information.--Each proposal
                    submitted by the Board under subparagraph (A)(i) shall
                    include--
                                ``(i) the recommendations described in
                            paragraph (2)(A)(i);
                                ``(ii) an explanation of each
                            recommendation contained in the proposal and
                            the reasons for including such recommendation;
                                ``(iii) an actuarial opinion by the Chief
                            Actuary of the Centers for Medicare & Medicaid
                            Services certifying that the proposal meets the
                            requirements of subparagraphs (A)(i) and (C) of
                            paragraph (2);
                                ``(iv) a legislative proposal that
                            implements the recommendations; and
                                ``(v) other information determined
                            appropriate by the Board.
                ``(4) Presidential submission to congress.--Upon receiving
            a proposal from the Board under paragraph (3)(A)(i) or the
            Secretary under paragraph (5), the President shall immediately
            submit such proposal to Congress.
                ``(5) Contingent secretarial development of proposal.--If,
            with respect to a proposal year, the Board is required, to but
            fails, to submit a proposal to the President by the deadline
            applicable under paragraph (3)(A)(i), the Secretary shall
            develop a detailed and specific proposal that satisfies the
            requirements of subparagraphs (A) and (C) (and, to the extent
            feasible, subparagraph (B)) of paragraph (2) and contains the
            information required paragraph (3)(B)). By not later than
            January 25 of the year, the Secretary shall transmit--
                        ``(A) such proposal to the President; and
                        ``(B) a copy of such proposal to the Medicare
                    Payment Advisory Commission for its review.
                ``(6) Per capita growth rate projections by chief
            actuary.--
                        ``(A) In general.--Subject to subsection (f)(3)(A),
                    not later than April 30, 2013, and annually thereafter,
                    the Chief Actuary of the Centers for Medicare &
                    Medicaid Services shall determine in each such year
                    whether--
                                ``(i) the projected Medicare per capita
                            growth rate for the implementation year (as
                            determined under subparagraph (B)); exceeds
                                ``(ii) the projected Medicare per capita
                            target growth rate for the implementation year
                            (as determined under subparagraph (C)).
                        ``(B) Medicare per capita growth rate.--
                                ``(i) In general.--For purposes of this
                            section, the Medicare per capita growth rate
                            for an implementation year shall be calculated
                            as the projected 5-year average (ending with
                            such year) of the growth in Medicare program
                            spending per unduplicated enrollee.
                                ``(ii) Requirement.--The projection under
                            clause (i) shall--
                                        ``(I) to the extent that there is
                                    projected to be a negative update to
                                    the single conversion factor applicable
                                    to payments for physicians' services
                                    under section 1848(d) furnished in the
                                    proposal year or the implementation
                                    year, assume that such update for such
                                    services is 0 percent rather than the
                                    negative percent that would otherwise
                                    apply; and
                                        ``(II) take into account any
                                    delivery system reforms or other
                                    payment changes that have been enacted
                                    or published in final rules but not yet
                                    implemented as of the making of such
                                    calculation.
                        ``(C) Medicare per capita target growth rate.--For
                    purposes of this section, the Medicare per capita
                    target growth rate for an implementation year shall be
                    calculated as the projected 5-year average (ending with
                    such year) percentage increase in--
                                ``(i) with respect to a determination year
                            that is prior to 2018, the average of the
                            projected percentage increase (if any) in--
                                        ``(I) the Consumer Price Index for
                                    All Urban Consumers (all items; United
                                    States city average); and
                                        ``(II) the medical care expenditure
                                    category of the Consumer Price Index
                                    for All Urban Consumers (United States
                                    city average); and
                                ``(ii) with respect to a determination year
                            that is after 2017, the nominal gross domestic
                            product per capita plus 1.0 percentage point.
                ``(7) Savings requirement.--
                        ``(A) In general.--If, with respect to a
                    determination year, the Chief Actuary of the Centers
                    for Medicare & Medicaid Services makes a determination
                    under paragraph (6)(A) that the growth rate described
                    in clause (i) of such paragraph exceeds the growth rate
                    described in clause (ii) of such paragraph, the Chief
                    Actuary shall establish an applicable savings target
                    for the implementation year.
                        ``(B) Applicable savings target.--For purposes of
                    this section, the applicable savings target for an
                    implementation year shall be an amount equal to the
                    product of--
                                ``(i) the total amount of projected
                            Medicare program spending for the proposal
                            year; and
                                ``(ii) the applicable percent for the
                            implementation year.
                        ``(C) Applicable percent.--For purposes of
                    subparagraph (B), the applicable percent for an
                    implementation year is the lesser of--
                                ``(i) in the case of--
                                        ``(I) implementation year 2015, 0.5
                                    percent;
                                        ``(II) implementation year 2016,
                                    1.0 percent;
                                        ``(III) implementation year 2017,
                                    1.25 percent; and
                                        ``(IV) implementation year 2018 or
                                    any subsequent implementation year, 1.5
                                    percent; and
                                ``(ii) the projected excess for the
                            implementation year (expressed as a percent)
                            determined under subparagraph (A).
                ``(8) Per capita rate of growth in national health
            expenditures.--In each determination year (beginning in 2018),
            the Chief Actuary of the Centers for Medicare & Medicaid
            Services shall project the per capita rate of growth in
            national health expenditures for the implementation year. Such
            rate of growth for an implementation year shall be calculated
            as the projected 5-year average (ending with such year)
            percentage increase in national health care expenditures.
        ``(d) Congressional Consideration.--
                ``(1) Introduction.--
                        ``(A) In general.--On the day on which a proposal
                    is submitted by the President to the House of
                    Representatives and the Senate under subsection (c)(4),
                    the legislative proposal (described in subsection
                    (c)(3)(B)(iv)) contained in the proposal shall be
                    introduced (by request) in the Senate by the majority
                    leader of the Senate or by Members of the Senate
                    designated by the majority leader of the Senate and
                    shall be introduced (by request) in the House by the
                    majority leader of the House or by Members of the House
                    designated by the majority leader of the House.
                        ``(B) Not in session.--If either House is not in
                    session on the day on which such legislative proposal
                    is submitted, the legislative proposal shall be
                    introduced in that House, as provided in subparagraph
                    (A), on the first day thereafter on which that House is
                    in session.
                        ``(C) Any member.--If the legislative proposal is
                    not introduced in either House within 5 days on which
                    that House is in session after the day on which the
                    legislative proposal is submitted, then any Member of
                    that House may introduce the legislative proposal.
                        ``(D) Referral.--The legislation introduced under
                    this paragraph shall be referred by the Presiding
                    Officers of the respective Houses to the Committee on
                    Finance in the Senate and to the Committee on Energy
                    and Commerce and the Committee on Ways and Means in the
                    House of Representatives.
                ``(2) Committee consideration of proposal.--
                        ``(A) Reporting bill.--Not later than April 1 of
                    any proposal year in which a proposal is submitted by
                    the President to Congress under this section, the
                    Committee on Ways and Means and the Committee on Energy
                    and Commerce of the House of Representatives and the
                    Committee on Finance of the Senate may report the bill
                    referred to the Committee under paragraph (1)(D) with
                    committee amendments related to the Medicare program.
                        ``(B) Calculations.--In determining whether a
                    committee amendment meets the requirement of
                    subparagraph (A), the reductions in Medicare program
                    spending during the 3-month period immediately
                    preceding the implementation year shall be counted to
                    the extent that such reductions are a result of the
                    implementation provisions in the committee amendment
                    for a change in the payment rate for an item or service
                    that was effective during such period pursuant to such
                    amendment.
                        ``(C) Committee jurisdiction.--Notwithstanding rule
                    XV of the Standing Rules of the Senate, a committee
                    amendment described in subparagraph (A) may include
                    matter not within the jurisdiction of the Committee on
                    Finance if that matter is relevant to a proposal
                    contained in the bill submitted under subsection
                    (c)(3).
                        ``(D) Discharge.--If, with respect to the House
                    involved, the committee has not reported the bill by
                    the date required by subparagraph (A), the committee
                    shall be discharged from further consideration of the
                    proposal.
                ``(3) Limitation on changes to the board recommendations.--
                        ``(A) In general.--It shall not be in order in the
                    Senate or the House of Representatives to consider any
                    bill, resolution, or amendment, pursuant to this
                    subsection or conference report thereon, that fails to
                    satisfy the requirements of subparagraphs (A)(i) and
                    (C) of subsection (c)(2).
                        ``(B) Limitation on changes to the board
                    recommendations in other legislation.--It shall not be
                    in order in the Senate or the House of Representatives
                    to consider any bill, resolution, amendment, or
                    conference report (other than pursuant to this section)
                    that would repeal or otherwise change the
                    recommendations of the Board if that change would fail
                    to satisfy the requirements of subparagraphs (A)(i) and
                    (C) of subsection (c)(2).
                        ``(C) Limitation on changes to this subsection.--It
                    shall not be in order in the Senate or the House of
                    Representatives to consider any bill, resolution,
                    amendment, or conference report that would repeal or
                    otherwise change this subsection.
                        ``(D) Waiver.--This paragraph may be waived or
                    suspended in the Senate only by the affirmative vote of
                    three-fifths of the Members, duly chosen and sworn.
                        ``(E) Appeals.--An affirmative vote of three-fifths
                    of the Members of the Senate, duly chosen and sworn,
                    shall be required in the Senate to sustain an appeal of
                    the ruling of the Chair on a point of order raised
                    under this paragraph.
                ``(4) Expedited procedure.--
                        ``(A) Consideration.--A motion to proceed to the
                    consideration of the bill in the Senate is not
                    debatable.
                        ``(B) Amendment.--
                                ``(i) Time limitation.--Debate in the
                            Senate on any amendment to a bill under this
                            section shall be limited to 1 hour, to be
                            equally divided between, and controlled by, the
                            mover and the manager of the bill, and debate
                            on any amendment to an amendment, debatable
                            motion, or appeal shall be limited to 30
                            minutes, to be equally divided between, and
                            controlled by, the mover and the manager of the
                            bill, except that in the event the manager of
                            the bill is in favor of any such amendment,
                            motion, or appeal, the time in opposition
                            thereto shall be controlled by the minority
                            leader or such leader's designee.
                                ``(ii) Germane.--No amendment that is not
                            germane to the provisions of such bill shall be
                            received.
                                ``(iii) Additional time.--The leaders, or
                            either of them, may, from the time under their
                            control on the passage of the bill, allot
                            additional time to any Senator during the
                            consideration of any amendment, debatable
                            motion, or appeal.
                                ``(iv) Amendment not in order.--It shall
                            not be in order to consider an amendment that
                            would cause the bill to result in a net
                            reduction in total Medicare program spending in
                            the implementation year that is less than the
                            applicable savings target established under
                            subsection (c)(7)(B) for such implementation
                            year.
                                ``(v) Waiver and appeals.--This paragraph
                            may be waived or suspended in the Senate only
                            by the affirmative vote of three-fifths of the
                            Members, duly chosen and sworn. An affirmative
                            vote of three-fifths of the Members of the
                            Senate, duly chosen and sworn, shall be
                            required in the Senate to sustain an appeal of
                            the ruling of the Chair on a point of order
                            raised under this section.
                        ``(C) Consideration by the other house.--
                                ``(i) In general.--The expedited procedures
                            provided in this subsection for the
                            consideration of a bill introduced pursuant to
                            paragraph (1) shall not apply to such a bill
                            that is received by one House from the other
                            House if such a bill was not introduced in the
                            receiving House.
                                ``(ii) Before passage.--If a bill that is
                            introduced pursuant to paragraph (1) is
                            received by one House from the other House,
                            after introduction but before disposition of
                            such a bill in the receiving House, then the
                            following shall apply:
                                        ``(I) The receiving House shall
                                    consider the bill introduced in that
                                    House through all stages of
                                    consideration up to, but not including,
                                    passage.
                                        ``(II) The question on passage
                                    shall be put on the bill of the other
                                    House as amended by the language of the
                                    receiving House.
                                ``(iii) After passage.--If a bill
                            introduced pursuant to paragraph (1) is
                            received by one House from the other House,
                            after such a bill is passed by the receiving
                            House, then the vote on passage of the bill
                            that originates in the receiving House shall be
                            considered to be the vote on passage of the
                            bill received from the other House as amended
                            by the language of the receiving House.
                                ``(iv) Disposition.--Upon disposition of a
                            bill introduced pursuant to paragraph (1) that
                            is received by one House from the other House,
                            it shall no longer be in order to consider the
                            bill that originates in the receiving House.
                                ``(v) Limitation.--Clauses (ii), (iii), and
                            (iv) shall apply only to a bill received by one
                            House from the other House if the bill--
                                        ``(I) is related only to the
                                    program under this title; and
                                        ``(II) satisfies the requirements
                                    of subparagraphs (A)(i) and (C) of
                                    subsection (c)(2).
                        ``(D) Senate limits on debate.--
                                ``(i) In general.--In the Senate,
                            consideration of the bill and on all debatable
                            motions and appeals in connection therewith
                            shall not exceed a total of 30 hours, which
                            shall be divided equally between the majority
                            and minority leaders or their designees.
                                ``(ii) Motion to further limit debate.--A
                            motion to further limit debate on the bill is
                            in order and is not debatable.
                                ``(iii) Motion or appeal.--Any debatable
                            motion or appeal is debatable for not to exceed
                            1 hour, to be divided equally between those
                            favoring and those opposing the motion or
                            appeal.
                                ``(iv) Final disposition.--After 30 hours
                            of consideration, the Senate shall proceed,
                            without any further debate on any question, to
                            vote on the final disposition thereof to the
                            exclusion of all amendments not then pending
                            before the Senate at that time and to the
                            exclusion of all motions, except a motion to
                            table, or to reconsider and one quorum call on
                            demand to establish the presence of a quorum
                            (and motions required to establish a quorum)
                            immediately before the final vote begins.
                        ``(E) Consideration in conference.--
                                ``(i) In general.--Consideration in the
                            Senate and the House of Representatives on the
                            conference report or any messages between
                            Houses shall be limited to 10 hours, equally
                            divided and controlled by the majority and
                            minority leaders of the Senate or their
                            designees and the Speaker of the House of
                            Representatives and the minority leader of the
                            House of Representatives or their designees.
                                ``(ii) Time limitation.--Debate in the
                            Senate on any amendment under this subparagraph
                            shall be limited to 1 hour, to be equally
                            divided between, and controlled by, the mover
                            and the manager of the bill, and debate on any
                            amendment to an amendment, debatable motion, or
                            appeal shall be limited to 30 minutes, to be
                            equally divided between, and controlled by, the
                            mover and the manager of the bill, except that
                            in the event the manager of the bill is in
                            favor of any such amendment, motion, or appeal,
                            the time in opposition thereto shall be
                            controlled by the minority leader or such
                            leader's designee.
                                ``(iii) Final disposition.--After 10 hours
                            of consideration, the Senate shall proceed,
                            without any further debate on any question, to
                            vote on the final disposition thereof to the
                            exclusion of all motions not then pending
                            before the Senate at that time or necessary to
                            resolve the differences between the Houses and
                            to the exclusion of all other motions, except a
                            motion to table, or to reconsider and one
                            quorum call on demand to establish the presence
                            of a quorum (and motions required to establish
                            a quorum) immediately before the final vote
                            begins.
                                ``(iv) Limitation.--Clauses (i) through
                            (iii) shall only apply to a conference report,
                            message or the amendments thereto if the
                            conference report, message, or an amendment
                            thereto--
                                        ``(I) is related only to the
                                    program under this title; and
                                        ``(II) satisfies the requirements
                                    of subparagraphs (A)(i) and (C) of
                                    subsection (c)(2).
                        ``(F) Veto.--If the President vetoes the bill
                    debate on a veto message in the Senate under this
                    subsection shall be 1 hour equally divided between the
                    majority and minority leaders or their designees.
                ``(5) Rules of the senate and house of representatives.--
            This subsection and subsection (f)(2) are enacted by Congress--
                        ``(A) as an exercise of the rulemaking power of the
                    Senate and the House of Representatives, respectively,
                    and is deemed to be part of the rules of each House,
                    respectively, but applicable only with respect to the
                    procedure to be followed in that House in the case of
                    bill under this section, and it supersedes other rules
                    only to the extent that it is inconsistent with such
                    rules; and
                        ``(B) with full recognition of the constitutional
                    right of either House to change the rules (so far as
                    they relate to the procedure of that House) at any
                    time, in the same manner, and to the same extent as in
                    the case of any other rule of that House.
        ``(e) Implementation of Proposal.--
                ``(1) In general.--Notwithstanding any other provision of
            law, the Secretary shall, except as provided in paragraph (3),
            implement the recommendations contained in a proposal submitted
            by the President to Congress pursuant to this section on August
            15 of the year in which the proposal is so submitted.
                ``(2) Application.--
                        ``(A) In general.--A recommendation described in
                    paragraph (1) shall apply as follows:
                                ``(i) In the case of a recommendation that
                            is a change in the payment rate for an item or
                            service under Medicare in which payment rates
                            change on a fiscal year basis (or a cost
                            reporting period basis that relates to a fiscal
                            year), on a calendar year basis (or a cost
                            reporting period basis that relates to a
                            calendar year), or on a rate year basis (or a
                            cost reporting period basis that relates to a
                            rate year), such recommendation shall apply to
                            items and services furnished on the first day
                            of the first fiscal year, calendar year, or
                            rate year (as the case may be) that begins
                            after such August 15.
                                ``(ii) In the case of a recommendation
                            relating to payments to plans under parts C and
                            D, such recommendation shall apply to plan
                            years beginning on the first day of the first
                            calendar year that begins after such August 15.
                                ``(iii) In the case of any other
                            recommendation, such recommendation shall be
                            addressed in the regular regulatory process
                            timeframe and shall apply as soon as
                            practicable.
                        ``(B) Interim final rulemaking.--The Secretary may
                    use interim final rulemaking to implement any
                    recommendation described in paragraph (1).
                ``(3) Exception.--The Secretary shall not be required to
            implement the recommendations contained in a proposal submitted
            in a proposal year by the President to Congress pursuant to
            this section if--
                        ``(A) prior to August 15 of the proposal year,
                    Federal legislation is enacted that includes the
                    following provision: `This Act supercedes the
                    recommendations of the Board contained in the proposal
                    submitted, in the year which includes the date of
                    enactment of this Act, to Congress under section 1899A
                    of the Social Security Act.'; and
                        ``(B) in the case of implementation year 2020 and
                    subsequent implementation years, a joint resolution
                    described in subsection (f)(1) is enacted not later
                    than August 15, 2017.
                ``(4) No affect on authority to implement certain
            provisions.--Nothing in paragraph (3) shall be construed to
            affect the authority of the Secretary to implement any
            recommendation contained in a proposal or advisory report under
            this section to the extent that the Secretary otherwise has the
            authority to implement such recommendation administratively.
                ``(5) Limitation on review.--There shall be no
            administrative or judicial review under section 1869, section
            1878, or otherwise of the implementation by the Secretary under
            this subsection of the recommendations contained in a proposal.
        ``(f) Joint Resolution Required To Discontinue the Board.--
                ``(1) In general.--For purposes of subsection (e)(3)(B), a
            joint resolution described in this paragraph means only a joint
            resolution--
                        ``(A) that is introduced in 2017 by not later than
                    February 1 of such year;
                        ``(B) which does not have a preamble;
                        ``(C) the title of which is as follows: `Joint
                    resolution approving the discontinuation of the process
                    for consideration and automatic implementation of the
                    annual proposal of the Independent Medicare Advisory
                    Board under section 1899A of the Social Security Act';
                    and
                        ``(D) the matter after the resolving clause of
                    which is as follows: `That Congress approves the
                    discontinuation of the process for consideration and
                    automatic implementation of the annual proposal of the
                    Independent Medicare Advisory Board under section 1899A
                    of the Social Security Act.'.
                ``(2) Procedure.--
                        ``(A) Referral.--A joint resolution described in
                    paragraph (1) shall be referred to the Committee on
                    Ways and Means and the Committee on Energy and Commerce
                    of the House of Representatives and the Committee on
                    Finance of the Senate.
                        ``(B) Discharge.--In the Senate, if the committee
                    to which is referred a joint resolution described in
                    paragraph (1) has not reported such joint resolution
                    (or an identical joint resolution) at the end of 20
                    days after the joint resolution described in paragraph
                    (1) is introduced, such committee may be discharged
                    from further consideration of such joint resolution
                    upon a petition supported in writing by 30 Members of
                    the Senate, and such joint resolution shall be placed
                    on the calendar.
                        ``(C) Consideration.--
                                ``(i) In general.--In the Senate, when the
                            committee to which a joint resolution is
                            referred has reported, or when a committee is
                            discharged (under subparagraph (C)) from
                            further consideration of a joint resolution
                            described in paragraph (1), it is at any time
                            thereafter in order (even though a previous
                            motion to the same effect has been disagreed
                            to) for a motion to proceed to the
                            consideration of the joint resolution to be
                            made, and all points of order against the joint
                            resolution (and against consideration of the
                            joint resolution) are waived, except for points
                            of order under the Congressional Budget act of
                            1974 or under budget resolutions pursuant to
                            that Act. The motion is not debatable. A motion
                            to reconsider the vote by which the motion is
                            agreed to or disagreed to shall not be in
                            order. If a motion to proceed to the
                            consideration of the joint resolution is agreed
                            to, the joint resolution shall remain the
                            unfinished business of the Senate until
                            disposed of.
                                ``(ii) Debate limitation.--In the Senate,
                            consideration of the joint resolution, and on
                            all debatable motions and appeals in connection
                            therewith, shall be limited to not more than 10
                            hours, which shall be divided equally between
                            the majority leader and the minority leader, or
                            their designees. A motion further to limit
                            debate is in order and not debatable. An
                            amendment to, or a motion to postpone, or a
                            motion to proceed to the consideration of other
                            business, or a motion to recommit the joint
                            resolution is not in order.
                                ``(iii) Passage.--In the Senate,
                            immediately following the conclusion of the
                            debate on a joint resolution described in
                            paragraph (1), and a single quorum call at the
                            conclusion of the debate if requested in
                            accordance with the rules of the Senate, the
                            vote on passage of the joint resolution shall
                            occur.
                                ``(iv) Appeals.--Appeals from the decisions
                            of the Chair relating to the application of the
                            rules of the Senate to the procedure relating
                            to a joint resolution described in paragraph
                            (1) shall be decided without debate.
                        ``(D) Other house acts first.--If, before the
                    passage by 1 House of a joint resolution of that House
                    described in paragraph (1), that House receives from
                    the other House a joint resolution described in
                    paragraph (1), then the following procedures shall
                    apply:
                                ``(i) The joint resolution of the other
                            House shall not be referred to a committee.
                                ``(ii) With respect to a joint resolution
                            described in paragraph (1) of the House
                            receiving the joint resolution--
                                        ``(I) the procedure in that House
                                    shall be the same as if no joint
                                    resolution had been received from the
                                    other House; but
                                        ``(II) the vote on final passage
                                    shall be on the joint resolution of the
                                    other House.
                        ``(E) Excluded days.--For purposes of determining
                    the period specified in subparagraph (B), there shall
                    be excluded any days either House of Congress is
                    adjourned for more than 3 days during a session of
                    Congress.
                        ``(F) Majority required for adoption.--A joint
                    resolution considered under this subsection shall
                    require an affirmative vote of three-fifths of the
                    Members, duly chosen and sworn, for adoption.
                ``(3) Termination.--If a joint resolution described in
            paragraph (1) is enacted not later than August 15, 2017--
                        ``(A) the Chief Actuary of the Medicare & Medicaid
                    Services shall not--
                                ``(i) make any determinations under
                            subsection (c)(6) after May 1, 2017; or
                                ``(ii) provide any opinion pursuant to
                            subsection (c)(3)(B)(iii) after January 16,
                            2018;
                        ``(B) the Board shall not submit any proposals or
                    advisory reports to Congress under this section after
                    January 16, 2018; and
                        ``(C) the Board and the consumer advisory council
                    under subsection (k) shall terminate on August 16,
                    2018.
        ``(g) Board Membership; Terms of Office; Chairperson; Removal.--
                ``(1) Membership.--
                        ``(A) In general.--The Board shall be composed of--
                                ``(i) 15 members appointed by the
                            President, by and with the advice and consent
                            of the Senate; and
                                ``(ii) the Secretary, the Administrator of
                            the Center for Medicare & Medicaid Services,
                            and the Administrator of the Health Resources
                            and Services Administration, all of whom shall
                            serve ex officio as nonvoting members of the
                            Board.
                        ``(B) Qualifications.--
                                ``(i) In general.--The appointed membership
                            of the Board shall include individuals with
                            national recognition for their expertise in
                            health finance and economics, actuarial
                            science, health facility management, health
                            plans and integrated delivery systems,
                            reimbursement of health facilities, allopathic
                            and osteopathic physicians, and other providers
                            of health services, and other related fields,
                            who provide a mix of different professionals,
                            broad geographic representation, and a balance
                            between urban and rural representatives.
                                ``(ii) Inclusion.--The appointed membership
                            of the Board shall include (but not be limited
                            to) physicians and other health professionals,
                            experts in the area of pharmaco-economics or
                            prescription drug benefit programs, employers,
                            third-party payers, individuals skilled in the
                            conduct and interpretation of biomedical,
                            health services, and health economics research
                            and expertise in outcomes and effectiveness
                            research and technology assessment. Such
                            membership shall also include representatives
                            of consumers and the elderly.
                                ``(iii) Majority nonproviders.--Individuals
                            who are directly involved in the provision or
                            management of the delivery of items and
                            services covered under this title shall not
                            constitute a majority of the appointed
                            membership of the Board.
                        ``(C) Ethical disclosure.--The President shall
                    establish a system for public disclosure by appointed
                    members of the Board of financial and other potential
                    conflicts of interest relating to such members.
                    Appointed members of the Board shall be treated as
                    officers in the executive branch for purposes of
                    applying title I of the Ethics in Government Act of
                    1978 (Public Law 95-521).
                        ``(D) Conflicts of interest.--No individual may
                    serve as an appointed member if that individual engages
                    in any other business, vocation, or employment.
                        ``(E) Consultation with congress.--In selecting
                    individuals for nominations for appointments to the
                    Board, the President shall consult with--
                                ``(i) the majority leader of the Senate
                            concerning the appointment of 3 members;
                                ``(ii) the Speaker of the House of
                            Representatives concerning the appointment of 3
                            members;
                                ``(iii) the minority leader of the Senate
                            concerning the appointment of 3 members; and
                                ``(iv) the minority leader of the House of
                            Representatives concerning the appointment of 3
                            members.
                ``(2) Term of office.--Each appointed member shall hold
            office for a term of 6 years except that--
                        ``(A) a member may not serve more than 2 full
                    consecutive terms (but may be reappointed to 2 full
                    consecutive terms after being appointed to fill a
                    vacancy on the Board);
                        ``(B) a member appointed to fill a vacancy
                    occurring prior to the expiration of the term for which
                    that member's predecessor was appointed shall be
                    appointed for the remainder of such term;
                        ``(C) a member may continue to serve after the
                    expiration of the member's term until a successor has
                    taken office; and
                        ``(D) of the members first appointed under this
                    section, 5 shall be appointed for a term of 1 year, 5
                    shall be appointed for a term of 3 years, and 5 shall
                    be appointed for a term of 6 years, the term of each to
                    be designated by the President at the time of
                    nomination.
                ``(3) Chairperson.--
                        ``(A) In general.--The Chairperson shall be
                    appointed by the President, by and with the advice and
                    consent of the Senate, from among the members of the
                    Board.
                        ``(B) Duties.--The Chairperson shall be the
                    principal executive officer of the Board, and shall
                    exercise all of the executive and administrative
                    functions of the Board, including functions of the
                    Board with respect to--
                                ``(i) the appointment and supervision of
                            personnel employed by the Board;
                                ``(ii) the distribution of business among
                            personnel appointed and supervised by the
                            Chairperson and among administrative units of
                            the Board; and
                                ``(iii) the use and expenditure of funds.
                        ``(C) Governance.--In carrying out any of the
                    functions under subparagraph (B), the Chairperson shall
                    be governed by the general policies established by the
                    Board and by the decisions, findings, and
                    determinations the Board shall by law be authorized to
                    make.
                        ``(D) Requests for appropriations.--Requests or
                    estimates for regular, supplemental, or deficiency
                    appropriations on behalf of the Board may not be
                    submitted by the Chairperson without the prior approval
                    of a majority vote of the Board.
                ``(4) Removal.--Any appointed member may be removed by the
            President for neglect of duty or malfeasance in office, but for
            no other cause.
        ``(h) Vacancies; Quorum; Seal; Vice Chairperson; Voting on
    Reports.--
                ``(1) Vacancies.--No vacancy on the Board shall impair the
            right of the remaining members to exercise all the powers of
            the Board.
                ``(2) Quorum.--A majority of the appointed members of the
            Board shall constitute a quorum for the transaction of
            business, but a lesser number of members may hold hearings.
                ``(3) Seal.--The Board shall have an official seal, of
            which judicial notice shall be taken.
                ``(4) Vice chairperson.--The Board shall annually elect a
            Vice Chairperson to act in the absence or disability of the
            Chairperson or in case of a vacancy in the office of the
            Chairperson.
                ``(5) Voting on proposals.--Any proposal of the Board must
            be approved by the majority of appointed members present.
        ``(i) Powers of the Board.--
                ``(1) Hearings.--The Board may hold such hearings, sit and
            act at such times and places, take such testimony, and receive
            such evidence as the Board considers advisable to carry out
            this section.
                ``(2) Authority to inform research priorities for data
            collection.--The Board may advise the Secretary on priorities
            for health services research, particularly as such priorities
            pertain to necessary changes and issues regarding payment
            reforms under Medicare.
                ``(3) Obtaining official data.--The Board may secure
            directly from any department or agency of the United States
            information necessary to enable it to carry out this section.
            Upon request of the Chairperson, the head of that department or
            agency shall furnish that information to the Board on an agreed
            upon schedule.
                ``(4) Postal services.--The Board may use the United States
            mails in the same manner and under the same conditions as other
            departments and agencies of the Federal Government.
                ``(5) Gifts.--The Board may accept, use, and dispose of
            gifts or donations of services or property.
                ``(6) Offices.--The Board shall maintain a principal office
            and such field offices as it determines necessary, and may meet
            and exercise any of its powers at any other place.
        ``(j) Personnel Matters.--
                ``(1) Compensation of members and chairperson.--Each
            appointed member, other than the Chairperson, shall be
            compensated at a rate equal to the annual rate of basic pay
            prescribed for level III of the Executive Schedule under
            section 5315 of title 5, United States Code. The Chairperson
            shall be compensated at a rate equal to the daily equivalent of
            the annual rate of basic pay prescribed for level II of the
            Executive Schedule under section 5315 of title 5, United States
            Code.
                ``(2) Travel expenses.--The appointed members shall be
            allowed travel expenses, including per diem in lieu of
            subsistence, at rates authorized for employees of agencies
            under subchapter I of chapter 57 of title 5, United States
            Code, while away from their homes or regular places of business
            in the performance of services for the Board.
                ``(3) Staff.--
                        ``(A) In general.--The Chairperson may, without
                    regard to the civil service laws and regulations,
                    appoint and terminate an executive director and such
                    other additional personnel as may be necessary to
                    enable the Board to perform its duties. The employment
                    of an executive director shall be subject to
                    confirmation by the Board.
                        ``(B) Compensation.--The Chairperson may fix the
                    compensation of the executive director and other
                    personnel without regard to chapter 51 and subchapter
                    III of chapter 53 of title 5, United States Code,
                    relating to classification of positions and General
                    Schedule pay rates, except that the rate of pay for the
                    executive director and other personnel may not exceed
                    the rate payable for level V of the Executive Schedule
                    under section 5316 of such title.
                ``(4) Detail of government employees.--Any Federal
            Government employee may be detailed to the Board without
            reimbursement, and such detail shall be without interruption or
            loss of civil service status or privilege.
                ``(5) Procurement of temporary and intermittent services.--
            The Chairperson may procure temporary and intermittent services
            under section 3109(b) of title 5, United States Code, at rates
            for individuals which do not exceed the daily equivalent of the
            annual rate of basic pay prescribed for level V of the
            Executive Schedule under section 5316 of such title.
        ``(k) Consumer Advisory Council.--
                ``(1) In general.--There is established a consumer advisory
            council to advise the Board on the impact of payment policies
            under this title on consumers.
                ``(2) Membership.--
                        ``(A) Number and appointment.--The consumer
                    advisory council shall be composed of 10 consumer
                    representatives appointed by the Comptroller General of
                    the United States, 1 from among each of the 10 regions
                    established by the Secretary as of the date of
                    enactment of this section.
                        ``(B) Qualifications.--The membership of the
                    council shall represent the interests of consumers and
                    particular communities.
                ``(3) Duties.--The consumer advisory council shall, subject
            to the call of the Board, meet not less frequently than 2 times
            each year in the District of Columbia.
                ``(4) Open meetings.--Meetings of the consumer advisory
            council shall be open to the public.
                ``(5) Election of officers.--Members of the consumer
            advisory council shall elect their own officers.
                ``(6) Application of faca.--The Federal Advisory Committee
            Act (5 U.S.C. App.) shall apply to the consumer advisory
            council except that section 14 of such Act shall not apply.
        ``(l) Definitions.--In this section:
                ``(1) Board; chairperson; member.--The terms `Board',
            `Chairperson', and `Member' mean the Independent Medicare
            Advisory Board established under subsection (a) and the
            Chairperson and any Member thereof, respectively.
                ``(2) Medicare.--The term `Medicare' means the program
            established under this title, including parts A, B, C, and D.
                ``(3) Medicare beneficiary.--The term `Medicare
            beneficiary' means an individual who is entitled to, or
            enrolled for, benefits under part A or enrolled for benefits
            under part B.
                ``(4) Medicare program spending.--The term `Medicare
            program spending' means program spending under parts A, B, and
            D net of premiums.
        ``(m) Funding.--
                ``(1) In general.--There are appropriated to the Board to
            carry out its duties and functions--
                        ``(A) for fiscal year 2012, $15,000,000; and
                        ``(B) for each subsequent fiscal year, the amount
                    appropriated under this paragraph for the previous
                    fiscal year increased by the annual percentage increase
                    in the Consumer Price Index for All Urban Consumers
                    (all items; United States city average) as of June of
                    the previous fiscal year.
                ``(2) From trust funds.--Sixty percent of amounts
            appropriated under paragraph (1) shall be derived by transfer
            from the Federal Hospital Insurance Trust Fund under section
            1817 and 40 percent of amounts appropriated under such
            paragraph shall be derived by transfer from the Federal
            Supplementary Medical Insurance Trust Fund under section
            1841.''.
                (2) Lobbying cooling-off period for members of the
            independent medicare advisory board.--Section 207(c) of title
            18, United States Code, is amended by inserting at the end the
            following:
                ``(3) Members of the independent medicare advisory board.--
                        ``(A) In general.--Paragraph (1) shall apply to a
                    member of the Independent Medicare Advisory Board under
                    section 1899A.
                        ``(B) Agencies and congress.--For purposes of
                    paragraph (1), the agency in which the individual
                    described in subparagraph (A) served shall be
                    considered to be the Independent Medicare Advisory
                    Board, the Department of Health and Human Services, and
                    the relevant committees of jurisdiction of Congress,
                    including the Committee on Ways and Means and the
                    Committee on Energy and Commerce of the House of
                    Representatives and the Committee on Finance of the
                    Senate.''.
        (b) GAO Study and Report on Determination and Implementation of
    Payment and Coverage Policies Under the Medicare Program.--
                (1) Initial study and report.--
                        (A) Study.--The Comptroller General of the United
                    States (in this section referred to as the
                    ``Comptroller General'') shall conduct a study on
                    changes to payment policies, methodologies, and rates
                    and coverage policies and methodologies under the
                    Medicare program under title XVIII of the Social
                    Security Act as a result of the recommendations
                    contained in the proposals made by the Independent
                    Medicare Advisory Board under section 1899A of such Act
                    (as added by subsection (a)), including an analysis of
                    the effect of such recommendations on--
                                (i) Medicare beneficiary access to
                            providers and items and services;
                                (ii) the affordability of Medicare premiums
                            and cost-sharing (including deductibles,
                            coinsurance, and copayments);
                                (iii) the potential impact of changes on
                            other government or private-sector purchasers
                            and payers of care; and
                                (iv) quality of patient care, including
                            patient experience, outcomes, and other
                            measures of care.
                        (B) Report.--Not later than July 1, 2015, the
                    Comptroller General shall submit to Congress a report
                    containing the results of the study conducted under
                    subparagraph (A), together with recommendations for
                    such legislation and administrative action as the
                    Comptroller General determines appropriate.
                (2) Subsequent studies and reports.--The Comptroller
            General shall periodically conduct such additional studies and
            submit reports to Congress on changes to Medicare payments
            policies, methodologies, and rates and coverage policies and
            methodologies as the Comptroller General determines
            appropriate, in consultation with the Committee on Ways and
            Means and the Committee on Energy and Commerce of the House of
            Representatives and the Committee on Finance of the Senate.
        (c) Conforming Amendments.--Section 1805(b) of the Social Security
    Act (42 U.S.C. 1395b-6(b)) is amended--
                (1) by redesignating paragraphs (4) through (8) as
            paragraphs (5) through (9), respectively; and
                (2) by inserting after paragraph (3) the following:
                ``(4) Review and comment on the independent medicare
            advisory board or secretarial proposal.--If the Independent
            Medicare Advisory Board (as established under subsection (a) of
            section 1899A) or the Secretary submits a proposal to the
            Commission under such section in a year, the Commission shall
            review the proposal and, not later than March 1 of that year,
            submit to the Committee on Ways and Means and the Committee on
            Energy and Commerce of the House of Representatives and the
            Committee on Finance of the Senate written comments on such
            proposal. Such comments may include such recommendations as the
            Commission deems appropriate.''.

                  Subtitle F--Health Care Quality Improvements

    SEC. 3501. HEALTH CARE DELIVERY SYSTEM RESEARCH; QUALITY IMPROVEMENT
                  TECHNICAL ASSISTANCE.

        Part D of title IX of the Public Health Service Act, as amended by
    section 3013, is further amended by adding at the end the following:

             ``Subpart II--Health Care Quality Improvement Programs

    ``SEC. 933. HEALTH CARE DELIVERY SYSTEM RESEARCH.

        ``(a) Purpose.--The purposes of this section are to--
                ``(1) enable the Director to identify, develop, evaluate,
            disseminate, and provide training in innovative methodologies
            and strategies for quality improvement practices in the
            delivery of health care services that represent best practices
            (referred to as `best practices') in health care quality,
            safety, and value; and
                ``(2) ensure that the Director is accountable for
            implementing a model to pursue such research in a collaborative
            manner with other related Federal agencies.
        ``(b) General Functions of the Center.--The Center for Quality
    Improvement and Patient Safety of the Agency for Healthcare Research
    and Quality (referred to in this section as the `Center'), or any other
    relevant agency or department designated by the Director, shall--
                ``(1) carry out its functions using research from a variety
            of disciplines, which may include epidemiology, health
            services, sociology, psychology, human factors engineering,
            biostatistics, health economics, clinical research, and health
            informatics;
                ``(2) conduct or support activities consistent with the
            purposes described in subsection (a), and for--
                        ``(A) best practices for quality improvement
                    practices in the delivery of health care services; and
                        ``(B) that include changes in processes of care and
                    the redesign of systems used by providers that will
                    reliably result in intended health outcomes, improve
                    patient safety, and reduce medical errors (such as
                    skill development for health care providers in team-
                    based health care delivery and rapid cycle process
                    improvement) and facilitate adoption of improved
                    workflow;
                ``(3) identify health care providers, including health care
            systems, single institutions, and individual providers, that--
                        ``(A) deliver consistently high-quality, efficient
                    health care services (as determined by the Secretary);
                    and
                        ``(B) employ best practices that are adaptable and
                    scalable to diverse health care settings or effective
                    in improving care across diverse settings;
                ``(4) assess research, evidence, and knowledge about what
            strategies and methodologies are most effective in improving
            health care delivery;
                ``(5) find ways to translate such information rapidly and
            effectively into practice, and document the sustainability of
            those improvements;
                ``(6) create strategies for quality improvement through the
            development of tools, methodologies, and interventions that can
            successfully reduce variations in the delivery of health care;
                ``(7) identify, measure, and improve organizational, human,
            or other causative factors, including those related to the
            culture and system design of a health care organization, that
            contribute to the success and sustainability of specific
            quality improvement and patient safety strategies;
                ``(8) provide for the development of best practices in the
            delivery of health care services that--
                        ``(A) have a high likelihood of success, based on
                    structured review of empirical evidence;
                        ``(B) are specified with sufficient detail of the
                    individual processes, steps, training, skills, and
                    knowledge required for implementation and incorporation
                    into workflow of health care practitioners in a variety
                    of settings;
                        ``(C) are designed to be readily adapted by health
                    care providers in a variety of settings; and
                        ``(D) where applicable, assist health care
                    providers in working with other health care providers
                    across the continuum of care and in engaging patients
                    and their families in improving the care and patient
                    health outcomes;
                ``(9) provide for the funding of the activities of
            organizations with recognized expertise and excellence in
            improving the delivery of health care services, including
            children's health care, by involving multiple disciplines,
            managers of health care entities, broad development and
            training, patients, caregivers and families, and frontline
            health care workers, including activities for the examination
            of strategies to share best quality improvement practices and
            to promote excellence in the delivery of health care services;
            and
                ``(10) build capacity at the State and community level to
            lead quality and safety efforts through education, training,
            and mentoring programs to carry out the activities under
            paragraphs (1) through (9).
        ``(c) Research Functions of Center.--
                ``(1) In general.--The Center shall support, such as
            through a contract or other mechanism, research on health care
            delivery system improvement and the development of tools to
            facilitate adoption of best practices that improve the quality,
            safety, and efficiency of health care delivery services. Such
            support may include establishing a Quality Improvement Network
            Research Program for the purpose of testing, scaling, and
            disseminating of interventions to improve quality and
            efficiency in health care. Recipients of funding under the
            Program may include national, State, multi-State, or multi-site
            quality improvement networks.
                ``(2) Research requirements.--The research conducted
            pursuant to paragraph (1) shall--
                        ``(A) address the priorities identified by the
                    Secretary in the national strategic plan established
                    under section 399HH;
                        ``(B) identify areas in which evidence is
                    insufficient to identify strategies and methodologies,
                    taking into consideration areas of insufficient
                    evidence identified by the entity with a contract under
                    section 1890(a) of the Social Security Act in the
                    report required under section 399JJ;
                        ``(C) address concerns identified by health care
                    institutions and providers and communicated through the
                    Center pursuant to subsection (d);
                        ``(D) reduce preventable morbidity, mortality, and
                    associated costs of morbidity and mortality by building
                    capacity for patient safety research;
                        ``(E) support the discovery of processes for the
                    reliable, safe, efficient, and responsive delivery of
                    health care, taking into account discoveries from
                    clinical research and comparative effectiveness
                    research;
                        ``(F) allow communication of research findings and
                    translate evidence into practice recommendations that
                    are adaptable to a variety of settings, and which, as
                    soon as practicable after the establishment of the
                    Center, shall include--
                                ``(i) the implementation of a national
                            application of Intensive Care Unit improvement
                            projects relating to the adult (including
                            geriatric), pediatric, and neonatal patient
                            populations;
                                ``(ii) practical methods for addressing
                            health care associated infections, including
                            Methicillin-Resistant Staphylococcus Aureus and
                            Vancomycin-Resistant Entercoccus infections and
                            other emerging infections; and
                                ``(iii) practical methods for reducing
                            preventable hospital admissions and
                            readmissions;
                        ``(G) expand demonstration projects for improving
                    the quality of children's health care and the use of
                    health information technology, such as through
                    Pediatric Quality Improvement Collaboratives and
                    Learning Networks, consistent with provisions of
                    section 1139A of the Social Security Act for assessing
                    and improving quality, where applicable;
                        ``(H) identify and mitigate hazards by--
                                ``(i) analyzing events reported to patient
                            safety reporting systems and patient safety
                            organizations; and
                                ``(ii) using the results of such analyses
                            to develop scientific methods of response to
                            such events;
                        ``(I) include the conduct of systematic reviews of
                    existing practices that improve the quality, safety,
                    and efficiency of health care delivery, as well as new
                    research on improving such practices; and
                        ``(J) include the examination of how to measure and
                    evaluate the progress of quality and patient safety
                    activities.
        ``(d) Dissemination of Research Findings.--
                ``(1) Public availability.--The Director shall make the
            research findings of the Center available to the public through
            multiple media and appropriate formats to reflect the varying
            needs of health care providers and consumers and diverse levels
            of health literacy.
                ``(2) Linkage to health information technology.--The
            Secretary shall ensure that research findings and results
            generated by the Center are shared with the Office of the
            National Coordinator of Health Information Technology and used
            to inform the activities of the health information technology
            extension program under section 3012, as well as any relevant
            standards, certification criteria, or implementation
            specifications.
        ``(e) Prioritization.--The Director shall identify and regularly
    update a list of processes or systems on which to focus research and
    dissemination activities of the Center, taking into account--
                ``(1) the cost to Federal health programs;
                ``(2) consumer assessment of health care experience;
                ``(3) provider assessment of such processes or systems and
            opportunities to minimize distress and injury to the health
            care workforce;
                ``(4) the potential impact of such processes or systems on
            health status and function of patients, including vulnerable
            populations including children;
                ``(5) the areas of insufficient evidence identified under
            subsection (c)(2)(B); and
                ``(6) the evolution of meaningful use of health information
            technology, as defined in section 3000.
        ``(f) Coordination.--The Center shall coordinate its activities
    with activities conducted by the Center for Medicare and Medicaid
    Innovation established under section 1115A of the Social Security Act.
        ``(g) Funding.--There is authorized to be appropriated to carry out
    this section $20,000,000 for fiscal years 2010 through 2014.

    ``SEC. 934. QUALITY IMPROVEMENT TECHNICAL ASSISTANCE AND
                  IMPLEMENTATION.

        ``(a) In General.--The Director, through the Center for Quality
    Improvement and Patient Safety of the Agency for Healthcare Research
    and Quality (referred to in this section as the `Center'), shall
    award--
                ``(1) technical assistance grants or contracts to eligible
            entities to provide technical support to institutions that
            deliver health care and health care providers (including rural
            and urban providers of services and suppliers with limited
            infrastructure and financial resources to implement and support
            quality improvement activities, providers of services and
            suppliers with poor performance scores, and providers of
            services and suppliers for which there are disparities in care
            among subgroups of patients) so that such institutions and
            providers understand, adapt, and implement the models and
            practices identified in the research conducted by the Center,
            including the Quality Improvement Networks Research Program;
            and
                ``(2) implementation grants or contracts to eligible
            entities to implement the models and practices described under
            paragraph (1).
        ``(b) Eligible Entities.--
                ``(1) Technical assistance award.--To be eligible to
            receive a technical assistance grant or contract under
            subsection (a)(1), an entity--
                        ``(A) may be a health care provider, health care
                    provider association, professional society, health care
                    worker organization, Indian health organization,
                    quality improvement organization, patient safety
                    organization, local quality improvement collaborative,
                    the Joint Commission, academic health center,
                    university, physician-based research network, primary
                    care extension program established under section 399W,
                    a Federal Indian Health Service program or a health
                    program operated by an Indian tribe (as defined in
                    section 4 of the Indian Health Care Improvement Act),
                    or any other entity identified by the Secretary; and
                        ``(B) shall have demonstrated expertise in
                    providing information and technical support and
                    assistance to health care providers regarding quality
                    improvement.
                ``(2) Implementation award.--To be eligible to receive an
            implementation grant or contract under subsection (a)(2), an
            entity--
                        ``(A) may be a hospital or other health care
                    provider or consortium or providers, as determined by
                    the Secretary; and
                        ``(B) shall have demonstrated expertise in
                    providing information and technical support and
                    assistance to health care providers regarding quality
                    improvement.
        ``(c) Application.--
                ``(1) Technical assistance award.--To receive a technical
            assistance grant or contract under subsection (a)(1), an
            eligible entity shall submit an application to the Secretary at
            such time, in such manner, and containing--
                        ``(A) a plan for a sustainable business model that
                    may include a system of--
                                ``(i) charging fees to institutions and
                            providers that receive technical support from
                            the entity; and
                                ``(ii) reducing or eliminating such fees
                            for such institutions and providers that serve
                            low-income populations; and
                        ``(B) such other information as the Director may
                    require.
                ``(2) Implementation award.--To receive a grant or contract
            under subsection (a)(2), an eligible entity shall submit an
            application to the Secretary at such time, in such manner, and
            containing--
                        ``(A) a plan for implementation of a model or
                    practice identified in the research conducted by the
                    Center including--
                                ``(i) financial cost, staffing
                            requirements, and timeline for implementation;
                            and
                                ``(ii) pre- and projected post-
                            implementation quality measure performance data
                            in targeted improvement areas identified by the
                            Secretary; and
                        ``(B) such other information as the Director may
                    require.
        ``(d) Matching Funds.--The Director may not award a grant or
    contract under this section to an entity unless the entity agrees that
    it will make available (directly or through contributions from other
    public or private entities) non-Federal contributions toward the
    activities to be carried out under the grant or contract in an amount
    equal to $1 for each $5 of Federal funds provided under the grant or
    contract. Such non-Federal matching funds may be provided directly or
    through donations from public or private entities and may be in cash or
    in-kind, fairly evaluated, including plant, equipment, or services.
        ``(e) Evaluation.--
                ``(1) In general.--The Director shall evaluate the
            performance of each entity that receives a grant or contract
            under this section. The evaluation of an entity shall include a
            study of--
                        ``(A) the success of such entity in achieving the
                    implementation, by the health care institutions and
                    providers assisted by such entity, of the models and
                    practices identified in the research conducted by the
                    Center under section 933;
                        ``(B) the perception of the health care
                    institutions and providers assisted by such entity
                    regarding the value of the entity; and
                        ``(C) where practicable, better patient health
                    outcomes and lower cost resulting from the assistance
                    provided by such entity.
                ``(2) Effect of evaluation.--Based on the outcome of the
            evaluation of the entity under paragraph (1), the Director
            shall determine whether to renew a grant or contract with such
            entity under this section.
        ``(f) Coordination.--The entities that receive a grant or contract
    under this section shall coordinate with health information technology
    regional extension centers under section 3012(c) and the primary care
    extension program established under section 399W regarding the
    dissemination of quality improvement, system delivery reform, and best
    practices information.''.

    SEC. 3502. ESTABLISHING COMMUNITY HEALTH TEAMS TO SUPPORT THE PATIENT-
                  CENTERED MEDICAL HOME.

        (a) In General.--The Secretary of Health and Human Services
    (referred to in this section as the ``Secretary'') shall establish a
    program to provide grants to or enter into contracts with eligible
    entities to establish community-based interdisciplinary,
    interprofessional teams (referred to in this section as ``health
    teams'') to support primary care practices, including obstetrics and
    gynecology practices, within the hospital service areas served by the
    eligible entities. Grants or contracts shall be used to--
                (1) establish health teams to provide support services to
            primary care providers; and
                (2) provide capitated payments to primary care providers as
            determined by the Secretary.
        (b) Eligible Entities.--To be eligible to receive a grant or
    contract under subsection (a), an entity shall--
                (1)(A) be a State or State-designated entity; or
                (B) be an Indian tribe or tribal organization, as defined
            in section 4 of the Indian Health Care Improvement Act;
                (2) submit a plan for achieving long-term financial
            sustainability within 3 years;
                (3) submit a plan for incorporating prevention initiatives
            and patient education and care management resources into the
            delivery of health care that is integrated with community-based
            prevention and treatment resources, where available;
                (4) ensure that the health team established by the entity
            includes an interdisciplinary, interprofessional team of health
            care providers, as determined by the Secretary; such team may
            include medical specialists, nurses, pharmacists,
            nutritionists, dieticians, social workers, behavioral and
            mental health providers (including substance use disorder
            prevention and treatment providers), doctors of chiropractic,
            licensed complementary and alternative medicine practitioners,
            and physicians' assistants;
                (5) agree to provide services to eligible individuals with
            chronic conditions, as described in section 1945 of the Social
            Security Act (as added by section 2703), in accordance with the
            payment methodology established under subsection (c) of such
            section; and
                (6) submit to the Secretary an application at such time, in
            such manner, and containing such information as the Secretary
            may require.
        (c) Requirements for Health Teams.--A health team established
    pursuant to a grant or contract under subsection (a) shall--
                (1) establish contractual agreements with primary care
            providers to provide support services;
                (2) support patient-centered medical homes, defined as a
            mode of care that includes--
                        (A) personal physicians;
                        (B) whole person orientation;
                        (C) coordinated and integrated care;
                        (D) safe and high-quality care through evidence-
                    informed medicine, appropriate use of health
                    information technology, and continuous quality
                    improvements;
                        (E) expanded access to care; and
                        (F) payment that recognizes added value from
                    additional components of patient-centered care;
                (3) collaborate with local primary care providers and
            existing State and community based resources to coordinate
            disease prevention, chronic disease management, transitioning
            between health care providers and settings and case management
            for patients, including children, with priority given to those
            amenable to prevention and with chronic diseases or conditions
            identified by the Secretary;
                (4) in collaboration with local health care providers,
            develop and implement interdisciplinary, interprofessional care
            plans that integrate clinical and community preventive and
            health promotion services for patients, including children,
            with a priority given to those amenable to prevention and with
            chronic diseases or conditions identified by the Secretary;
                (5) incorporate health care providers, patients,
            caregivers, and authorized representatives in program design
            and oversight;
                (6) provide support necessary for local primary care
            providers to--
                        (A) coordinate and provide access to high-quality
                    health care services;
                        (B) coordinate and provide access to preventive and
                    health promotion services;
                        (C) provide access to appropriate specialty care
                    and inpatient services;
                        (D) provide quality-driven, cost-effective,
                    culturally appropriate, and patient- and family-
                    centered health care;
                        (E) provide access to pharmacist-delivered
                    medication management services, including medication
                    reconciliation;
                        (F) provide coordination of the appropriate use of
                    complementary and alternative (CAM) services to those
                    who request such services;
                        (G) promote effective strategies for treatment
                    planning, monitoring health outcomes and resource use,
                    sharing information, treatment decision support, and
                    organizing care to avoid duplication of service and
                    other medical management approaches intended to improve
                    quality and value of health care services;
                        (H) provide local access to the continuum of health
                    care services in the most appropriate setting,
                    including access to individuals that implement the care
                    plans of patients and coordinate care, such as
                    integrative health care practitioners;
                        (I) collect and report data that permits evaluation
                    of the success of the collaborative effort on patient
                    outcomes, including collection of data on patient
                    experience of care, and identification of areas for
                    improvement; and
                        (J) establish a coordinated system of early
                    identification and referral for children at risk for
                    developmental or behavioral problems such as through
                    the use of infolines, health information technology, or
                    other means as determined by the Secretary;
                (7) provide 24-hour care management and support during
            transitions in care settings including--
                        (A) a transitional care program that provides
                    onsite visits from the care coordinator, assists with
                    the development of discharge plans and medication
                    reconciliation upon admission to and discharge from the
                    hospitals, nursing home, or other institution setting;
                        (B) discharge planning and counseling support to
                    providers, patients, caregivers, and authorized
                    representatives;
                        (C) assuring that post-discharge care plans include
                    medication management, as appropriate;
                        (D) referrals for mental and behavioral health
                    services, which may include the use of infolines; and
                        (E) transitional health care needs from adolescence
                    to adulthood;
                (8) serve as a liaison to community prevention and
            treatment programs;
                (9) demonstrate a capacity to implement and maintain health
            information technology that meets the requirements of certified
            EHR technology (as defined in section 3000 of the Public Health
            Service Act (42 U.S.C. 300jj)) to facilitate coordination among
            members of the applicable care team and affiliated primary care
            practices; and
                (10) where applicable, report to the Secretary information
            on quality measures used under section 399JJ of the Public
            Health Service Act.
        (d) Requirement for Primary Care Providers.--A provider who
    contracts with a care team shall--
                (1) provide a care plan to the care team for each patient
            participant;
                (2) provide access to participant health records; and
                (3) meet regularly with the care team to ensure integration
            of care.
        (e) Reporting to Secretary.--An entity that receives a grant or
    contract under subsection (a) shall submit to the Secretary a report
    that describes and evaluates, as requested by the Secretary, the
    activities carried out by the entity under subsection (c).
        (f) Definition of Primary Care.--In this section, the term
    ``primary care'' means the provision of integrated, accessible health
    care services by clinicians who are accountable for addressing a large
    majority of personal health care needs, developing a sustained
    partnership with patients, and practicing in the context of family and
    community.

    SEC. 3503. MEDICATION MANAGEMENT SERVICES IN TREATMENT OF CHRONIC
                  DISEASE.

        Title IX of the Public Health Service Act (42 U.S.C. 299 et seq.),
    as amended by section 3501, is further amended by inserting after
    section 934 the following:

    ``SEC. 935. GRANTS OR CONTRACTS TO IMPLEMENT MEDICATION MANAGEMENT
                  SERVICES IN TREATMENT OF CHRONIC DISEASES.

        ``(a) In General.--The Secretary, acting through the Patient Safety
    Research Center established in section 933 (referred to in this section
    as the `Center'), shall establish a program to provide grants or
    contracts to eligible entities to implement medication management
    (referred to in this section as `MTM') services provided by licensed
    pharmacists, as a collaborative, multidisciplinary, inter-professional
    approach to the treatment of chronic diseases for targeted individuals,
    to improve the quality of care and reduce overall cost in the treatment
    of such diseases. The Secretary shall commence the program under this
    section not later than May 1, 2010.
        ``(b) Eligible Entities.--To be eligible to receive a grant or
    contract under subsection (a), an entity shall--
                ``(1) provide a setting appropriate for MTM services, as
            recommended by the experts described in subsection (e);
                ``(2) submit to the Secretary a plan for achieving long-
            term financial sustainability;
                ``(3) where applicable, submit a plan for coordinating MTM
            services through local community health teams established in
            section 3502 of the Patient Protection and Affordable Care Act
            or in collaboration with primary care extension programs
            established in section 399W;
                ``(4) submit a plan for meeting the requirements under
            subsection (c); and
                ``(5) submit to the Secretary such other information as the
            Secretary may require.
        ``(c) MTM Services to Targeted Individuals.--The MTM services
    provided with the assistance of a grant or contract awarded under
    subsection (a) shall, as allowed by State law including applicable
    collaborative pharmacy practice agreements, include--
                ``(1) performing or obtaining necessary assessments of the
            health and functional status of each patient receiving such MTM
            services;
                ``(2) formulating a medication treatment plan according to
            therapeutic goals agreed upon by the prescriber and the patient
            or caregiver or authorized representative of the patient;
                ``(3) selecting, initiating, modifying, recommending
            changes to, or administering medication therapy;
                ``(4) monitoring, which may include access to, ordering, or
            performing laboratory assessments, and evaluating the response
            of the patient to therapy, including safety and effectiveness;
                ``(5) performing an initial comprehensive medication review
            to identify, resolve, and prevent medication-related problems,
            including adverse drug events, quarterly targeted medication
            reviews for ongoing monitoring, and additional followup
            interventions on a schedule developed collaboratively with the
            prescriber;
                ``(6) documenting the care delivered and communicating
            essential information about such care, including a summary of
            the medication review, and the recommendations of the
            pharmacist to other appropriate health care providers of the
            patient in a timely fashion;
                ``(7) providing education and training designed to enhance
            the understanding and appropriate use of the medications by the
            patient, caregiver, and other authorized representative;
                ``(8) providing information, support services, and
            resources and strategies designed to enhance patient adherence
            with therapeutic regimens;
                ``(9) coordinating and integrating MTM services within the
            broader health care management services provided to the
            patient; and
                ``(10) such other patient care services allowed under
            pharmacist scopes of practice in use in other Federal programs
            that have implemented MTM services.
        ``(d) Targeted Individuals.--MTM services provided by licensed
    pharmacists under a grant or contract awarded under subsection (a)
    shall be offered to targeted individuals who--
                ``(1) take 4 or more prescribed medications (including
            over-the-counter medications and dietary supplements);
                ``(2) take any `high risk' medications;
                ``(3) have 2 or more chronic diseases, as identified by the
            Secretary; or
                ``(4) have undergone a transition of care, or other
            factors, as determined by the Secretary, that are likely to
            create a high risk of medication-related problems.
        ``(e) Consultation With Experts.--In designing and implementing MTM
    services provided under grants or contracts awarded under subsection
    (a), the Secretary shall consult with Federal, State, private, public-
    private, and academic entities, pharmacy and pharmacist organizations,
    health care organizations, consumer advocates, chronic disease groups,
    and other stakeholders involved with the research, dissemination, and
    implementation of pharmacist-delivered MTM services, as the Secretary
    determines appropriate. The Secretary, in collaboration with this
    group, shall determine whether it is possible to incorporate rapid
    cycle process improvement concepts in use in other Federal programs
    that have implemented MTM services.
        ``(f) Reporting to the Secretary.--An entity that receives a grant
    or contract under subsection (a) shall submit to the Secretary a report
    that describes and evaluates, as requested by the Secretary, the
    activities carried out under subsection (c), including quality measures
    endorsed by the entity with a contract under section 1890 of the Social
    Security Act, as determined by the Secretary.
        ``(g) Evaluation and Report.--The Secretary shall submit to the
    relevant committees of Congress a report which shall--
                ``(1) assess the clinical effectiveness of pharmacist-
            provided services under the MTM services program, as compared
            to usual care, including an evaluation of whether enrollees
            maintained better health with fewer hospitalizations and
            emergency room visits than similar patients not enrolled in the
            program;
                ``(2) assess changes in overall health care resource use by
            targeted individuals;
                ``(3) assess patient and prescriber satisfaction with MTM
            services;
                ``(4) assess the impact of patient-cost sharing
            requirements on medication adherence and recommendations for
            modifications;
                ``(5) identify and evaluate other factors that may impact
            clinical and economic outcomes, including demographic
            characteristics, clinical characteristics, and health services
            use of the patient, as well as characteristics of the regimen,
            pharmacy benefit, and MTM services provided; and
                ``(6) evaluate the extent to which participating
            pharmacists who maintain a dispensing role have a conflict of
            interest in the provision of MTM services, and if such conflict
            is found, provide recommendations on how such a conflict might
            be appropriately addressed.
        ``(h) Grants or Contracts To Fund Development of Performance
    Measures.--The Secretary may, through the quality measure development
    program under section 931 of the Public Health Service Act, award
    grants or contracts to eligible entities for the purpose of funding the
    development of performance measures that assess the use and
    effectiveness of medication therapy management services.''.

    SEC. 3504. DESIGN AND IMPLEMENTATION OF REGIONALIZED SYSTEMS FOR
                  EMERGENCY CARE.

        (a) In General.--Title XII of the Public Health Service Act (42
    U.S.C. 300d et seq.) is amended--
                (1) in section 1203--
                        (A) in the section heading, by inserting ``for
                    trauma systems'' after ``grants''; and
                        (B) in subsection (a), by striking ``Administrator
                    of the Health Resources and Services Administration''
                    and inserting ``Assistant Secretary for Preparedness
                    and Response'';
                (2) by inserting after section 1203 the following:

    ``SEC. 1204. COMPETITIVE GRANTS FOR REGIONALIZED SYSTEMS FOR EMERGENCY
                  CARE RESPONSE.

        ``(a) In General.--The Secretary, acting through the Assistant
    Secretary for Preparedness and Response, shall award not fewer than 4
    multiyear contracts or competitive grants to eligible entities to
    support pilot projects that design, implement, and evaluate innovative
    models of regionalized, comprehensive, and accountable emergency care
    and trauma systems.
        ``(b) Eligible Entity; Region.--In this section:
                ``(1) Eligible entity.--The term `eligible entity' means--
                        ``(A) a State or a partnership of 1 or more States
                    and 1 or more local governments; or
                        ``(B) an Indian tribe (as defined in section 4 of
                    the Indian Health Care Improvement Act) or a
                    partnership of 1 or more Indian tribes.
                ``(2) Region.--The term `region' means an area within a
            State, an area that lies within multiple States, or a similar
            area (such as a multicounty area), as determined by the
            Secretary.
                ``(3) Emergency services.--The term `emergency services'
            includes acute, prehospital, and trauma care.
        ``(c) Pilot Projects.--The Secretary shall award a contract or
    grant under subsection (a) to an eligible entity that proposes a pilot
    project to design, implement, and evaluate an emergency medical and
    trauma system that--
                ``(1) coordinates with public health and safety services,
            emergency medical services, medical facilities, trauma centers,
            and other entities in a region to develop an approach to
            emergency medical and trauma system access throughout the
            region, including 9-1-1 Public Safety Answering Points and
            emergency medical dispatch;
                ``(2) includes a mechanism, such as a regional medical
            direction or transport communications system, that operates
            throughout the region to ensure that the patient is taken to
            the medically appropriate facility (whether an initial facility
            or a higher-level facility) in a timely fashion;
                ``(3) allows for the tracking of prehospital and hospital
            resources, including inpatient bed capacity, emergency
            department capacity, trauma center capacity, on-call specialist
            coverage, ambulance diversion status, and the coordination of
            such tracking with regional communications and hospital
            destination decisions; and
                ``(4) includes a consistent region-wide prehospital,
            hospital, and interfacility data management system that--
                        ``(A) submits data to the National EMS Information
                    System, the National Trauma Data Bank, and others;
                        ``(B) reports data to appropriate Federal and State
                    databanks and registries; and
                        ``(C) contains information sufficient to evaluate
                    key elements of prehospital care, hospital destination
                    decisions, including initial hospital and interfacility
                    decisions, and relevant health outcomes of hospital
                    care.
        ``(d) Application.--
                ``(1) In general.--An eligible entity that seeks a contract
            or grant described in subsection (a) shall submit to the
            Secretary an application at such time and in such manner as the
            Secretary may require.
                ``(2) Application information.--Each application shall
            include--
                        ``(A) an assurance from the eligible entity that
                    the proposed system--
                                ``(i) has been coordinated with the
                            applicable State Office of Emergency Medical
                            Services (or equivalent State office);
                                ``(ii) includes consistent indirect and
                            direct medical oversight of prehospital,
                            hospital, and interfacility transport
                            throughout the region;
                                ``(iii) coordinates prehospital treatment
                            and triage, hospital destination, and
                            interfacility transport throughout the region;
                                ``(iv) includes a categorization or
                            designation system for special medical
                            facilities throughout the region that is
                            integrated with transport and destination
                            protocols;
                                ``(v) includes a regional medical
                            direction, patient tracking, and resource
                            allocation system that supports day-to-day
                            emergency care and surge capacity and is
                            integrated with other components of the
                            national and State emergency preparedness
                            system; and
                                ``(vi) addresses pediatric concerns related
                            to integration, planning, preparedness, and
                            coordination of emergency medical services for
                            infants, children and adolescents; and
                        ``(B) such other information as the Secretary may
                    require.
        ``(e) Requirement of Matching Funds.--
                ``(1) In general.--The Secretary may not make a grant under
            this section unless the State (or consortia of States) involved
            agrees, with respect to the costs to be incurred by the State
            (or consortia) in carrying out the purpose for which such grant
            was made, to make available non-Federal contributions (in cash
            or in kind under paragraph (2)) toward such costs in an amount
            equal to not less than $1 for each $3 of Federal funds provided
            in the grant. Such contributions may be made directly or
            through donations from public or private entities.
                ``(2) Non-federal contributions.--Non-Federal contributions
            required in paragraph (1) may be in cash or in kind, fairly
            evaluated, including equipment or services (and excluding
            indirect or overhead costs). Amounts provided by the Federal
            Government, or services assisted or subsidized to any
            significant extent by the Federal Government, may not be
            included in determining the amount of such non-Federal
            contributions.
        ``(f) Priority.--The Secretary shall give priority for the award of
    the contracts or grants described in subsection (a) to any eligible
    entity that serves a population in a medically underserved area (as
    defined in section 330(b)(3)).
        ``(g) Report.--Not later than 90 days after the completion of a
    pilot project under subsection (a), the recipient of such contract or
    grant described in shall submit to the Secretary a report containing
    the results of an evaluation of the program, including an
    identification of--
                ``(1) the impact of the regional, accountable emergency
            care and trauma system on patient health outcomes for various
            critical care categories, such as trauma, stroke, cardiac
            emergencies, neurological emergencies, and pediatric
            emergencies;
                ``(2) the system characteristics that contribute to the
            effectiveness and efficiency of the program (or lack thereof);
                ``(3) methods of assuring the long-term financial
            sustainability of the emergency care and trauma system;
                ``(4) the State and local legislation necessary to
            implement and to maintain the system;
                ``(5) the barriers to developing regionalized, accountable
            emergency care and trauma systems, as well as the methods to
            overcome such barriers; and
                ``(6) recommendations on the utilization of available
            funding for future regionalization efforts.
        ``(h) Dissemination of Findings.--The Secretary shall, as
    appropriate, disseminate to the public and to the appropriate
    Committees of the Congress, the information contained in a report made
    under subsection (g).''; and
                (3) in section 1232--
                        (A) in subsection (a), by striking ``appropriated''
                    and all that follows through the period at the end and
                    inserting ``appropriated $24,000,000 for each of fiscal
                    years 2010 through 2014.''; and
                        (B) by inserting after subsection (c) the
                    following:
        ``(d) Authority.--For the purpose of carrying out parts A through
    C, beginning on the date of enactment of the Patient Protection and
    Affordable Care Act, the Secretary shall transfer authority in
    administering grants and related authorities under such parts from the
    Administrator of the Health Resources and Services Administration to
    the Assistant Secretary for Preparedness and Response.''.
        (b) Support for Emergency Medicine Research.--Part H of title IV of
    the Public Health Service Act (42 U.S.C. 289 et seq.) is amended by
    inserting after the section 498C the following:

    ``SEC. 498D. SUPPORT FOR EMERGENCY MEDICINE RESEARCH.

        ``(a) Emergency Medical Research.--The Secretary shall support
    Federal programs administered by the National Institutes of Health, the
    Agency for Healthcare Research and Quality, the Health Resources and
    Services Administration, the Centers for Disease Control and
    Prevention, and other agencies involved in improving the emergency care
    system to expand and accelerate research in emergency medical care
    systems and emergency medicine, including--
                ``(1) the basic science of emergency medicine;
                ``(2) the model of service delivery and the components of
            such models that contribute to enhanced patient health
            outcomes;
                ``(3) the translation of basic scientific research into
            improved practice; and
                ``(4) the development of timely and efficient delivery of
            health services.
        ``(b) Pediatric Emergency Medical Research.--The Secretary shall
    support Federal programs administered by the National Institutes of
    Health, the Agency for Healthcare Research and Quality, the Health
    Resources and Services Administration, the Centers for Disease Control
    and Prevention, and other agencies to coordinate and expand research in
    pediatric emergency medical care systems and pediatric emergency
    medicine, including--
                ``(1) an examination of the gaps and opportunities in
            pediatric emergency care research and a strategy for the
            optimal organization and funding of such research;
                ``(2) the role of pediatric emergency services as an
            integrated component of the overall health system;
                ``(3) system-wide pediatric emergency care planning,
            preparedness, coordination, and funding;
                ``(4) pediatric training in professional education; and
                ``(5) research in pediatric emergency care, specifically on
            the efficacy, safety, and health outcomes of medications used
            for infants, children, and adolescents in emergency care
            settings in order to improve patient safety.
        ``(c) Impact Research.--The Secretary shall support research to
    determine the estimated economic impact of, and savings that result
    from, the implementation of coordinated emergency care systems.
        ``(d) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this section such sums as may be necessary
    for each of fiscal years 2010 through 2014.''.

    SEC. 3505. TRAUMA CARE CENTERS AND SERVICE AVAILABILITY.

        (a) Trauma Care Centers.--
                (1) Grants for trauma care centers.--Section 1241 of the
            Public Health Service Act (42 U.S.C. 300d-41) is amended by
            striking subsections (a) and (b) and inserting the following:
        ``(a) In General.--The Secretary shall establish 3 programs to
    award grants to qualified public, nonprofit Indian Health Service,
    Indian tribal, and urban Indian trauma centers--
                ``(1) to assist in defraying substantial uncompensated care
            costs;
                ``(2) to further the core missions of such trauma centers,
            including by addressing costs associated with patient
            stabilization and transfer, trauma education and outreach,
            coordination with local and regional trauma systems, essential
            personnel and other fixed costs, and expenses associated with
            employee and non-employee physician services; and
                ``(3) to provide emergency relief to ensure the continued
            and future availability of trauma services.
        ``(b) Minimum Qualifications of Trauma Centers.--
                ``(1) Participation in trauma care system operating under
            certain professional guidelines.--Except as provided in
            paragraph (2), the Secretary may not award a grant to a trauma
            center under subsection (a) unless the trauma center is a
            participant in a trauma system that substantially complies with
            section 1213.
                ``(2) Exemption.--Paragraph (1) shall not apply to trauma
            centers that are located in States with no existing trauma care
            system.
                ``(3) Qualification for substantial uncompensated care
            costs.--The Secretary shall award substantial uncompensated
            care grants under subsection (a)(1) only to trauma centers
            meeting at least 1 of the criteria in 1 of the following 3
            categories:
                        ``(A) Category a.--The criteria for category A are
                    as follows:
                                ``(i) At least 40 percent of the visits in
                            the emergency department of the hospital in
                            which the trauma center is located were charity
                            or self-pay patients.
                                ``(ii) At least 50 percent of the visits in
                            such emergency department were Medicaid (under
                            title XIX of the Social Security Act (42 U.S.C.
                            1396 et seq.)) and charity and self-pay
                            patients combined.
                        ``(B) Category b.--The criteria for category B are
                    as follows:
                                ``(i) At least 35 percent of the visits in
                            the emergency department were charity or self-
                            pay patients.
                                ``(ii) At least 50 percent of the visits in
                            the emergency department were Medicaid and
                            charity and self-pay patients combined.
                        ``(C) Category c.--The criteria for category C are
                    as follows:
                                ``(i) At least 20 percent of the visits in
                            the emergency department were charity or self-
                            pay patients.
                                ``(ii) At least 30 percent of the visits in
                            the emergency department were Medicaid and
                            charity and self-pay patients combined.
                ``(4) Trauma centers in 1115 waiver states.--
            Notwithstanding paragraph (3), the Secretary may award a
            substantial uncompensated care grant to a trauma center under
            subsection (a)(1) if the trauma center qualifies for funds
            under a Low Income Pool or Safety Net Care Pool established
            through a waiver approved under section 1115 of the Social
            Security Act (42 U.S.C. 1315).
                ``(5) Designation.--The Secretary may not award a grant to
            a trauma center unless such trauma center is verified by the
            American College of Surgeons or designated by an equivalent
            State or local agency.
        ``(c) Additional Requirements.--The Secretary may not award a grant
    to a trauma center under subsection (a)(1) unless such trauma center--
                ``(1) submits to the Secretary a plan satisfactory to the
            Secretary that demonstrates a continued commitment to serving
            trauma patients regardless of their ability to pay; and
                ``(2) has policies in place to assist patients who cannot
            pay for part or all of the care they receive, including a
            sliding fee scale, and to ensure fair billing and collection
            practices.''.
                (2) Considerations in making grants.--Section 1242 of the
            Public Health Service Act (42 U.S.C. 300d-42) is amended by
            striking subsections (a) and (b) and inserting the following:
        ``(a) Substantial Uncompensated Care Awards.--
                ``(1) In general.--The Secretary shall establish an award
            basis for each eligible trauma center for grants under section
            1241(a)(1) according to the percentage described in paragraph
            (2), subject to the requirements of section 1241(b)(3).
                ``(2) Percentages.--The applicable percentages are as
            follows:
                        ``(A) With respect to a category A trauma center,
                    100 percent of the uncompensated care costs.
                        ``(B) With respect to a category B trauma center,
                    not more than 75 percent of the uncompensated care
                    costs.
                        ``(C) With respect to a category C trauma center,
                    not more than 50 percent of the uncompensated care
                    costs.
        ``(b) Core Mission Awards.--
                ``(1) In general.--In awarding grants under section
            1241(a)(2), the Secretary shall--
                        ``(A) reserve 25 percent of the amount allocated
                    for core mission awards for Level III and Level IV
                    trauma centers; and
                        ``(B) reserve 25 percent of the amount allocated
                    for core mission awards for large urban Level I and II
                    trauma centers--
                                ``(i) that have at least 1 graduate medical
                            education fellowship in trauma or trauma
                            related specialties for which demand is
                            exceeding supply;
                                ``(ii) for which--
                                        ``(I) annual uncompensated care
                                    costs exceed $10,000,000; or
                                        ``(II) at least 20 percent of
                                    emergency department visits are charity
                                    or self-pay or Medicaid patients; and
                                ``(iii) that are not eligible for
                            substantial uncompensated care awards under
                            section 1241(a)(1).
        ``(c) Emergency Awards.--In awarding grants under section
    1241(a)(3), the Secretary shall--
                ``(1) give preference to any application submitted by a
            trauma center that provides trauma care in a geographic area in
            which the availability of trauma care has significantly
            decreased or will significantly decrease if the center is
            forced to close or downgrade service or growth in demand for
            trauma services exceeds capacity; and
                ``(2) reallocate any emergency awards funds not obligated
            due to insufficient, or a lack of qualified, applications to
            the significant uncompensated care award program.''.
                (3) Certain agreements.--Section 1243 of the Public Health
            Service Act (42 U.S.C. 300d-43) is amended by striking
            subsections (a), (b), and (c) and inserting the following:
        ``(a) Maintenance of Financial Support.--The Secretary may require
    a trauma center receiving a grant under section 1241(a) to maintain
    access to trauma services at comparable levels to the prior year during
    the grant period.
        ``(b) Trauma Care Registry.--The Secretary may require the trauma
    center receiving a grant under section 1241(a) to provide data to a
    national and centralized registry of trauma cases, in accordance with
    guidelines developed by the American College of Surgeons, and as the
    Secretary may otherwise require.''.
                (4) General provisions.--Section 1244 of the Public Health
            Service Act (42 U.S.C. 300d-44) is amended by striking
            subsections (a), (b), and (c) and inserting the following:
        ``(a) Application.--The Secretary may not award a grant to a trauma
    center under section 1241(a) unless such center submits an application
    for the grant to the Secretary and the application is in such form, is
    made in such manner, and contains such agreements, assurances, and
    information as the Secretary determines to be necessary to carry out
    this part.
        ``(b) Limitation on Duration of Support.--The period during which a
    trauma center receives payments under a grant under section 1241(a)(3)
    shall be for 3 fiscal years, except that the Secretary may waive such
    requirement for a center and authorize such center to receive such
    payments for 1 additional fiscal year.
        ``(c) Limitation on Amount of Grant.--Notwithstanding section
    1242(a), a grant under section 1241 may not be made in an amount
    exceeding $2,000,000 for each fiscal year.
        ``(d) Eligibility.--Except as provided in section
    1242(b)(1)(B)(iii), acquisition of, or eligibility for, a grant under
    section 1241(a) shall not preclude a trauma center from being eligible
    for other grants described in such section.
        ``(e) Funding Distribution.--Of the total amount appropriated for a
    fiscal year under section 1245, 70 percent shall be used for
    substantial uncompensated care awards under section 1241(a)(1), 20
    percent shall be used for core mission awards under section 1241(a)(2),
    and 10 percent shall be used for emergency awards under section
    1241(a)(3).
        ``(f) Minimum Allowance.--Notwithstanding subsection (e), if the
    amount appropriated for a fiscal year under section 1245 is less than
    $25,000,000, all available funding for such fiscal year shall be used
    for substantial uncompensated care awards under section 1241(a)(1).
        ``(g) Substantial Uncompensated Care Award Distribution and
    Proportional Share.--Notwithstanding section 1242(a), of the amount
    appropriated for substantial uncompensated care grants for a fiscal
    year, the Secretary shall--
                ``(1) make available--
                        ``(A) 50 percent of such funds for category A
                    trauma center grantees;
                        ``(B) 35 percent of such funds for category B
                    trauma center grantees; and
                        ``(C) 15 percent of such funds for category C
                    trauma center grantees; and
                ``(2) provide available funds within each category in a
            manner proportional to the award basis specified in section
            1242(a)(2) to each eligible trauma center.
        ``(h) Report.--Beginning 2 years after the date of enactment of the
    Patient Protection and Affordable Care Act, and every 2 years
    thereafter, the Secretary shall biennially report to Congress regarding
    the status of the grants made under section 1241 and on the overall
    financial stability of trauma centers.''.
                (5) Authorization of appropriations.--Section 1245 of the
            Public Health Service Act (42 U.S.C. 300d-45) is amended to
            read as follows:

    ``SEC. 1245. AUTHORIZATION OF APPROPRIATIONS.

        ``For the purpose of carrying out this part, there are authorized
    to be appropriated $100,000,000 for fiscal year 2009, and such sums as
    may be necessary for each of fiscal years 2010 through 2015. Such
    authorization of appropriations is in addition to any other
    authorization of appropriations or amounts that are available for such
    purpose.''.
                (6) Definition.--Part D of title XII of the Public Health
            Service Act (42 U.S.C. 300d-41 et seq.) is amended by adding at
            the end the following:

    ``SEC. 1246. DEFINITION.

        ``In this part, the term `uncompensated care costs' means
    unreimbursed costs from serving self-pay, charity, or Medicaid
    patients, without regard to payment under section 1923 of the Social
    Security Act, all of which are attributable to emergency care and
    trauma care, including costs related to subsequent inpatient admissions
    to the hospital.''.
        (b) Trauma Service Availability.--Title XII of the Public Health
    Service Act (42 U.S.C. 300d et seq.) is amended by adding at the end
    the following:

                     ``PART H--TRAUMA SERVICE AVAILABILITY

    ``SEC. 1281. GRANTS TO STATES.

        ``(a) Establishment.--To promote universal access to trauma care
    services provided by trauma centers and trauma-related physician
    specialties, the Secretary shall provide funding to States to enable
    such States to award grants to eligible entities for the purposes
    described in this section.
        ``(b) Awarding of Grants by States.--Each State may award grants to
    eligible entities within the State for the purposes described in
    subparagraph (d).
        ``(c) Eligibility.--
                ``(1) In general.--To be eligible to receive a grant under
            subsection (b) an entity shall--
                        ``(A) be--
                                ``(i) a public or nonprofit trauma center
                            or consortium thereof that meets that
                            requirements of paragraphs (1), (2), and (5) of
                            section 1241(b);
                                ``(ii) a safety net public or nonprofit
                            trauma center that meets the requirements of
                            paragraphs (1) through (5) of section 1241(b);
                            or
                                ``(iii) a hospital in an underserved area
                            (as defined by the State) that seeks to
                            establish new trauma services; and
                        ``(B) submit to the State an application at such
                    time, in such manner, and containing such information
                    as the State may require.
                ``(2) Limitation.--A State shall use at least 40 percent of
            the amount available to the State under this part for a fiscal
            year to award grants to safety net trauma centers described in
            paragraph (1)(A)(ii).
        ``(d) Use of Funds.--The recipient of a grant under subsection (b)
    shall carry out 1 or more of the following activities consistent with
    subsection (b):
                ``(1) Providing trauma centers with funding to support
            physician compensation in trauma-related physician specialties
            where shortages exist in the region involved, with priority
            provided to safety net trauma centers described in subsection
            (c)(1)(A)(ii).
                ``(2) Providing for individual safety net trauma center
            fiscal stability and costs related to having service that is
            available 24 hours a day, 7 days a week, with priority provided
            to safety net trauma centers described in subsection
            (c)(1)(A)(ii) located in urban, border, and rural areas.
                ``(3) Reducing trauma center overcrowding at specific
            trauma centers related to throughput of trauma patients.
                ``(4) Establishing new trauma services in underserved areas
            as defined by the State.
                ``(5) Enhancing collaboration between trauma centers and
            other hospitals and emergency medical services personnel
            related to trauma service availability.
                ``(6) Making capital improvements to enhance access and
            expedite trauma care, including providing helipads and
            associated safety infrastructure.
                ``(7) Enhancing trauma surge capacity at specific trauma
            centers.
                ``(8) Ensuring expedient receipt of trauma patients
            transported by ground or air to the appropriate trauma center.
                ``(9) Enhancing interstate trauma center collaboration.
        ``(e) Limitation.--
                ``(1) In general.--A State may use not more than 20 percent
            of the amount available to the State under this part for a
            fiscal year for administrative costs associated with awarding
            grants and related costs.
                ``(2) Maintenance of effort.--The Secretary may not provide
            funding to a State under this part unless the State agrees that
            such funds will be used to supplement and not supplant State
            funding otherwise available for the activities and costs
            described in this part.
        ``(f) Distribution of Funds.--The following shall apply with
    respect to grants provided in this part:
                ``(1) Less than $10,000,000.--If the amount of
            appropriations for this part in a fiscal year is less than
            $10,000,000, the Secretary shall divide such funding evenly
            among only those States that have 1 or more trauma centers
            eligible for funding under section 1241(b)(3)(A).
                ``(2) Less than $20,000,000.--If the amount of
            appropriations in a fiscal year is less than $20,000,000, the
            Secretary shall divide such funding evenly among only those
            States that have 1 or more trauma centers eligible for funding
            under subparagraphs (A) and (B) of section 1241(b)(3).
                ``(3) Less than $30,000,000.--If the amount of
            appropriations for this part in a fiscal year is less than
            $30,000,000, the Secretary shall divide such funding evenly
            among only those States that have 1 or more trauma centers
            eligible for funding under section 1241(b)(3).
                ``(4) $30,000,000 or more.--If the amount of appropriations
            for this part in a fiscal year is $30,000,000 or more, the
            Secretary shall divide such funding evenly among all States.

    ``SEC. 1282. AUTHORIZATION OF APPROPRIATIONS.

        ``For the purpose of carrying out this part, there is authorized to
    be appropriated $100,000,000 for each of fiscal years 2010 through
    2015.''.

    SEC. 3506. PROGRAM TO FACILITATE SHARED DECISIONMAKING.

        Part D of title IX of the Public Health Service Act, as amended by
    section 3503, is further amended by adding at the end the following:

    ``SEC. 936. PROGRAM TO FACILITATE SHARED DECISIONMAKING.

        ``(a) Purpose.--The purpose of this section is to facilitate
    collaborative processes between patients, caregivers or authorized
    representatives, and clinicians that engages the patient, caregiver or
    authorized representative in decisionmaking, provides patients,
    caregivers or authorized representatives with information about trade-
    offs among treatment options, and facilitates the incorporation of
    patient preferences and values into the medical plan.
        ``(b) Definitions.--In this section:
                ``(1) Patient decision aid.--The term `patient decision
            aid' means an educational tool that helps patients, caregivers
            or authorized representatives understand and communicate their
            beliefs and preferences related to their treatment options, and
            to decide with their health care provider what treatments are
            best for them based on their treatment options, scientific
            evidence, circumstances, beliefs, and preferences.
                ``(2) Preference sensitive care.--The term `preference
            sensitive care' means medical care for which the clinical
            evidence does not clearly support one treatment option such
            that the appropriate course of treatment depends on the values
            of the patient or the preferences of the patient, caregivers or
            authorized representatives regarding the benefits, harms and
            scientific evidence for each treatment option, the use of such
            care should depend on the informed patient choice among
            clinically appropriate treatment options.
        ``(c) Establishment of Independent Standards for Patient Decision
    Aids for Preference Sensitive Care.--
                ``(1) Contract with entity to establish standards and
            certify patient decision aids.--
                        ``(A) In general.--For purposes of supporting
                    consensus-based standards for patient decision aids for
                    preference sensitive care and a certification process
                    for patient decision aids for use in the Federal health
                    programs and by other interested parties, the Secretary
                    shall have in effect a contract with the entity with a
                    contract under section 1890 of the Social Security Act.
                    Such contract shall provide that the entity perform the
                    duties described in paragraph (2).
                        ``(B) Timing for first contract.--As soon as
                    practicable after the date of the enactment of this
                    section, the Secretary shall enter into the first
                    contract under subparagraph (A).
                        ``(C) Period of contract.--A contract under
                    subparagraph (A) shall be for a period of 18 months
                    (except such contract may be renewed after a subsequent
                    bidding process).
                ``(2) Duties.--The following duties are described in this
            paragraph:
                        ``(A) Develop and identify standards for patient
                    decision aids.--The entity shall synthesize evidence
                    and convene a broad range of experts and key
                    stakeholders to develop and identify consensus-based
                    standards to evaluate patient decision aids for
                    preference sensitive care.
                        ``(B) Endorse patient decision aids.--The entity
                    shall review patient decision aids and develop a
                    certification process whether patient decision aids
                    meet the standards developed and identified under
                    subparagraph (A). The entity shall give priority to the
                    review and certification of patient decision aids for
                    preference sensitive care.
        ``(d) Program To Develop, Update and Patient Decision Aids To
    Assist Health Care Providers and Patients.--
                ``(1) In general.--The Secretary, acting through the
            Director, and in coordination with heads of other relevant
            agencies, such as the Director of the Centers for Disease
            Control and Prevention and the Director of the National
            Institutes of Health, shall establish a program to award grants
            or contracts--
                        ``(A) to develop, update, and produce patient
                    decision aids for preference sensitive care to assist
                    health care providers in educating patients,
                    caregivers, and authorized representatives concerning
                    the relative safety, relative effectiveness (including
                    possible health outcomes and impact on functional
                    status), and relative cost of treatment or, where
                    appropriate, palliative care options;
                        ``(B) to test such materials to ensure such
                    materials are balanced and evidence based in aiding
                    health care providers and patients, caregivers, and
                    authorized representatives to make informed decisions
                    about patient care and can be easily incorporated into
                    a broad array of practice settings; and
                        ``(C) to educate providers on the use of such
                    materials, including through academic curricula.
                ``(2) Requirements for patient decision aids.--Patient
            decision aids developed and produced pursuant to a grant or
            contract under paragraph (1)--
                        ``(A) shall be designed to engage patients,
                    caregivers, and authorized representatives in informed
                    decisionmaking with health care providers;
                        ``(B) shall present up-to-date clinical evidence
                    about the risks and benefits of treatment options in a
                    form and manner that is age-appropriate and can be
                    adapted for patients, caregivers, and authorized
                    representatives from a variety of cultural and
                    educational backgrounds to reflect the varying needs of
                    consumers and diverse levels of health literacy;
                        ``(C) shall, where appropriate, explain why there
                    is a lack of evidence to support one treatment option
                    over another; and
                        ``(D) shall address health care decisions across
                    the age span, including those affecting vulnerable
                    populations including children.
                ``(3) Distribution.--The Director shall ensure that patient
            decision aids produced with grants or contracts under this
            section are available to the public.
                ``(4) Nonduplication of efforts.--The Director shall ensure
            that the activities under this section of the Agency and other
            agencies, including the Centers for Disease Control and
            Prevention and the National Institutes of Health, are free of
            unnecessary duplication of effort.
        ``(e) Grants To Support Shared Decisionmaking Implementation.--
                ``(1) In general.--The Secretary shall establish a program
            to provide for the phased-in development, implementation, and
            evaluation of shared decisionmaking using patient decision aids
            to meet the objective of improving the understanding of
            patients of their medical treatment options.
                ``(2) Shared decisionmaking resource centers.--
                        ``(A) In general.--The Secretary shall provide
                    grants for the establishment and support of Shared
                    Decisionmaking Resource Centers (referred to in this
                    subsection as `Centers') to provide technical
                    assistance to providers and to develop and disseminate
                    best practices and other information to support and
                    accelerate adoption, implementation, and effective use
                    of patient decision aids and shared decisionmaking by
                    providers.
                        ``(B) Objectives.--The objective of a Center is to
                    enhance and promote the adoption of patient decision
                    aids and shared decisionmaking through--
                                ``(i) providing assistance to eligible
                            providers with the implementation and effective
                            use of, and training on, patient decision aids;
                            and
                                ``(ii) the dissemination of best practices
                            and research on the implementation and
                            effective use of patient decision aids.
                ``(3) Shared decisionmaking participation grants.--
                        ``(A) In general.--The Secretary shall provide
                    grants to health care providers for the development and
                    implementation of shared decisionmaking techniques and
                    to assess the use of such techniques.
                        ``(B) Preference.--In order to facilitate the use
                    of best practices, the Secretary shall provide a
                    preference in making grants under this subsection to
                    health care providers who participate in training by
                    Shared Decisionmaking Resource Centers or comparable
                    training.
                        ``(C) Limitation.--Funds under this paragraph shall
                    not be used to purchase or implement use of patient
                    decision aids other than those certified under the
                    process identified in subsection (c).
                ``(4) Guidance.--The Secretary may issue guidance to
            eligible grantees under this subsection on the use of patient
            decision aids.
        ``(f) Funding.--For purposes of carrying out this section there are
    authorized to be appropriated such sums as may be necessary for fiscal
    year 2010 and each subsequent fiscal year.''.

    SEC. 3507. PRESENTATION OF PRESCRIPTION DRUG BENEFIT AND RISK
                  INFORMATION.

        (a) In General.--The Secretary of Health and Human Services
    (referred to in this section as the ``Secretary''), acting through the
    Commissioner of Food and Drugs, shall determine whether the addition of
    quantitative summaries of the benefits and risks of prescription drugs
    in a standardized format (such as a table or drug facts box) to the
    promotional labeling or print advertising of such drugs would improve
    health care decisionmaking by clinicians and patients and consumers.
        (b) Review and Consultation.--In making the determination under
    subsection (a), the Secretary shall review all available scientific
    evidence and research on decisionmaking and social and cognitive
    psychology and consult with drug manufacturers, clinicians, patients
    and consumers, experts in health literacy, representatives of racial
    and ethnic minorities, and experts in women's and pediatric health.
        (c) Report.--Not later than 1 year after the date of enactment of
    this Act, the Secretary shall submit to Congress a report that
    provides--
                (1) the determination by the Secretary under subsection
            (a); and
                (2) the reasoning and analysis underlying that
            determination.
        (d) Authority.--If the Secretary determines under subsection (a)
    that the addition of quantitative summaries of the benefits and risks
    of prescription drugs in a standardized format (such as a table or drug
    facts box) to the promotional labeling or print advertising of such
    drugs would improve health care decisionmaking by clinicians and
    patients and consumers, then the Secretary, not later than 3 years
    after the date of submission of the report under subsection (c), shall
    promulgate proposed regulations as necessary to implement such format.
        (e) Clarification.--Nothing in this section shall be construed to
    restrict the existing authorities of the Secretary with respect to
    benefit and risk information.

    SEC. 3508. DEMONSTRATION PROGRAM TO INTEGRATE QUALITY IMPROVEMENT AND
                  PATIENT SAFETY TRAINING INTO CLINICAL EDUCATION OF HEALTH
                  PROFESSIONALS.

        (a) In General.--The Secretary may award grants to eligible
    entities or consortia under this section to carry out demonstration
    projects to develop and implement academic curricula that integrates
    quality improvement and patient safety in the clinical education of
    health professionals. Such awards shall be made on a competitive basis
    and pursuant to peer review.
        (b) Eligibility.--To be eligible to receive a grant under
    subsection (a), an entity or consortium shall--
                (1) submit to the Secretary an application at such time, in
            such manner, and containing such information as the Secretary
            may require;
                (2) be or include--
                        (A) a health professions school;
                        (B) a school of public health;
                        (C) a school of social work;
                        (D) a school of nursing;
                        (E) a school of pharmacy;
                        (F) an institution with a graduate medical
                    education program; or
                        (G) a school of health care administration;
                (3) collaborate in the development of curricula described
            in subsection (a) with an organization that accredits such
            school or institution;
                (4) provide for the collection of data regarding the
            effectiveness of the demonstration project; and
                (5) provide matching funds in accordance with subsection
            (c).
        (c) Matching Funds.--
                (1) In general.--The Secretary may award a grant to an
            entity or consortium under this section only if the entity or
            consortium agrees to make available non-Federal contributions
            toward the costs of the program to be funded under the grant in
            an amount that is not less than $1 for each $5 of Federal funds
            provided under the grant.
                (2) Determination of amount contributed.--Non-Federal
            contributions under paragraph (1) may be in cash or in-kind,
            fairly evaluated, including equipment or services. Amounts
            provided by the Federal Government, or services assisted or
            subsidized to any significant extent by the Federal Government,
            may not be included in determining the amount of such
            contributions.
        (d) Evaluation.--The Secretary shall take such action as may be
    necessary to evaluate the projects funded under this section and
    publish, make publicly available, and disseminate the results of such
    evaluations on as wide a basis as is practicable.
        (e) Reports.--Not later than 2 years after the date of enactment of
    this section, and annually thereafter, the Secretary shall submit to
    the Committee on Health, Education, Labor, and Pensions and the
    Committee on Finance of the Senate and the Committee on Energy and
    Commerce and the Committee on Ways and Means of the House of
    Representatives a report that--
                (1) describes the specific projects supported under this
            section; and
                (2) contains recommendations for Congress based on the
            evaluation conducted under subsection (d).

    SEC. 3509. IMPROVING WOMEN'S HEALTH.

        (a) Health and Human Services Office on Women's Health.--
                (1) Establishment.--Part A of title II of the Public Health
            Service Act (42 U.S.C. 202 et seq.) is amended by adding at the
            end the following:

    ``SEC. 229. HEALTH AND HUMAN SERVICES OFFICE ON WOMEN'S HEALTH.

        ``(a) Establishment of Office.--There is established within the
    Office of the Secretary, an Office on Women's Health (referred to in
    this section as the `Office'). The Office shall be headed by a Deputy
    Assistant Secretary for Women's Health who may report to the Secretary.
        ``(b) Duties.--The Secretary, acting through the Office, with
    respect to the health concerns of women, shall--
                ``(1) establish short-range and long-range goals and
            objectives within the Department of Health and Human Services
            and, as relevant and appropriate, coordinate with other
            appropriate offices on activities within the Department that
            relate to disease prevention, health promotion, service
            delivery, research, and public and health care professional
            education, for issues of particular concern to women throughout
            their lifespan;
                ``(2) provide expert advice and consultation to the
            Secretary concerning scientific, legal, ethical, and policy
            issues relating to women's health;
                ``(3) monitor the Department of Health and Human Services'
            offices, agencies, and regional activities regarding women's
            health and identify needs regarding the coordination of
            activities, including intramural and extramural
            multidisciplinary activities;
                ``(4) establish a Department of Health and Human Services
            Coordinating Committee on Women's Health, which shall be
            chaired by the Deputy Assistant Secretary for Women's Health
            and composed of senior level representatives from each of the
            agencies and offices of the Department of Health and Human
            Services;
                ``(5) establish a National Women's Health Information
            Center to--
                        ``(A) facilitate the exchange of information
                    regarding matters relating to health information,
                    health promotion, preventive health services, research
                    advances, and education in the appropriate use of
                    health care;
                        ``(B) facilitate access to such information;
                        ``(C) assist in the analysis of issues and problems
                    relating to the matters described in this paragraph;
                    and
                        ``(D) provide technical assistance with respect to
                    the exchange of information (including facilitating the
                    development of materials for such technical
                    assistance);
                ``(6) coordinate efforts to promote women's health programs
            and policies with the private sector; and
                ``(7) through publications and any other means appropriate,
            provide for the exchange of information between the Office and
            recipients of grants, contracts, and agreements under
            subsection (c), and between the Office and health professionals
            and the general public.
        ``(c) Grants and Contracts Regarding Duties.--
                ``(1) Authority.--In carrying out subsection (b), the
            Secretary may make grants to, and enter into cooperative
            agreements, contracts, and interagency agreements with, public
            and private entities, agencies, and organizations.
                ``(2) Evaluation and dissemination.--The Secretary shall
            directly or through contracts with public and private entities,
            agencies, and organizations, provide for evaluations of
            projects carried out with financial assistance provided under
            paragraph (1) and for the dissemination of information
            developed as a result of such projects.
        ``(d) Reports.--Not later than 1 year after the date of enactment
    of this section, and every second year thereafter, the Secretary shall
    prepare and submit to the appropriate committees of Congress a report
    describing the activities carried out under this section during the
    period for which the report is being prepared.
        ``(e) Authorization of Appropriations.--For the purpose of carrying
    out this section, there are authorized to be appropriated such sums as
    may be necessary for each of the fiscal years 2010 through 2014.''.
                (2) Transfer of functions.--There are transferred to the
            Office on Women's Health (established under section 229 of the
            Public Health Service Act, as added by this section), all
            functions exercised by the Office on Women's Health of the
            Public Health Service prior to the date of enactment of this
            section, including all personnel and compensation authority,
            all delegation and assignment authority, and all remaining
            appropriations. All orders, determinations, rules, regulations,
            permits, agreements, grants, contracts, certificates, licenses,
            registrations, privileges, and other administrative actions
            that--
                        (A) have been issued, made, granted, or allowed to
                    become effective by the President, any Federal agency
                    or official thereof, or by a court of competent
                    jurisdiction, in the performance of functions
                    transferred under this paragraph; and
                        (B) are in effect at the time this section takes
                    effect, or were final before the date of enactment of
                    this section and are to become effective on or after
                    such date,
            shall continue in effect according to their terms until
            modified, terminated, superseded, set aside, or revoked in
            accordance with law by the President, the Secretary, or other
            authorized official, a court of competent jurisdiction, or by
            operation of law.
        (b) Centers for Disease Control and Prevention Office of Women's
    Health.--Part A of title III of the Public Health Service Act (42
    U.S.C. 241 et seq.) is amended by adding at the end the following:

    ``SEC. 310A. CENTERS FOR DISEASE CONTROL AND PREVENTION OFFICE OF
                  WOMEN'S HEALTH.

        ``(a) Establishment.--There is established within the Office of the
    Director of the Centers for Disease Control and Prevention, an office
    to be known as the Office of Women's Health (referred to in this
    section as the `Office'). The Office shall be headed by a director who
    shall be appointed by the Director of such Centers.
        ``(b) Purpose.--The Director of the Office shall--
                ``(1) report to the Director of the Centers for Disease
            Control and Prevention on the current level of the Centers'
            activity regarding women's health conditions across, where
            appropriate, age, biological, and sociocultural contexts, in
            all aspects of the Centers' work, including prevention
            programs, public and professional education, services, and
            treatment;
                ``(2) establish short-range and long-range goals and
            objectives within the Centers for women's health and, as
            relevant and appropriate, coordinate with other appropriate
            offices on activities within the Centers that relate to
            prevention, research, education and training, service delivery,
            and policy development, for issues of particular concern to
            women;
                ``(3) identify projects in women's health that should be
            conducted or supported by the Centers;
                ``(4) consult with health professionals, nongovernmental
            organizations, consumer organizations, women's health
            professionals, and other individuals and groups, as
            appropriate, on the policy of the Centers with regard to women;
            and
                ``(5) serve as a member of the Department of Health and
            Human Services Coordinating Committee on Women's Health
            (established under section 229(b)(4)).
        ``(c) Definition.--As used in this section, the term `women's
    health conditions', with respect to women of all age, ethnic, and
    racial groups, means diseases, disorders, and conditions--
                ``(1) unique to, significantly more serious for, or
            significantly more prevalent in women; and
                ``(2) for which the factors of medical risk or type of
            medical intervention are different for women, or for which
            there is reasonable evidence that indicates that such factors
            or types may be different for women.
        ``(d) Authorization of Appropriations.--For the purpose of carrying
    out this section, there are authorized to be appropriated such sums as
    may be necessary for each of the fiscal years 2010 through 2014.''.
        (c) Office of Women's Health Research.--Section 486(a) of the
    Public Health Service Act (42 U.S.C. 287d(a)) is amended by inserting
    ``and who shall report directly to the Director'' before the period at
    the end thereof.
        (d) Substance Abuse and Mental Health Services Administration.--
    Section 501(f) of the Public Health Service Act (42 U.S.C. 290aa(f)) is
    amended--
                (1) in paragraph (1), by inserting ``who shall report
            directly to the Administrator'' before the period;
                (2) by redesignating paragraph (4) as paragraph (5); and
                (3) by inserting after paragraph (3), the following:
                ``(4) Office.--Nothing in this subsection shall be
            construed to preclude the Secretary from establishing within
            the Substance Abuse and Mental Health Administration an Office
            of Women's Health.''.
        (e) Agency for Healthcare Research and Quality Activities Regarding
    Women's Health.--Part C of title IX of the Public Health Service Act
    (42 U.S.C. 299c et seq.) is amended--
                (1) by redesignating sections 925 and 926 as sections 926
            and 927, respectively; and
                (2) by inserting after section 924 the following:

    ``SEC. 925. ACTIVITIES REGARDING WOMEN'S HEALTH.

        ``(a) Establishment.--There is established within the Office of the
    Director, an Office of Women's Health and Gender-Based Research
    (referred to in this section as the `Office'). The Office shall be
    headed by a director who shall be appointed by the Director of
    Healthcare and Research Quality.
        ``(b) Purpose.--The official designated under subsection (a)
    shall--
                ``(1) report to the Director on the current Agency level of
            activity regarding women's health, across, where appropriate,
            age, biological, and sociocultural contexts, in all aspects of
            Agency work, including the development of evidence reports and
            clinical practice protocols and the conduct of research into
            patient outcomes, delivery of health care services, quality of
            care, and access to health care;
                ``(2) establish short-range and long-range goals and
            objectives within the Agency for research important to women's
            health and, as relevant and appropriate, coordinate with other
            appropriate offices on activities within the Agency that relate
            to health services and medical effectiveness research, for
            issues of particular concern to women;
                ``(3) identify projects in women's health that should be
            conducted or supported by the Agency;
                ``(4) consult with health professionals, nongovernmental
            organizations, consumer organizations, women's health
            professionals, and other individuals and groups, as
            appropriate, on Agency policy with regard to women; and
                ``(5) serve as a member of the Department of Health and
            Human Services Coordinating Committee on Women's Health
            (established under section 229(b)(4)).''.
        ``(c) Authorization of Appropriations.--For the purpose of carrying
    out this section, there are authorized to be appropriated such sums as
    may be necessary for each of the fiscal years 2010 through 2014.''.
        (f) Health Resources and Services Administration Office of Women's
    Health.--Title VII of the Social Security Act (42 U.S.C. 901 et seq.)
    is amended by adding at the end the following:

    ``SEC. 713. OFFICE OF WOMEN'S HEALTH.

        ``(a) Establishment.--The Secretary shall establish within the
    Office of the Administrator of the Health Resources and Services
    Administration, an office to be known as the Office of Women's Health.
    The Office shall be headed by a director who shall be appointed by the
    Administrator.
        ``(b) Purpose.--The Director of the Office shall--
                ``(1) report to the Administrator on the current
            Administration level of activity regarding women's health
            across, where appropriate, age, biological, and sociocultural
            contexts;
                ``(2) establish short-range and long-range goals and
            objectives within the Health Resources and Services
            Administration for women's health and, as relevant and
            appropriate, coordinate with other appropriate offices on
            activities within the Administration that relate to health care
            provider training, health service delivery, research, and
            demonstration projects, for issues of particular concern to
            women;
                ``(3) identify projects in women's health that should be
            conducted or supported by the bureaus of the Administration;
                ``(4) consult with health professionals, nongovernmental
            organizations, consumer organizations, women's health
            professionals, and other individuals and groups, as
            appropriate, on Administration policy with regard to women; and
                ``(5) serve as a member of the Department of Health and
            Human Services Coordinating Committee on Women's Health
            (established under section 229(b)(4) of the Public Health
            Service Act).
        ``(c) Continued Administration of Existing Programs.--The Director
    of the Office shall assume the authority for the development,
    implementation, administration, and evaluation of any projects carried
    out through the Health Resources and Services Administration relating
    to women's health on the date of enactment of this section.
        ``(d) Definitions.--For purposes of this section:
                ``(1) Administration.--The term `Administration' means the
            Health Resources and Services Administration.
                ``(2) Administrator.--The term `Administrator' means the
            Administrator of the Health Resources and Services
            Administration.
                ``(3) Office.--The term `Office' means the Office of
            Women's Health established under this section in the
            Administration.
        ``(e) Authorization of Appropriations.--For the purpose of carrying
    out this section, there are authorized to be appropriated such sums as
    may be necessary for each of the fiscal years 2010 through 2014.''.
        (g) Food and Drug Administration Office of Women's Health.--Chapter
    X of the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 391 et seq.)
    is amended by adding at the end the following:

    ``SEC. 1011. OFFICE OF WOMEN'S HEALTH.

        ``(a) Establishment.--There is established within the Office of the
    Commissioner, an office to be known as the Office of Women's Health
    (referred to in this section as the `Office'). The Office shall be
    headed by a director who shall be appointed by the Commissioner of Food
    and Drugs.
        ``(b) Purpose.--The Director of the Office shall--
                ``(1) report to the Commissioner of Food and Drugs on
            current Food and Drug Administration (referred to in this
            section as the `Administration') levels of activity regarding
            women's participation in clinical trials and the analysis of
            data by sex in the testing of drugs, medical devices, and
            biological products across, where appropriate, age, biological,
            and sociocultural contexts;
                ``(2) establish short-range and long-range goals and
            objectives within the Administration for issues of particular
            concern to women's health within the jurisdiction of the
            Administration, including, where relevant and appropriate,
            adequate inclusion of women and analysis of data by sex in
            Administration protocols and policies;
                ``(3) provide information to women and health care
            providers on those areas in which differences between men and
            women exist;
                ``(4) consult with pharmaceutical, biologics, and device
            manufacturers, health professionals with expertise in women's
            issues, consumer organizations, and women's health
            professionals on Administration policy with regard to women;
                ``(5) make annual estimates of funds needed to monitor
            clinical trials and analysis of data by sex in accordance with
            needs that are identified; and
                ``(6) serve as a member of the Department of Health and
            Human Services Coordinating Committee on Women's Health
            (established under section 229(b)(4) of the Public Health
            Service Act).
        ``(c) Authorization of Appropriations.--For the purpose of carrying
    out this section, there are authorized to be appropriated such sums as
    may be necessary for each of the fiscal years 2010 through 2014.''.
        (h) No New Regulatory Authority.--Nothing in this section and the
    amendments made by this section may be construed as establishing
    regulatory authority or modifying any existing regulatory authority.
        (i) Limitation on Termination.--Notwithstanding any other provision
    of law, a Federal office of women's health (including the Office of
    Research on Women's Health of the National Institutes of Health) or
    Federal appointive position with primary responsibility over women's
    health issues (including the Associate Administrator for Women's
    Services under the Substance Abuse and Mental Health Services
    Administration) that is in existence on the date of enactment of this
    section shall not be terminated, reorganized, or have any of it's
    powers or duties transferred unless such termination, reorganization,
    or transfer is approved by Congress through the adoption of a
    concurrent resolution of approval.
        (j) Rule of Construction.--Nothing in this section (or the
    amendments made by this section) shall be construed to limit the
    authority of the Secretary of Health and Human Services with respect to
    women's health, or with respect to activities carried out through the
    Department of Health and Human Services on the date of enactment of
    this section.

    SEC. 3510. PATIENT NAVIGATOR PROGRAM.

        Section 340A of the Public Health Service Act (42 U.S.C. 256a) is
    amended--
                (1) by striking subsection (d)(3) and inserting the
            following:
                ``(3) Limitations on grant period.--In carrying out this
            section, the Secretary shall ensure that the total period of a
            grant does not exceed 4 years.'';
                (2) in subsection (e), by adding at the end the following:
                ``(3) Minimum core proficiencies.--The Secretary shall not
            award a grant to an entity under this section unless such
            entity provides assurances that patient navigators recruited,
            assigned, trained, or employed using grant funds meet minimum
            core proficiencies, as defined by the entity that submits the
            application, that are tailored for the main focus or
            intervention of the navigator involved.''; and
                (3) in subsection (m)--
                        (A) in paragraph (1), by striking ``and $3,500,000
                    for fiscal year 2010.'' and inserting ``$3,500,000 for
                    fiscal year 2010, and such sums as may be necessary for
                    each of fiscal years 2011 through 2015.''; and
                        (B) in paragraph (2), by striking ``2010'' and
                    inserting ``2015''.

    SEC. 3511. AUTHORIZATION OF APPROPRIATIONS.

        Except where otherwise provided in this subtitle (or an amendment
    made by this subtitle), there is authorized to be appropriated such
    sums as may be necessary to carry out this subtitle (and such
    amendments made by this subtitle).

       Subtitle G--Protecting and Improving Guaranteed Medicare Benefits

    SEC. 3601. PROTECTING AND IMPROVING GUARANTEED MEDICARE BENEFITS.

        (a) Protecting Guaranteed Medicare Benefits.--Nothing in the
    provisions of, or amendments made by, this Act shall result in a
    reduction of guaranteed benefits under title XVIII of the Social
    Security Act.
        (b) Ensuring That Medicare Savings Benefit the Medicare Program and
    Medicare Beneficiaries.--Savings generated for the Medicare program
    under title XVIII of the Social Security Act under the provisions of,
    and amendments made by, this Act shall extend the solvency of the
    Medicare trust funds, reduce Medicare premiums and other cost-sharing
    for beneficiaries, and improve or expand guaranteed Medicare benefits
    and protect access to Medicare providers.

    SEC. 3602. NO CUTS IN GUARANTEED BENEFITS.

        Nothing in this Act shall result in the reduction or elimination of
    any benefits guaranteed by law to participants in Medicare Advantage
    plans.

      TITLE IV--PREVENTION OF CHRONIC DISEASE AND IMPROVING PUBLIC HEALTH

      Subtitle A--Modernizing Disease Prevention and Public Health Systems

    SEC. 4001. NATIONAL PREVENTION, HEALTH PROMOTION AND PUBLIC HEALTH
                  COUNCIL.

        (a) Establishment.--The President shall establish, within the
    Department of Health and Human Services, a council to be known as the
    ``National Prevention, Health Promotion and Public Health Council''
    (referred to in this section as the ``Council'').
        (b) Chairperson.--The President shall appoint the Surgeon General
    to serve as the chairperson of the Council.
        (c) Composition.--The Council shall be composed of--
                (1) the Secretary of Health and Human Services;
                (2) the Secretary of Agriculture;
                (3) the Secretary of Education;
                (4) the Chairman of the Federal Trade Commission;
                (5) the Secretary of Transportation;
                (6) the Secretary of Labor;
                (7) the Secretary of Homeland Security;
                (8) the Administrator of the Environmental Protection
            Agency;
                (9) the Director of the Office of National Drug Control
            Policy;
                (10) the Director of the Domestic Policy Council;
                (11) the Assistant Secretary for Indian Affairs;
                (12) the Chairman of the Corporation for National and
            Community Service; and
                (13) the head of any other Federal agency that the
            chairperson determines is appropriate.
        (d) Purposes and Duties.--The Council shall--
                (1) provide coordination and leadership at the Federal
            level, and among all Federal departments and agencies, with
            respect to prevention, wellness and health promotion practices,
            the public health system, and integrative health care in the
            United States;
                (2) after obtaining input from relevant stakeholders,
            develop a national prevention, health promotion, public health,
            and integrative health care strategy that incorporates the most
            effective and achievable means of improving the health status
            of Americans and reducing the incidence of preventable illness
            and disability in the United States;
                (3) provide recommendations to the President and Congress
            concerning the most pressing health issues confronting the
            United States and changes in Federal policy to achieve national
            wellness, health promotion, and public health goals, including
            the reduction of tobacco use, sedentary behavior, and poor
            nutrition;
                (4) consider and propose evidence-based models, policies,
            and innovative approaches for the promotion of transformative
            models of prevention, integrative health, and public health on
            individual and community levels across the United States;
                (5) establish processes for continual public input,
            including input from State, regional, and local leadership
            communities and other relevant stakeholders, including Indian
            tribes and tribal organizations;
                (6) submit the reports required under subsection (g); and
                (7) carry out other activities determined appropriate by
            the President.
        (e) Meetings.--The Council shall meet at the call of the
    Chairperson.
        (f) Advisory Group.--
                (1) In general.--The President shall establish an Advisory
            Group to the Council to be known as the ``Advisory Group on
            Prevention, Health Promotion, and Integrative and Public
            Health'' (hereafter referred to in this section as the
            ``Advisory Group''). The Advisory Group shall be within the
            Department of Health and Human Services and report to the
            Surgeon General.
                (2) Composition.--
                        (A) In general.--The Advisory Group shall be
                    composed of not more than 25 non-Federal members to be
                    appointed by the President.
                        (B) Representation.--In appointing members under
                    subparagraph (A), the President shall ensure that the
                    Advisory Group includes a diverse group of licensed
                    health professionals, including integrative health
                    practitioners who have expertise in--
                                (i) worksite health promotion;
                                (ii) community services, including
                            community health centers;
                                (iii) preventive medicine;
                                (iv) health coaching;
                                (v) public health education;
                                (vi) geriatrics; and
                                (vii) rehabilitation medicine.
                (3) Purposes and duties.--The Advisory Group shall develop
            policy and program recommendations and advise the Council on
            lifestyle-based chronic disease prevention and management,
            integrative health care practices, and health promotion.
        (g) National Prevention and Health Promotion Strategy.--Not later
    than 1 year after the date of enactment of this Act, the Chairperson,
    in consultation with the Council, shall develop and make public a
    national prevention, health promotion and public health strategy, and
    shall review and revise such strategy periodically. Such strategy
    shall--
                (1) set specific goals and objectives for improving the
            health of the United States through federally-supported
            prevention, health promotion, and public health programs,
            consistent with ongoing goal setting efforts conducted by
            specific agencies;
                (2) establish specific and measurable actions and timelines
            to carry out the strategy, and determine accountability for
            meeting those timelines, within and across Federal departments
            and agencies; and
                (3) make recommendations to improve Federal efforts
            relating to prevention, health promotion, public health, and
            integrative health care practices to ensure Federal efforts are
            consistent with available standards and evidence.
        (h) Report.--Not later than July 1, 2010, and annually thereafter
    through January 1, 2015, the Council shall submit to the President and
    the relevant committees of Congress, a report that--
                (1) describes the activities and efforts on prevention,
            health promotion, and public health and activities to develop a
            national strategy conducted by the Council during the period
            for which the report is prepared;
                (2) describes the national progress in meeting specific
            prevention, health promotion, and public health goals defined
            in the strategy and further describes corrective actions
            recommended by the Council and taken by relevant agencies and
            organizations to meet these goals;
                (3) contains a list of national priorities on health
            promotion and disease prevention to address lifestyle behavior
            modification (smoking cessation, proper nutrition, appropriate
            exercise, mental health, behavioral health, substance use
            disorder, and domestic violence screenings) and the prevention
            measures for the 5 leading disease killers in the United
            States;
                (4) contains specific science-based initiatives to achieve
            the measurable goals of Healthy People 2010 regarding
            nutrition, exercise, and smoking cessation, and targeting the 5
            leading disease killers in the United States;
                (5) contains specific plans for consolidating Federal
            health programs and Centers that exist to promote healthy
            behavior and reduce disease risk (including eliminating
            programs and offices determined to be ineffective in meeting
            the priority goals of Healthy People 2010);
                (6) contains specific plans to ensure that all Federal
            health care programs are fully coordinated with science-based
            prevention recommendations by the Director of the Centers for
            Disease Control and Prevention; and
                (7) contains specific plans to ensure that all non-
            Department of Health and Human Services prevention programs are
            based on the science-based guidelines developed by the Centers
            for Disease Control and Prevention under paragraph (4).
        (i) Periodic Reviews.--The Secretary and the Comptroller General of
    the United States shall jointly conduct periodic reviews, not less than
    every 5 years, and evaluations of every Federal disease prevention and
    health promotion initiative, program, and agency. Such reviews shall be
    evaluated based on effectiveness in meeting metrics-based goals with an
    analysis posted on such agencies' public Internet websites.

    SEC. 4002. PREVENTION AND PUBLIC HEALTH FUND.

        (a) Purpose.--It is the purpose of this section to establish a
    Prevention and Public Health Fund (referred to in this section as the
    ``Fund''), to be administered through the Department of Health and
    Human Services, Office of the Secretary, to provide for expanded and
    sustained national investment in prevention and public health programs
    to improve health and help restrain the rate of growth in private and
    public sector health care costs.
        (b) Funding.--There are hereby authorized to be appropriated, and
    appropriated, to the Fund, out of any monies in the Treasury not
    otherwise appropriated--
                (1) for fiscal year 2010, $500,000,000;
                (2) for fiscal year 2011, $750,000,000;
                (3) for fiscal year 2012, $1,000,000,000;
                (4) for fiscal year 2013, $1,250,000,000;
                (5) for fiscal year 2014, $1,500,000,000; and
                (6) for fiscal year 2015, and each fiscal year thereafter,
            $2,000,000,000.
        (c) Use of Fund.--The Secretary shall transfer amounts in the Fund
    to accounts within the Department of Health and Human Services to
    increase funding, over the fiscal year 2008 level, for programs
    authorized by the Public Health Service Act, for prevention, wellness,
    and public health activities including prevention research and health
    screenings, such as the Community Transformation grant program, the
    Education and Outreach Campaign for Preventive Benefits, and
    immunization programs.
        (d) Transfer Authority.--The Committee on Appropriations of the
    Senate and the Committee on Appropriations of the House of
    Representatives may provide for the transfer of funds in the Fund to
    eligible activities under this section, subject to subsection (c).

    SEC. 4003. CLINICAL AND COMMUNITY PREVENTIVE SERVICES.

        (a) Preventive Services Task Force.--Section 915 of the Public
    Health Service Act (42 U.S.C. 299b-4) is amended by striking subsection
    (a) and inserting the following:
        ``(a) Preventive Services Task Force.--
                ``(1) Establishment and purpose.--The Director shall
            convene an independent Preventive Services Task Force (referred
            to in this subsection as the `Task Force') to be composed of
            individuals with appropriate expertise. Such Task Force shall
            review the scientific evidence related to the effectiveness,
            appropriateness, and cost-effectiveness of clinical preventive
            services for the purpose of developing recommendations for the
            health care community, and updating previous clinical
            preventive recommendations, to be published in the Guide to
            Clinical Preventive Services (referred to in this section as
            the `Guide'), for individuals and organizations delivering
            clinical services, including primary care professionals, health
            care systems, professional societies, employers, community
            organizations, non-profit organizations, Congress and other
            policy-makers, governmental public health agencies, health care
            quality organizations, and organizations developing national
            health objectives. Such recommendations shall consider clinical
            preventive best practice recommendations from the Agency for
            Healthcare Research and Quality, the National Institutes of
            Health, the Centers for Disease Control and Prevention, the
            Institute of Medicine, specialty medical associations, patient
            groups, and scientific societies.
                ``(2) Duties.--The duties of the Task Force shall include--
                        ``(A) the development of additional topic areas for
                    new recommendations and interventions related to those
                    topic areas, including those related to specific sub-
                    populations and age groups;
                        ``(B) at least once during every 5-year period,
                    review interventions and update recommendations related
                    to existing topic areas, including new or improved
                    techniques to assess the health effects of
                    interventions;
                        ``(C) improved integration with Federal Government
                    health objectives and related target setting for health
                    improvement;
                        ``(D) the enhanced dissemination of
                    recommendations;
                        ``(E) the provision of technical assistance to
                    those health care professionals, agencies and
                    organizations that request help in implementing the
                    Guide recommendations; and
                        ``(F) the submission of yearly reports to Congress
                    and related agencies identifying gaps in research, such
                    as preventive services that receive an insufficient
                    evidence statement, and recommending priority areas
                    that deserve further examination, including areas
                    related to populations and age groups not adequately
                    addressed by current recommendations.
                ``(3) Role of agency.--The Agency shall provide ongoing
            administrative, research, and technical support for the
            operations of the Task Force, including coordinating and
            supporting the dissemination of the recommendations of the Task
            Force, ensuring adequate staff resources, and assistance to
            those organizations requesting it for implementation of the
            Guide's recommendations.
                ``(4) Coordination with community preventive services task
            force.--The Task Force shall take appropriate steps to
            coordinate its work with the Community Preventive Services Task
            Force and the Advisory Committee on Immunization Practices,
            including the examination of how each task force's
            recommendations interact at the nexus of clinic and community.
                ``(5) Operation.--Operation. In carrying out the duties
            under paragraph (2), the Task Force is not subject to the
            provisions of Appendix 2 of title 5, United States Code.
                ``(6) Independence.--All members of the Task Force convened
            under this subsection, and any recommendations made by such
            members, shall be independent and, to the extent practicable,
            not subject to political pressure.
                ``(7) Authorization of appropriations.--There are
            authorized to be appropriated such sums as may be necessary for
            each fiscal year to carry out the activities of the Task
            Force.''.
        (b) Community Preventive Services Task Force.--
                (1) In general.--Part P of title III of the Public Health
            Service Act, as amended by paragraph (2), is amended by adding
            at the end the following:

    ``SEC. 399U. COMMUNITY PREVENTIVE SERVICES TASK FORCE.

        ``(a) Establishment and Purpose.--The Director of the Centers for
    Disease Control and Prevention shall convene an independent Community
    Preventive Services Task Force (referred to in this subsection as the
    `Task Force') to be composed of individuals with appropriate expertise.
    Such Task Force shall review the scientific evidence related to the
    effectiveness, appropriateness, and cost-effectiveness of community
    preventive interventions for the purpose of developing recommendations,
    to be published in the Guide to Community Preventive Services (referred
    to in this section as the `Guide'), for individuals and organizations
    delivering population-based services, including primary care
    professionals, health care systems, professional societies, employers,
    community organizations, non-profit organizations, schools,
    governmental public health agencies, Indian tribes, tribal
    organizations and urban Indian organizations, medical groups, Congress
    and other policy-makers. Community preventive services include any
    policies, programs, processes or activities designed to affect or
    otherwise affecting health at the population level.
        ``(b) Duties.--The duties of the Task Force shall include--
                ``(1) the development of additional topic areas for new
            recommendations and interventions related to those topic areas,
            including those related to specific populations and age groups,
            as well as the social, economic and physical environments that
            can have broad effects on the health and disease of populations
            and health disparities among sub-populations and age groups;
                ``(2) at least once during every 5-year period, review
            interventions and update recommendations related to existing
            topic areas, including new or improved techniques to assess the
            health effects of interventions, including health impact
            assessment and population health modeling;
                ``(3) improved integration with Federal Government health
            objectives and related target setting for health improvement;
                ``(4) the enhanced dissemination of recommendations;
                ``(5) the provision of technical assistance to those health
            care professionals, agencies, and organizations that request
            help in implementing the Guide recommendations; and
                ``(6) providing yearly reports to Congress and related
            agencies identifying gaps in research and recommending priority
            areas that deserve further examination, including areas related
            to populations and age groups not adequately addressed by
            current recommendations.
        ``(c) Role of Agency.--The Director shall provide ongoing
    administrative, research, and technical support for the operations of
    the Task Force, including coordinating and supporting the dissemination
    of the recommendations of the Task Force, ensuring adequate staff
    resources, and assistance to those organizations requesting it for
    implementation of Guide recommendations.
        ``(d) Coordination With Preventive Services Task Force.--The Task
    Force shall take appropriate steps to coordinate its work with the U.S.
    Preventive Services Task Force and the Advisory Committee on
    Immunization Practices, including the examination of how each task
    force's recommendations interact at the nexus of clinic and community.
        ``(e) Operation.--In carrying out the duties under subsection (b),
    the Task Force shall not be subject to the provisions of Appendix 2 of
    title 5, United States Code.
        ``(f) Authorization of Appropriations.--There are authorized to be
    appropriated such sums as may be necessary for each fiscal year to
    carry out the activities of the Task Force.''.
                (2) Technical amendments.--
                        (A) Section 399R of the Public Health Service Act
                    (as added by section 2 of the ALS Registry Act (Public
                    Law 110-373; 122 Stat. 4047)) is redesignated as
                    section 399S.
                        (B) Section 399R of such Act (as added by section 3
                    of the Prenatally and Postnatally Diagnosed Conditions
                    Awareness Act (Public Law 110-374; 122 Stat. 4051)) is
                    redesignated as section 399T.

    SEC. 4004. EDUCATION AND OUTREACH CAMPAIGN REGARDING PREVENTIVE
                  BENEFITS.

        (a) In General.--The Secretary of Health and Human Services
    (referred to in this section as the ``Secretary'') shall provide for
    the planning and implementation of a national public-private
    partnership for a prevention and health promotion outreach and
    education campaign to raise public awareness of health improvement
    across the life span. Such campaign shall include the dissemination of
    information that--
                (1) describes the importance of utilizing preventive
            services to promote wellness, reduce health disparities, and
            mitigate chronic disease;
                (2) promotes the use of preventive services recommended by
            the United States Preventive Services Task Force and the
            Community Preventive Services Task Force;
                (3) encourages healthy behaviors linked to the prevention
            of chronic diseases;
                (4) explains the preventive services covered under health
            plans offered through a Gateway;
                (5) describes additional preventive care supported by the
            Centers for Disease Control and Prevention, the Health
            Resources and Services Administration, the Substance Abuse and
            Mental Health Services Administration, the Advisory Committee
            on Immunization Practices, and other appropriate agencies; and
                (6) includes general health promotion information.
        (b) Consultation.--In coordinating the campaign under subsection
    (a), the Secretary shall consult with the Institute of Medicine to
    provide ongoing advice on evidence-based scientific information for
    policy, program development, and evaluation.
        (c) Media Campaign.--
                (1) In general.--Not later than 1 year after the date of
            enactment of this Act, the Secretary, acting through the
            Director of the Centers for Disease Control and Prevention,
            shall establish and implement a national science-based media
            campaign on health promotion and disease prevention.
                (2) Requirement of campaign.--The campaign implemented
            under paragraph (1)--
                        (A) shall be designed to address proper nutrition,
                    regular exercise, smoking cessation, obesity reduction,
                    the 5 leading disease killers in the United States, and
                    secondary prevention through disease screening
                    promotion;
                        (B) shall be carried out through competitively bid
                    contracts awarded to entities providing for the
                    professional production and design of such campaign;
                        (C) may include the use of television, radio,
                    Internet, and other commercial marketing venues and may
                    be targeted to specific age groups based on peer-
                    reviewed social research;
                        (D) shall not be duplicative of any other Federal
                    efforts relating to health promotion and disease
                    prevention; and
                        (E) may include the use of humor and nationally
                    recognized positive role models.
                (3) Evaluation.--The Secretary shall ensure that the
            campaign implemented under paragraph (1) is subject to an
            independent evaluation every 2 years and shall report every 2
            years to Congress on the effectiveness of such campaigns
            towards meeting science-based metrics.
        (d) Website.--The Secretary, in consultation with private-sector
    experts, shall maintain or enter into a contract to maintain an
    Internet website to provide science-based information on guidelines for
    nutrition, regular exercise, obesity reduction, smoking cessation, and
    specific chronic disease prevention. Such website shall be designed to
    provide information to health care providers and consumers.
        (e) Dissemination of Information Through Providers.--The Secretary,
    acting through the Centers for Disease Control and Prevention, shall
    develop and implement a plan for the dissemination of health promotion
    and disease prevention information consistent with national priorities,
    to health care providers who participate in Federal programs, including
    programs administered by the Indian Health Service, the Department of
    Veterans Affairs, the Department of Defense, and the Health Resources
    and Services Administration, and Medicare and Medicaid.
        (f) Personalized Prevention Plans.--
                (1) Contract.--The Secretary, acting through the Director
            of the Centers for Disease Control and Prevention, shall enter
            into a contract with a qualified entity for the development and
            operation of a Federal Internet website personalized prevention
            plan tool.
                (2) Use.--The website developed under paragraph (1) shall
            be designed to be used as a source of the most up-to-date
            scientific evidence relating to disease prevention for use by
            individuals. Such website shall contain a component that
            enables an individual to determine their disease risk (based on
            personal health and family history, BMI, and other relevant
            information) relating to the 5 leading diseases in the United
            States, and obtain personalized suggestions for preventing such
            diseases.
        (g) Internet Portal.--The Secretary shall establish an Internet
    portal for accessing risk-assessment tools developed and maintained by
    private and academic entities.
        (h) Priority Funding.--Funding for the activities authorized under
    this section shall take priority over funding provided through the
    Centers for Disease Control and Prevention for grants to States and
    other entities for similar purposes and goals as provided for in this
    section. Not to exceed $500,000,000 shall be expended on the campaigns
    and activities required under this section.
        (i) Public Awareness of Preventive and Obesity-related Services.--
                (1) Information to states.--The Secretary of Health and
            Human Services shall provide guidance and relevant information
            to States and health care providers regarding preventive and
            obesity-related services that are available to Medicaid
            enrollees, including obesity screening and counseling for
            children and adults.
                (2) Information to enrollees.--Each State shall design a
            public awareness campaign to educate Medicaid enrollees
            regarding availability and coverage of such services, with the
            goal of reducing incidences of obesity.
                (3) Report.--Not later than January 1, 2011, and every 3
            years thereafter through January 1, 2017, the Secretary of
            Health and Human Services shall report to Congress on the
            status and effectiveness of efforts under paragraphs (1) and
            (2), including summaries of the States' efforts to increase
            awareness of coverage of obesity-related services.
        (j) Authorization of Appropriations.--There are authorized to be
    appropriated such sums as may be necessary to carry out this section.

         Subtitle B--Increasing Access to Clinical Preventive Services

    SEC. 4101. SCHOOL-BASED HEALTH CENTERS.

        (a) Grants for the Establishment of School-based Health Centers.--
                (1) Program.--The Secretary of Health and Human Services
            (in this subsection referred to as the ``Secretary'') shall
            establish a program to award grants to eligible entities to
            support the operation of school-based health centers.
                (2) Eligibility.--To be eligible for a grant under this
            subsection, an entity shall--
                        (A) be a school-based health center or a sponsoring
                    facility of a school-based health center; and
                        (B) submit an application at such time, in such
                    manner, and containing such information as the
                    Secretary may require, including at a minimum an
                    assurance that funds awarded under the grant shall not
                    be used to provide any service that is not authorized
                    or allowed by Federal, State, or local law.
                (3) Preference.--In awarding grants under this section, the
            Secretary shall give preference to awarding grants for school-
            based health centers that serve a large population of children
            eligible for medical assistance under the State Medicaid plan
            under title XIX of the Social Security Act or under a waiver of
            such plan or children eligible for child health assistance
            under the State child health plan under title XXI of that Act
            (42 U.S.C. 1397aa et seq.).
                (4) Limitation on use of funds.--An eligible entity shall
            use funds provided under a grant awarded under this subsection
            only for expenditures for facilities (including the acquisition
            or improvement of land, or the acquisition, construction,
            expansion, replacement, or other improvement of any building or
            other facility), equipment, or similar expenditures, as
            specified by the Secretary. No funds provided under a grant
            awarded under this section shall be used for expenditures for
            personnel or to provide health services.
                (5) Appropriations.--Out of any funds in the Treasury not
            otherwise appropriated, there is appropriated for each of
            fiscal years 2010 through 2013, $50,000,000 for the purpose of
            carrying out this subsection. Funds appropriated under this
            paragraph shall remain available until expended.
                (6) Definitions.--In this subsection, the terms ``school-
            based health center'' and ``sponsoring facility'' have the
            meanings given those terms in section 2110(c)(9) of the Social
            Security Act (42 U.S.C. 1397jj(c)(9)).
        (b) Grants for the Operation of School-based Health Centers.--Part
    Q of title III of the Public Health Service Act (42 U.S.C. 280h et
    seq.) is amended by adding at the end the following:

    ``SEC. 399Z-1. SCHOOL-BASED HEALTH CENTERS.

        ``(a) Definitions; Establishment of Criteria.--In this section:
                ``(1) Comprehensive primary health services.--The term
            `comprehensive primary health services' means the core services
            offered by school-based health centers, which shall include the
            following:
                        ``(A) Physical.--Comprehensive health assessments,
                    diagnosis, and treatment of minor, acute, and chronic
                    medical conditions, and referrals to, and follow-up
                    for, specialty care and oral health services.
                        ``(B) Mental health.--Mental health and substance
                    use disorder assessments, crisis intervention,
                    counseling, treatment, and referral to a continuum of
                    services including emergency psychiatric care,
                    community support programs, inpatient care, and
                    outpatient programs.
                ``(2) Medically underserved children and adolescents.--
                        ``(A) In general.--The term `medically underserved
                    children and adolescents' means a population of
                    children and adolescents who are residents of an area
                    designated as a medically underserved area or a health
                    professional shortage area by the Secretary.
                        ``(B) Criteria.--The Secretary shall prescribe
                    criteria for determining the specific shortages of
                    personal health services for medically underserved
                    children and adolescents under subparagraph (A) that
                    shall--
                                ``(i) take into account any comments
                            received by the Secretary from the chief
                            executive officer of a State and local
                            officials in a State; and
                                ``(ii) include factors indicative of the
                            health status of such children and adolescents
                            of an area, including the ability of the
                            residents of such area to pay for health
                            services, the accessibility of such services,
                            the availability of health professionals to
                            such children and adolescents, and other
                            factors as determined appropriate by the
                            Secretary.
                ``(3) School-based health center.--The term `school-based
            health center' means a health clinic that--
                        ``(A) meets the definition of a school-based health
                    center under section 2110(c)(9)(A) of the Social
                    Security Act and is administered by a sponsoring
                    facility (as defined in section 2110(c)(9)(B) of the
                    Social Security Act);
                        ``(B) provides, at a minimum, comprehensive primary
                    health services during school hours to children and
                    adolescents by health professionals in accordance with
                    established standards, community practice, reporting
                    laws, and other State laws, including parental consent
                    and notification laws that are not inconsistent with
                    Federal law; and
                        ``(C) does not perform abortion services.
        ``(b) Authority To Award Grants.--The Secretary shall award grants
    for the costs of the operation of school-based health centers (referred
    to in this section as `SBHCs') that meet the requirements of this
    section.
        ``(c) Applications.--To be eligible to receive a grant under this
    section, an entity shall--
                ``(1) be an SBHC (as defined in subsection (a)(3)); and
                ``(2) submit to the Secretary an application at such time,
            in such manner, and containing--
                        ``(A) evidence that the applicant meets all
                    criteria necessary to be designated an SBHC;
                        ``(B) evidence of local need for the services to be
                    provided by the SBHC;
                        ``(C) an assurance that--
                                ``(i) SBHC services will be provided to
                            those children and adolescents for whom
                            parental or guardian consent has been obtained
                            in cooperation with Federal, State, and local
                            laws governing health care service provision to
                            children and adolescents;
                                ``(ii) the SBHC has made and will continue
                            to make every reasonable effort to establish
                            and maintain collaborative relationships with
                            other health care providers in the catchment
                            area of the SBHC;
                                ``(iii) the SBHC will provide on-site
                            access during the academic day when school is
                            in session and 24-hour coverage through an on-
                            call system and through its backup health
                            providers to ensure access to services on a
                            year-round basis when the school or the SBHC is
                            closed;
                                ``(iv) the SBHC will be integrated into the
                            school environment and will coordinate health
                            services with school personnel, such as
                            administrators, teachers, nurses, counselors,
                            and support personnel, as well as with other
                            community providers co-located at the school;
                                ``(v) the SBHC sponsoring facility assumes
                            all responsibility for the SBHC administration,
                            operations, and oversight; and
                                ``(vi) the SBHC will comply with Federal,
                            State, and local laws concerning patient
                            privacy and student records, including
                            regulations promulgated under the Health
                            Insurance Portability and Accountability Act of
                            1996 and section 444 of the General Education
                            Provisions Act; and
                        ``(D) such other information as the Secretary may
                    require.
        ``(d) Preferences and Consideration.--In reviewing applications:
                ``(1) The Secretary may give preference to applicants who
            demonstrate an ability to serve the following:
                        ``(A) Communities that have evidenced barriers to
                    primary health care and mental health and substance use
                    disorder prevention services for children and
                    adolescents.
                        ``(B) Communities with high per capita numbers of
                    children and adolescents who are uninsured,
                    underinsured, or enrolled in public health insurance
                    programs.
                        ``(C) Populations of children and adolescents that
                    have historically demonstrated difficulty in accessing
                    health and mental health and substance use disorder
                    prevention services.
                ``(2) The Secretary may give consideration to whether an
            applicant has received a grant under subsection (a) of section
            4101 of the Patient Protection and Affordable Care Act.
        ``(e) Waiver of Requirements.--The Secretary may--
                ``(1) under appropriate circumstances, waive the
            application of all or part of the requirements of this
            subsection with respect to an SBHC for not to exceed 2 years;
            and
                ``(2) upon a showing of good cause, waive the requirement
            that the SBHC provide all required comprehensive primary health
            services for a designated period of time to be determined by
            the Secretary.
        ``(f) Use of Funds.--
                ``(1) Funds.--Funds awarded under a grant under this
            section--
                        ``(A) may be used for--
                                ``(i) acquiring and leasing equipment
                            (including the costs of amortizing the
                            principle of, and paying interest on, loans for
                            such equipment);
                                ``(ii) providing training related to the
                            provision of required comprehensive primary
                            health services and additional health services;
                                ``(iii) the management and operation of
                            health center programs;
                                ``(iv) the payment of salaries for
                            physicians, nurses, and other personnel of the
                            SBHC; and
                        ``(B) may not be used to provide abortions.
                ``(2) Construction.--The Secretary may award grants which
            may be used to pay the costs associated with expanding and
            modernizing existing buildings for use as an SBHC, including
            the purchase of trailers or manufactured buildings to install
            on the school property.
                ``(3) Limitations.--
                        ``(A) In general.--Any provider of services that is
                    determined by a State to be in violation of a State law
                    described in subsection (a)(3)(B) with respect to
                    activities carried out at a SBHC shall not be eligible
                    to receive additional funding under this section.
                        ``(B) No overlapping grant period.--No entity that
                    has received funding under section 330 for a grant
                    period shall be eligible for a grant under this section
                    for with respect to the same grant period.
        ``(g) Matching Requirement.--
                ``(1) In general.--Each eligible entity that receives a
            grant under this section shall provide, from non-Federal
            sources, an amount equal to 20 percent of the amount of the
            grant (which may be provided in cash or in-kind) to carry out
            the activities supported by the grant.
                ``(2) Waiver.--The Secretary may waive all or part of the
            matching requirement described in paragraph (1) for any fiscal
            year for the SBHC if the Secretary determines that applying the
            matching requirement to the SBHC would result in serious
            hardship or an inability to carry out the purposes of this
            section.
        ``(h) Supplement, Not Supplant.--Grant funds provided under this
    section shall be used to supplement, not supplant, other Federal or
    State funds.
        ``(i) Evaluation.--The Secretary shall develop and implement a plan
    for evaluating SBHCs and monitoring quality performance under the
    awards made under this section.
        ``(j) Age Appropriate Services.--An eligible entity receiving funds
    under this section shall only provide age appropriate services through
    a SBHC funded under this section to an individual.
        ``(k) Parental Consent.--An eligible entity receiving funds under
    this section shall not provide services through a SBHC funded under
    this section to an individual without the consent of the parent or
    guardian of such individual if such individual is considered a minor
    under applicable State law.
        ``(l) Authorization of Appropriations.--For purposes of carrying
    out this section, there are authorized to be appropriated such sums as
    may be necessary for each of the fiscal years 2010 through 2014.''.

    SEC. 4102. ORAL HEALTHCARE PREVENTION ACTIVITIES.

        (a) In General.--Title III of the Public Health Service Act (42
    U.S.C. 241 et seq.), as amended by section 3025, is amended by adding
    at the end the following:

                ``PART T--ORAL HEALTHCARE PREVENTION ACTIVITIES

    ``SEC. 399LL. ORAL HEALTHCARE PREVENTION EDUCATION CAMPAIGN.

        ``(a) Establishment.--The Secretary, acting through the Director of
    the Centers for Disease Control and Prevention and in consultation with
    professional oral health organizations, shall, subject to the
    availability of appropriations, establish a 5-year national, public
    education campaign (referred to in this section as the `campaign') that
    is focused on oral healthcare prevention and education, including
    prevention of oral disease such as early childhood and other caries,
    periodontal disease, and oral cancer.
        ``(b) Requirements.--In establishing the campaign, the Secretary
    shall--
                ``(1) ensure that activities are targeted towards specific
            populations such as children, pregnant women, parents, the
            elderly, individuals with disabilities, and ethnic and racial
            minority populations, including Indians, Alaska Natives and
            Native Hawaiians (as defined in section 4(c) of the Indian
            Health Care Improvement Act) in a culturally and linguistically
            appropriate manner; and
                ``(2) utilize science-based strategies to convey oral
            health prevention messages that include, but are not limited
            to, community water fluoridation and dental sealants.
        ``(c) Planning and Implementation.--Not later than 2 years after
    the date of enactment of this section, the Secretary shall begin
    implementing the 5-year campaign. During the 2-year period referred to
    in the previous sentence, the Secretary shall conduct planning
    activities with respect to the campaign.

    ``SEC. 399LL-1. RESEARCH-BASED DENTAL CARIES DISEASE MANAGEMENT.

        ``(a) In General.--The Secretary, acting through the Director of
    the Centers for Disease Control and Prevention, shall award
    demonstration grants to eligible entities to demonstrate the
    effectiveness of research-based dental caries disease management
    activities.
        ``(b) Eligibility.--To be eligible for a grant under this section,
    an entity shall--
                ``(1) be a community-based provider of dental services (as
            defined by the Secretary), including a Federally-qualified
            health center, a clinic of a hospital owned or operated by a
            State (or by an instrumentality or a unit of government within
            a State), a State or local department of health, a dental
            program of the Indian Health Service, an Indian tribe or tribal
            organization, or an urban Indian organization (as such terms
            are defined in section 4 of the Indian Health Care Improvement
            Act), a health system provider, a private provider of dental
            services, medical, dental, public health, nursing, nutrition
            educational institutions, or national organizations involved in
            improving children's oral health; and
                ``(2) submit to the Secretary an application at such time,
            in such manner, and containing such information as the
            Secretary may require.
        ``(c) Use of Funds.--A grantee shall use amounts received under a
    grant under this section to demonstrate the effectiveness of research-
    based dental caries disease management activities.
        ``(d) Use of Information.--The Secretary shall utilize information
    generated from grantees under this section in planning and implementing
    the public education campaign under section 399LL.

    ``SEC. 399LL-2. AUTHORIZATION OF APPROPRIATIONS.

        ``There is authorized to be appropriated to carry out this part,
    such sums as may be necessary.''.
        (b) School-based Sealant Programs.--Section 317M(c)(1) of the
    Public Health Service Act (42 U.S.C. 247b-14(c)(1)) is amended by
    striking ``may award grants to States and Indian tribes'' and inserting
    ``shall award a grant to each of the 50 States and territories and to
    Indians, Indian tribes, tribal organizations and urban Indian
    organizations (as such terms are defined in section 4 of the Indian
    Health Care Improvement Act)''.
        (c) Oral Health Infrastructure.--Section 317M of the Public Health
    Service Act (42 U.S.C. 247b-14) is amended--
                (1) by redesignating subsections (d) and (e) as subsections
            (e) and (f), respectively; and
                (2) by inserting after subsection (c), the following:
        ``(d) Oral Health Infrastructure.--
                ``(1) Cooperative agreements.--The Secretary, acting
            through the Director of the Centers for Disease Control and
            Prevention, shall enter into cooperative agreements with State,
            territorial, and Indian tribes or tribal organizations (as
            those terms are defined in section 4 of the Indian Health Care
            Improvement Act) to establish oral health leadership and
            program guidance, oral health data collection and
            interpretation, (including determinants of poor oral health
            among vulnerable populations), a multi-dimensional delivery
            system for oral health, and to implement science-based programs
            (including dental sealants and community water fluoridation) to
            improve oral health.
                ``(2) Authorization of appropriations.--There is authorized
            to be appropriated such sums as necessary to carry out this
            subsection for fiscal years 2010 through 2014.''.
        (d) Updating National Oral Healthcare Surveillance Activities.--
                (1) PRAMS.--
                        (A) In general.--The Secretary of Health and Human
                    Services (referred to in this subsection as the
                    ``Secretary'') shall carry out activities to update and
                    improve the Pregnancy Risk Assessment Monitoring System
                    (referred to in this section as ``PRAMS'') as it
                    relates to oral healthcare.
                        (B) State reports and mandatory measurements.--
                                (i) In general.--Not later than 5 years
                            after the date of enactment of this Act, and
                            every 5 years thereafter, a State shall submit
                            to the Secretary a report concerning activities
                            conducted within the State under PRAMS.
                                (ii) Measurements.--The oral healthcare
                            measurements developed by the Secretary for use
                            under PRAMS shall be mandatory with respect to
                            States for purposes of the State reports under
                            clause (i).
                        (C) Funding.--There is authorized to be
                    appropriated to carry out this paragraph, such sums as
                    may be necessary.
                (2) National health and nutrition examination survey.--The
            Secretary shall develop oral healthcare components that shall
            include tooth-level surveillance for inclusion in the National
            Health and Nutrition Examination Survey. Such components shall
            be updated by the Secretary at least every 6 years. For
            purposes of this paragraph, the term ``tooth-level
            surveillance'' means a clinical examination where an examiner
            looks at each dental surface, on each tooth in the mouth and as
            expanded by the Division of Oral Health of the Centers for
            Disease Control and Prevention.
                (3) Medical expenditures panel survey.--The Secretary shall
            ensure that the Medical Expenditures Panel Survey by the Agency
            for Healthcare Research and Quality includes the verification
            of dental utilization, expenditure, and coverage findings
            through conduct of a look-back analysis.
                (4) National oral health surveillance system.--
                        (A) Appropriations.--There is authorized to be
                    appropriated, such sums as may be necessary for each of
                    fiscal years 2010 through 2014 to increase the
                    participation of States in the National Oral Health
                    Surveillance System from 16 States to all 50 States,
                    territories, and District of Columbia.
                        (B) Requirements.--The Secretary shall ensure that
                    the National Oral Health Surveillance System include
                    the measurement of early childhood caries.

    SEC. 4103. MEDICARE COVERAGE OF ANNUAL WELLNESS VISIT PROVIDING A
                  PERSONALIZED PREVENTION PLAN.

        (a) Coverage of Personalized Prevention Plan Services.--
                (1) In general.--Section 1861(s)(2) of the Social Security
            Act (42 U.S.C. 1395x(s)(2)) is amended--
                        (A) in subparagraph (DD), by striking ``and'' at
                    the end;
                        (B) in subparagraph (EE), by adding ``and'' at the
                    end; and
                        (C) by adding at the end the following new
                    subparagraph:
                ``(FF) personalized prevention plan services (as defined in
            subsection (hhh));''.
                (2) Conforming amendments.--Clauses (i) and (ii) of section
            1861(s)(2)(K) of the Social Security Act (42 U.S.C.
            1395x(s)(2)(K)) are each amended by striking ``subsection
            (ww)(1)'' and inserting ``subsections (ww)(1) and (hhh)''.
        (b) Personalized Prevention Plan Services Defined.--Section 1861 of
    the Social Security Act (42 U.S.C. 1395x) is amended by adding at the
    end the following new subsection:

                            ``Annual Wellness Visit

        ``(hhh)(1) The term `personalized prevention plan services' means
    the creation of a plan for an individual--
                ``(A) that includes a health risk assessment (that meets
            the guidelines established by the Secretary under paragraph
            (4)(A)) of the individual that is completed prior to or as part
            of the same visit with a health professional described in
            paragraph (3); and
                ``(B) that--
                        ``(i) takes into account the results of the health
                    risk assessment; and
                        ``(ii) may contain the elements described in
                    paragraph (2).
        ``(2) Subject to paragraph (4)(H), the elements described in this
    paragraph are the following:
                ``(A) The establishment of, or an update to, the
            individual's medical and family history.
                ``(B) A list of current providers and suppliers that are
            regularly involved in providing medical care to the individual
            (including a list of all prescribed medications).
                ``(C) A measurement of height, weight, body mass index (or
            waist circumference, if appropriate), blood pressure, and other
            routine measurements.
                ``(D) Detection of any cognitive impairment.
                ``(E) The establishment of, or an update to, the following:
                        ``(i) A screening schedule for the next 5 to 10
                    years, as appropriate, based on recommendations of the
                    United States Preventive Services Task Force and the
                    Advisory Committee on Immunization Practices, and the
                    individual's health status, screening history, and age-
                    appropriate preventive services covered under this
                    title.
                        ``(ii) A list of risk factors and conditions for
                    which primary, secondary, or tertiary prevention
                    interventions are recommended or are underway,
                    including any mental health conditions or any such risk
                    factors or conditions that have been identified through
                    an initial preventive physical examination (as
                    described under subsection (ww)(1)), and a list of
                    treatment options and their associated risks and
                    benefits.
                ``(F) The furnishing of personalized health advice and a
            referral, as appropriate, to health education or preventive
            counseling services or programs aimed at reducing identified
            risk factors and improving self-management, or community-based
            lifestyle interventions to reduce health risks and promote
            self-management and wellness, including weight loss, physical
            activity, smoking cessation, fall prevention, and nutrition.
                ``(G) Any other element determined appropriate by the
            Secretary.
        ``(3) A health professional described in this paragraph is--
                ``(A) a physician;
                ``(B) a practitioner described in clause (i) of section
            1842(b)(18)(C); or
                ``(C) a medical professional (including a health educator,
            registered dietitian, or nutrition professional) or a team of
            medical professionals, as determined appropriate by the
            Secretary, under the supervision of a physician.
        ``(4)(A) For purposes of paragraph (1)(A), the Secretary, not later
    than 1 year after the date of enactment of this subsection, shall
    establish publicly available guidelines for health risk assessments.
    Such guidelines shall be developed in consultation with relevant groups
    and entities and shall provide that a health risk assessment--
                ``(i) identify chronic diseases, injury risks, modifiable
            risk factors, and urgent health needs of the individual; and
                ``(ii) may be furnished--
                        ``(I) through an interactive telephonic or web-
                    based program that meets the standards established
                    under subparagraph (B);
                        ``(II) during an encounter with a health care
                    professional;
                        ``(III) through community-based prevention
                    programs; or
                        ``(IV) through any other means the Secretary
                    determines appropriate to maximize accessibility and
                    ease of use by beneficiaries, while ensuring the
                    privacy of such beneficiaries.
        ``(B) Not later than 1 year after the date of enactment of this
    subsection, the Secretary shall establish standards for interactive
    telephonic or web-based programs used to furnish health risk
    assessments under subparagraph (A)(ii)(I). The Secretary may utilize
    any health risk assessment developed under section 4004(f) of the
    Patient Protection and Affordable Care Act as part of the requirement
    to develop a personalized prevention plan to comply with this
    subparagraph.
        ``(C)(i) Not later than 18 months after the date of enactment of
    this subsection, the Secretary shall develop and make available to the
    public a health risk assessment model. Such model shall meet the
    guidelines under subparagraph (A) and may be used to meet the
    requirement under paragraph (1)(A).
        ``(ii) Any health risk assessment that meets the guidelines under
    subparagraph (A) and is approved by the Secretary may be used to meet
    the requirement under paragraph (1)(A).
        ``(D) The Secretary may coordinate with community-based entities
    (including State Health Insurance Programs, Area Agencies on Aging,
    Aging and Disability Resource Centers, and the Administration on Aging)
    to--
                ``(i) ensure that health risk assessments are accessible to
            beneficiaries; and
                ``(ii) provide appropriate support for the completion of
            health risk assessments by beneficiaries.
        ``(E) The Secretary shall establish procedures to make
    beneficiaries and providers aware of the requirement that a beneficiary
    complete a health risk assessment prior to or at the same time as
    receiving personalized prevention plan services.
        ``(F) To the extent practicable, the Secretary shall encourage the
    use of, integration with, and coordination of health information
    technology (including use of technology that is compatible with
    electronic medical records and personal health records) and may
    experiment with the use of personalized technology to aid in the
    development of self-management skills and management of and adherence
    to provider recommendations in order to improve the health status of
    beneficiaries.
        ``(G)(i) A beneficiary shall only be eligible to receive an initial
    preventive physical examination (as defined under subsection (ww)(1))
    at any time during the 12-month period after the date that the
    beneficiary's coverage begins under part B and shall be eligible to
    receive personalized prevention plan services under this subsection
    provided that the beneficiary has not received such services within the
    preceding 12-month period.
        ``(ii) The Secretary shall establish procedures to make
    beneficiaries aware of the option to select an initial preventive
    physical examination or personalized prevention plan services during
    the period of 12 months after the date that a beneficiary's coverage
    begins under part B, which shall include information regarding any
    relevant differences between such services.
        ``(H) The Secretary shall issue guidance that--
                ``(i) identifies elements under paragraph (2) that are
            required to be provided to a beneficiary as part of their first
            visit for personalized prevention plan services; and
                ``(ii) establishes a yearly schedule for appropriate
            provision of such elements thereafter.''.
        (c) Payment and Elimination of Cost-Sharing.--
                (1) Payment and elimination of coinsurance.--Section
            1833(a)(1) of the Social Security Act (42 U.S.C. 1395l(a)(1))
            is amended--
                        (A) in subparagraph (N), by inserting ``other than
                    personalized prevention plan services (as defined in
                    section 1861(hhh)(1))'' after ``(as defined in section
                    1848(j)(3))'';
                        (B) by striking ``and'' before ``(W)''; and
                        (C) by inserting before the semicolon at the end
                    the following: ``, and (X) with respect to personalized
                    prevention plan services (as defined in section
                    1861(hhh)(1)), the amount paid shall be 100 percent of
                    the lesser of the actual charge for the services or the
                    amount determined under the payment basis determined
                    under section 1848''.
                (2) Payment under physician fee schedule.--Section
            1848(j)(3) of the Social Security Act (42 U.S.C. 1395w-4(j)(3))
            is amended by inserting ``(2)(FF) (including administration of
            the health risk assessment) ,'' after ``(2)(EE),''.
                (3) Elimination of coinsurance in outpatient hospital
            settings.--
                        (A) Exclusion from opd fee schedule.--Section
                    1833(t)(1)(B)(iv) of the Social Security Act (42 U.S.C.
                    1395l(t)(1)(B)(iv)) is amended by striking ``and
                    diagnostic mammography'' and inserting ``, diagnostic
                    mammography, or personalized prevention plan services
                    (as defined in section 1861(hhh)(1))''.
                        (B) Conforming amendments.--Section 1833(a)(2) of
                    the Social Security Act (42 U.S.C. 1395l(a)(2)) is
                    amended--
                                (i) in subparagraph (F), by striking
                            ``and'' at the end;
                                (ii) in subparagraph (G)(ii), by striking
                            the comma at the end and inserting ``; and'';
                            and
                                (iii) by inserting after subparagraph
                            (G)(ii) the following new subparagraph:
                        ``(H) with respect to personalized prevention plan
                    services (as defined in section 1861(hhh)(1)) furnished
                    by an outpatient department of a hospital, the amount
                    determined under paragraph (1)(X),''.
                (4) Waiver of application of deductible.--The first
            sentence of section 1833(b) of the Social Security Act (42
            U.S.C. 1395l(b)) is amended--
                        (A) by striking ``and'' before ``(9)''; and
                        (B) by inserting before the period the following:
                    ``, and (10) such deductible shall not apply with
                    respect to personalized prevention plan services (as
                    defined in section 1861(hhh)(1))''.
        (d) Frequency Limitation.--Section 1862(a) of the Social Security
    Act (42 U.S.C. 1395y(a)) is amended--
                (1) in paragraph (1)--
                        (A) in subparagraph (N), by striking ``and'' at the
                    end;
                        (B) in subparagraph (O), by striking the semicolon
                    at the end and inserting ``, and''; and
                        (C) by adding at the end the following new
                    subparagraph:
                ``(P) in the case of personalized prevention plan services
            (as defined in section 1861(hhh)(1)), which are performed more
            frequently than is covered under such section;''; and
                (2) in paragraph (7), by striking ``or (K)'' and inserting
            ``(K), or (P)''.
        (e) Effective Date.--The amendments made by this section shall
    apply to services furnished on or after January 1, 2011.

    SEC. 4104. REMOVAL OF BARRIERS TO PREVENTIVE SERVICES IN MEDICARE.

        (a) Definition of Preventive Services.--Section 1861(ddd) of the
    Social Security Act (42 U.S.C. 1395x(ddd)) is amended--
                (1) in the heading, by inserting ``; Preventive Services''
            after ``Services'';
                (2) in paragraph (1), by striking ``not otherwise described
            in this title'' and inserting ``not described in subparagraph
            (A) or (C) of paragraph (3)''; and
                (3) by adding at the end the following new paragraph:
        ``(3) The term `preventive services' means the following:
                ``(A) The screening and preventive services described in
            subsection (ww)(2) (other than the service described in
            subparagraph (M) of such subsection).
                ``(B) An initial preventive physical examination (as
            defined in subsection (ww)).
                ``(C) Personalized prevention plan services (as defined in
            subsection (hhh)(1)).''.
        (b) Coinsurance.--
                (1) General application.--
                        (A) In general.--Section 1833(a)(1) of the Social
                    Security Act (42 U.S.C. 1395l(a)(1)), as amended by
                    section 4103(c)(1), is amended--
                                (i) in subparagraph (T), by inserting ``(or
                            100 percent if such services are recommended
                            with a grade of A or B by the United States
                            Preventive Services Task Force for any
                            indication or population and are appropriate
                            for the individual)'' after ``80 percent'';
                                (ii) in subparagraph (W)--
                                        (I) in clause (i), by inserting
                                    ``(if such subparagraph were applied,
                                    by substituting `100 percent' for `80
                                    percent')'' after ``subparagraph (D)'';
                                    and
                                        (II) in clause (ii), by striking
                                    ``80 percent'' and inserting ``100
                                    percent'';
                                (iii) by striking ``and'' before ``(X)'';
                            and
                                (iv) by inserting before the semicolon at
                            the end the following: ``, and (Y) with respect
                            to preventive services described in
                            subparagraphs (A) and (B) of section
                            1861(ddd)(3) that are appropriate for the
                            individual and, in the case of such services
                            described in subparagraph (A), are recommended
                            with a grade of A or B by the United States
                            Preventive Services Task Force for any
                            indication or population, the amount paid shall
                            be 100 percent of the lesser of the actual
                            charge for the services or the amount
                            determined under the fee schedule that applies
                            to such services under this part''.
                (2) Elimination of coinsurance in outpatient hospital
            settings.--
                        (A) Exclusion from opd fee schedule.--Section
                    1833(t)(1)(B)(iv) of the Social Security Act (42 U.S.C.
                    1395l(t)(1)(B)(iv)), as amended by section
                    4103(c)(3)(A), is amended--
                                (i) by striking ``or'' before
                            ``personalized prevention plan services''; and
                                (ii) by inserting before the period the
                            following: ``, or preventive services described
                            in subparagraphs (A) and (B) of section
                            1861(ddd)(3) that are appropriate for the
                            individual and, in the case of such services
                            described in subparagraph (A), are recommended
                            with a grade of A or B by the United States
                            Preventive Services Task Force for any
                            indication or population''.
                        (B) Conforming amendments.--Section 1833(a)(2) of
                    the Social Security Act (42 U.S.C. 1395l(a)(2)), as
                    amended by section 4103(c)(3)(B), is amended--
                                (i) in subparagraph (G)(ii), by striking
                            ``and'' after the semicolon at the end;
                                (ii) in subparagraph (H), by striking the
                            comma at the end and inserting ``; and''; and
                                (iii) by inserting after subparagraph (H)
                            the following new subparagraph:
                        ``(I) with respect to preventive services described
                    in subparagraphs (A) and (B) of section 1861(ddd)(3)
                    that are appropriate for the individual and are
                    furnished by an outpatient department of a hospital
                    and, in the case of such services described in
                    subparagraph (A), are recommended with a grade of A or
                    B by the United States Preventive Services Task Force
                    for any indication or population, the amount determined
                    under paragraph (1)(W) or (1)(Y),''.
        (c) Waiver of Application of Deductible for Preventive Services and
    Colorectal Cancer Screening Tests.--Section 1833(b) of the Social
    Security Act (42 U.S.C. 1395l(b)), as amended by section 4103(c)(4), is
    amended--
                (1) in paragraph (1), by striking ``items and services
            described in section 1861(s)(10)(A)'' and inserting
            ``preventive services described in subparagraph (A) of section
            1861(ddd)(3) that are recommended with a grade of A or B by the
            United States Preventive Services Task Force for any indication
            or population and are appropriate for the individual.''; and
                (2) by adding at the end the following new sentence:
            ``Paragraph (1) of the first sentence of this subsection shall
            apply with respect to a colorectal cancer screening test
            regardless of the code that is billed for the establishment of
            a diagnosis as a result of the test, or for the removal of
            tissue or other matter or other procedure that is furnished in
            connection with, as a result of, and in the same clinical
            encounter as the screening test.''.
        (d) Effective Date.--The amendments made by this section shall
    apply to items and services furnished on or after January 1, 2011.

    SEC. 4105. EVIDENCE-BASED COVERAGE OF PREVENTIVE SERVICES IN MEDICARE.

        (a) Authority To Modify or Eliminate Coverage of Certain Preventive
    Services.--Section 1834 of the Social Security Act (42 U.S.C. 1395m) is
    amended by adding at the end the following new subsection:
        ``(n) Authority To Modify or Eliminate Coverage of Certain
    Preventive Services.--Notwithstanding any other provision of this
    title, effective beginning on January 1, 2010, if the Secretary
    determines appropriate, the Secretary may--
                ``(1) modify--
                        ``(A) the coverage of any preventive service
                    described in subparagraph (A) of section 1861(ddd)(3)
                    to the extent that such modification is consistent with
                    the recommendations of the United States Preventive
                    Services Task Force; and
                        ``(B) the services included in the initial
                    preventive physical examination described in
                    subparagraph (B) of such section; and
                ``(2) provide that no payment shall be made under this
            title for a preventive service described in subparagraph (A) of
            such section that has not received a grade of A, B, C, or I by
            such Task Force.''.
        (b) Construction.--Nothing in the amendment made by paragraph (1)
    shall be construed to affect the coverage of diagnostic or treatment
    services under title XVIII of the Social Security Act.

    SEC. 4106. IMPROVING ACCESS TO PREVENTIVE SERVICES FOR ELIGIBLE ADULTS
                  IN MEDICAID.

        (a) Clarification of Inclusion of Services.--Section 1905(a)(13) of
    the Social Security Act (42 U.S.C. 1396d(a)(13)) is amended to read as
    follows:
                ``(13) other diagnostic, screening, preventive, and
            rehabilitative services, including--
                        ``(A) any clinical preventive services that are
                    assigned a grade of A or B by the United States
                    Preventive Services Task Force;
                        ``(B) with respect to an adult individual, approved
                    vaccines recommended by the Advisory Committee on
                    Immunization Practices (an advisory committee
                    established by the Secretary, acting through the
                    Director of the Centers for Disease Control and
                    Prevention) and their administration; and
                        ``(C) any medical or remedial services (provided in
                    a facility, a home, or other setting) recommended by a
                    physician or other licensed practitioner of the healing
                    arts within the scope of their practice under State
                    law, for the maximum reduction of physical or mental
                    disability and restoration of an individual to the best
                    possible functional level;''.
        (b) Increased Fmap.--Section 1905(b) of the Social Security Act (42
    U.S.C. 1396d(b)), as amended by sections 2001(a)(3)(A) and 2004(c)(1),
    is amended in the first sentence--
                (1) by striking ``, and (4)'' and inserting ``, (4)''; and
                (2) by inserting before the period the following: ``, and
            (5) in the case of a State that provides medical assistance for
            services and vaccines described in subparagraphs (A) and (B) of
            subsection (a)(13), and prohibits cost-sharing for such
            services and vaccines, the Federal medical assistance
            percentage, as determined under this subsection and subsection
            (y) (without regard to paragraph (1)(C) of such subsection),
            shall be increased by 1 percentage point with respect to
            medical assistance for such services and vaccines and for items
            and services described in subsection (a)(4)(D)''.
        (c) Effective Date.--The amendments made under this section shall
    take effect on January 1, 2013.

    SEC. 4107. COVERAGE OF COMPREHENSIVE TOBACCO CESSATION SERVICES FOR
                  PREGNANT WOMEN IN MEDICAID.

        (a) Requiring Coverage of Counseling and Pharmacotherapy for
    Cessation of Tobacco Use by Pregnant Women.--Section 1905 of the Social
    Security Act (42 U.S.C. 1396d), as amended by sections 2001(a)(3)(B)
    and 2303, is further amended--
                (1) in subsection (a)(4)--
                        (A) by striking ``and'' before ``(C)''; and
                        (B) by inserting before the semicolon at the end
                    the following new subparagraph: ``; and (D) counseling
                    and pharmacotherapy for cessation of tobacco use by
                    pregnant women (as defined in subsection (bb))''; and
                (2) by adding at the end the following:
        ``(bb)(1) For purposes of this title, the term `counseling and
    pharmacotherapy for cessation of tobacco use by pregnant women' means
    diagnostic, therapy, and counseling services and pharmacotherapy
    (including the coverage of prescription and nonprescription tobacco
    cessation agents approved by the Food and Drug Administration) for
    cessation of tobacco use by pregnant women who use tobacco products or
    who are being treated for tobacco use that is furnished--
                ``(A) by or under the supervision of a physician; or
                ``(B) by any other health care professional who--
                        ``(i) is legally authorized to furnish such
                    services under State law (or the State regulatory
                    mechanism provided by State law) of the State in which
                    the services are furnished; and
                        ``(ii) is authorized to receive payment for other
                    services under this title or is designated by the
                    Secretary for this purpose.
        ``(2) Subject to paragraph (3), such term is limited to--
                ``(A) services recommended with respect to pregnant women
            in `Treating Tobacco Use and Dependence: 2008 Update: A
            Clinical Practice Guideline', published by the Public Health
            Service in May 2008, or any subsequent modification of such
            Guideline; and
                ``(B) such other services that the Secretary recognizes to
            be effective for cessation of tobacco use by pregnant women.
        ``(3) Such term shall not include coverage for drugs or biologicals
    that are not otherwise covered under this title.''.
        (b) Exception From Optional Restriction Under Medicaid Prescription
    Drug Coverage.--Section 1927(d)(2)(F) of the Social Security Act (42
    U.S.C. 1396r-8(d)(2)(F)), as redesignated by section 2502(a), is
    amended by inserting before the period at the end the following: ``,
    except, in the case of pregnant women when recommended in accordance
    with the Guideline referred to in section 1905(bb)(2)(A), agents
    approved by the Food and Drug Administration under the over-the-counter
    monograph process for purposes of promoting, and when used to promote,
    tobacco cessation''.
        (c) Removal of Cost-Sharing for Counseling and Pharmacotherapy for
    Cessation of Tobacco Use by Pregnant Women.--
                (1) General cost-sharing limitations.--Section 1916 of the
            Social Security Act (42 U.S.C. 1396o) is amended in each of
            subsections (a)(2)(B) and (b)(2)(B) by inserting ``, and
            counseling and pharmacotherapy for cessation of tobacco use by
            pregnant women (as defined in section 1905(bb)) and covered
            outpatient drugs (as defined in subsection (k)(2) of section
            1927 and including nonprescription drugs described in
            subsection (d)(2) of such section) that are prescribed for
            purposes of promoting, and when used to promote, tobacco
            cessation by pregnant women in accordance with the Guideline
            referred to in section 1905(bb)(2)(A)'' after ``complicate the
            pregnancy''.
                (2) Application to alternative cost-sharing.--Section
            1916A(b)(3)(B)(iii) of such Act (42 U.S.C. 1396o-
            1(b)(3)(B)(iii)) is amended by inserting ``, and counseling and
            pharmacotherapy for cessation of tobacco use by pregnant women
            (as defined in section 1905(bb))'' after ``complicate the
            pregnancy''.
        (d) Effective Date.--The amendments made by this section shall take
    effect on October 1, 2010.

    SEC. 4108. INCENTIVES FOR PREVENTION OF CHRONIC DISEASES IN MEDICAID.

        (a) Initiatives.--
                (1) Establishment.--
                        (A) In general.--The Secretary shall award grants
                    to States to carry out initiatives to provide
                    incentives to Medicaid beneficiaries who--
                                (i) successfully participate in a program
                            described in paragraph (3); and
                                (ii) upon completion of such participation,
                            demonstrate changes in health risk and
                            outcomes, including the adoption and
                            maintenance of healthy behaviors by meeting
                            specific targets (as described in subsection
                            (c)(2)).
                        (B) Purpose.--The purpose of the initiatives under
                    this section is to test approaches that may encourage
                    behavior modification and determine scalable solutions.
                (2) Duration.--
                        (A) Initiation of program; resources.--The
                    Secretary shall awards grants to States beginning on
                    January 1, 2011, or beginning on the date on which the
                    Secretary develops program criteria, whichever is
                    earlier. The Secretary shall develop program criteria
                    for initiatives under this section using relevant
                    evidence-based research and resources, including the
                    Guide to Community Preventive Services, the Guide to
                    Clinical Preventive Services, and the National Registry
                    of Evidence-Based Programs and Practices.
                        (B) Duration of program.--A State awarded a grant
                    to carry out initiatives under this section shall carry
                    out such initiatives within the 5-year period beginning
                    on January 1, 2011, or beginning on the date on which
                    the Secretary develops program criteria, whichever is
                    earlier. Initiatives under this section shall be
                    carried out by a State for a period of not less than 3
                    years.
                (3) Program described.--
                        (A) In general.--A program described in this
                    paragraph is a comprehensive, evidence-based, widely
                    available, and easily accessible program, proposed by
                    the State and approved by the Secretary, that is
                    designed and uniquely suited to address the needs of
                    Medicaid beneficiaries and has demonstrated success in
                    helping individuals achieve one or more of the
                    following:
                                (i) Ceasing use of tobacco products.
                                (ii) Controlling or reducing their weight.
                                (iii) Lowering their cholesterol.
                                (iv) Lowering their blood pressure.
                                (v) Avoiding the onset of diabetes or, in
                            the case of a diabetic, improving the
                            management of that condition.
                        (B) Co-morbidities.--A program under this section
                    may also address co-morbidities (including depression)
                    that are related to any of the conditions described in
                    subparagraph (A).
                        (C) Waiver authority.--The Secretary may waive the
                    requirements of section 1902(a)(1) (relating to
                    statewideness) of the Social Security Act for a State
                    awarded a grant to conduct an initiative under this
                    section and shall ensure that a State makes any program
                    described in subparagraph (A) available and accessible
                    to Medicaid beneficiaries.
                        (D) Flexibility in implementation.--A State may
                    enter into arrangements with providers participating in
                    Medicaid, community-based organizations, faith-based
                    organizations, public-private partnerships, Indian
                    tribes, or similar entities or organizations to carry
                    out programs described in subparagraph (A).
                (4) Application.--Following the development of program
            criteria by the Secretary, a State may submit an application,
            in such manner and containing such information as the Secretary
            may require, that shall include a proposal for programs
            described in paragraph (3)(A) and a plan to make Medicaid
            beneficiaries and providers participating in Medicaid who
            reside in the State aware and informed about such programs.
        (b) Education and Outreach Campaign.--
                (1) State awareness.--The Secretary shall conduct an
            outreach and education campaign to make States aware of the
            grants under this section.
                (2) Provider and beneficiary education.--A State awarded a
            grant to conduct an initiative under this section shall conduct
            an outreach and education campaign to make Medicaid
            beneficiaries and providers participating in Medicaid who
            reside in the State aware of the programs described in
            subsection (a)(3) that are to be carried out by the State under
            the grant.
        (c) Impact.--A State awarded a grant to conduct an initiative under
    this section shall develop and implement a system to--
                (1) track Medicaid beneficiary participation in the program
            and validate changes in health risk and outcomes with clinical
            data, including the adoption and maintenance of health
            behaviors by such beneficiaries;
                (2) to the extent practicable, establish standards and
            health status targets for Medicaid beneficiaries participating
            in the program and measure the degree to which such standards
            and targets are met;
                (3) evaluate the effectiveness of the program and provide
            the Secretary with such evaluations;
                (4) report to the Secretary on processes that have been
            developed and lessons learned from the program; and
                (5) report on preventive services as part of reporting on
            quality measures for Medicaid managed care programs.
        (d) Evaluations and Reports.--
                (1) Independent assessment.--The Secretary shall enter into
            a contract with an independent entity or organization to
            conduct an evaluation and assessment of the initiatives carried
            out by States under this section, for the purpose of
            determining--
                        (A) the effect of such initiatives on the use of
                    health care services by Medicaid beneficiaries
                    participating in the program;
                        (B) the extent to which special populations
                    (including adults with disabilities, adults with
                    chronic illnesses, and children with special health
                    care needs) are able to participate in the program;
                        (C) the level of satisfaction of Medicaid
                    beneficiaries with respect to the accessibility and
                    quality of health care services provided through the
                    program; and
                        (D) the administrative costs incurred by State
                    agencies that are responsible for administration of the
                    program.
                (2) State reporting.--A State awarded a grant to carry out
            initiatives under this section shall submit reports to the
            Secretary, on a semi-annual basis, regarding the programs that
            are supported by the grant funds. Such report shall include
            information, as specified by the Secretary, regarding--
                        (A) the specific uses of the grant funds;
                        (B) an assessment of program implementation and
                    lessons learned from the programs;
                        (C) an assessment of quality improvements and
                    clinical outcomes under such programs; and
                        (D) estimates of cost savings resulting from such
                    programs.
                (3) Initial report.--Not later than January 1, 2014, the
            Secretary shall submit to Congress an initial report on such
            initiatives based on information provided by States through
            reports required under paragraph (2). The initial report shall
            include an interim evaluation of the effectiveness of the
            initiatives carried out with grants awarded under this section
            and a recommendation regarding whether funding for expanding or
            extending the initiatives should be extended beyond January 1,
            2016.
                (4) Final report.--Not later than July 1, 2016, the
            Secretary shall submit to Congress a final report on the
            program that includes the results of the independent assessment
            required under paragraph (1), together with recommendations for
            such legislation and administrative action as the Secretary
            determines appropriate.
        (e) No Effect on Eligibility for, or Amount of, Medicaid or Other
    Benefits.--Any incentives provided to a Medicaid beneficiary
    participating in a program described in subsection (a)(3) shall not be
    taken into account for purposes of determining the beneficiary's
    eligibility for, or amount of, benefits under the Medicaid program or
    any program funded in whole or in part with Federal funds.
        (f) Funding.--Out of any funds in the Treasury not otherwise
    appropriated, there are appropriated for the 5-year period beginning on
    January 1, 2011, $100,000,000 to the Secretary to carry out this
    section. Amounts appropriated under this subsection shall remain
    available until expended.
        (g) Definitions.--In this section:
                (1) Medicaid beneficiary.--The term ``Medicaid
            beneficiary'' means an individual who is eligible for medical
            assistance under a State plan or waiver under title XIX of the
            Social Security Act (42 U.S.C. 1396 et seq.) and is enrolled in
            such plan or waiver.
                (2) State.--The term ``State'' has the meaning given that
            term for purposes of title XIX of the Social Security Act (42
            U.S.C. 1396 et seq.).

                   Subtitle C--Creating Healthier Communities

    SEC. 4201. COMMUNITY TRANSFORMATION GRANTS.

        (a) In General.--The Secretary of Health and Human Services
    (referred to in this section as the ``Secretary''), acting through the
    Director of the Centers for Disease Control and Prevention (referred to
    in this section as the ``Director''), shall award competitive grants to
    State and local governmental agencies and community-based organizations
    for the implementation, evaluation, and dissemination of evidence-based
    community preventive health activities in order to reduce chronic
    disease rates, prevent the development of secondary conditions, address
    health disparities, and develop a stronger evidence-base of effective
    prevention programming.
        (b) Eligibility.--To be eligible to receive a grant under
    subsection (a), an entity shall--
                (1) be--
                        (A) a State governmental agency;
                        (B) a local governmental agency;
                        (C) a national network of community-based
                    organizations;
                        (D) a State or local non-profit organization; or
                        (E) an Indian tribe; and
                (2) submit to the Director an application at such time, in
            such a manner, and containing such information as the Director
            may require, including a description of the program to be
            carried out under the grant; and
                (3) demonstrate a history or capacity, if funded, to
            develop relationships necessary to engage key stakeholders from
            multiple sectors within and beyond health care and across a
            community, such as healthy futures corps and health care
            providers.
        (c) Use of Funds.--
                (1) In general.--An eligible entity shall use amounts
            received under a grant under this section to carry out programs
            described in this subsection.
                (2) Community transformation plan.--
                        (A) In general.--An eligible entity that receives a
                    grant under this section shall submit to the Director
                    (for approval) a detailed plan that includes the
                    policy, environmental, programmatic, and as appropriate
                    infrastructure changes needed to promote healthy living
                    and reduce disparities.
                        (B) Activities.--Activities within the plan may
                    focus on (but not be limited to)--
                                (i) creating healthier school environments,
                            including increasing healthy food options,
                            physical activity opportunities, promotion of
                            healthy lifestyle, emotional wellness, and
                            prevention curricula, and activities to prevent
                            chronic diseases;
                                (ii) creating the infrastructure to support
                            active living and access to nutritious foods in
                            a safe environment;
                                (iii) developing and promoting programs
                            targeting a variety of age levels to increase
                            access to nutrition, physical activity and
                            smoking cessation, improve social and emotional
                            wellness, enhance safety in a community, or
                            address any other chronic disease priority area
                            identified by the grantee;
                                (iv) assessing and implementing worksite
                            wellness programming and incentives;
                                (v) working to highlight healthy options at
                            restaurants and other food venues;
                                (vi) prioritizing strategies to reduce
                            racial and ethnic disparities, including
                            social, economic, and geographic determinants
                            of health; and
                                (vii) addressing special populations needs,
                            including all age groups and individuals with
                            disabilities, and individuals in both urban and
                            rural areas.
                (3) Community-based prevention health activities.--
                        (A) In general.--An eligible entity shall use
                    amounts received under a grant under this section to
                    implement a variety of programs, policies, and
                    infrastructure improvements to promote healthier
                    lifestyles.
                        (B) Activities.--An eligible entity shall implement
                    activities detailed in the community transformation
                    plan under paragraph (2).
                        (C) In-kind support.--An eligible entity may
                    provide in-kind resources such as staff, equipment, or
                    office space in carrying out activities under this
                    section.
                (4) Evaluation.--
                        (A) In general.--An eligible entity shall use
                    amounts provided under a grant under this section to
                    conduct activities to measure changes in the prevalence
                    of chronic disease risk factors among community members
                    participating in preventive health activities
                        (B) Types of measures.--In carrying out
                    subparagraph (A), the eligible entity shall, with
                    respect to residents in the community, measure--
                                (i) changes in weight;
                                (ii) changes in proper nutrition;
                                (iii) changes in physical activity;
                                (iv) changes in tobacco use prevalence;
                                (v) changes in emotional well-being and
                            overall mental health;
                                (vi) other factors using community-specific
                            data from the Behavioral Risk Factor
                            Surveillance Survey; and
                                (vii) other factors as determined by the
                            Secretary.
                        (C) Reporting.--An eligible entity shall annually
                    submit to the Director a report containing an
                    evaluation of activities carried out under the grant.
                (5) Dissemination.--A grantee under this section shall--
                        (A) meet at least annually in regional or national
                    meetings to discuss challenges, best practices, and
                    lessons learned with respect to activities carried out
                    under the grant; and
                        (B) develop models for the replication of
                    successful programs and activities and the mentoring of
                    other eligible entities.
        (d) Training.--
                (1) In general.--The Director shall develop a program to
            provide training for eligible entities on effective strategies
            for the prevention and control of chronic disease and the link
            between physical, emotional, and social well-being.
                (2) Community transformation plan.--The Director shall
            provide appropriate feedback and technical assistance to
            grantees to establish community transformation plans
                (3) Evaluation.--The Director shall provide a literature
            review and framework for the evaluation of programs conducted
            as part of the grant program under this section, in addition to
            working with academic institutions or other entities with
            expertise in outcome evaluation.
        (e) Prohibition.--A grantee shall not use funds provided under a
    grant under this section to create video games or to carry out any
    other activities that may lead to higher rates of obesity or
    inactivity.
        (f) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this section, such sums as may be necessary
    for each fiscal years 2010 through 2014.

    SEC. 4202. HEALTHY AGING, LIVING WELL; EVALUATION OF COMMUNITY-BASED
                  PREVENTION AND WELLNESS PROGRAMS FOR MEDICARE
                  BENEFICIARIES.

        (a) Healthy Aging, Living Well.--
                (1) In general.--The Secretary of Health and Human Services
            (referred to in this section as the ``Secretary''), acting
            through the Director of the Centers for Disease Control and
            Prevention, shall award grants to State or local health
            departments and Indian tribes to carry out 5-year pilot
            programs to provide public health community interventions,
            screenings, and where necessary, clinical referrals for
            individuals who are between 55 and 64 years of age.
                (2) Eligibility.--To be eligible to receive a grant under
            paragraph (1), an entity shall--
                        (A) be--
                                (i) a State health department;
                                (ii) a local health department; or
                                (iii) an Indian tribe;
                        (B) submit to the Secretary an application at such
                    time, in such manner, and containing such information
                    as the Secretary may require including a description of
                    the program to be carried out under the grant;
                        (C) design a strategy for improving the health of
                    the 55-to-64 year-old population through community-
                    based public health interventions; and
                        (D) demonstrate the capacity, if funded, to develop
                    the relationships necessary with relevant health
                    agencies, health care providers, community-based
                    organizations, and insurers to carry out the activities
                    described in paragraph (3), such relationships to
                    include the identification of a community-based
                    clinical partner, such as a community health center or
                    rural health clinic.
                (3) Use of funds.--
                        (A) In general.--A State or local health department
                    shall use amounts received under a grant under this
                    subsection to carry out a program to provide the
                    services described in this paragraph to individuals who
                    are between 55 and 64 years of age.
                        (B) Public health interventions.--
                                (i) In general.--In developing and
                            implementing such activities, a grantee shall
                            collaborate with the Centers for Disease
                            Control and Prevention and the Administration
                            on Aging, and relevant local agencies and
                            organizations.
                                (ii) Types of intervention activities.--
                            Intervention activities conducted under this
                            subparagraph may include efforts to improve
                            nutrition, increase physical activity, reduce
                            tobacco use and substance abuse, improve mental
                            health, and promote healthy lifestyles among
                            the target population.
                        (C) Community preventive screenings.--
                                (i) In general.--In addition to community-
                            wide public health interventions, a State or
                            local health department shall use amounts
                            received under a grant under this subsection to
                            conduct ongoing health screening to identify
                            risk factors for cardiovascular disease,
                            cancer, stroke, and diabetes among individuals
                            in both urban and rural areas who are between
                            55 and 64 years of age.
                                (ii) Types of screening activities.--
                            Screening activities conducted under this
                            subparagraph may include--
                                        (I) mental health/behavioral health
                                    and substance use disorders;
                                        (II) physical activity, smoking,
                                    and nutrition; and
                                        (III) any other measures deemed
                                    appropriate by the Secretary.
                                (iii) Monitoring.--Grantees under this
                            section shall maintain records of screening
                            results under this subparagraph to establish
                            the baseline data for monitoring the targeted
                            population
                        (D) Clinical referral/treatment for chronic
                    diseases.--
                                (i) In general.--A State or local health
                            department shall use amounts received under a
                            grant under this subsection to ensure that
                            individuals between 55 and 64 years of age who
                            are found to have chronic disease risk factors
                            through the screening activities described in
                            subparagraph (C)(ii), receive clinical
                            referral/treatment for follow-up services to
                            reduce such risk.
                                (ii) Mechanism.--
                                        (I) Identification and
                                    determination of status.--With respect
                                    to each individual with risk factors
                                    for or having heart disease, stroke,
                                    diabetes, or any other condition for
                                    which such individual was screened
                                    under subparagraph (C), a grantee under
                                    this section shall determine whether or
                                    not such individual is covered under
                                    any public or private health insurance
                                    program.
                                        (II) Insured individuals.--An
                                    individual determined to be covered
                                    under a health insurance program under
                                    subclause (I) shall be referred by the
                                    grantee to the existing providers under
                                    such program or, if such individual
                                    does not have a current provider, to a
                                    provider who is in-network with respect
                                    to the program involved.
                                        (III) Uninsured individuals.--With
                                    respect to an individual determined to
                                    be uninsured under subclause (I), the
                                    grantee's community-based clinical
                                    partner described in paragraph (4)(D)
                                    shall assist the individual in
                                    determining eligibility for available
                                    public coverage options and identify
                                    other appropriate community health care
                                    resources and assistance programs.
                                (iii) Public health intervention program.--
                            A State or local health department shall use
                            amounts received under a grant under this
                            subsection to enter into contracts with
                            community health centers or rural health
                            clinics and mental health and substance use
                            disorder service providers to assist in the
                            referral/treatment of at risk patients to
                            community resources for clinical follow-up and
                            help determine eligibility for other public
                            programs.
                        (E) Grantee evaluation.--An eligible entity shall
                    use amounts provided under a grant under this
                    subsection to conduct activities to measure changes in
                    the prevalence of chronic disease risk factors among
                    participants.
                (4) Pilot program evaluation.--The Secretary shall conduct
            an annual evaluation of the effectiveness of the pilot program
            under this subsection. In determining such effectiveness, the
            Secretary shall consider changes in the prevalence of
            uncontrolled chronic disease risk factors among new Medicare
            enrollees (or individuals nearing enrollment, including those
            who are 63 and 64 years of age) who reside in States or
            localities receiving grants under this section as compared with
            national and historical data for those States and localities
            for the same population.
                (5) Authorization of appropriations.--There are authorized
            to be appropriated to carry out this subsection, such sums as
            may be necessary for each of fiscal years 2010 through 2014.
        (b) Evaluation and Plan for Community-based Prevention and Wellness
    Programs for Medicare Beneficiaries.--
                (1) In general.--The Secretary shall conduct an evaluation
            of community-based prevention and wellness programs and develop
            a plan for promoting healthy lifestyles and chronic disease
            self-management for Medicare beneficiaries.
                (2) Medicare evaluation of prevention and wellness
            programs.--
                        (A) In general.--The Secretary shall evaluate
                    community prevention and wellness programs including
                    those that are sponsored by the Administration on
                    Aging, are evidence-based, and have demonstrated
                    potential to help Medicare beneficiaries (particularly
                    beneficiaries that have attained 65 years of age)
                    reduce their risk of disease, disability, and injury by
                    making healthy lifestyle choices, including exercise,
                    diet, and self-management of chronic diseases.
                        (B) Evaluation.--The evaluation under subparagraph
                    (A) shall consist of the following:
                                (i) Evidence review.--The Secretary shall
                            review available evidence, literature, best
                            practices, and resources that are relevant to
                            programs that promote healthy lifestyles and
                            reduce risk factors for the Medicare
                            population. The Secretary may determine the
                            scope of the evidence review and such issues to
                            be considered, which shall include, at a
                            minimum--
                                        (I) physical activity, nutrition,
                                    and obesity;
                                        (II) falls;
                                        (III) chronic disease self-
                                    management; and
                                        (IV) mental health.
                                (ii) Independent evaluation of evidence-
                            based community prevention and wellness
                            programs.--The Administrator of the Centers for
                            Medicare & Medicaid Services, in consultation
                            with the Assistant Secretary for Aging, shall,
                            to the extent feasible and practicable, conduct
                            an evaluation of existing community prevention
                            and wellness programs that are sponsored by the
                            Administration on Aging to assess the extent to
                            which Medicare beneficiaries who participate in
                            such programs--
                                        (I) reduce their health risks,
                                    improve their health outcomes, and
                                    adopt and maintain healthy behaviors;
                                        (II) improve their ability to
                                    manage their chronic conditions; and
                                        (III) reduce their utilization of
                                    health services and associated costs
                                    under the Medicare program for
                                    conditions that are amenable to
                                    improvement under such programs.
                (3) Report.--Not later than September 30, 2013, the
            Secretary shall submit to Congress a report that includes--
                        (A) recommendations for such legislation and
                    administrative action as the Secretary determines
                    appropriate to promote healthy lifestyles and chronic
                    disease self-management for Medicare beneficiaries;
                        (B) any relevant findings relating to the evidence
                    review under paragraph (2)(B)(i); and
                        (C) the results of the evaluation under paragraph
                    (2)(B)(ii).
                (4) Funding.--For purposes of carrying out this subsection,
            the Secretary shall provide for the transfer, from the Federal
            Hospital Insurance Trust Fund under section 1817 of the Social
            Security Act (42 U.S.C. 1395i) and the Federal Supplemental
            Medical Insurance Trust Fund under section 1841 of such Act (42
            U.S.C. 1395t), in such proportion as the Secretary determines
            appropriate, of $50,000,000 to the Centers for Medicare &
            Medicaid Services Program Management Account. Amounts
            transferred under the preceding sentence shall remain available
            until expended.
                (5) Administration.--Chapter 35 of title 44, United States
            Code shall not apply to the this subsection.
                (6) Medicare beneficiary.--In this subsection, the term
            ``Medicare beneficiary'' means an individual who is entitled to
            benefits under part A of title XVIII of the Social Security Act
            and enrolled under part B of such title.

    SEC. 4203. REMOVING BARRIERS AND IMPROVING ACCESS TO WELLNESS FOR
                  INDIVIDUALS WITH DISABILITIES.

        Title V of the Rehabilitation Act of 1973 (29 U.S.C. 791 et seq.)
    is amended by adding at the end of the following:

    ``SEC. 510. ESTABLISHMENT OF STANDARDS FOR ACCESSIBLE MEDICAL
                  DIAGNOSTIC EQUIPMENT.

        ``(a) Standards.--Not later than 24 months after the date of
    enactment of the Affordable Health Choices Act, the Architectural and
    Transportation Barriers Compliance Board shall, in consultation with
    the Commissioner of the Food and Drug Administration, promulgate
    regulatory standards in accordance with the Administrative Procedure
    Act (2 U.S.C. 551 et seq.) setting forth the minimum technical criteria
    for medical diagnostic equipment used in (or in conjunction with)
    physician's offices, clinics, emergency rooms, hospitals, and other
    medical settings. The standards shall ensure that such equipment is
    accessible to, and usable by, individuals with accessibility needs, and
    shall allow independent entry to, use of, and exit from the equipment
    by such individuals to the maximum extent possible.
        ``(b) Medical Diagnostic Equipment Covered.--The standards issued
    under subsection (a) for medical diagnostic equipment shall apply to
    equipment that includes examination tables, examination chairs
    (including chairs used for eye examinations or procedures, and dental
    examinations or procedures), weight scales, mammography equipment, x-
    ray machines, and other radiological equipment commonly used for
    diagnostic purposes by health professionals.
        ``(c) Review and Amendment.--The Architectural and Transportation
    Barriers Compliance Board, in consultation with the Commissioner of the
    Food and Drug Administration, shall periodically review and, as
    appropriate, amend the standards in accordance with the Administrative
    Procedure Act (2 U.S.C. 551 et seq.).''.

    SEC. 4204. IMMUNIZATIONS.

        (a) State Authority To Purchase Recommended Vaccines for Adults.--
    Section 317 of the Public Health Service Act (42 U.S.C. 247b) is
    amended by adding at the end the following:
        ``(l) Authority to Purchase Recommended Vaccines for Adults.--
                ``(1) In general.--The Secretary may negotiate and enter
            into contracts with manufacturers of vaccines for the purchase
            and delivery of vaccines for adults as provided for under
            subsection (e).
                ``(2) State purchase.--A State may obtain additional
            quantities of such adult vaccines (subject to amounts specified
            to the Secretary by the State in advance of negotiations)
            through the purchase of vaccines from manufacturers at the
            applicable price negotiated by the Secretary under this
            subsection.''.
        (b) Demonstration Program to Improve Immunization Coverage.--
    Section 317 of the Public Health Service Act (42 U.S.C. 247b), as
    amended by subsection (a), is further amended by adding at the end the
    following:
        ``(m) Demonstration Program To Improve Immunization Coverage.--
                ``(1) In general.--The Secretary, acting through the
            Director of the Centers for Disease Control and Prevention,
            shall establish a demonstration program to award grants to
            States to improve the provision of recommended immunizations
            for children, adolescents, and adults through the use of
            evidence-based, population-based interventions for high-risk
            populations.
                ``(2) State plan.--To be eligible for a grant under
            paragraph (1), a State shall submit to the Secretary an
            application at such time, in such manner, and containing such
            information as the Secretary may require, including a State
            plan that describes the interventions to be implemented under
            the grant and how such interventions match with local needs and
            capabilities, as determined through consultation with local
            authorities.
                ``(3) Use of funds.--Funds received under a grant under
            this subsection shall be used to implement interventions that
            are recommended by the Task Force on Community Preventive
            Services (as established by the Secretary, acting through the
            Director of the Centers for Disease Control and Prevention) or
            other evidence-based interventions, including--
                        ``(A) providing immunization reminders or recalls
                    for target populations of clients, patients, and
                    consumers;
                        ``(B) educating targeted populations and health
                    care providers concerning immunizations in combination
                    with one or more other interventions;
                        ``(C) reducing out-of-pocket costs for families for
                    vaccines and their administration;
                        ``(D) carrying out immunization-promoting
                    strategies for participants or clients of public
                    programs, including assessments of immunization status,
                    referrals to health care providers, education,
                    provision of on-site immunizations, or incentives for
                    immunization;
                        ``(E) providing for home visits that promote
                    immunization through education, assessments of need,
                    referrals, provision of immunizations, or other
                    services;
                        ``(F) providing reminders or recalls for
                    immunization providers;
                        ``(G) conducting assessments of, and providing
                    feedback to, immunization providers;
                        ``(H) any combination of one or more interventions
                    described in this paragraph; or
                        ``(I) immunization information systems to allow all
                    States to have electronic databases for immunization
                    records.
                ``(4) Consideration.--In awarding grants under this
            subsection, the Secretary shall consider any reviews or
            recommendations of the Task Force on Community Preventive
            Services.
                ``(5) Evaluation.--Not later than 3 years after the date on
            which a State receives a grant under this subsection, the State
            shall submit to the Secretary an evaluation of progress made
            toward improving immunization coverage rates among high-risk
            populations within the State.
                ``(6) Report to congress.--Not later than 4 years after the
            date of enactment of the Affordable Health Choices Act, the
            Secretary shall submit to Congress a report concerning the
            effectiveness of the demonstration program established under
            this subsection together with recommendations on whether to
            continue and expand such program.
                ``(7) Authorization of appropriations.--There is authorized
            to be appropriated to carry out this subsection, such sums as
            may be necessary for each of fiscal years 2010 through 2014.''.
        (c) Reauthorization of Immunization Program.--Section 317(j) of the
    Public Health Service Act (42 U.S.C. 247b(j)) is amended--
                (1) in paragraph (1), by striking ``for each of the fiscal
            years 1998 through 2005''; and
                (2) in paragraph (2), by striking ``after October 1,
            1997,''.
        (d) Rule of Construction Regarding Access to Immunizations.--
    Nothing in this section (including the amendments made by this
    section), or any other provision of this Act (including any amendments
    made by this Act) shall be construed to decrease children's access to
    immunizations.
        (e) GAO Study and Report on Medicare Beneficiary Access to
    Vaccines.--
                (1) Study.--The Comptroller General of the United States
            (in this section referred to as the ``Comptroller General'')
            shall conduct a study on the ability of Medicare beneficiaries
            who were 65 years of age or older to access routinely
            recommended vaccines covered under the prescription drug
            program under part D of title XVIII of the Social Security Act
            over the period since the establishment of such program. Such
            study shall include the following:
                        (A) An analysis and determination of--
                                (i) the number of Medicare beneficiaries
                            who were 65 years of age or older and were
                            eligible for a routinely recommended
                            vaccination that was covered under part D;
                                (ii) the number of such beneficiaries who
                            actually received a routinely recommended
                            vaccination that was covered under part D; and
                                (iii) any barriers to access by such
                            beneficiaries to routinely recommended
                            vaccinations that were covered under part D.
                        (B) A summary of the findings and recommendations
                    by government agencies, departments, and advisory
                    bodies (as well as relevant professional organizations)
                    on the impact of coverage under part D of routinely
                    recommended adult immunizations for access to such
                    immunizations by Medicare beneficiaries.
                (2) Report.--Not later than June 1, 2011, the Comptroller
            General shall submit to the appropriate committees of
            jurisdiction of the House of Representatives and the Senate a
            report containing the results of the study conducted under
            paragraph (1), together with recommendations for such
            legislation and administrative action as the Comptroller
            General determines appropriate.
                (3) Funding.--Out of any funds in the Treasury not
            otherwise appropriated, there are appropriated $1,000,000 for
            fiscal year 2010 to carry out this subsection.

    SEC. 4205. NUTRITION LABELING OF STANDARD MENU ITEMS AT CHAIN
                  RESTAURANTS.

        (a) Technical Amendments.--Section 403(q)(5)(A) of the Federal
    Food, Drug, and Cosmetic Act (21 U.S.C. 343(q)(5)(A)) is amended--
                (1) in subitem (i), by inserting at the beginning ``except
            as provided in clause (H)(ii)(III),''; and
                (2) in subitem (ii), by inserting at the beginning ``except
            as provided in clause (H)(ii)(III),''.
        (b) Labeling Requirements.--Section 403(q)(5) of the Federal Food,
    Drug, and Cosmetic Act (21 U.S.C. 343(q)(5)) is amended by adding at
    the end the following:
        ``(H) Restaurants, Retail Food Establishments, and Vending
    Machines.--
                ``(i) General requirements for restaurants and similar
            retail food establishments.--Except for food described in
            subclause (vii), in the case of food that is a standard menu
            item that is offered for sale in a restaurant or similar retail
            food establishment that is part of a chain with 20 or more
            locations doing business under the same name (regardless of the
            type of ownership of the locations) and offering for sale
            substantially the same menu items, the restaurant or similar
            retail food establishment shall disclose the information
            described in subclauses (ii) and (iii).
                ``(ii) Information required to be disclosed by restaurants
            and retail food establishments.--Except as provided in
            subclause (vii), the restaurant or similar retail food
            establishment shall disclose in a clear and conspicuous
            manner--
                        ``(I)(aa) in a nutrient content disclosure
                    statement adjacent to the name of the standard menu
                    item, so as to be clearly associated with the standard
                    menu item, on the menu listing the item for sale, the
                    number of calories contained in the standard menu item,
                    as usually prepared and offered for sale; and
                        ``(bb) a succinct statement concerning suggested
                    daily caloric intake, as specified by the Secretary by
                    regulation and posted prominently on the menu and
                    designed to enable the public to understand, in the
                    context of a total daily diet, the significance of the
                    caloric information that is provided on the menu;
                        ``(II)(aa) in a nutrient content disclosure
                    statement adjacent to the name of the standard menu
                    item, so as to be clearly associated with the standard
                    menu item, on the menu board, including a drive-through
                    menu board, the number of calories contained in the
                    standard menu item, as usually prepared and offered for
                    sale; and
                        ``(bb) a succinct statement concerning suggested
                    daily caloric intake, as specified by the Secretary by
                    regulation and posted prominently on the menu board,
                    designed to enable the public to understand, in the
                    context of a total daily diet, the significance of the
                    nutrition information that is provided on the menu
                    board;
                ``(III) in a written form, available on the premises of the
            restaurant or similar retail establishment and to the consumer
            upon request, the nutrition information required under clauses
            (C) and (D) of subparagraph (1); and
                ``(IV) on the menu or menu board, a prominent, clear, and
            conspicuous statement regarding the availability of the
            information described in item (III).
                ``(iii) Self-service food and food on display.--Except as
            provided in subclause (vii), in the case of food sold at a
            salad bar, buffet line, cafeteria line, or similar self-service
            facility, and for self-service beverages or food that is on
            display and that is visible to customers, a restaurant or
            similar retail food establishment shall place adjacent to each
            food offered a sign that lists calories per displayed food item
            or per serving.
                ``(iv) Reasonable basis.--For the purposes of this clause,
            a restaurant or similar retail food establishment shall have a
            reasonable basis for its nutrient content disclosures,
            including nutrient databases, cookbooks, laboratory analyses,
            and other reasonable means, as described in section 101.10 of
            title 21, Code of Federal Regulations (or any successor
            regulation) or in a related guidance of the Food and Drug
            Administration.
                ``(v) Menu variability and combination meals.--The
            Secretary shall establish by regulation standards for
            determining and disclosing the nutrient content for standard
            menu items that come in different flavors, varieties, or
            combinations, but which are listed as a single menu item, such
            as soft drinks, ice cream, pizza, doughnuts, or children's
            combination meals, through means determined by the Secretary,
            including ranges, averages, or other methods.
                ``(vi) Additional information.--If the Secretary determines
            that a nutrient, other than a nutrient required under subclause
            (ii)(III), should be disclosed for the purpose of providing
            information to assist consumers in maintaining healthy dietary
            practices, the Secretary may require, by regulation, disclosure
            of such nutrient in the written form required under subclause
            (ii)(III).
                ``(vii) Nonapplicability to certain food.--
                        ``(I) In general.--Subclauses (i) through (vi) do
                    not apply to--
                                ``(aa) items that are not listed on a menu
                            or menu board (such as condiments and other
                            items placed on the table or counter for
                            general use);
                                ``(bb) daily specials, temporary menu items
                            appearing on the menu for less than 60 days per
                            calendar year, or custom orders; or
                                ``(cc) such other food that is part of a
                            customary market test appearing on the menu for
                            less than 90 days, under terms and conditions
                            established by the Secretary.
                        ``(II) Written forms.--Subparagraph (5)(C) shall
                    apply to any regulations promulgated under subclauses
                    (ii)(III) and (vi).
                ``(viii) Vending machines.--
                        ``(I) In general.--In the case of an article of
                    food sold from a vending machine that--
                                ``(aa) does not permit a prospective
                            purchaser to examine the Nutrition Facts Panel
                            before purchasing the article or does not
                            otherwise provide visible nutrition information
                            at the point of purchase; and
                                ``(bb) is operated by a person who is
                            engaged in the business of owning or operating
                            20 or more vending machines,
                    the vending machine operator shall provide a sign in
                    close proximity to each article of food or the
                    selection button that includes a clear and conspicuous
                    statement disclosing the number of calories contained
                    in the article.
                ``(ix) Voluntary provision of nutrition information.--
                        ``(I) In general.--An authorized official of any
                    restaurant or similar retail food establishment or
                    vending machine operator not subject to the
                    requirements of this clause may elect to be subject to
                    the requirements of such clause, by registering
                    biannually the name and address of such restaurant or
                    similar retail food establishment or vending machine
                    operator with the Secretary, as specified by the
                    Secretary by regulation.
                        ``(II) Registration.--Within 120 days of enactment
                    of this clause, the Secretary shall publish a notice in
                    the Federal Register specifying the terms and
                    conditions for implementation of item (I), pending
                    promulgation of regulations.
                        ``(III) Rule of construction.--Nothing in this
                    subclause shall be construed to authorize the Secretary
                    to require an application, review, or licensing process
                    for any entity to register with the Secretary, as
                    described in such item.
                ``(x) Regulations.--
                        ``(I) Proposed regulation.--Not later than 1 year
                    after the date of enactment of this clause, the
                    Secretary shall promulgate proposed regulations to
                    carry out this clause.
                        ``(II) Contents.--In promulgating regulations, the
                    Secretary shall--
                                ``(aa) consider standardization of recipes
                            and methods of preparation, reasonable
                            variation in serving size and formulation of
                            menu items, space on menus and menu boards,
                            inadvertent human error, training of food
                            service workers, variations in ingredients, and
                            other factors, as the Secretary determines; and
                                ``(bb) specify the format and manner of the
                            nutrient content disclosure requirements under
                            this subclause.
                        ``(III) Reporting.--The Secretary shall submit to
                    the Committee on Health, Education, Labor, and Pensions
                    of the Senate and the Committee on Energy and Commerce
                    of the House of Representatives a quarterly report that
                    describes the Secretary's progress toward promulgating
                    final regulations under this subparagraph.
                ``(xi) Definition.--In this clause, the term `menu' or
            `menu board' means the primary writing of the restaurant or
            other similar retail food establishment from which a consumer
            makes an order selection.''
        (c) National Uniformity.--Section 403A(a)(4) of the Federal Food,
    Drug, and Cosmetic Act (21 U.S.C. 343-1(a)(4)) is amended by striking
    ``except a requirement for nutrition labeling of food which is exempt
    under subclause (i) or (ii) of section 403(q)(5)(A)'' and inserting
    ``except that this paragraph does not apply to food that is offered for
    sale in a restaurant or similar retail food establishment that is not
    part of a chain with 20 or more locations doing business under the same
    name (regardless of the type of ownership of the locations) and
    offering for sale substantially the same menu items unless such
    restaurant or similar retail food establishment complies with the
    voluntary provision of nutrition information requirements under section
    403(q)(5)(H)(ix)''.
        (d) Rule of Construction.--Nothing in the amendments made by this
    section shall be construed--
                (1) to preempt any provision of State or local law, unless
            such provision establishes or continues into effect nutrient
            content disclosures of the type required under section
            403(q)(5)(H) of the Federal Food, Drug, and Cosmetic Act (as
            added by subsection (b)) and is expressly preempted under
            subsection (a)(4) of such section;
                (2) to apply to any State or local requirement respecting a
            statement in the labeling of food that provides for a warning
            concerning the safety of the food or component of the food; or
                (3) except as provided in section 403(q)(5)(H)(ix) of the
            Federal Food, Drug, and Cosmetic Act (as added by subsection
            (b)), to apply to any restaurant or similar retail food
            establishment other than a restaurant or similar retail food
            establishment described in section 403(q)(5)(H)(i) of such Act.

    SEC. 4206. DEMONSTRATION PROJECT CONCERNING INDIVIDUALIZED WELLNESS
                  PLAN.

        Section 330 of the Public Health Service Act (42 U.S.C. 245b) is
    amended by adding at the end the following:
        ``(s) Demonstration Program for Individualized Wellness Plans.--
                ``(1) In general.--The Secretary shall establish a pilot
            program to test the impact of providing at-risk populations who
            utilize community health centers funded under this section an
            individualized wellness plan that is designed to reduce risk
            factors for preventable conditions as identified by a
            comprehensive risk-factor assessment.
                ``(2) Agreements.--The Secretary shall enter into
            agreements with not more than 10 community health centers
            funded under this section to conduct activities under the pilot
            program under paragraph (1).
                ``(3) Wellness plans.--
                        ``(A) In general.--An individualized wellness plan
                    prepared under the pilot program under this subsection
                    may include one or more of the following as appropriate
                    to the individual's identified risk factors:
                                ``(i) Nutritional counseling.
                                ``(ii) A physical activity plan.
                                ``(iii) Alcohol and smoking cessation
                            counseling and services.
                                ``(iv) Stress management.
                                ``(v) Dietary supplements that have health
                            claims approved by the Secretary.
                                ``(vi) Compliance assistance provided by a
                            community health center employee.
                        ``(B) Risk factors.--Wellness plan risk factors
                    shall include--
                                ``(i) weight;
                                ``(ii) tobacco and alcohol use;
                                ``(iii) exercise rates;
                                ``(iv) nutritional status; and
                                ``(v) blood pressure.
                        ``(C) Comparisons.--Individualized wellness plans
                    shall make comparisons between the individual involved
                    and a control group of individuals with respect to the
                    risk factors described in subparagraph (B).
                ``(4) Authorization of appropriations.--There is authorized
            to be appropriated to carry out this subsection, such sums as
            may be necessary.''.

    SEC. 4207. REASONABLE BREAK TIME FOR NURSING MOTHERS.

        Section 7 of the Fair Labor Standards Act of 1938 (29 U.S.C. 207)
    is amended by adding at the end the following:
        ``(r)(1) An employer shall provide--
                ``(A) a reasonable break time for an employee to express
            breast milk for her nursing child for 1 year after the child's
            birth each time such employee has need to express the milk; and
                ``(B) a place, other than a bathroom, that is shielded from
            view and free from intrusion from coworkers and the public,
            which may be used by an employee to express breast milk.
        ``(2) An employer shall not be required to compensate an employee
    receiving reasonable break time under paragraph (1) for any work time
    spent for such purpose.
        ``(3) An employer that employs less than 50 employees shall not be
    subject to the requirements of this subsection, if such requirements
    would impose an undue hardship by causing the employer significant
    difficulty or expense when considered in relation to the size,
    financial resources, nature, or structure of the employer's business.
        ``(4) Nothing in this subsection shall preempt a State law that
    provides greater protections to employees than the protections provided
    for under this subsection.''.

        Subtitle D--Support for Prevention and Public Health Innovation

    SEC. 4301. RESEARCH ON OPTIMIZING THE DELIVERY OF PUBLIC HEALTH
                  SERVICES.

        (a) In General.--The Secretary of Health and Human Services
    (referred to in this section as the ``Secretary''), acting through the
    Director of the Centers for Disease Control and Prevention, shall
    provide funding for research in the area of public health services and
    systems.
        (b) Requirements of Research.--Research supported under this
    section shall include--
                (1) examining evidence-based practices relating to
            prevention, with a particular focus on high priority areas as
            identified by the Secretary in the National Prevention Strategy
            or Healthy People 2020, and including comparing community-based
            public health interventions in terms of effectiveness and cost;
                (2) analyzing the translation of interventions from
            academic settings to real world settings; and
                (3) identifying effective strategies for organizing,
            financing, or delivering public health services in real world
            community settings, including comparing State and local health
            department structures and systems in terms of effectiveness and
            cost.
        (c) Existing Partnerships.--Research supported under this section
    shall be coordinated with the Community Preventive Services Task Force
    and carried out by building on existing partnerships within the Federal
    Government while also considering initiatives at the State and local
    levels and in the private sector.
        (d) Annual Report.--The Secretary shall, on an annual basis, submit
    to Congress a report concerning the activities and findings with
    respect to research supported under this section.

    SEC. 4302. UNDERSTANDING HEALTH DISPARITIES: DATA COLLECTION AND
                  ANALYSIS.

        (a) Uniform Categories and Collection Requirements.--The Public
    Health Service Act (42 U.S.C. 201 et seq.) is amended by adding at the
    end the following:

              ``TITLE XXXI--DATA COLLECTION, ANALYSIS, AND QUALITY

    ``SEC. 3101. DATA COLLECTION, ANALYSIS, AND QUALITY.

        ``(a) Data Collection.--
                ``(1) In general.--The Secretary shall ensure that, by not
            later than 2 years after the date of enactment of this title,
            any federally conducted or supported health care or public
            health program, activity or survey (including Current
            Population Surveys and American Community Surveys conducted by
            the Bureau of Labor Statistics and the Bureau of the Census)
            collects and reports, to the extent practicable--
                        ``(A) data on race, ethnicity, sex, primary
                    language, and disability status for applicants,
                    recipients, or participants;
                        ``(B) data at the smallest geographic level such as
                    State, local, or institutional levels if such data can
                    be aggregated;
                        ``(C) sufficient data to generate statistically
                    reliable estimates by racial, ethnic, sex, primary
                    language, and disability status subgroups for
                    applicants, recipients or participants using, if
                    needed, statistical oversamples of these
                    subpopulations; and
                        ``(D) any other demographic data as deemed
                    appropriate by the Secretary regarding health
                    disparities.
                ``(2) Collection standards.--In collecting data described
            in paragraph (1), the Secretary or designee shall--
                        ``(A) use Office of Management and Budget
                    standards, at a minimum, for race and ethnicity
                    measures;
                        ``(B) develop standards for the measurement of sex,
                    primary language, and disability status;
                        ``(C) develop standards for the collection of data
                    described in paragraph (1) that, at a minimum--
                                ``(i) collects self-reported data by the
                            applicant, recipient, or participant; and
                                ``(ii) collects data from a parent or legal
                            guardian if the applicant, recipient, or
                            participant is a minor or legally
                            incapacitated;
                        ``(D) survey health care providers and establish
                    other procedures in order to assess access to care and
                    treatment for individuals with disabilities and to
                    identify--
                                ``(i) locations where individuals with
                            disabilities access primary, acute (including
                            intensive), and long-term care;
                                ``(ii) the number of providers with
                            accessible facilities and equipment to meet the
                            needs of the individuals with disabilities,
                            including medical diagnostic equipment that
                            meets the minimum technical criteria set forth
                            in section 510 of the Rehabilitation Act of
                            1973; and
                                ``(iii) the number of employees of health
                            care providers trained in disability awareness
                            and patient care of individuals with
                            disabilities; and
                        ``(E) require that any reporting requirement
                    imposed for purposes of measuring quality under any
                    ongoing or federally conducted or supported health care
                    or public health program, activity, or survey includes
                    requirements for the collection of data on individuals
                    receiving health care items or services under such
                    programs activities by race, ethnicity, sex, primary
                    language, and disability status.
                ``(3) Data management.--In collecting data described in
            paragraph (1), the Secretary, acting through the National
            Coordinator for Health Information Technology shall--
                        ``(A) develop national standards for the management
                    of data collected; and
                        ``(B) develop interoperability and security systems
                    for data management.
        ``(b) Data Analysis.--
                ``(1) In general.--For each federally conducted or
            supported health care or public health program or activity, the
            Secretary shall analyze data collected under paragraph (a) to
            detect and monitor trends in health disparities (as defined for
            purposes of section 485E) at the Federal and State levels.
        ``(c) Data Reporting and Dissemination.--
                ``(1) In general.--The Secretary shall make the analyses
            described in (b) available to--
                        ``(A) the Office of Minority Health;
                        ``(B) the National Center on Minority Health and
                    Health Disparities;
                        ``(C) the Agency for Healthcare Research and
                    Quality;
                        ``(D) the Centers for Disease Control and
                    Prevention;
                        ``(E) the Centers for Medicare & Medicaid Services;
                        ``(F) the Indian Health Service and epidemiology
                    centers funded under the Indian Health Care Improvement
                    Act;
                        ``(G) the Office of Rural health;
                        ``(H) other agencies within the Department of
                    Health and Human Services; and
                        ``(I) other entities as determined appropriate by
                    the Secretary.
                ``(2) Reporting of data.--The Secretary shall report data
            and analyses described in (a) and (b) through--
                        ``(A) public postings on the Internet websites of
                    the Department of Health and Human Services; and
                        ``(B) any other reporting or dissemination
                    mechanisms determined appropriate by the Secretary.
                ``(3) Availability of data.--The Secretary may make data
            described in (a) and (b) available for additional research,
            analyses, and dissemination to other Federal agencies, non-
            governmental entities, and the public, in accordance with any
            Federal agency's data user agreements.
        ``(d) Limitations on Use of Data.--Nothing in this section shall be
    construed to permit the use of information collected under this section
    in a manner that would adversely affect any individual.
        ``(e) Protection and Sharing of Data.--
                ``(1) Privacy and other safeguards.--The Secretary shall
            ensure (through the promulgation of regulations or otherwise)
            that--
                        ``(A) all data collected pursuant to subsection (a)
                    is protected--
                                ``(i) under privacy protections that are at
                            least as broad as those that the Secretary
                            applies to other health data under the
                            regulations promulgated under section 264(c) of
                            the Health Insurance Portability and
                            Accountability Act of 1996 (Public Law 104-191;
                            110 Stat. 2033); and
                                ``(ii) from all inappropriate internal use
                            by any entity that collects, stores, or
                            receives the data, including use of such data
                            in determinations of eligibility (or continued
                            eligibility) in health plans, and from other
                            inappropriate uses, as defined by the
                            Secretary; and
                        ``(B) all appropriate information security
                    safeguards are used in the collection, analysis, and
                    sharing of data collected pursuant to subsection (a).
                ``(2) Data sharing.--The Secretary shall establish
            procedures for sharing data collected pursuant to subsection
            (a), measures relating to such data, and analyses of such data,
            with other relevant Federal and State agencies including the
            agencies, centers, and entities within the Department of Health
            and Human Services specified in subsection (c)(1)..
        ``(f) Data on Rural Underserved Populations.--The Secretary shall
    ensure that any data collected in accordance with this section
    regarding racial and ethnic minority groups are also collected
    regarding underserved rural and frontier populations.
        ``(g) Authorization of Appropriations.--For the purpose of carrying
    out this section, there are authorized to be appropriated such sums as
    may be necessary for each of fiscal years 2010 through 2014.
        ``(h) Requirement for Implementation.--Notwithstanding any other
    provision of this section, data may not be collected under this section
    unless funds are directly appropriated for such purpose in an
    appropriations Act.
        ``(i) Consultation.--The Secretary shall consult with the Director
    of the Office of Personnel Management, the Secretary of Defense, the
    Secretary of Veterans Affairs, the Director of the Bureau of the
    Census, the Commissioner of Social Security, and the head of other
    appropriate Federal agencies in carrying out this section.''.
        (b) Addressing Health Care Disparities in Medicaid and CHIP.--
                (1) Standardized collection requirements included in state
            plans.--
                        (A) Medicaid.--Section 1902(a) of the Social
                    Security Act (42 U.S.C. 1396a(a)), as amended by
                    section 2001(d), is amended--
                                (i) in paragraph 4), by striking ``and'' at
                            the end;
                                (ii) in paragraph (75), by striking the
                            period at the end and inserting ``; and''; and
                                (iii) by inserting after paragraph (75) the
                            following new paragraph:
                ``(76) provide that any data collected under the State plan
            meets the requirements of section 3101 of the Public Health
            Service Act.''.
                        (B) CHIP.--Section 2108(e) of the Social Security
                    Act (42 U.S.C. 1397hh(e)) is amended by adding at the
                    end the following new paragraph:
                ``(7) Data collected and reported in accordance with
            section 3101 of the Public Health Service Act, with respect to
            individuals enrolled in the State child health plan (and, in
            the case of enrollees under 19 years of age, their parents or
            legal guardians), including data regarding the primary language
            of such individuals, parents, and legal guardians.''.
                (2) Extending medicare requirement to address health
            disparities data collection to medicaid and chip.--Title XIX of
            the Social Security Act (42 U.S.C. 1396 et seq.), as amended by
            section 2703 is amended by adding at the end the following new
            section:

    ``SEC. 1946. ADDRESSING HEALTH CARE DISPARITIES.

        ``(a) Evaluating Data Collection Approaches.--The Secretary shall
    evaluate approaches for the collection of data under this title and
    title XXI, to be performed in conjunction with existing quality
    reporting requirements and programs under this title and title XXI,
    that allow for the ongoing, accurate, and timely collection and
    evaluation of data on disparities in health care services and
    performance on the basis of race, ethnicity, sex, primary language, and
    disability status. In conducting such evaluation, the Secretary shall
    consider the following objectives:
                ``(1) Protecting patient privacy.
                ``(2) Minimizing the administrative burdens of data
            collection and reporting on States, providers, and health plans
            participating under this title or title XXI.
                ``(3) Improving program data under this title and title XXI
            on race, ethnicity, sex, primary language, and disability
            status.
        ``(b) Reports to Congress.--
                ``(1) Report on evaluation.--Not later than 18 months after
            the date of the enactment of this section, the Secretary shall
            submit to Congress a report on the evaluation conducted under
            subsection (a). Such report shall, taking into consideration
            the results of such evaluation--
                        ``(A) identify approaches (including defining
                    methodologies) for identifying and collecting and
                    evaluating data on health care disparities on the basis
                    of race, ethnicity, sex, primary language, and
                    disability status for the programs under this title and
                    title XXI; and
                        ``(B) include recommendations on the most effective
                    strategies and approaches to reporting HEDIS quality
                    measures as required under section 1852(e)(3) and other
                    nationally recognized quality performance measures, as
                    appropriate, on such bases.
                ``(2) Reports on data analyses.--Not later than 4 years
            after the date of the enactment of this section, and 4 years
            thereafter, the Secretary shall submit to Congress a report
            that includes recommendations for improving the identification
            of health care disparities for beneficiaries under this title
            and under title XXI based on analyses of the data collected
            under subsection (c).
        ``(c) Implementing Effective Approaches.--Not later than 24 months
    after the date of the enactment of this section, the Secretary shall
    implement the approaches identified in the report submitted under
    subsection (b)(1) for the ongoing, accurate, and timely collection and
    evaluation of data on health care disparities on the basis of race,
    ethnicity, sex, primary language, and disability status.''.

    SEC. 4303. CDC AND EMPLOYER-BASED WELLNESS PROGRAMS.

        Title III of the Public Health Service Act (42 U.S.C. 241 et seq.),
    by section 4102, is further amended by adding at the end the following:

                   ``PART U--EMPLOYER-BASED WELLNESS PROGRAM

    ``SEC. 399MM. TECHNICAL ASSISTANCE FOR EMPLOYER-BASED WELLNESS
                  PROGRAMS.

        ``In order to expand the utilization of evidence-based prevention
    and health promotion approaches in the workplace, the Director shall--
                ``(1) provide employers (including small, medium, and large
            employers, as determined by the Director) with technical
            assistance, consultation, tools, and other resources in
            evaluating such employers' employer-based wellness programs,
            including--
                        ``(A) measuring the participation and methods to
                    increase participation of employees in such programs;
                        ``(B) developing standardized measures that assess
                    policy, environmental and systems changes necessary to
                    have a positive health impact on employees' health
                    behaviors, health outcomes, and health care
                    expenditures; and
                        ``(C) evaluating such programs as they relate to
                    changes in the health status of employees, the
                    absenteeism of employees, the productivity of
                    employees, the rate of workplace injury, and the
                    medical costs incurred by employees; and
                ``(2) build evaluation capacity among workplace staff by
            training employers on how to evaluate employer-based wellness
            programs by ensuring evaluation resources, technical
            assistance, and consultation are available to workplace staff
            as needed through such mechanisms as web portals, call centers,
            or other means.

    ``SEC. 399MM-1. NATIONAL WORKSITE HEALTH POLICIES AND PROGRAMS STUDY.

        ``(a) In General.--In order to assess, analyze, and monitor over
    time data about workplace policies and programs, and to develop
    instruments to assess and evaluate comprehensive workplace chronic
    disease prevention and health promotion programs, policies and
    practices, not later than 2 years after the date of enactment of this
    part, and at regular intervals (to be determined by the Director)
    thereafter, the Director shall conduct a national worksite health
    policies and programs survey to assess employer-based health policies
    and programs.
        ``(b) Report.--Upon the completion of each study under subsection
    (a), the Director shall submit to Congress a report that includes the
    recommendations of the Director for the implementation of effective
    employer-based health policies and programs.

    ``SEC. 399MM-2. PRIORITIZATION OF EVALUATION BY SECRETARY.

        ``The Secretary shall evaluate, in accordance with this part, all
    programs funded through the Centers for Disease Control and Prevention
    before conducting such an evaluation of privately funded programs
    unless an entity with a privately funded wellness program requests such
    an evaluation.

    ``SEC. 399MM-3. PROHIBITION OF FEDERAL WORKPLACE WELLNESS REQUIREMENTS.

        ``Notwithstanding any other provision of this part, any
    recommendations, data, or assessments carried out under this part shall
    not be used to mandate requirements for workplace wellness programs.''.

    SEC. 4304. EPIDEMIOLOGY-LABORATORY CAPACITY GRANTS.

        Title XXVIII of the Public Health Service Act (42 U.S.C. 300hh et
    seq.) is amended by adding at the end the following:

         ``Subtitle C--Strengthening Public Health Surveillance Systems

    ``SEC. 2821. EPIDEMIOLOGY-LABORATORY CAPACITY GRANTS.

        ``(a) In General.--Subject to the availability of appropriations,
    the Secretary, acting through the Director of the Centers for Disease
    Control and Prevention, shall establish an Epidemiology and Laboratory
    Capacity Grant Program to award grants to State health departments as
    well as local health departments and tribal jurisdictions that meet
    such criteria as the Director determines appropriate. Academic centers
    that assist State and eligible local and tribal health departments may
    also be eligible for funding under this section as the Director
    determines appropriate. Grants shall be awarded under this section to
    assist public health agencies in improving surveillance for, and
    response to, infectious diseases and other conditions of public health
    importance by--
                ``(1) strengthening epidemiologic capacity to identify and
            monitor the occurrence of infectious diseases and other
            conditions of public health importance;
                ``(2) enhancing laboratory practice as well as systems to
            report test orders and results electronically;
                ``(3) improving information systems including developing
            and maintaining an information exchange using national
            guidelines and complying with capacities and functions
            determined by an advisory council established and appointed by
            the Director; and
                ``(4) developing and implementing prevention and control
            strategies.
        ``(b) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this section $190,000,000 for each of fiscal
    years 2010 through 2013, of which--
                ``(1) not less than $95,000,000 shall be made available
            each such fiscal year for activities under paragraphs (1) and
            (4) of subsection (a);
                ``(2) not less than $60,000,000 shall be made available
            each such fiscal year for activities under subsection (a)(3);
            and
                ``(3) not less than $32,000,000 shall be made available
            each such fiscal year for activities under subsection
            (a)(2).''.

    SEC. 4305. ADVANCING RESEARCH AND TREATMENT FOR PAIN CARE MANAGEMENT.

        (a) Institute of Medicine Conference on Pain.--
                (1) Convening.--Not later than 1 year after funds are
            appropriated to carry out this subsection, the Secretary of
            Health and Human Services shall seek to enter into an agreement
            with the Institute of Medicine of the National Academies to
            convene a Conference on Pain (in this subsection referred to as
            ``the Conference'').
                (2) Purposes.--The purposes of the Conference shall be to--
                        (A) increase the recognition of pain as a
                    significant public health problem in the United States;
                        (B) evaluate the adequacy of assessment, diagnosis,
                    treatment, and management of acute and chronic pain in
                    the general population, and in identified racial,
                    ethnic, gender, age, and other demographic groups that
                    may be disproportionately affected by inadequacies in
                    the assessment, diagnosis, treatment, and management of
                    pain;
                        (C) identify barriers to appropriate pain care;
                        (D) establish an agenda for action in both the
                    public and private sectors that will reduce such
                    barriers and significantly improve the state of pain
                    care research, education, and clinical care in the
                    United States.
                (3) Other appropriate entity.--If the Institute of Medicine
            declines to enter into an agreement under paragraph (1), the
            Secretary of Health and Human Services may enter into such
            agreement with another appropriate entity.
                (4) Report.--A report summarizing the Conference's findings
            and recommendations shall be submitted to the Congress not
            later than June 30, 2011.
                (5) Authorization of appropriations.--For the purpose of
            carrying out this subsection, there is authorized to be
            appropriated such sums as may be necessary for each of fiscal
            years 2010 and 2011.
        (b) Pain Research at National Institutes of Health.--Part B of
    title IV of the Public Health Service Act (42 U.S.C. 284 et seq.) is
    amended by adding at the end the following:

    ``SEC. 409J. PAIN RESEARCH.

        ``(a) Research Initiatives.--
                ``(1) In general.--The Director of NIH is encouraged to
            continue and expand, through the Pain Consortium, an aggressive
            program of basic and clinical research on the causes of and
            potential treatments for pain.
                ``(2) Annual recommendations.--Not less than annually, the
            Pain Consortium, in consultation with the Division of Program
            Coordination, Planning, and Strategic Initiatives, shall
            develop and submit to the Director of NIH recommendations on
            appropriate pain research initiatives that could be undertaken
            with funds reserved under section 402A(c)(1) for the Common
            Fund or otherwise available for such initiatives.
                ``(3) Definition.--In this subsection, the term `Pain
            Consortium' means the Pain Consortium of the National
            Institutes of Health or a similar trans-National Institutes of
            Health coordinating entity designated by the Secretary for
            purposes of this subsection.
        ``(b) Interagency Pain Research Coordinating Committee.--
                ``(1) Establishment.--The Secretary shall establish not
            later than 1 year after the date of the enactment of this
            section and as necessary maintain a committee, to be known as
            the Interagency Pain Research Coordinating Committee (in this
            section referred to as the `Committee'), to coordinate all
            efforts within the Department of Health and Human Services and
            other Federal agencies that relate to pain research.
                ``(2) Membership.--
                        ``(A) In general.--The Committee shall be composed
                    of the following voting members:
                                ``(i) Not more than 7 voting Federal
                            representatives appoint by the Secretary from
                            agencies that conduct pain care research and
                            treatment.
                                ``(ii) 12 additional voting members
                            appointed under subparagraph (B).
                        ``(B) Additional members.--The Committee shall
                    include additional voting members appointed by the
                    Secretary as follows:
                                ``(i) 6 non-Federal members shall be
                            appointed from among scientists, physicians,
                            and other health professionals.
                                ``(ii) 6 members shall be appointed from
                            members of the general public, who are
                            representatives of leading research, advocacy,
                            and service organizations for individuals with
                            pain-related conditions.
                        ``(C) Nonvoting members.--The Committee shall
                    include such nonvoting members as the Secretary
                    determines to be appropriate.
                ``(3) Chairperson.--The voting members of the Committee
            shall select a chairperson from among such members. The
            selection of a chairperson shall be subject to the approval of
            the Director of NIH.
                ``(4) Meetings.--The Committee shall meet at the call of
            the chairperson of the Committee or upon the request of the
            Director of NIH, but in no case less often than once each year.
                ``(5) Duties.--The Committee shall--
                        ``(A) develop a summary of advances in pain care
                    research supported or conducted by the Federal agencies
                    relevant to the diagnosis, prevention, and treatment of
                    pain and diseases and disorders associated with pain;
                        ``(B) identify critical gaps in basic and clinical
                    research on the symptoms and causes of pain;
                        ``(C) make recommendations to ensure that the
                    activities of the National Institutes of Health and
                    other Federal agencies are free of unnecessary
                    duplication of effort;
                        ``(D) make recommendations on how best to
                    disseminate information on pain care; and
                        ``(E) make recommendations on how to expand
                    partnerships between public entities and private
                    entities to expand collaborative, cross-cutting
                    research.
                ``(6) Review.--The Secretary shall review the necessity of
            the Committee at least once every 2 years.''.
        (c) Pain Care Education and Training.--Part D of title VII of the
    Public Health Service Act (42 U.S.C. 294 et seq.) is amended by adding
    at the end the following new section:

    ``SEC. 759. PROGRAM FOR EDUCATION AND TRAINING IN PAIN CARE.

        ``(a) In General.--The Secretary may make awards of grants,
    cooperative agreements, and contracts to health professions schools,
    hospices, and other public and private entities for the development and
    implementation of programs to provide education and training to health
    care professionals in pain care.
        ``(b) Certain Topics.--An award may be made under subsection (a)
    only if the applicant for the award agrees that the program carried out
    with the award will include information and education on--
                ``(1) recognized means for assessing, diagnosing, treating,
            and managing pain and related signs and symptoms, including the
            medically appropriate use of controlled substances;
                ``(2) applicable laws, regulations, rules, and policies on
            controlled substances, including the degree to which
            misconceptions and concerns regarding such laws, regulations,
            rules, and policies, or the enforcement thereof, may create
            barriers to patient access to appropriate and effective pain
            care;
                ``(3) interdisciplinary approaches to the delivery of pain
            care, including delivery through specialized centers providing
            comprehensive pain care treatment expertise;
                ``(4) cultural, linguistic, literacy, geographic, and other
            barriers to care in underserved populations; and
                ``(5) recent findings, developments, and improvements in
            the provision of pain care.
        ``(c) Evaluation of Programs.--The Secretary shall (directly or
    through grants or contracts) provide for the evaluation of programs
    implemented under subsection (a) in order to determine the effect of
    such programs on knowledge and practice of pain care.
        ``(d) Pain Care Defined.--For purposes of this section the term
    `pain care' means the assessment, diagnosis, treatment, or management
    of acute or chronic pain regardless of causation or body location.
        ``(e) Authorization of Appropriations.--There is authorized to be
    appropriated to carry out this section, such sums as may be necessary
    for each of the fiscal years 2010 through 2012. Amounts appropriated
    under this subsection shall remain available until expended.''.

    SEC. 4306. FUNDING FOR CHILDHOOD OBESITY DEMONSTRATION PROJECT.

        Section 1139A(e)(8) of the Social Security Act (42 U.S.C. 1320b-
    9a(e)(8)) is amended to read as follows:
                ``(8) Appropriation.--Out of any funds in the Treasury not
            otherwise appropriated, there is appropriated to carry out this
            subsection, $25,000,000 for the period of fiscal years 2010
            through 2014.''.

                      Subtitle E--Miscellaneous Provisions

    SEC. 4401. SENSE OF THE SENATE CONCERNING CBO SCORING.

        (a) Finding.--The Senate finds that the costs of prevention
    programs are difficult to estimate due in part because prevention
    initiatives are hard to measure and results may occur outside the 5 and
    10 year budget windows.
        (b) Sense of Congress.--It is the sense of the Senate that Congress
    should work with the Congressional Budget Office to develop better
    methodologies for scoring progress to be made in prevention and
    wellness programs.

    SEC. 4402. EFFECTIVENESS OF FEDERAL HEALTH AND WELLNESS INITIATIVES.

        To determine whether existing Federal health and wellness
    initiatives are effective in achieving their stated goals, the
    Secretary of Health and Human Services shall--
                (1) conduct an evaluation of such programs as they relate
            to changes in health status of the American public and
            specifically on the health status of the Federal workforce,
            including absenteeism of employees, the productivity of
            employees, the rate of workplace injury, and the medical costs
            incurred by employees, and health conditions, including
            workplace fitness, healthy food and beverages, and incentives
            in the Federal Employee Health Benefits Program; and
                (2) submit to Congress a report concerning such evaluation,
            which shall include conclusions concerning the reasons that
            such existing programs have proven successful or not successful
            and what factors contributed to such conclusions.

                         TITLE V--HEALTH CARE WORKFORCE

                      Subtitle A--Purpose and Definitions

    SEC. 5001. PURPOSE.

        The purpose of this title is to improve access to and the delivery
    of health care services for all individuals, particularly low income,
    underserved, uninsured, minority, health disparity, and rural
    populations by--
                (1) gathering and assessing comprehensive data in order for
            the health care workforce to meet the health care needs of
            individuals, including research on the supply, demand,
            distribution, diversity, and skills needs of the health care
            workforce;
                (2) increasing the supply of a qualified health care
            workforce to improve access to and the delivery of health care
            services for all individuals;
                (3) enhancing health care workforce education and training
            to improve access to and the delivery of health care services
            for all individuals; and
                (4) providing support to the existing health care workforce
            to improve access to and the delivery of health care services
            for all individuals.

    SEC. 5002. DEFINITIONS.

        (a) This Title.--In this title:
                (1) Allied health professional.--The term ``allied health
            professional'' means an allied health professional as defined
            in section 799B(5) of the Public Heath Service Act (42 U.S.C.
            295p(5)) who--
                        (A) has graduated and received an allied health
                    professions degree or certificate from an institution
                    of higher education; and
                        (B) is employed with a Federal, State, local or
                    tribal public health agency, or in a setting where
                    patients might require health care services, including
                    acute care facilities, ambulatory care facilities,
                    personal residences, and other settings located in
                    health professional shortage areas, medically
                    underserved areas, or medically underserved
                    populations, as recognized by the Secretary of Health
                    and Human Services.
                (2) Health care career pathway.--The term ``healthcare
            career pathway'' means a rigorous, engaging, and high quality
            set of courses and services that--
                        (A) includes an articulated sequence of academic
                    and career courses, including 21st century skills;
                        (B) is aligned with the needs of healthcare
                    industries in a region or State;
                        (C) prepares students for entry into the full range
                    of postsecondary education options, including
                    registered apprenticeships, and careers;
                        (D) provides academic and career counseling in
                    student-to-counselor ratios that allow students to make
                    informed decisions about academic and career options;
                        (E) meets State academic standards, State
                    requirements for secondary school graduation and is
                    aligned with requirements for entry into postsecondary
                    education, and applicable industry standards; and
                        (F) leads to 2 or more credentials, including--
                                (i) a secondary school diploma; and
                                (ii) a postsecondary degree, an
                            apprenticeship or other occupational
                            certification, a certificate, or a license.
                (3) Institution of higher education.--The term
            ``institution of higher education'' has the meaning given the
            term in sections 101 and 102 of the Higher Education Act of
            1965 (20 U.S.C. 1001 and 1002).
                (4) Low income individual, state workforce investment
            board, and local workforce investment board.--
                        (A) Low-income individual.--The term ``low-income
                    individual'' has the meaning given that term in section
                    101 of the Workforce investment Act of 1998 (29 U.S.C.
                    2801).
                        (B) State workforce investment board; local
                    workforce investment board.--The terms ``State
                    workforce investment board'' and ``local workforce
                    investment board'', refer to a State workforce
                    investment board established under section 111 of the
                    Workforce Investment Act of 1998 (29 U.S.C. 2821) and a
                    local workforce investment board established under
                    section 117 of such Act (29 U.S.C. 2832), respectively.
                (5) Postsecondary education.--The term ``postsecondary
            education'' means--
                        (A) a 4-year program of instruction, or not less
                    than a 1-year program of instruction that is acceptable
                    for credit toward an associate or a baccalaureate
                    degree, offered by an institution of higher education;
                    or
                        (B) a certificate or registered apprenticeship
                    program at the postsecondary level offered by an
                    institution of higher education or a non-profit
                    educational institution.
                (6) Registered apprenticeship program.--The term
            ``registered apprenticeship program'' means an industry skills
            training program at the postsecondary level that combines
            technical and theoretical training through structure on the job
            learning with related instruction (in a classroom or through
            distance learning) while an individual is employed, working
            under the direction of qualified personnel or a mentor, and
            earning incremental wage increases aligned to enhance job
            proficiency, resulting in the acquisition of a nationally
            recognized and portable certificate, under a plan approved by
            the Office of Apprenticeship or a State agency recognized by
            the Department of Labor.
        (b) Title VII of the Public Health Service Act.--Section 799B of
    the Public Health Service Act (42 U.S.C. 295p) is amended--
                (1) by striking paragraph (3) and inserting the following:
                ``(3) Physician assistant education program.--The term
            `physician assistant education program' means an educational
            program in a public or private institution in a State that--
                        ``(A) has as its objective the education of
                    individuals who, upon completion of their studies in
                    the program, be qualified to provide primary care
                    medical services with the supervision of a physician;
                    and
                        ``(B) is accredited by the Accreditation Review
                    Commission on Education for the Physician Assistant.'';
                    and
                (2) by adding at the end the following:
                ``(12) Area health education center.--The term `area health
            education center' means a public or nonprofit private
            organization that has a cooperative agreement or contract in
            effect with an entity that has received an award under
            subsection (a)(1) or (a)(2) of section 751, satisfies the
            requirements in section 751(d)(1), and has as one of its
            principal functions the operation of an area health education
            center. Appropriate organizations may include hospitals, health
            organizations with accredited primary care training programs,
            accredited physician assistant educational programs associated
            with a college or university, and universities or colleges not
            operating a school of medicine or osteopathic medicine.
                ``(13) Area health education center program.--The term
            `area health education center program' means cooperative
            program consisting of an entity that has received an award
            under subsection (a)(1) or (a)(2) of section 751 for the
            purpose of planning, developing, operating, and evaluating an
            area health education center program and one or more area
            health education centers, which carries out the required
            activities described in section 751(c), satisfies the program
            requirements in such section, has as one of its principal
            functions identifying and implementing strategies and
            activities that address health care workforce needs in its
            service area, in coordination with the local workforce
            investment boards.
                ``(14) Clinical social worker.--The term `clinical social
            worker' has the meaning given the term in section 1861(hh)(1)
            of the Social Security Act (42 U.S.C. 1395x(hh)(1)).
                ``(15) Cultural competency.--The term `cultural competency'
            shall be defined by the Secretary in a manner consistent with
            section 1707(d)(3).
                ``(16) Direct care worker.--The term `direct care worker'
            has the meaning given that term in the 2010 Standard
            Occupational Classifications of the Department of Labor for
            Home Health Aides [31-1011], Psychiatric Aides [31-1013],
            Nursing Assistants [31-1014], and Personal Care Aides [39-
            9021].
                ``(17) Federally qualified health center.--The term
            `Federally qualified health center' has the meaning given that
            term in section 1861(aa) of the Social Security Act (42 U.S.C.
            1395x(aa)).
                ``(18) Frontier health professional shortage area.--The
            term `frontier health professional shortage area' means an
            area--
                        ``(A) with a population density less than 6 persons
                    per square mile within the service area; and
                        ``(B) with respect to which the distance or time
                    for the population to access care is excessive.
                ``(19) Graduate psychology.--The term `graduate psychology'
            means an accredited program in professional psychology.
                ``(20) Health disparity population.--The term `health
            disparity population' has the meaning given such term in
            section 903(d)(1).
                ``(21) Health literacy.--The term `health literacy' means
            the degree to which an individual has the capacity to obtain,
            communicate, process, and understand health information and
            services in order to make appropriate health decisions.
                ``(22) Mental health service professional.--The term
            `mental health service professional' means an individual with a
            graduate or postgraduate degree from an accredited institution
            of higher education in psychiatry, psychology, school
            psychology, behavioral pediatrics, psychiatric nursing, social
            work, school social work, substance abuse disorder prevention
            and treatment, marriage and family counseling, school
            counseling, or professional counseling.
                ``(23) One-stop delivery system center.--The term `one-stop
            delivery system' means a one-stop delivery system described in
            section 134(c) of the Workforce Investment Act of 1998 (29
            U.S.C. 2864(c)).
                ``(24) Paraprofessional child and adolescent mental health
            worker.--The term `paraprofessional child and adolescent mental
            health worker' means an individual who is not a mental or
            behavioral health service professional, but who works at the
            first stage of contact with children and families who are
            seeking mental or behavioral health services, including
            substance abuse prevention and treatment services.
                ``(25) Racial and ethnic minority group; racial and ethnic
            minority population.--The terms `racial and ethnic minority
            group' and `racial and ethnic minority population' have the
            meaning given the term `racial and ethnic minority group' in
            section 1707.
                ``(26) Rural health clinic.--The term `rural health clinic'
            has the meaning given that term in section 1861(aa) of the
            Social Security Act (42 U.S.C. 1395x(aa)).''.
        (c) Title VIII of the Public Health Service Act.--Section 801 of
    the Public Health Service Act (42 U.S.C. 296) is amended--
                (1) in paragraph (2)--
                        (A) by striking ``means a'' and inserting ``means
                    an accredited (as defined in paragraph 6)''; and
                        (B) by striking the period as inserting the
                    following: ``where graduates are--
                        ``(A) authorized to sit for the National Council
                    Licensure EXamination-Registered Nurse (NCLEX-RN); or
                        ``(B) licensed registered nurses who will receive a
                    graduate or equivalent degree or training to become an
                    advanced education nurse as defined by section
                    811(b).''; and
                (2) by adding at the end the following:
                ``(16) Accelerated nursing degree program.--The term
            `accelerated nursing degree program' means a program of
            education in professional nursing offered by an accredited
            school of nursing in which an individual holding a bachelors
            degree in another discipline receives a BSN or MSN degree in an
            accelerated time frame as determined by the accredited school
            of nursing.
                ``(17) Bridge or degree completion program.--The term
            `bridge or degree completion program' means a program of
            education in professional nursing offered by an accredited
            school of nursing, as defined in paragraph (2), that leads to a
            baccalaureate degree in nursing. Such programs may include,
            Registered Nurse (RN) to Bachelor's of Science of Nursing (BSN)
            programs, RN to MSN (Master of Science of Nursing) programs, or
            BSN to Doctoral programs.''.

              Subtitle B--Innovations in the Health Care Workforce

    SEC. 5101. NATIONAL HEALTH CARE WORKFORCE COMMISSION.

        (a) Purpose.--It is the purpose of this section to establish a
    National Health Care Workforce Commission that--
                (1) serves as a national resource for Congress, the
            President, States, and localities;
                (2) communicates and coordinates with the Departments of
            Health and Human Services, Labor, Veterans Affairs, Homeland
            Security, and Education on related activities administered by
            one or more of such Departments;
                (3) develops and commissions evaluations of education and
            training activities to determine whether the demand for health
            care workers is being met;
                (4) identifies barriers to improved coordination at the
            Federal, State, and local levels and recommend ways to address
            such barriers; and
                (5) encourages innovations to address population needs,
            constant changes in technology, and other environmental
            factors.
        (b) Establishment.--There is hereby established the National Health
    Care Workforce Commission (in this section referred to as the
    ``Commission'').
        (c) Membership.--
                (1) Number and appointment.--The Commission shall be
            composed of 15 members to be appointed by the Comptroller
            General, without regard to section 5 of the Federal Advisory
            Committee Act (5 U.S.C. App.).
                (2) Qualifications.--
                        (A) In general.--The membership of the Commission
                    shall include individuals--
                                (i) with national recognition for their
                            expertise in health care labor market analysis,
                            including health care workforce analysis;
                            health care finance and economics; health care
                            facility management; health care plans and
                            integrated delivery systems; health care
                            workforce education and training; health care
                            philanthropy; providers of health care
                            services; and other related fields; and
                                (ii) who will provide a combination of
                            professional perspectives, broad geographic
                            representation, and a balance between urban,
                            suburban, rural, and frontier representatives.
                        (B) Inclusion.--
                                (i) In general.--The membership of the
                            Commission shall include no less than one
                            representative of--
                                        (I) the health care workforce and
                                    health professionals;
                                        (II) employers;
                                        (III) third-party payers;
                                        (IV) individuals skilled in the
                                    conduct and interpretation of health
                                    care services and health economics
                                    research;
                                        (V) representatives of consumers;
                                        (VI) labor unions;
                                        (VII) State or local workforce
                                    investment boards; and
                                        (VIII) educational institutions
                                    (which may include elementary and
                                    secondary institutions, institutions of
                                    higher education, including 2 and 4
                                    year institutions, or registered
                                    apprenticeship programs).
                                (ii) Additional members.--The remaining
                            membership may include additional
                            representatives from clause (i) and other
                            individuals as determined appropriate by the
                            Comptroller General of the United States.
                        (C) Majority non-providers.--Individuals who are
                    directly involved in health professions education or
                    practice shall not constitute a majority of the
                    membership of the Commission.
                        (D) Ethical disclosure.--The Comptroller General
                    shall establish a system for public disclosure by
                    members of the Commission of financial and other
                    potential conflicts of interest relating to such
                    members. Members of the Commission shall be treated as
                    employees of Congress for purposes of applying title I
                    of the Ethics in Government Act of 1978. Members of the
                    Commission shall not be treated as special government
                    employees under title 18, United States Code.
                (3) Terms.--
                        (A) In general.--The terms of members of the
                    Commission shall be for 3 years except that the
                    Comptroller General shall designate staggered terms for
                    the members first appointed.
                        (B) Vacancies.--Any member appointed to fill a
                    vacancy occurring before the expiration of the term for
                    which the member's predecessor was appointed shall be
                    appointed only for the remainder of that term. A member
                    may serve after the expiration of that member's term
                    until a successor has taken office. A vacancy in the
                    Commission shall be filled in the manner in which the
                    original appointment was made.
                        (C) Initial appointments.--The Comptroller General
                    shall make initial appointments of members to the
                    Commission not later than September 30, 2010.
                (4) Compensation.--While serving on the business of the
            Commission (including travel time), a member of the Commission
            shall be entitled to compensation at the per diem equivalent of
            the rate provided for level IV of the Executive Schedule under
            section 5315 of tile 5, United States Code, and while so
            serving away from home and the member's regular place of
            business, a member may be allowed travel expenses, as
            authorized by the Chairman of the Commission. Physicians
            serving as personnel of the Commission may be provided a
            physician comparability allowance by the Commission in the same
            manner as Government physicians may be provided such an
            allowance by an agency under section 5948 of title 5, United
            States Code, and for such purpose subsection (i) of such
            section shall apply to the Commission in the same manner as it
            applies to the Tennessee Valley Authority. For purposes of pay
            (other than pay of members of the Commission) and employment
            benefits, rights, and privileges, all personnel of the
            Commission shall be treated as if they were employees of the
            United States Senate. Personnel of the Commission shall not be
            treated as employees of the Government Accountability Office
            for any purpose.
                (5) Chairman, vice chairman.--The Comptroller General shall
            designate a member of the Commission, at the time of
            appointment of the member, as Chairman and a member as Vice
            Chairman for that term of appointment, except that in the case
            of vacancy of the chairmanship or vice chairmanship, the
            Comptroller General may designate another member for the
            remainder of that member's term.
                (6) Meetings.--The Commission shall meet at the call of the
            chairman, but no less frequently than on a quarterly basis.
        (d) Duties.--
                (1) Recognition, dissemination, and communication.--The
            Commission shall--
                        (A) recognize efforts of Federal, State, and local
                    partnerships to develop and offer health care career
                    pathways of proven effectiveness;
                        (B) disseminate information on promising retention
                    practices for health care professionals; and
                        (C) communicate information on important policies
                    and practices that affect the recruitment, education
                    and training, and retention of the health care
                    workforce.
                (2) Review of health care workforce and annual reports.--In
            order to develop a fiscally sustainable integrated workforce
            that supports a high-quality, readily accessible health care
            delivery system that meets the needs of patients and
            populations, the Commission, in consultation with relevant
            Federal, State, and local agencies, shall--
                        (A) review current and projected health care
                    workforce supply and demand, including the topics
                    described in paragraph (3);
                        (B) make recommendations to Congress and the
                    Administration concerning national health care
                    workforce priorities, goals, and policies;
                        (C) by not later than October 1 of each year
                    (beginning with 2011), submit a report to Congress and
                    the Administration containing the results of such
                    reviews and recommendations concerning related
                    policies; and
                        (D) by not later than April 1 of each year
                    (beginning with 2011), submit a report to Congress and
                    the Administration containing a review of, and
                    recommendations on, at a minimum one high priority area
                    as described in paragraph (4).
                (3) Specific topics to be reviewed.--The topics described
            in this paragraph include--
                        (A) current health care workforce supply and
                    distribution, including demographics, skill sets, and
                    demands, with projected demands during the subsequent
                    10 and 25 year periods;
                        (B) health care workforce education and training
                    capacity, including the number of students who have
                    completed education and training, including registered
                    apprenticeships; the number of qualified faculty; the
                    education and training infrastructure; and the
                    education and training demands, with projected demands
                    during the subsequent 10 and 25 year periods;
                        (C) the education loan and grant programs in titles
                    VII and VIII of the Public Health Service Act (42
                    U.S.C. 292 et seq. and 296 et seq.), with
                    recommendations on whether such programs should become
                    part of the Higher Education Act of 1965 (20 U.S.C.
                    1001 et seq);
                        (D) the implications of new and existing Federal
                    policies which affect the health care workforce,
                    including Medicare and Medicaid graduate medical
                    education policies, titles VII and VIII of the Public
                    Health Service Act (42 U.S.C. 292 et seq. and 296 et
                    seq.), the National Health Service Corps (with
                    recommendations for aligning such programs with
                    national health workforce priorities and goals), and
                    other health care workforce programs, including those
                    supported through the Workforce Investment Act of 1998
                    (29 U.S.C. 2801 et seq.), the Carl D. Perkins Career
                    and Technical Education Act of 2006 (20 U.S.C. 2301 et
                    seq.), the Higher Education Act of 1965 (20 U.S.C. 1001
                    et seq.), and any other Federal health care workforce
                    programs;
                        (E) the health care workforce needs of special
                    populations, such as minorities, rural populations,
                    medically underserved populations, gender specific
                    needs, individuals with disabilities, and geriatric and
                    pediatric populations with recommendations for new and
                    existing Federal policies to meet the needs of these
                    special populations; and
                        (F) recommendations creating or revising national
                    loan repayment programs and scholarship programs to
                    require low-income, minority medical students to serve
                    in their home communities, if designated as medical
                    underserved community.
                (4) High priority areas.--
                        (A) In general.--The initial high priority topics
                    described in this paragraph include each of the
                    following:
                                (i) Integrated health care workforce
                            planning that identifies health care
                            professional skills needed and maximizes the
                            skill sets of health care professionals across
                            disciplines.
                                (ii) An analysis of the nature, scopes of
                            practice, and demands for health care workers
                            in the enhanced information technology and
                            management workplace.
                                (iii) An analysis of how to align Medicare
                            and Medicaid graduate medical education
                            policies with national workforce goals.
                                (iv) The education and training capacity,
                            projected demands, and integration with the
                            health care delivery system of each of the
                            following:
                                        (I) Nursing workforce capacity at
                                    all levels.
                                        (II) Oral health care workforce
                                    capacity at all levels.
                                        (III) Mental and behavioral health
                                    care workforce capacity at all levels.
                                        (IV) Allied health and public
                                    health care workforce capacity at all
                                    levels.
                                        (V) Emergency medical service
                                    workforce capacity, including the
                                    retention and recruitment of the
                                    volunteer workforce, at all levels.
                                        (VI) The geographic distribution of
                                    health care providers as compared to
                                    the identified health care workforce
                                    needs of States and regions.
                        (B) Future determinations.--The Commission may
                    require that additional topics be included under
                    subparagraph (A). The appropriate committees of
                    Congress may recommend to the Commission the inclusion
                    of other topics for health care workforce development
                    areas that require special attention.
                (5) Grant program.--The Commission shall--
                        (A) review implementation progress reports on, and
                    report to Congress about, the State Health Care
                    Workforce Development Grant program established in
                    section 5102;
                        (B) in collaboration with the Department of Labor
                    and in coordination with the Department of Education
                    and other relevant Federal agencies, make
                    recommendations to the fiscal and administrative agent
                    under section 5102(b) for grant recipients under
                    section 5102;
                        (C) assess the implementation of the grants under
                    such section; and
                        (D) collect performance and report information,
                    including identified models and best practices, on
                    grants from the fiscal and administrative agent under
                    such section and distribute this information to
                    Congress, relevant Federal agencies, and to the public.
                (6) Study.--The Commission shall study effective mechanisms
            for financing education and training for careers in health
            care, including public health and allied health.
                (7) Recommendations.--The Commission shall submit
            recommendations to Congress, the Department of Labor, and the
            Department of Health and Human Services about improving safety,
            health, and worker protections in the workplace for the health
            care workforce.
                (8) Assessment.--The Commission shall assess and receive
            reports from the National Center for Health Care Workforce
            Analysis established under section 761(b) of the Public Service
            Health Act (as amended by section 5103).
        (e) Consultation With Federal, State, and Local Agencies, Congress,
    and Other Organizations.--
                (1) In general.--The Commission shall consult with Federal
            agencies (including the Departments of Health and Human
            Services, Labor, Education, Commerce, Agriculture, Defense, and
            Veterans Affairs and the Environmental Protection Agency),
            Congress, the Medicare Payment Advisory Commission, the
            Medicaid and CHIP Payment and Access Commission, and, to the
            extent practicable, with State and local agencies, Indian
            tribes, voluntary health care organizations, professional
            societies, and other relevant public-private health care
            partnerships.
                (2) Obtaining official data.--The Commission, consistent
            with established privacy rules, may secure directly from any
            department or agency of the Executive Branch information
            necessary to enable the Commission to carry out this section.
                (3) Detail of federal government employees.--An employee of
            the Federal Government may be detailed to the Commission
            without reimbursement. The detail of such an employee shall be
            without interruption or loss of civil service status.
        (f) Director and Staff; Experts and Consultants.--Subject to such
    review as the Comptroller General of the United States determines to be
    necessary to ensure the efficient administration of the Commission, the
    Commission may--
                (1) employ and fix the compensation of an executive
            director that shall not exceed the rate of basic pay payable
            for level V of the Executive Schedule and such other personnel
            as may be necessary to carry out its duties (without regard to
            the provisions of title 5, United States Code, governing
            appointments in the competitive service);
                (2) seek such assistance and support as may be required in
            the performance of its duties from appropriate Federal
            departments and agencies;
                (3) enter into contracts or make other arrangements, as may
            be necessary for the conduct of the work of the Commission
            (without regard to section 3709 of the Revised Statutes (41
            U.S.C. 5));
                (4) make advance, progress, and other payments which relate
            to the work of the Commission;
                (5) provide transportation and subsistence for persons
            serving without compensation; and
                (6) prescribe such rules and regulations as the Commission
            determines to be necessary with respect to the internal
            organization and operation of the Commission.
        (g) Powers.--
                (1) Data collection.--In order to carry out its functions
            under this section, the Commission shall--
                        (A) utilize existing information, both published
                    and unpublished, where possible, collected and assessed
                    either by its own staff or under other arrangements
                    made in accordance with this section, including
                    coordination with the Bureau of Labor Statistics;
                        (B) carry out, or award grants or contracts for the
                    carrying out of, original research and development,
                    where existing information is inadequate, and
                        (C) adopt procedures allowing interested parties to
                    submit information for the Commission's use in making
                    reports and recommendations.
                (2) Access of the government accountability office to
            information.--The Comptroller General of the United States
            shall have unrestricted access to all deliberations, records,
            and data of the Commission, immediately upon request.
                (3) Periodic audit.--The Commission shall be subject to
            periodic audit by an independent public accountant under
            contract to the Commission.
        (h) Authorization of Appropriations.--
                (1) Request for appropriations.--The Commission shall
            submit requests for appropriations in the same manner as the
            Comptroller General of the United States submits requests for
            appropriations. Amounts so appropriated for the Commission
            shall be separate from amounts appropriated for the Comptroller
            General.
                (2) Authorization.--There are authorized to be appropriated
            such sums as may be necessary to carry out this section.
                (3) Gifts and services.--The Commission may not accept
            gifts, bequeaths, or donations of property, but may accept and
            use donations of services for purposes of carrying out this
            section.
        (i) Definitions.--In this section:
                (1) Health care workforce.--The term ``health care
            workforce'' includes all health care providers with direct
            patient care and support responsibilities, such as physicians,
            nurses, nurse practitioners, primary care providers, preventive
            medicine physicians, optometrists, ophthalmologists, physician
            assistants, pharmacists, dentists, dental hygienists, and other
            oral healthcare professionals, allied health professionals,
            doctors of chiropractic, community health workers, health care
            paraprofessionals, direct care workers, psychologists and other
            behavioral and mental health professionals (including substance
            abuse prevention and treatment providers), social workers,
            physical and occupational therapists, certified nurse midwives,
            podiatrists, the EMS workforce (including professional and
            volunteer ambulance personnel and firefighters who perform
            emergency medical services), licensed complementary and
            alternative medicine providers, integrative health
            practitioners, public health professionals, and any other
            health professional that the Comptroller General of the United
            States determines appropriate.
                (2) Health professionals.--The term ``health
            professionals'' includes--
                        (A) dentists, dental hygienists, primary care
                    providers, specialty physicians, nurses, nurse
                    practitioners, physician assistants, psychologists and
                    other behavioral and mental health professionals
                    (including substance abuse prevention and treatment
                    providers), social workers, physical and occupational
                    therapists, public health professionals, clinical
                    pharmacists, allied health professionals, doctors of
                    chiropractic, community health workers, school nurses,
                    certified nurse midwives, podiatrists, licensed
                    complementary and alternative medicine providers, the
                    EMS workforce (including professional and volunteer
                    ambulance personnel and firefighters who perform
                    emergency medical services), and integrative health
                    practitioners;
                        (B) national representatives of health
                    professionals;
                        (C) representatives of schools of medicine,
                    osteopathy, nursing, dentistry, optometry, pharmacy,
                    chiropractic, allied health, educational programs for
                    public health professionals, behavioral and mental
                    health professionals (as so defined), social workers,
                    pharmacists, physical and occupational therapists, oral
                    health care industry dentistry and dental hygiene, and
                    physician assistants;
                        (D) representatives of public and private teaching
                    hospitals, and ambulatory health facilities, including
                    Federal medical facilities; and
                        (E) any other health professional the Comptroller
                    General of the United States determines appropriate.

    SEC. 5102. STATE HEALTH CARE WORKFORCE DEVELOPMENT GRANTS.

        (a) Establishment.--There is established a competitive health care
    workforce development grant program (referred to in this section as the
    ``program'') for the purpose of enabling State partnerships to complete
    comprehensive planning and to carry out activities leading to coherent
    and comprehensive health care workforce development strategies at the
    State and local levels.
        (b) Fiscal and Administrative Agent.--The Health Resources and
    Services Administration of the Department of Health and Human Services
    (referred to in this section as the ``Administration'') shall be the
    fiscal and administrative agent for the grants awarded under this
    section. The Administration is authorized to carry out the program, in
    consultation with the National Health Care Workforce Commission
    (referred to in this section as the ``Commission''), which shall review
    reports on the development, implementation, and evaluation activities
    of the grant program, including--
                (1) administering the grants;
                (2) providing technical assistance to grantees; and
                (3) reporting performance information to the Commission.
        (c) Planning Grants.--
                (1) Amount and duration.--A planning grant shall be awarded
            under this subsection for a period of not more than one year
            and the maximum award may not be more than $150,000.
                (2) Eligibility.--To be eligible to receive a planning
            grant, an entity shall be an eligible partnership. An eligible
            partnership shall be a State workforce investment board, if it
            includes or modifies the members to include at least one
            representative from each of the following: health care
            employer, labor organization, a public 2-year institution of
            higher education, a public 4-year institution of higher
            education, the recognized State federation of labor, the State
            public secondary education agency, the State P-16 or P-20
            Council if such a council exists, and a philanthropic
            organization that is actively engaged in providing learning,
            mentoring, and work opportunities to recruit, educate, and
            train individuals for, and retain individuals in, careers in
            health care and related industries.
                (3) Fiscal and administrative agent.--The Governor of the
            State receiving a planning grant has the authority to appoint a
            fiscal and an administrative agency for the partnership.
                (4) Application.--Each State partnership desiring a
            planning grant shall submit an application to the Administrator
            of the Administration at such time and in such manner, and
            accompanied by such information as the Administrator may
            reasonable require. Each application submitted for a planning
            grant shall describe the members of the State partnership, the
            activities for which assistance is sought, the proposed
            performance benchmarks to be used to measure progress under the
            planning grant, a budget for use of the funds to complete the
            required activities described in paragraph (5), and such
            additional assurance and information as the Administrator
            determines to be essential to ensure compliance with the grant
            program requirements.
                (5) Required activities.--A State partnership receiving a
            planning grant shall carry out the following:
                        (A) Analyze State labor market information in order
                    to create health care career pathways for students and
                    adults, including dislocated workers.
                        (B) Identify current and projected high demand
                    State or regional health care sectors for purposes of
                    planning career pathways.
                        (C) Identify existing Federal, State, and private
                    resources to recruit, educate or train, and retain a
                    skilled health care workforce and strengthen
                    partnerships.
                        (D) Describe the academic and health care industry
                    skill standards for high school graduation, for entry
                    into postsecondary education, and for various
                    credentials and licensure.
                        (E) Describe State secondary and postsecondary
                    education and training policies, models, or practices
                    for the health care sector, including career
                    information and guidance counseling.
                        (F) Identify Federal or State policies or rules to
                    developing a coherent and comprehensive health care
                    workforce development strategy and barriers and a plan
                    to resolve these barriers.
                        (G) Participate in the Administration's evaluation
                    and reporting activities.
                (6) Performance and evaluation.--Before the State
            partnership receives a planning grant, such partnership and the
            Administrator of the Administration shall jointly determine the
            performance benchmarks that will be established for the
            purposes of the planning grant.
                (7) Match.--Each State partnership receiving a planning
            grant shall provide an amount, in cash or in kind, that is not
            less that 15 percent of the amount of the grant, to carry out
            the activities supported by the grant. The matching requirement
            may be provided from funds available under other Federal,
            State, local or private sources to carry out the activities.
                (8) Report.--
                        (A) Report to administration.--Not later than 1
                    year after a State partnership receives a planning
                    grant, the partnership shall submit a report to the
                    Administration on the State's performance of the
                    activities under the grant, including the use of funds,
                    including matching funds, to carry out required
                    activities, and a description of the progress of the
                    State workforce investment board in meeting the
                    performance benchmarks.
                        (B) Report to congress.--The Administration shall
                    submit a report to Congress analyzing the planning
                    activities, performance, and fund utilization of each
                    State grant recipient, including an identification of
                    promising practices and a profile of the activities of
                    each State grant recipient.
        (d) Implementation Grants.--
                (1) In general.--The Administration shall--
                        (A) competitively award implementation grants to
                    State partnerships to enable such partnerships to
                    implement activities that will result in a coherent and
                    comprehensive plan for health workforce development
                    that will address current and projected workforce
                    demands within the State; and
                        (B) inform the Commission and Congress about the
                    awards made.
                (2) Duration.--An implementation grant shall be awarded for
            a period of no more than 2 years, except in those cases where
            the Administration determines that the grantee is high
            performing and the activities supported by the grant warrant up
            to 1 additional year of funding.
                (3) Eligibility.--To be eligible for an implementation
            grant, a State partnership shall have--
                        (A) received a planning grant under subsection (c)
                    and completed all requirements of such grant; or
                        (B) completed a satisfactory application, including
                    a plan to coordinate with required partners and
                    complete the required activities during the 2 year
                    period of the implementation grant.
                (4) Fiscal and administrative agent.--A State partnership
            receiving an implementation grant shall appoint a fiscal and an
            administration agent for the implementation of such grant.
                (5) Application.--Each eligible State partnership desiring
            an implementation grant shall submit an application to the
            Administration at such time, in such manner, and accompanied by
            such information as the Administration may reasonably require.
            Each application submitted shall include--
                        (A) a description of the members of the State
                    partnership;
                        (B) a description of how the State partnership
                    completed the required activities under the planning
                    grant, if applicable;
                        (C) a description of the activities for which
                    implementation grant funds are sought, including grants
                    to regions by the State partnership to advance coherent
                    and comprehensive regional health care workforce
                    planning activities;
                        (D) a description of how the State partnership will
                    coordinate with required partners and complete the
                    required partnership activities during the duration of
                    an implementation grant;
                        (E) a budget proposal of the cost of the activities
                    supported by the implementation grant and a timeline
                    for the provision of matching funds required;
                        (F) proposed performance benchmarks to be used to
                    assess and evaluate the progress of the partnership
                    activities;
                        (G) a description of how the State partnership will
                    collect data to report progress in grant activities;
                    and
                        (H) such additional assurances as the
                    Administration determines to be essential to ensure
                    compliance with grant requirements.
                (6) Required activities.--
                        (A) In general.--A State partnership that receives
                    an implementation grant may reserve not less than 60
                    percent of the grant funds to make grants to be
                    competitively awarded by the State partnership,
                    consistent with State procurement rules, to encourage
                    regional partnerships to address health care workforce
                    development needs and to promote innovative health care
                    workforce career pathway activities, including career
                    counseling, learning, and employment.
                        (B) Eligible partnership duties.--An eligible State
                    partnership receiving an implementation grant shall--
                                (i) identify and convene regional
                            leadership to discuss opportunities to engage
                            in statewide health care workforce development
                            planning, including the potential use of
                            competitive grants to improve the development,
                            distribution, and diversity of the regional
                            health care workforce; the alignment of
                            curricula for health care careers; and the
                            access to quality career information and
                            guidance and education and training
                            opportunities;
                                (ii) in consultation with key stakeholders
                            and regional leaders, take appropriate steps to
                            reduce Federal, State, or local barriers to a
                            comprehensive and coherent strategy, including
                            changes in State or local policies to foster
                            coherent and comprehensive health care
                            workforce development activities, including
                            health care career pathways at the regional and
                            State levels, career planning information,
                            retraining for dislocated workers, and as
                            appropriate, requests for Federal program or
                            administrative waivers;
                                (iii) develop, disseminate, and review with
                            key stakeholders a preliminary statewide
                            strategy that addresses short- and long-term
                            health care workforce development supply versus
                            demand;
                                (iv) convene State partnership members on a
                            regular basis, and at least on a semiannual
                            basis;
                                (v) assist leaders at the regional level to
                            form partnerships, including technical
                            assistance and capacity building activities;
                                (vi) collect and assess data on and report
                            on the performance benchmarks selected by the
                            State partnership and the Administration for
                            implementation activities carried out by
                            regional and State partnerships; and
                                (vii) participate in the Administration's
                            evaluation and reporting activities.
                (7) Performance and evaluation.--Before the State
            partnership receives an implementation grant, it and the
            Administrator shall jointly determine the performance
            benchmarks that shall be established for the purposes of the
            implementation grant.
                (8) Match.--Each State partnership receiving an
            implementation grant shall provide an amount, in cash or in
            kind that is not less than 25 percent of the amount of the
            grant, to carry out the activities supported by the grant. The
            matching funds may be provided from funds available from other
            Federal, State, local, or private sources to carry out such
            activities.
                (9) Reports.--
                        (A) Report to administration.--For each year of the
                    implementation grant, the State partnership receiving
                    the implementation grant shall submit a report to the
                    Administration on the performance of the State of the
                    grant activities, including a description of the use of
                    the funds, including matched funds, to complete
                    activities, and a description of the performance of the
                    State partnership in meeting the performance
                    benchmarks.
                        (B) Report to congress.--The Administration shall
                    submit a report to Congress analyzing implementation
                    activities, performance, and fund utilization of the
                    State grantees, including an identification of
                    promising practices and a profile of the activities of
                    each State grantee.
        (e) Authorization for Appropriations.--
                (1) Planning grants.--There are authorized to be
            appropriated to award planning grants under subsection (c)
            $8,000,000 for fiscal year 2010, and such sums as may be
            necessary for each subsequent fiscal year.
                (2) Implementation grants.--There are authorized to be
            appropriated to award implementation grants under subsection
            (d), $150,000,000 for fiscal year 2010, and such sums as may be
            necessary for each subsequent fiscal year.

    SEC. 5103. HEALTH CARE WORKFORCE ASSESSMENT.

        (a) In General.--Section 761 of the Public Health Service Act (42
    U.S.C. 294m) is amended--
                (1) by redesignating subsection (c) as subsection (e);
                (2) by striking subsection (b) and inserting the following:
        ``(b) National Center for Health Care Workforce Analysis.--
                ``(1) Establishment.--The Secretary shall establish the
            National Center for Health Workforce Analysis (referred to in
            this section as the `National Center').
                ``(2) Purposes.--The National Center, in coordination to
            the extent practicable with the National Health Care Workforce
            Commission (established in section 5101 of the Patient
            Protection and Affordable Care Act), and relevant regional and
            State centers and agencies, shall--
                        ``(A) provide for the development of information
                    describing and analyzing the health care workforce and
                    workforce related issues;
                        ``(B) carry out the activities under section
                    792(a);
                        ``(C) annually evaluate programs under this title;
                        ``(D) develop and publish performance measures and
                    benchmarks for programs under this title; and
                        ``(E) establish, maintain, and publicize a national
                    Internet registry of each grant awarded under this
                    title and a database to collect data from longitudinal
                    evaluations (as described in subsection (d)(2)) on
                    performance measures (as developed under sections
                    749(d)(3), 757(d)(3), and 762(a)(3)).
                ``(3) Collaboration and data sharing.--
                        ``(A) In general.--The National Center shall
                    collaborate with Federal agencies and relevant
                    professional and educational organizations or societies
                    for the purpose of linking data regarding grants
                    awarded under this title.
                        ``(B) Contracts for health workforce analysis.--For
                    the purpose of carrying out the activities described in
                    subparagraph (A), the National Center may enter into
                    contracts with relevant professional and educational
                    organizations or societies.
        ``(c) State and Regional Centers for Health Workforce Analysis.--
                ``(1) In general.--The Secretary shall award grants to, or
            enter into contracts with, eligible entities for purposes of--
                        ``(A) collecting, analyzing, and reporting data
                    regarding programs under this title to the National
                    Center and to the public; and
                        ``(B) providing technical assistance to local and
                    regional entities on the collection, analysis, and
                    reporting of data.
                ``(2) Eligible entities.--To be eligible for a grant or
            contract under this subsection, an entity shall--
                        ``(A) be a State, a State workforce investment
                    board, a public health or health professions school, an
                    academic health center, or an appropriate public or
                    private nonprofit entity; and
                        ``(B) submit to the Secretary an application at
                    such time, in such manner, and containing such
                    information as the Secretary may require.
        ``(d) Increase in Grants for Longitudinal Evaluations.--
                ``(1) In general.--The Secretary shall increase the amount
            awarded to an eligible entity under this title for a
            longitudinal evaluation of individuals who have received
            education, training, or financial assistance from programs
            under this title.
                ``(2) Capability.--A longitudinal evaluation shall be
            capable of--
                        ``(A) studying practice patterns; and
                        ``(B) collecting and reporting data on performance
                    measures developed under sections 749(d)(3), 757(d)(3),
                    and 762(a)(3).
                ``(3) Guidelines.--A longitudinal evaluation shall comply
            with guidelines issued under sections 749(d)(4), 757(d)(4), and
            762(a)(4).
                ``(4) Eligible entities.--To be eligible to obtain an
            increase under this section, an entity shall be a recipient of
            a grant or contract under this title.''; and
                (3) in subsection (e), as so redesignated--
                        (A) by striking paragraph (1) and inserting the
                    following:
                ``(1) In general.--
                        ``(A) National center.--To carry out subsection
                    (b), there are authorized to be appropriated $7,500,000
                    for each of fiscal years 2010 through 2014.
                        ``(B) State and regional centers.--To carry out
                    subsection (c), there are authorized to be appropriated
                    $4,500,000 for each of fiscal years 2010 through 2014.
                        ``(C) Grants for longitudinal evaluations.--To
                    carry out subsection (d), there are authorized to be
                    appropriated such sums as may be necessary for fiscal
                    years 2010 through 2014.''; and
                (4) in paragraph (2), by striking ``subsection (a)'' and
            inserting ``paragraph (1)''.
        (b) Transfers.--Not later than 180 days after the date of enactment
    of this Act, the responsibilities and resources of the National Center
    for Health Workforce Analysis, as in effect on the date before the date
    of enactment of this Act, shall be transferred to the National Center
    for Health Care Workforce Analysis established under section 761 of the
    Public Health Service Act, as amended by subsection (a).
        (c) Use of Longitudinal Evaluations.--Section 791(a)(1) of the
    Public Health Service Act (42 U.S.C. 295j(a)(1)) is amended--
                (1) in subparagraph (A), by striking ``or'' at the end;
                (2) in subparagraph (B), by striking the period and
            inserting ``; or''; and
                (3) by adding at the end the following:
                        ``(C) utilizes a longitudinal evaluation (as
                    described in section 761(d)(2)) and reports data from
                    such system to the national workforce database (as
                    established under section 761(b)(2)(E)).''.
        (d) Performance Measures; Guidelines for Longitudinal
    Evaluations.--
                (1) Advisory committee on training in primary care medicine
            and dentistry.--Section 748(d) of the Public Health Service Act
            is amended--
                        (A) in paragraph (1), by striking ``and'' at the
                    end;
                        (B) in paragraph (2), by striking the period and
                    inserting a semicolon; and
                        (C) by adding at the end the following:
                ``(3) develop, publish, and implement performance measures
            for programs under this part;
                ``(4) develop and publish guidelines for longitudinal
            evaluations (as described in section 761(d)(2)) for programs
            under this part; and
                ``(5) recommend appropriation levels for programs under
            this part.''.
                (2) Advisory committee on interdisciplinary, community-
            based linkages.--Section 756(d) of the Public Health Service
            Act is amended--
                        (A) in paragraph (1), by striking ``and'' at the
                    end;
                        (B) in paragraph (2), by striking the period and
                    inserting a semicolon; and
                        (C) by adding at the end the following:
                ``(3) develop, publish, and implement performance measures
            for programs under this part;
                ``(4) develop and publish guidelines for longitudinal
            evaluations (as described in section 761(d)(2)) for programs
            under this part; and
                ``(5) recommend appropriation levels for programs under
            this part.''.
                (3) Advisory council on graduate medical education.--
            Section 762(a) of the Public Health Service Act (42 U.S.C.
            294o(a)) is amended--
                        (A) in paragraph (1), by striking ``and'' at the
                    end;
                        (B) in paragraph (2), by striking the period and
                    inserting a semicolon; and
                        (C) by adding at the end the following:
                ``(3) develop, publish, and implement performance measures
            for programs under this title, except for programs under part C
            or D;
                ``(4) develop and publish guidelines for longitudinal
            evaluations (as described in section 761(d)(2)) for programs
            under this title, except for programs under part C or D; and
                ``(5) recommend appropriation levels for programs under
            this title, except for programs under part C or D.''.

         Subtitle C--Increasing the Supply of the Health Care Workforce

    SEC. 5201. FEDERALLY SUPPORTED STUDENT LOAN FUNDS.

        (a) Medical Schools and Primary Health Care.--Section 723 of the
    Public Health Service Act (42 U.S.C. 292s) is amended--
                (1) in subsection (a)--
                        (A) in paragraph (1), by striking subparagraph (B)
                    and inserting the following:
                        ``(B) to practice in such care for 10 years
                    (including residency training in primary health care)
                    or through the date on which the loan is repaid in
                    full, whichever occurs first.''; and
                        (B) by striking paragraph (3) and inserting the
                    following:
                ``(3) Noncompliance by student.--Each agreement entered
            into with a student pursuant to paragraph (1) shall provide
            that, if the student fails to comply with such agreement, the
            loan involved will begin to accrue interest at a rate of 2
            percent per year greater than the rate at which the student
            would pay if compliant in such year.''; and
                (2) by adding at the end the following:
        ``(d) Sense of Congress.--It is the sense of Congress that funds
    repaid under the loan program under this section should not be
    transferred to the Treasury of the United States or otherwise used for
    any other purpose other than to carry out this section.''.
        (b) Student Loan Guidelines.--The Secretary of Health and Human
    Services shall not require parental financial information for an
    independent student to determine financial need under section 723 of
    the Public Health Service Act (42 U.S.C. 292s) and the determination of
    need for such information shall be at the discretion of applicable
    school loan officer. The Secretary shall amend guidelines issued by the
    Health Resources and Services Administration in accordance with the
    preceding sentence.

    SEC. 5202. NURSING STUDENT LOAN PROGRAM.

        (a) Loan Agreements.--Section 836(a) of the Public Health Service
    Act (42 U.S.C. 297b(a)) is amended--
                (1) by striking ``$2,500'' and inserting ``$3,300'';
                (2) by striking ``$4,000'' and inserting ``$5,200''; and
                (3) by striking ``$13,000'' and all that follows through
            the period and inserting ``$17,000 in the case of any student
            during fiscal years 2010 and 2011. After fiscal year 2011, such
            amounts shall be adjusted to provide for a cost-of-attendance
            increase for the yearly loan rate and the aggregate of the
            loans.''.
        (b) Loan Provisions.--Section 836(b) of the Public Health Service
    Act (42 U.S.C. 297b(b)) is amended--
                (1) in paragraph (1)(C), by striking ``1986'' and inserting
            ``2000''; and
                (2) in paragraph (3), by striking ``the date of enactment
            of the Nurse Training Amendments of 1979'' and inserting
            ``September 29, 1995''.

    SEC. 5203. HEALTH CARE WORKFORCE LOAN REPAYMENT PROGRAMS.

        Part E of title VII of the Public Health Service Act (42 U.S.C.
    294n et seq.) is amended by adding at the end the following:

                ``Subpart 3--Recruitment and Retention Programs

    ``SEC. 775. INVESTMENT IN TOMORROW'S PEDIATRIC HEALTH CARE WORKFORCE.

        ``(a) Establishment.--The Secretary shall establish and carry out a
    pediatric specialty loan repayment program under which the eligible
    individual agrees to be employed full-time for a specified period
    (which shall not be less than 2 years) in providing pediatric medical
    subspecialty, pediatric surgical specialty, or child and adolescent
    mental and behavioral health care, including substance abuse prevention
    and treatment services.
        ``(b) Program Administration.--Through the program established
    under this section, the Secretary shall enter into contracts with
    qualified health professionals under which--
                ``(1) such qualified health professionals will agree to
            provide pediatric medical subspecialty, pediatric surgical
            specialty, or child and adolescent mental and behavioral health
            care in an area with a shortage of the specified pediatric
            subspecialty that has a sufficient pediatric population to
            support such pediatric subspecialty, as determined by the
            Secretary; and
                ``(2) the Secretary agrees to make payments on the
            principal and interest of undergraduate, graduate, or graduate
            medical education loans of professionals described in paragraph
            (1) of not more than $35,000 a year for each year of agreed
            upon service under such paragraph for a period of not more than
            3 years during the qualified health professional's--
                        ``(A) participation in an accredited pediatric
                    medical subspecialty, pediatric surgical specialty, or
                    child and adolescent mental health subspecialty
                    residency or fellowship; or
                        ``(B) employment as a pediatric medical
                    subspecialist, pediatric surgical specialist, or child
                    and adolescent mental health professional serving an
                    area or population described in such paragraph.
        ``(c) In General.--
                ``(1) Eligible individuals.--
                        ``(A) Pediatric medical specialists and pediatric
                    surgical specialists.--For purposes of contracts with
                    respect to pediatric medical specialists and pediatric
                    surgical specialists, the term `qualified health
                    professional' means a licensed physician who--
                                ``(i) is entering or receiving training in
                            an accredited pediatric medical subspecialty or
                            pediatric surgical specialty residency or
                            fellowship; or
                                ``(ii) has completed (but not prior to the
                            end of the calendar year in which this section
                            is enacted) the training described in
                            subparagraph (B).
                        ``(B) Child and adolescent mental and behavioral
                    health.--For purposes of contracts with respect to
                    child and adolescent mental and behavioral health care,
                    the term `qualified health professional' means a health
                    care professional who--
                                ``(i) has received specialized training or
                            clinical experience in child and adolescent
                            mental health in psychiatry, psychology, school
                            psychology, behavioral pediatrics, psychiatric
                            nursing, social work, school social work,
                            substance abuse disorder prevention and
                            treatment, marriage and family therapy, school
                            counseling, or professional counseling;
                                ``(ii) has a license or certification in a
                            State to practice allopathic medicine,
                            osteopathic medicine, psychology, school
                            psychology, psychiatric nursing, social work,
                            school social work, marriage and family
                            therapy, school counseling, or professional
                            counseling; or
                                ``(iii) is a mental health service
                            professional who completed (but not before the
                            end of the calendar year in which this section
                            is enacted) specialized training or clinical
                            experience in child and adolescent mental
                            health described in clause (i).
                ``(2) Additional eligibility requirements.--The Secretary
            may not enter into a contract under this subsection with an
            eligible individual unless--
                        ``(A) the individual agrees to work in, or for a
                    provider serving, a health professional shortage area
                    or medically underserved area, or to serve a medically
                    underserved population;
                        ``(B) the individual is a United States citizen or
                    a permanent legal United States resident; and
                        ``(C) if the individual is enrolled in a graduate
                    program, the program is accredited, and the individual
                    has an acceptable level of academic standing (as
                    determined by the Secretary).
        ``(d) Priority.--In entering into contracts under this subsection,
    the Secretary shall give priority to applicants who--
                ``(1) are or will be working in a school or other pre-
            kindergarten, elementary, or secondary education setting;
                ``(2) have familiarity with evidence-based methods and
            cultural and linguistic competence health care services; and
                ``(3) demonstrate financial need.
        ``(e) Authorization of Appropriations.--There is authorized to be
    appropriated $30,000,000 for each of fiscal years 2010 through 2014 to
    carry out subsection (c)(1)(A) and $20,000,000 for each of fiscal years
    2010 through 2013 to carry out subsection (c)(1)(B).''.

    SEC. 5204. PUBLIC HEALTH WORKFORCE RECRUITMENT AND RETENTION PROGRAMS.

        Part E of title VII of the Public Health Service Act (42 U.S.C.
    294n et seq.), as amended by section 5203, is further amended by adding
    at the end the following:

    ``SEC. 776. PUBLIC HEALTH WORKFORCE LOAN REPAYMENT PROGRAM.

        ``(a) Establishment.--The Secretary shall establish the Public
    Health Workforce Loan Repayment Program (referred to in this section as
    the `Program') to assure an adequate supply of public health
    professionals to eliminate critical public health workforce shortages
    in Federal, State, local, and tribal public health agencies.
        ``(b) Eligibility.--To be eligible to participate in the Program,
    an individual shall--
                ``(1)(A) be accepted for enrollment, or be enrolled, as a
            student in an accredited academic educational institution in a
            State or territory in the final year of a course of study or
            program leading to a public health or health professions degree
            or certificate; and have accepted employment with a Federal,
            State, local, or tribal public health agency, or a related
            training fellowship, as recognized by the Secretary, to
            commence upon graduation;
                ``(B)(i) have graduated, during the preceding 10-year
            period, from an accredited educational institution in a State
            or territory and received a public health or health professions
            degree or certificate; and
                ``(ii) be employed by, or have accepted employment with, a
            Federal, State, local, or tribal public health agency or a
            related training fellowship, as recognized by the Secretary;
                ``(2) be a United States citizen; and
                ``(3)(A) submit an application to the Secretary to
            participate in the Program;
                ``(B) execute a written contract as required in subsection
            (c); and
                ``(4) not have received, for the same service, a reduction
            of loan obligations under section 455(m), 428J, 428K, 428L, or
            460 of the Higher Education Act of 1965.
        ``(c) Contract.--The written contract (referred to in this section
    as the `written contract') between the Secretary and an individual
    shall contain--
                ``(1) an agreement on the part of the Secretary that the
            Secretary will repay on behalf of the individual loans incurred
            by the individual in the pursuit of the relevant degree or
            certificate in accordance with the terms of the contract;
                ``(2) an agreement on the part of the individual that the
            individual will serve in the full-time employment of a Federal,
            State, local, or tribal public health agency or a related
            fellowship program in a position related to the course of study
            or program for which the contract was awarded for a period of
            time (referred to in this section as the `period of obligated
            service') equal to the greater of--
                        ``(A) 3 years; or
                        ``(B) such longer period of time as determined
                    appropriate by the Secretary and the individual;
                ``(3) an agreement, as appropriate, on the part of the
            individual to relocate to a priority service area (as
            determined by the Secretary) in exchange for an additional loan
            repayment incentive amount to be determined by the Secretary;
                ``(4) a provision that any financial obligation of the
            United States arising out of a contract entered into under this
            section and any obligation of the individual that is
            conditioned thereon, is contingent on funds being appropriated
            for loan repayments under this section;
                ``(5) a statement of the damages to which the United States
            is entitled, under this section for the individual's breach of
            the contract; and
                ``(6) such other statements of the rights and liabilities
            of the Secretary and of the individual, not inconsistent with
            this section.
        ``(d) Payments.--
                ``(1) In general.--A loan repayment provided for an
            individual under a written contract under the Program shall
            consist of payment, in accordance with paragraph (2), on behalf
            of the individual of the principal, interest, and related
            expenses on government and commercial loans received by the
            individual regarding the undergraduate or graduate education of
            the individual (or both), which loans were made for tuition
            expenses incurred by the individual.
                ``(2) Payments for years served.--For each year of
            obligated service that an individual contracts to serve under
            subsection (c) the Secretary may pay up to $35,000 on behalf of
            the individual for loans described in paragraph (1). With
            respect to participants under the Program whose total eligible
            loans are less than $105,000, the Secretary shall pay an amount
            that does not exceed \1/3\ of the eligible loan balance for
            each year of obligated service of the individual.
                ``(3) Tax liability.--For the purpose of providing
            reimbursements for tax liability resulting from payments under
            paragraph (2) on behalf of an individual, the Secretary shall,
            in addition to such payments, make payments to the individual
            in an amount not to exceed 39 percent of the total amount of
            loan repayments made for the taxable year involved.
        ``(e) Postponing Obligated Service.--With respect to an individual
    receiving a degree or certificate from a health professions or other
    related school, the date of the initiation of the period of obligated
    service may be postponed as approved by the Secretary.
        ``(f) Breach of Contract.--An individual who fails to comply with
    the contract entered into under subsection (c) shall be subject to the
    same financial penalties as provided for under section 338E for
    breaches of loan repayment contracts under section 338B.
        ``(g) Authorization of Appropriations.--There is authorized to be
    appropriated to carry out this section $195,000,000 for fiscal year
    2010, and such sums as may be necessary for each of fiscal years 2011
    through 2015.''.

    SEC. 5205. ALLIED HEALTH WORKFORCE RECRUITMENT AND RETENTION PROGRAMS.

        (a) Purpose.--The purpose of this section is to assure an adequate
    supply of allied health professionals to eliminate critical allied
    health workforce shortages in Federal, State, local, and tribal public
    health agencies or in settings where patients might require health care
    services, including acute care facilities, ambulatory care facilities,
    personal residences and other settings, as recognized by the Secretary
    of Health and Human Services by authorizing an Allied Health Loan
    Forgiveness Program.
        (b) Allied Health Workforce Recruitment and Retention Program.--
    Section 428K of the Higher Education Act of 1965 (20 U.S.C. 1078-11) is
    amended--
                (1) in subsection (b), by adding at the end the following:
                ``(18) Allied health professionals.--The individual is
            employed full-time as an allied health professional--
                        ``(A) in a Federal, State, local, or tribal public
                    health agency; or
                        ``(B) in a setting where patients might require
                    health care services, including acute care facilities,
                    ambulatory care facilities, personal residences and
                    other settings located in health professional shortage
                    areas, medically underserved areas, or medically
                    underserved populations, as recognized by the Secretary
                    of Health and Human Services.''; and
                (2) in subsection (g)--
                        (A) by redesignating paragraphs (1) through (9) as
                    paragraphs (2) through (10), respectively; and
                        (B) by inserting before paragraph (2) (as
                    redesignated by subparagraph (A)) the following:
                ``(1) Allied health professional.--The term `allied health
            professional' means an allied health professional as defined in
            section 799B(5) of the Public Heath Service Act (42 U.S.C.
            295p(5)) who--
                        ``(A) has graduated and received an allied health
                    professions degree or certificate from an institution
                    of higher education; and
                        ``(B) is employed with a Federal, State, local or
                    tribal public health agency, or in a setting where
                    patients might require health care services, including
                    acute care facilities, ambulatory care facilities,
                    personal residences and other settings located in
                    health professional shortage areas, medically
                    underserved areas, or medically underserved
                    populations, as recognized by the Secretary of Health
                    and Human Services.''.

    SEC. 5206. GRANTS FOR STATE AND LOCAL PROGRAMS.

        (a) In General.--Section 765(d) of the Public Health Service Act
    (42 U.S.C. 295(d)) is amended--
                (1) in paragraph (7), by striking ``; or'' and inserting a
            semicolon;
                (2) by redesignating paragraph (8) as paragraph (9); and
                (3) by inserting after paragraph (7) the following:
                ``(8) public health workforce loan repayment programs;
            or''.
        (b) Training for Mid-career Public Health Professionals.--Part E of
    title VII of the Public Health Service Act (42 U.S.C. 294n et seq.), as
    amended by section 5204, is further amended by adding at the end the
    following:

    ``SEC. 777. TRAINING FOR MID-CAREER PUBLIC AND ALLIED HEALTH
                  PROFESSIONALS.

        ``(a) In General.--The Secretary may make grants to, or enter into
    contracts with, any eligible entity to award scholarships to eligible
    individuals to enroll in degree or professional training programs for
    the purpose of enabling mid-career professionals in the public health
    and allied health workforce to receive additional training in the field
    of public health and allied health.
        ``(b) Eligibility.--
                ``(1) Eligible entity.--The term `eligible entity'
            indicates an accredited educational institution that offers a
            course of study, certificate program, or professional training
            program in public or allied health or a related discipline, as
            determined by the Secretary
                ``(2) Eligible individuals.--The term `eligible
            individuals' includes those individuals employed in public and
            allied health positions at the Federal, State, tribal, or local
            level who are interested in retaining or upgrading their
            education.
        ``(c) Authorization of Appropriations.--There is authorized to be
    appropriated to carry out this section, $60,000,000 for fiscal year
    2010 and such sums as may be necessary for each of fiscal years 2011
    through 2015. Fifty percent of appropriated funds shall be allotted to
    public health mid-career professionals and 50 percent shall be allotted
    to allied health mid-career professionals.''.

    SEC. 5207. FUNDING FOR NATIONAL HEALTH SERVICE CORPS.

        Section 338H(a) of the Public Health Service Act (42 U.S.C.
    254q(a)) is amended to read as follows:
        ``(a) Authorization of Appropriations.--For the purpose of carrying
    out this section, there is authorized to be appropriated, out of any
    funds in the Treasury not otherwise appropriated, the following:
                ``(1) For fiscal year 2010, $320,461,632.
                ``(2) For fiscal year 2011, $414,095,394.
                ``(3) For fiscal year 2012, $535,087,442.
                ``(4) For fiscal year 2013, $691,431,432.
                ``(5) For fiscal year 2014, $893,456,433.
                ``(6) For fiscal year 2015, $1,154,510,336.
                ``(7) For fiscal year 2016, and each subsequent fiscal
            year, the amount appropriated for the preceding fiscal year
            adjusted by the product of--
                        ``(A) one plus the average percentage increase in
                    the costs of health professions education during the
                    prior fiscal year; and
                        ``(B) one plus the average percentage change in the
                    number of individuals residing in health professions
                    shortage areas designated under section 333 during the
                    prior fiscal year, relative to the number of
                    individuals residing in such areas during the previous
                    fiscal year.''.

    SEC. 5208. NURSE-MANAGED HEALTH CLINICS.

        (a) Purpose.--The purpose of this section is to fund the
    development and operation of nurse-managed health clinics.
        (b) Grants.--Subpart 1 of part D of title III of the Public Health
    Service Act (42 U.S.C. 254b et seq.) is amended by inserting after
    section 330A the following:

    ``SEC. 330A-1. GRANTS TO NURSE-MANAGED HEALTH CLINICS.

        ``(a) Definitions.--
                ``(1) Comprehensive primary health care services.--In this
            section, the term `comprehensive primary health care services'
            means the primary health services described in section
            330(b)(1).
                ``(2) Nurse-managed health clinic.--The term `nurse-managed
            health clinic' means a nurse-practice arrangement, managed by
            advanced practice nurses, that provides primary care or
            wellness services to underserved or vulnerable populations and
            that is associated with a school, college, university or
            department of nursing, federally qualified health center, or
            independent nonprofit health or social services agency.
        ``(b) Authority to Award Grants.--The Secretary shall award grants
    for the cost of the operation of nurse-managed health clinics that meet
    the requirements of this section.
        ``(c) Applications.--To be eligible to receive a grant under this
    section, an entity shall--
                ``(1) be an NMHC; and
                ``(2) submit to the Secretary an application at such time,
            in such manner, and containing--
                        ``(A) assurances that nurses are the major
                    providers of services at the NMHC and that at least 1
                    advanced practice nurse holds an executive management
                    position within the organizational structure of the
                    NMHC;
                        ``(B) an assurance that the NMHC will continue
                    providing comprehensive primary health care services or
                    wellness services without regard to income or insurance
                    status of the patient for the duration of the grant
                    period; and
                        ``(C) an assurance that, not later than 90 days of
                    receiving a grant under this section, the NMHC will
                    establish a community advisory committee, for which a
                    majority of the members shall be individuals who are
                    served by the NMHC.
        ``(d) Grant Amount.--The amount of any grant made under this
    section for any fiscal year shall be determined by the Secretary,
    taking into account--
                ``(1) the financial need of the NMHC, considering State,
            local, and other operational funding provided to the NMHC; and
                ``(2) other factors, as the Secretary determines
            appropriate.
        ``(e) Authorization of Appropriations.--For the purposes of
    carrying out this section, there are authorized to be appropriated
    $50,000,000 for the fiscal year 2010 and such sums as may be necessary
    for each of the fiscal years 2011 through 2014.''.

    SEC. 5209. ELIMINATION OF CAP ON COMMISSIONED CORPS.

        Section 202 of the Department of Health and Human Services
    Appropriations Act, 1993 (Public Law 102-394) is amended by striking
    ``not to exceed 2,800''.

    SEC. 5210. ESTABLISHING A READY RESERVE CORPS.

        Section 203 of the Public Health Service Act (42 U.S.C. 204) is
    amended to read as follows:

    ``SEC. 203. COMMISSIONED CORPS AND READY RESERVE CORPS.

        ``(a) Establishment.--
                ``(1) In general.--There shall be in the Service a
            commissioned Regular Corps and a Ready Reserve Corps for
            service in time of national emergency.
                ``(2) Requirement.--All commissioned officers shall be
            citizens of the United States and shall be appointed without
            regard to the civil-service laws and compensated without regard
            to the Classification Act of 1923, as amended.
                ``(3) Appointment.--Commissioned officers of the Ready
            Reserve Corps shall be appointed by the President and
            commissioned officers of the Regular Corps shall be appointed
            by the President with the advice and consent of the Senate.
                ``(4) Active duty.--Commissioned officers of the Ready
            Reserve Corps shall at all times be subject to call to active
            duty by the Surgeon General, including active duty for the
            purpose of training.
                ``(5) Warrant officers.--Warrant officers may be appointed
            to the Service for the purpose of providing support to the
            health and delivery systems maintained by the Service and any
            warrant officer appointed to the Service shall be considered
            for purposes of this Act and title 37, United States Code, to
            be a commissioned officer within the Commissioned Corps of the
            Service.
        ``(b) Assimilating Reserve Corp Officers Into the Regular Corps.--
    Effective on the date of enactment of the Patient Protection and
    Affordable Care Act, all individuals classified as officers in the
    Reserve Corps under this section (as such section existed on the day
    before the date of enactment of such Act) and serving on active duty
    shall be deemed to be commissioned officers of the Regular Corps.
        ``(c) Purpose and Use of Ready Research.--
                ``(1) Purpose.--The purpose of the Ready Reserve Corps is
            to fulfill the need to have additional Commissioned Corps
            personnel available on short notice (similar to the uniformed
            service's reserve program) to assist regular Commissioned Corps
            personnel to meet both routine public health and emergency
            response missions.
                ``(2) Uses.--The Ready Reserve Corps shall--
                        ``(A) participate in routine training to meet the
                    general and specific needs of the Commissioned Corps;
                        ``(B) be available and ready for involuntary calls
                    to active duty during national emergencies and public
                    health crises, similar to the uniformed service reserve
                    personnel;
                        ``(C) be available for backfilling critical
                    positions left vacant during deployment of active duty
                    Commissioned Corps members, as well as for deployment
                    to respond to public health emergencies, both foreign
                    and domestic; and
                        ``(D) be available for service assignment in
                    isolated, hardship, and medically underserved
                    communities (as defined in section 799B) to improve
                    access to health services.
        ``(d) Funding.--For the purpose of carrying out the duties and
    responsibilities of the Commissioned Corps under this section, there
    are authorized to be appropriated $5,000,000 for each of fiscal years
    2010 through 2014 for recruitment and training and $12,500,000 for each
    of fiscal years 2010 through 2014 for the Ready Reserve Corps.''.

       Subtitle D--Enhancing Health Care Workforce Education and Training

    SEC. 5301. TRAINING IN FAMILY MEDICINE, GENERAL INTERNAL MEDICINE,
                  GENERAL PEDIATRICS, AND PHYSICIAN ASSISTANTSHIP.

        Part C of title VII (42 U.S.C. 293k et seq.) is amended by striking
    section 747 and inserting the following:

    ``SEC. 747. PRIMARY CARE TRAINING AND ENHANCEMENT.

        ``(a) Support and Development of Primary Care Training Programs.--
                ``(1) In general.--The Secretary may make grants to, or
            enter into contracts with, an accredited public or nonprofit
            private hospital, school of medicine or osteopathic medicine,
            academically affiliated physician assistant training program,
            or a public or private nonprofit entity which the Secretary has
            determined is capable of carrying out such grant or contract--
                        ``(A) to plan, develop, operate, or participate in
                    an accredited professional training program, including
                    an accredited residency or internship program in the
                    field of family medicine, general internal medicine, or
                    general pediatrics for medical students, interns,
                    residents, or practicing physicians as defined by the
                    Secretary;
                        ``(B) to provide need-based financial assistance in
                    the form of traineeships and fellowships to medical
                    students, interns, residents, practicing physicians, or
                    other medical personnel, who are participants in any
                    such program, and who plan to specialize or work in the
                    practice of the fields defined in subparagraph (A);
                        ``(C) to plan, develop, and operate a program for
                    the training of physicians who plan to teach in family
                    medicine, general internal medicine, or general
                    pediatrics training programs;
                        ``(D) to plan, develop, and operate a program for
                    the training of physicians teaching in community-based
                    settings;
                        ``(E) to provide financial assistance in the form
                    of traineeships and fellowships to physicians who are
                    participants in any such programs and who plan to teach
                    or conduct research in a family medicine, general
                    internal medicine, or general pediatrics training
                    program;
                        ``(F) to plan, develop, and operate a physician
                    assistant education program, and for the training of
                    individuals who will teach in programs to provide such
                    training;
                        ``(G) to plan, develop, and operate a demonstration
                    program that provides training in new competencies, as
                    recommended by the Advisory Committee on Training in
                    Primary Care Medicine and Dentistry and the National
                    Health Care Workforce Commission established in section
                    5101 of the Patient Protection and Affordable Care Act,
                    which may include--
                                ``(i) providing training to primary care
                            physicians relevant to providing care through
                            patient-centered medical homes (as defined by
                            the Secretary for purposes of this section);
                                ``(ii) developing tools and curricula
                            relevant to patient-centered medical homes; and
                                ``(iii) providing continuing education to
                            primary care physicians relevant to patient-
                            centered medical homes; and
                        ``(H) to plan, develop, and operate joint degree
                    programs to provide interdisciplinary and
                    interprofessional graduate training in public health
                    and other health professions to provide training in
                    environmental health, infectious disease control,
                    disease prevention and health promotion,
                    epidemiological studies and injury control.
                ``(2) Duration of awards.--The period during which payments
            are made to an entity from an award of a grant or contract
            under this subsection shall be 5 years.
        ``(b) Capacity Building in Primary Care.--
                ``(1) In general.--The Secretary may make grants to or
            enter into contracts with accredited schools of medicine or
            osteopathic medicine to establish, maintain, or improve--
                        ``(A) academic units or programs that improve
                    clinical teaching and research in fields defined in
                    subsection (a)(1)(A); or
                        ``(B) programs that integrate academic
                    administrative units in fields defined in subsection
                    (a)(1)(A) to enhance interdisciplinary recruitment,
                    training, and faculty development.
                ``(2) Preference in making awards under this subsection.--
            In making awards of grants and contracts under paragraph (1),
            the Secretary shall give preference to any qualified applicant
            for such an award that agrees to expend the award for the
            purpose of--
                        ``(A) establishing academic units or programs in
                    fields defined in subsection (a)(1)(A); or
                        ``(B) substantially expanding such units or
                    programs.
                ``(3) Priorities in making awards.--In awarding grants or
            contracts under paragraph (1), the Secretary shall give
            priority to qualified applicants that--
                        ``(A) proposes a collaborative project between
                    academic administrative units of primary care;
                        ``(B) proposes innovative approaches to clinical
                    teaching using models of primary care, such as the
                    patient centered medical home, team management of
                    chronic disease, and interprofessional integrated
                    models of health care that incorporate transitions in
                    health care settings and integration physical and
                    mental health provision;
                        ``(C) have a record of training the greatest
                    percentage of providers, or that have demonstrated
                    significant improvements in the percentage of providers
                    trained, who enter and remain in primary care practice;
                        ``(D) have a record of training individuals who are
                    from underrepresented minority groups or from a rural
                    or disadvantaged background;
                        ``(E) provide training in the care of vulnerable
                    populations such as children, older adults, homeless
                    individuals, victims of abuse or trauma, individuals
                    with mental health or substance-related disorders,
                    individuals with HIV/AIDS, and individuals with
                    disabilities;
                        ``(F) establish formal relationships and submit
                    joint applications with federally qualified health
                    centers, rural health clinics, area health education
                    centers, or clinics located in underserved areas or
                    that serve underserved populations;
                        ``(G) teach trainees the skills to provide
                    interprofessional, integrated care through
                    collaboration among health professionals;
                        ``(H) provide training in enhanced communication
                    with patients, evidence-based practice, chronic disease
                    management, preventive care, health information
                    technology, or other competencies as recommended by the
                    Advisory Committee on Training in Primary Care Medicine
                    and Dentistry and the National Health Care Workforce
                    Commission established in section 5101 of the Patient
                    Protection and Affordable Care Act; or
                        ``(I) provide training in cultural competency and
                    health literacy.
                ``(4) Duration of awards.--The period during which payments
            are made to an entity from an award of a grant or contract
            under this subsection shall be 5 years.
        ``(c) Authorization of Appropriations.--
                ``(1) In general.--For purposes of carrying out this
            section (other than subsection (b)(1)(B)), there are authorized
            to be appropriated $125,000,000 for fiscal year 2010, and such
            sums as may be necessary for each of fiscal years 2011 through
            2014.
                ``(2) Training programs.--Fifteen percent of the amount
            appropriated pursuant to paragraph (1) in each such fiscal year
            shall be allocated to the physician assistant training programs
            described in subsection (a)(1)(F), which prepare students for
            practice in primary care.
                ``(3) Integrating academic administrative units.--For
            purposes of carrying out subsection (b)(1)(B), there are
            authorized to be appropriated $750,000 for each of fiscal years
            2010 through 2014.''.

    SEC. 5302. TRAINING OPPORTUNITIES FOR DIRECT CARE WORKERS.

        Part C of title VII of the Public Health Service Act (42 U.S.C.
    293k et seq.) is amended by inserting after section 747, as amended by
    section 5301, the following:

    ``SEC. 747A. TRAINING OPPORTUNITIES FOR DIRECT CARE WORKERS.

        ``(a) In General.--The Secretary shall award grants to eligible
    entities to enable such entities to provide new training opportunities
    for direct care workers who are employed in long-term care settings
    such as nursing homes (as defined in section 1908(e)(1) of the Social
    Security Act (42 U.S.C. 1396g(e)(1)), assisted living facilities and
    skilled nursing facilities, intermediate care facilities for
    individuals with mental retardation, home and community based settings,
    and any other setting the Secretary determines to be appropriate.
        ``(b) Eligibility.--To be eligible to receive a grant under this
    section, an entity shall--
                ``(1) be an institution of higher education (as defined in
            section 102 of the Higher Education Act of 1965 (20 U.S.C.
            1002)) that--
                        ``(A) is accredited by a nationally recognized
                    accrediting agency or association listed under section
                    101(c) of the Higher Education Act of 1965 (20 U.S.C.
                    1001(c)); and
                        ``(B) has established a public-private educational
                    partnership with a nursing home or skilled nursing
                    facility, agency or entity providing home and community
                    based services to individuals with disabilities, or
                    other long-term care provider; and
                ``(2) submit to the Secretary an application at such time,
            in such manner, and containing such information as the
            Secretary may require.
        ``(c) Use of Funds.--An eligible entity shall use amounts awarded
    under a grant under this section to provide assistance to eligible
    individuals to offset the cost of tuition and required fees for
    enrollment in academic programs provided by such entity.
        ``(d) Eligible Individual.--
                ``(1) Eligibility.--To be eligible for assistance under
            this section, an individual shall be enrolled in courses
            provided by a grantee under this subsection and maintain
            satisfactory academic progress in such courses.
                ``(2) Condition of assistance.--As a condition of receiving
            assistance under this section, an individual shall agree that,
            following completion of the assistance period, the individual
            will work in the field of geriatrics, disability services, long
            term services and supports, or chronic care management for a
            minimum of 2 years under guidelines set by the Secretary.
        ``(e) Authorization of Appropriations.--There is authorized to be
    appropriated to carry out this section, $10,000,000 for the period of
    fiscal years 2011 through 2013.''.

    SEC. 5303. TRAINING IN GENERAL, PEDIATRIC, AND PUBLIC HEALTH DENTISTRY.

        Part C of Title VII of the Public Health Service Act (42 U.S.C.
    293k et seq.) is amended by--
                (1) redesignating section 748, as amended by section 5103
            of this Act, as section 749; and
                (2) inserting after section 747A, as added by section 5302,
            the following:

    ``SEC. 748. TRAINING IN GENERAL, PEDIATRIC, AND PUBLIC HEALTH
                  DENTISTRY.

        ``(a) Support and Development of Dental Training Programs.--
                ``(1) In general.--The Secretary may make grants to, or
            enter into contracts with, a school of dentistry, public or
            nonprofit private hospital, or a public or private nonprofit
            entity which the Secretary has determined is capable of
            carrying out such grant or contract--
                        ``(A) to plan, develop, and operate, or participate
                    in, an approved professional training program in the
                    field of general dentistry, pediatric dentistry, or
                    public health dentistry for dental students, residents,
                    practicing dentists, dental hygienists, or other
                    approved primary care dental trainees, that emphasizes
                    training for general, pediatric, or public health
                    dentistry;
                        ``(B) to provide financial assistance to dental
                    students, residents, practicing dentists, and dental
                    hygiene students who are in need thereof, who are
                    participants in any such program, and who plan to work
                    in the practice of general, pediatric, public heath
                    dentistry, or dental hygiene;
                        ``(C) to plan, develop, and operate a program for
                    the training of oral health care providers who plan to
                    teach in general, pediatric, public health dentistry,
                    or dental hygiene;
                        ``(D) to provide financial assistance in the form
                    of traineeships and fellowships to dentists who plan to
                    teach or are teaching in general, pediatric, or public
                    health dentistry;
                        ``(E) to meet the costs of projects to establish,
                    maintain, or improve dental faculty development
                    programs in primary care (which may be departments,
                    divisions or other units);
                        ``(F) to meet the costs of projects to establish,
                    maintain, or improve predoctoral and postdoctoral
                    training in primary care programs;
                        ``(G) to create a loan repayment program for
                    faculty in dental programs; and
                        ``(H) to provide technical assistance to pediatric
                    training programs in developing and implementing
                    instruction regarding the oral health status, dental
                    care needs, and risk-based clinical disease management
                    of all pediatric populations with an emphasis on
                    underserved children.
                ``(2) Faculty loan repayment.--
                        ``(A) In general.--A grant or contract under
                    subsection (a)(1)(G) may be awarded to a program of
                    general, pediatric, or public health dentistry
                    described in such subsection to plan, develop, and
                    operate a loan repayment program under which--
                                ``(i) individuals agree to serve full-time
                            as faculty members; and
                                ``(ii) the program of general, pediatric or
                            public health dentistry agrees to pay the
                            principal and interest on the outstanding
                            student loans of the individuals.
                        ``(B) Manner of payments.--With respect to the
                    payments described in subparagraph (A)(ii), upon
                    completion by an individual of each of the first,
                    second, third, fourth, and fifth years of service, the
                    program shall pay an amount equal to 10, 15, 20, 25,
                    and 30 percent, respectively, of the individual's
                    student loan balance as calculated based on principal
                    and interest owed at the initiation of the agreement.
        ``(b) Eligible Entity.--For purposes of this subsection, entities
    eligible for such grants or contracts in general, pediatric, or public
    health dentistry shall include entities that have programs in dental or
    dental hygiene schools, or approved residency or advanced education
    programs in the practice of general, pediatric, or public health
    dentistry. Eligible entities may partner with schools of public health
    to permit the education of dental students, residents, and dental
    hygiene students for a master's year in public health at a school of
    public health.
        ``(c) Priorities in Making Awards.--With respect to training
    provided for under this section, the Secretary shall give priority in
    awarding grants or contracts to the following:
                ``(1) Qualified applicants that propose collaborative
            projects between departments of primary care medicine and
            departments of general, pediatric, or public health dentistry.
                ``(2) Qualified applicants that have a record of training
            the greatest percentage of providers, or that have demonstrated
            significant improvements in the percentage of providers, who
            enter and remain in general, pediatric, or public health
            dentistry.
                ``(3) Qualified applicants that have a record of training
            individuals who are from a rural or disadvantaged background,
            or from underrepresented minorities.
                ``(4) Qualified applicants that establish formal
            relationships with Federally qualified health centers, rural
            health centers, or accredited teaching facilities and that
            conduct training of students, residents, fellows, or faculty at
            the center or facility.
                ``(5) Qualified applicants that conduct teaching programs
            targeting vulnerable populations such as older adults, homeless
            individuals, victims of abuse or trauma, individuals with
            mental health or substance-related disorders, individuals with
            disabilities, and individuals with HIV/AIDS, and in the risk-
            based clinical disease management of all populations.
                ``(6) Qualified applicants that include educational
            activities in cultural competency and health literacy.
                ``(7) Qualified applicants that have a high rate for
            placing graduates in practice settings that serve underserved
            areas or health disparity populations, or who achieve a
            significant increase in the rate of placing graduates in such
            settings.
                ``(8) Qualified applicants that intend to establish a
            special populations oral health care education center or
            training program for the didactic and clinical education of
            dentists, dental health professionals, and dental hygienists
            who plan to teach oral health care for people with
            developmental disabilities, cognitive impairment, complex
            medical problems, significant physical limitations, and
            vulnerable elderly.
        ``(d) Application.--An eligible entity desiring a grant under this
    section shall submit to the Secretary an application at such time, in
    such manner, and containing such information as the Secretary may
    require.
        ``(e) Duration of Award.--The period during which payments are made
    to an entity from an award of a grant or contract under subsection (a)
    shall be 5 years. The provision of such payments shall be subject to
    annual approval by the Secretary and subject to the availability of
    appropriations for the fiscal year involved to make the payments.
        ``(f) Authorizations of Appropriations.--For the purpose of
    carrying out subsections (a) and (b), there is authorized to be
    appropriated $30,000,000 for fiscal year 2010 and such sums as may be
    necessary for each of fiscal years 2011 through 2015.
        ``(g) Carryover Funds.--An entity that receives an award under this
    section may carry over funds from 1 fiscal year to another without
    obtaining approval from the Secretary. In no case may any funds be
    carried over pursuant to the preceding sentence for more than 3
    years.''.

    SEC. 5304. ALTERNATIVE DENTAL HEALTH CARE PROVIDERS DEMONSTRATION
                  PROJECT.

        Subpart X of part D of title III of the Public Health Service Act
    (42 U.S.C. 256f et seq.) is amended by adding at the end the following:

    ``SEC. 340G-1. DEMONSTRATION PROGRAM.

        ``(a) In General.--
                ``(1) Authorization.--The Secretary is authorized to award
            grants to 15 eligible entities to enable such entities to
            establish a demonstration program to establish training
            programs to train, or to employ, alternative dental health care
            providers in order to increase access to dental health care
            services in rural and other underserved communities.
                ``(2) Definition.--The term `alternative dental health care
            providers' includes community dental health coordinators,
            advance practice dental hygienists, independent dental
            hygienists, supervised dental hygienists, primary care
            physicians, dental therapists, dental health aides, and any
            other health professional that the Secretary determines
            appropriate.
        ``(b) Timeframe.--The demonstration projects funded under this
    section shall begin not later than 2 years after the date of enactment
    of this section, and shall conclude not later than 7 years after such
    date of enactment.
        ``(c) Eligible Entities.--To be eligible to receive a grant under
    subsection (a), an entity shall--
                ``(1) be--
                        ``(A) an institution of higher education, including
                    a community college;
                        ``(B) a public-private partnership;
                        ``(C) a federally qualified health center;
                        ``(D) an Indian Health Service facility or a tribe
                    or tribal organization (as such terms are defined in
                    section 4 of the Indian Self-Determination and
                    Education Assistance Act);
                        ``(E) a State or county public health clinic, a
                    health facility operated by an Indian tribe or tribal
                    organization, or urban Indian organization providing
                    dental services; or
                        ``(F) a public hospital or health system;
                ``(2) be within a program accredited by the Commission on
            Dental Accreditation or within a dental education program in an
            accredited institution; and
                ``(3) shall submit an application to the Secretary at such
            time, in such manner, and containing such information as the
            Secretary may require.
        ``(d) Administrative Provisions.--
                ``(1) Amount of grant.--Each grant under this section shall
            be in an amount that is not less than $4,000,000 for the 5-year
            period during which the demonstration project being conducted.
                ``(2) Disbursement of funds.--
                        ``(A) Preliminary disbursements.--Beginning 1 year
                    after the enactment of this section, the Secretary may
                    disperse to any entity receiving a grant under this
                    section not more than 20 percent of the total funding
                    awarded to such entity under such grant, for the
                    purpose of enabling the entity to plan the
                    demonstration project to be conducted under such grant.
                        ``(B) Subsequent disbursements.--The remaining
                    amount of grant funds not dispersed under subparagraph
                    (A) shall be dispersed such that not less than 15
                    percent of such remaining amount is dispersed each
                    subsequent year.
        ``(e) Compliance With State Requirements.--Each entity receiving a
    grant under this section shall certify that it is in compliance with
    all applicable State licensing requirements.
        ``(f) Evaluation.--The Secretary shall contract with the Director
    of the Institute of Medicine to conduct a study of the demonstration
    programs conducted under this section that shall provide analysis,
    based upon quantitative and qualitative data, regarding access to
    dental health care in the United States.
        ``(g) Clarification Regarding Dental Health Aide Program.--Nothing
    in this section shall prohibit a dental health aide training program
    approved by the Indian Health Service from being eligible for a grant
    under this section.
        ``(h) Authorization of Appropriations.--There is authorized to be
    appropriated such sums as may be necessary to carry out this
    section.''.

    SEC. 5305. GERIATRIC EDUCATION AND TRAINING; CAREER AWARDS;
                  COMPREHENSIVE GERIATRIC EDUCATION.

        (a) Workforce Development; Career Awards.--Section 753 of the
    Public Health Service Act (42 U.S.C. 294c) is amended by adding at the
    end the following:
        ``(d) Geriatric Workforce Development.--
                ``(1) In general.--The Secretary shall award grants or
            contracts under this subsection to entities that operate a
            geriatric education center pursuant to subsection (a)(1).
                ``(2) Application.--To be eligible for an award under
            paragraph (1), an entity described in such paragraph shall
            submit to the Secretary an application at such time, in such
            manner, and containing such information as the Secretary may
            require.
                ``(3) Use of funds.--Amounts awarded under a grant or
            contract under paragraph (1) shall be used to--
                        ``(A) carry out the fellowship program described in
                    paragraph (4); and
                        ``(B) carry out 1 of the 2 activities described in
                    paragraph (5).
                ``(4) Fellowship program.--
                        ``(A) In general.--Pursuant to paragraph (3), a
                    geriatric education center that receives an award under
                    this subsection shall use such funds to offer short-
                    term intensive courses (referred to in this subsection
                    as a `fellowship') that focus on geriatrics, chronic
                    care management, and long-term care that provide
                    supplemental training for faculty members in medical
                    schools and other health professions schools with
                    programs in psychology, pharmacy, nursing, social work,
                    dentistry, public health, allied health, or other
                    health disciplines, as approved by the Secretary. Such
                    a fellowship shall be open to current faculty, and
                    appropriately credentialed volunteer faculty and
                    practitioners, who do not have formal training in
                    geriatrics, to upgrade their knowledge and clinical
                    skills for the care of older adults and adults with
                    functional limitations and to enhance their
                    interdisciplinary teaching skills.
                        ``(B) Location.--A fellowship shall be offered
                    either at the geriatric education center that is
                    sponsoring the course, in collaboration with other
                    geriatric education centers, or at medical schools,
                    schools of dentistry, schools of nursing, schools of
                    pharmacy, schools of social work, graduate programs in
                    psychology, or allied health and other health
                    professions schools approved by the Secretary with
                    which the geriatric education centers are affiliated.
                        ``(C) CME credit.--Participation in a fellowship
                    under this paragraph shall be accepted with respect to
                    complying with continuing health profession education
                    requirements. As a condition of such acceptance, the
                    recipient shall agree to subsequently provide a minimum
                    of 18 hours of voluntary instructional support through
                    a geriatric education center that is providing clinical
                    training to students or trainees in long-term care
                    settings.
                ``(5) Additional required activities described.--Pursuant
            to paragraph (3), a geriatric education center that receives an
            award under this subsection shall use such funds to carry out 1
            of the following 2 activities.
                        ``(A) Family caregiver and direct care provider
                    training.--A geriatric education center that receives
                    an award under this subsection shall offer at least 2
                    courses each year, at no charge or nominal cost, to
                    family caregivers and direct care providers that are
                    designed to provide practical training for supporting
                    frail elders and individuals with disabilities. The
                    Secretary shall require such Centers to work with
                    appropriate community partners to develop training
                    program content and to publicize the availability of
                    training courses in their service areas. All family
                    caregiver and direct care provider training programs
                    shall include instruction on the management of
                    psychological and behavioral aspects of dementia,
                    communication techniques for working with individuals
                    who have dementia, and the appropriate, safe, and
                    effective use of medications for older adults.
                        ``(B) Incorporation of best practices.--A geriatric
                    education center that receives an award under this
                    subsection shall develop and include material on
                    depression and other mental disorders common among
                    older adults, medication safety issues for older
                    adults, and management of the psychological and
                    behavioral aspects of dementia and communication
                    techniques with individuals who have dementia in all
                    training courses, where appropriate.
                ``(6) Targets.--A geriatric education center that receives
            an award under this subsection shall meet targets approved by
            the Secretary for providing geriatric training to a certain
            number of faculty or practitioners during the term of the
            award, as well as other parameters established by the
            Secretary.
                ``(7) Amount of award.--An award under this subsection
            shall be in an amount of $150,000. Not more than 24 geriatric
            education centers may receive an award under this subsection.
                ``(8) Maintenance of effort.--A geriatric education center
            that receives an award under this subsection shall provide
            assurances to the Secretary that funds provided to the
            geriatric education center under this subsection will be used
            only to supplement, not to supplant, the amount of Federal,
            State, and local funds otherwise expended by the geriatric
            education center.
                ``(9) Authorization of appropriations.--In addition to any
            other funding available to carry out this section, there is
            authorized to be appropriated to carry out this subsection,
            $10,800,000 for the period of fiscal year 2011 through 2014.
        ``(e) Geriatric Career Incentive Awards.--
                ``(1) In general.--The Secretary shall award grants or
            contracts under this section to individuals described in
            paragraph (2) to foster greater interest among a variety of
            health professionals in entering the field of geriatrics, long-
            term care, and chronic care management.
                ``(2) Eligible individuals.--To be eligible to received an
            award under paragraph (1), an individual shall--
                        ``(A) be an advanced practice nurse, a clinical
                    social worker, a pharmacist, or student of psychology
                    who is pursuing a doctorate or other advanced degree in
                    geriatrics or related fields in an accredited health
                    professions school; and
                        ``(B) submit to the Secretary an application at
                    such time, in such manner, and containing such
                    information as the Secretary may require.
                ``(3) Condition of award.--As a condition of receiving an
            award under this subsection, an individual shall agree that,
            following completion of the award period, the individual will
            teach or practice in the field of geriatrics, long-term care,
            or chronic care management for a minimum of 5 years under
            guidelines set by the Secretary.
                ``(4) Authorization of appropriations.--There is authorized
            to be appropriated to carry out this subsection, $10,000,000
            for the period of fiscal years 2011 through 2013.''.
        (b) Expansion of Eligibility for Geriatric Academic Career Awards;
    Payment to Institution.--Section 753(c) of the Public Health Service
    Act 294(c)) is amended--
                (1) by redesignating paragraphs (4) and (5) as paragraphs
            (5) and (6), respectively;
                (2) by striking paragraph (2) through paragraph (3) and
            inserting the following:
                ``(2) Eligible individuals.--To be eligible to receive an
            Award under paragraph (1), an individual shall--
                        ``(A) be board certified or board eligible in
                    internal medicine, family practice, psychiatry, or
                    licensed dentistry, or have completed any required
                    training in a discipline and employed in an accredited
                    health professions school that is approved by the
                    Secretary;
                        ``(B) have completed an approved fellowship program
                    in geriatrics or have completed specialty training in
                    geriatrics as required by the discipline and any
                    addition geriatrics training as required by the
                    Secretary; and
                        ``(C) have a junior (non-tenured) faculty
                    appointment at an accredited (as determined by the
                    Secretary) school of medicine, osteopathic medicine,
                    nursing, social work, psychology, dentistry, pharmacy,
                    or other allied health disciplines in an accredited
                    health professions school that is approved by the
                    Secretary.
                ``(3) Limitations.--No Award under paragraph (1) may be
            made to an eligible individual unless the individual--
                        ``(A) has submitted to the Secretary an
                    application, at such time, in such manner, and
                    containing such information as the Secretary may
                    require, and the Secretary has approved such
                    application;
                        ``(B) provides, in such form and manner as the
                    Secretary may require, assurances that the individual
                    will meet the service requirement described in
                    paragraph (6); and
                        ``(C) provides, in such form and manner as the
                    Secretary may require, assurances that the individual
                    has a full-time faculty appointment in a health
                    professions institution and documented commitment from
                    such institution to spend 75 percent of the total time
                    of such individual on teaching and developing skills in
                    interdisciplinary education in geriatrics.
                ``(4) Maintenance of effort.--An eligible individual that
            receives an Award under paragraph (1) shall provide assurances
            to the Secretary that funds provided to the eligible individual
            under this subsection will be used only to supplement, not to
            supplant, the amount of Federal, State, and local funds
            otherwise expended by the eligible individual.''; and
                (3) in paragraph (5), as so designated--
                        (A) in subparagraph (A)--
                                (i) by inserting ``for individuals who are
                            physicians'' after ``this section''; and
                                (ii) by inserting after the period at the
                            end the following: ``The Secretary shall
                            determine the amount of an Award under this
                            section for individuals who are not
                            physicians.''; and
                        (B) by adding at the end the following:
                        ``(C) Payment to institution.--The Secretary shall
                    make payments to institutions which include schools of
                    medicine, osteopathic medicine, nursing, social work,
                    psychology, dentistry, and pharmacy, or other allied
                    health discipline in an accredited health professions
                    school that is approved by the Secretary.''.
        (c) Comprehensive Geriatric Education.--Section 855 of the Public
    Health Service Act (42 U.S.C. 298) is amended--
                (1) in subsection (b)--
                        (A) in paragraph (3), by striking ``or'' at the
                    end;
                        (B) in paragraph (4), by striking the period and
                    inserting ``; or''; and
                        (C) by adding at the end the following:
                ``(5) establish traineeships for individuals who are
            preparing for advanced education nursing degrees in geriatric
            nursing, long-term care, gero-psychiatric nursing or other
            nursing areas that specialize in the care of the elderly
            population.''; and
                (2) in subsection (e), by striking ``2003 through 2007''
            and inserting ``2010 through 2014''.

    SEC. 5306. MENTAL AND BEHAVIORAL HEALTH EDUCATION AND TRAINING GRANTS.

        (a) In General.--Part D of title VII (42 U.S.C. 294 et seq.) is
    amended by--
                (1) striking section 757;
                (2) redesignating section 756 (as amended by section 5103)
            as section 757; and
                (3) inserting after section 755 the following:

    ``SEC. 756. MENTAL AND BEHAVIORAL HEALTH EDUCATION AND TRAINING GRANTS.

        ``(a) Grants Authorized.--The Secretary may award grants to
    eligible institutions of higher education to support the recruitment of
    students for, and education and clinical experience of the students
    in--
                ``(1) baccalaureate, master's, and doctoral degree programs
            of social work, as well as the development of faculty in social
            work;
                ``(2) accredited master's, doctoral, internship, and post-
            doctoral residency programs of psychology for the development
            and implementation of interdisciplinary training of psychology
            graduate students for providing behavioral and mental health
            services, including substance abuse prevention and treatment
            services;
                ``(3) accredited institutions of higher education or
            accredited professional training programs that are establishing
            or expanding internships or other field placement programs in
            child and adolescent mental health in psychiatry, psychology,
            school psychology, behavioral pediatrics, psychiatric nursing,
            social work, school social work, substance abuse prevention and
            treatment, marriage and family therapy, school counseling, or
            professional counseling; and
                ``(4) State-licensed mental health nonprofit and for-profit
            organizations to enable such organizations to pay for programs
            for preservice or in-service training of paraprofessional child
            and adolescent mental health workers.
        ``(b) Eligibility Requirements.--To be eligible for a grant under
    this section, an institution shall demonstrate--
                ``(1) participation in the institutions' programs of
            individuals and groups from different racial, ethnic, cultural,
            geographic, religious, linguistic, and class backgrounds, and
            different genders and sexual orientations;
                ``(2) knowledge and understanding of the concerns of the
            individuals and groups described in subsection (a);
                ``(3) any internship or other field placement program
            assisted under the grant will prioritize cultural and
            linguistic competency;
                ``(4) the institution will provide to the Secretary such
            data, assurances, and information as the Secretary may require;
            and
                ``(5) with respect to any violation of the agreement
            between the Secretary and the institution, the institution will
            pay such liquidated damages as prescribed by the Secretary by
            regulation.
        ``(c) Institutional Requirement.--For grants authorized under
    subsection (a)(1), at least 4 of the grant recipients shall be
    historically black colleges or universities or other minority-serving
    institutions.
        ``(d) Priority.--
                ``(1) In selecting the grant recipients in social work
            under subsection (a)(1), the Secretary shall give priority to
            applicants that--
                        ``(A) are accredited by the Council on Social Work
                    Education;
                        ``(B) have a graduation rate of not less than 80
                    percent for social work students; and
                        ``(C) exhibit an ability to recruit social workers
                    from and place social workers in areas with a high need
                    and high demand population.
                ``(2) In selecting the grant recipients in graduate
            psychology under subsection (a)(2), the Secretary shall give
            priority to institutions in which training focuses on the needs
            of vulnerable groups such as older adults and children,
            individuals with mental health or substance-related disorders,
            victims of abuse or trauma and of combat stress disorders such
            as posttraumatic stress disorder and traumatic brain injuries,
            homeless individuals, chronically ill persons, and their
            families.
                ``(3) In selecting the grant recipients in training
            programs in child and adolescent mental health under
            subsections (a)(3) and (a)(4), the Secretary shall give
            priority to applicants that--
                        ``(A) have demonstrated the ability to collect data
                    on the number of students trained in child and
                    adolescent mental health and the populations served by
                    such students after graduation or completion of
                    preservice or in-service training;
                        ``(B) have demonstrated familiarity with evidence-
                    based methods in child and adolescent mental health
                    services, including substance abuse prevention and
                    treatment services;
                        ``(C) have programs designed to increase the number
                    of professionals and paraprofessionals serving high-
                    priority populations and to applicants who come from
                    high-priority communities and plan to serve medically
                    underserved populations, in health professional
                    shortage areas, or in medically underserved areas;
                        ``(D) offer curriculum taught collaboratively with
                    a family on the consumer and family lived experience or
                    the importance of family-professional or family-
                    paraprofessional partnerships; and
                        ``(E) provide services through a community mental
                    health program described in section 1913(b)(1).
        ``(e) Authorization of Appropriation.--For the fiscal years 2010
    through 2013, there is authorized to be appropriated to carry out this
    section--
                ``(1) $8,000,000 for training in social work in subsection
            (a)(1);
                ``(2) $12,000,000 for training in graduate psychology in
            subsection (a)(2), of which not less than $10,000,000 shall be
            allocated for doctoral, postdoctoral, and internship level
            training;
                ``(3) $10,000,000 for training in professional child and
            adolescent mental health in subsection (a)(3); and
                ``(4) $5,000,000 for training in paraprofessional child and
            adolescent work in subsection (a)(4).''.
        (b) Conforming Amendments.--Section 757(b)(2) of the Public Health
    Service Act, as redesignated by subsection (a), is amended by striking
    ``sections 751(a)(1)(A), 751(a)(1)(B), 753(b), 754(3)(A), and 755(b)''
    and inserting ``sections 751(b)(1)(A), 753(b), and 755(b)''.

    SEC. 5307. CULTURAL COMPETENCY, PREVENTION, AND PUBLIC HEALTH AND
                  INDIVIDUALS WITH DISABILITIES TRAINING.

        (a) Title VII.--Section 741 of the Public Health Service Act (42
    U.S.C. 293e) is amended--
                (1) in subsection (a)--
                        (A) by striking the subsection heading and
                    inserting ``Cultural Competency, Prevention, and Public
                    Health and Individuals With Disability Grants''; and
                        (B) in paragraph (1), by striking ``for the purpose
                    of'' and all that follows through the period at the end
                    and inserting ``for the development, evaluation, and
                    dissemination of research, demonstration projects, and
                    model curricula for cultural competency, prevention,
                    public health proficiency, reducing health disparities,
                    and aptitude for working with individuals with
                    disabilities training for use in health professions
                    schools and continuing education programs, and for
                    other purposes determined as appropriate by the
                    Secretary.''; and
                (2) by striking subsection (b) and inserting the following:
        ``(b) Collaboration.--In carrying out subsection (a), the Secretary
    shall collaborate with health professional societies, licensing and
    accreditation entities, health professions schools, and experts in
    minority health and cultural competency, prevention, and public health
    and disability groups, community-based organizations, and other
    organizations as determined appropriate by the Secretary. The Secretary
    shall coordinate with curricula and research and demonstration projects
    developed under section 807.
        ``(c) Dissemination.--
                ``(1) In general.--Model curricula developed under this
            section shall be disseminated through the Internet
            Clearinghouse under section 270 and such other means as
            determined appropriate by the Secretary.
                ``(2) Evaluation.--The Secretary shall evaluate the
            adoption and the implementation of cultural competency,
            prevention, and public health, and working with individuals
            with a disability training curricula, and the facilitate
            inclusion of these competency measures in quality measurement
            systems as appropriate.
        ``(d) Authorization of Appropriations.--There is authorized to be
    appropriated to carry out this section such sums as may be necessary
    for each of fiscal years 2010 through 2015.''.
        (b) Title VIII.--Section 807 of the Public Health Service Act (42
    U.S.C. 296e-1) is amended--
                (1) in subsection (a)--
                        (A) by striking the subsection heading and
                    inserting ``Cultural Competency, Prevention, and Public
                    Health and Individuals With Disability Grants''; and
                        (B) by striking ``for the purpose of'' and all that
                    follows through ``health care.'' and inserting ``for
                    the development, evaluation, and dissemination of
                    research, demonstration projects, and model curricula
                    for cultural competency, prevention, public health
                    proficiency, reducing health disparities, and aptitude
                    for working with individuals with disabilities training
                    for use in health professions schools and continuing
                    education programs, and for other purposes determined
                    as appropriate by the Secretary.''; and
                (2) by redesignating subsection (b) as subsection (d);
                (3) by inserting after subsection (a) the following:
        ``(b) Collaboration.--In carrying out subsection (a), the Secretary
    shall collaborate with the entities described in section 741(b). The
    Secretary shall coordinate with curricula and research and
    demonstration projects developed under such section 741.
        ``(c) Dissemination.--Model curricula developed under this section
    shall be disseminated and evaluated in the same manner as model
    curricula developed under section 741, as described in subsection (c)
    of such section.''; and
                (4) in subsection (d), as so redesignated--
                        (A) by striking ``subsection (a)'' and inserting
                    ``this section''; and
                        (B) by striking ``2001 through 2004'' and inserting
                    ``2010 through 2015''.

    SEC. 5308. ADVANCED NURSING EDUCATION GRANTS.

        Section 811 of the Public Health Service Act (42 U.S.C. 296j) is
    amended--
                (1) in subsection (c)--
                        (A) in the subsection heading, by striking ``and
                    Nurse Midwifery Programs''; and
                        (B) by striking ``and nurse midwifery'';
                (2) in subsection (f)--
                        (A) by striking paragraph (2); and
                        (B) by redesignating paragraph (3) as paragraph
                    (2); and
                (3) by redesignating subsections (d), (e), and (f) as
            subsections (e), (f), and (g), respectively; and
                (4) by inserting after subsection (c), the following:
        ``(d) Authorized Nurse-midwifery Programs.--Midwifery programs that
    are eligible for support under this section are educational programs
    that--
                ``(1) have as their objective the education of midwives;
            and
                ``(2) are accredited by the American College of Nurse-
            Midwives Accreditation Commission for Midwifery Education.''.

    SEC. 5309. NURSE EDUCATION, PRACTICE, AND RETENTION GRANTS.

        (a) In General.--Section 831 of the Public Health Service Act (42
    U.S.C. 296p) is amended--
                (1) in the section heading, by striking ``retention'' and
            inserting ``quality'';
                (2) in subsection (a)--
                        (A) in paragraph (1), by adding ``or'' after the
                    semicolon;
                        (B) by striking paragraph (2); and
                        (C) by redesignating paragraph (3) as paragraph
                    (2);
                (3) in subsection (b)(3), by striking ``managed care,
            quality improvement'' and inserting ``coordinated care'';
                (4) in subsection (g), by inserting ``, as defined in
            section 801(2),'' after ``school of nursing''; and
                (5) in subsection (h), by striking ``2003 through 2007''
            and inserting ``2010 through 2014''.
        (b) Nurse Retention Grants.--Title VIII of the Public Health
    Service Act is amended by inserting after section 831 (42 U.S.C. 296b)
    the following:

    ``SEC. 831A. NURSE RETENTION GRANTS.

        ``(a) Retention Priority Areas.--The Secretary may award grants to,
    and enter into contracts with, eligible entities to enhance the nursing
    workforce by initiating and maintaining nurse retention programs
    pursuant to subsection (b) or (c).
        ``(b) Grants for Career Ladder Program.--The Secretary may award
    grants to, and enter into contracts with, eligible entities for
    programs--
                ``(1) to promote career advancement for individuals
            including licensed practical nurses, licensed vocational
            nurses, certified nurse assistants, home health aides, diploma
            degree or associate degree nurses, to become baccalaureate
            prepared registered nurses or advanced education nurses in
            order to meet the needs of the registered nurse workforce;
                ``(2) developing and implementing internships and residency
            programs in collaboration with an accredited school of nursing,
            as defined by section 801(2), to encourage mentoring and the
            development of specialties; or
                ``(3) to assist individuals in obtaining education and
            training required to enter the nursing profession and advance
            within such profession.
        ``(c) Enhancing Patient Care Delivery Systems.--
                ``(1) Grants.--The Secretary may award grants to eligible
            entities to improve the retention of nurses and enhance patient
            care that is directly related to nursing activities by
            enhancing collaboration and communication among nurses and
            other health care professionals, and by promoting nurse
            involvement in the organizational and clinical decision-making
            processes of a health care facility.
                ``(2) Priority.--In making awards of grants under this
            subsection, the Secretary shall give preference to applicants
            that have not previously received an award under this
            subsection (or section 831(c) as such section existed on the
            day before the date of enactment of this section).
                ``(3) Continuation of an award.--The Secretary shall make
            continuation of any award under this subsection beyond the
            second year of such award contingent on the recipient of such
            award having demonstrated to the Secretary measurable and
            substantive improvement in nurse retention or patient care.
        ``(d) Other Priority Areas.--The Secretary may award grants to, or
    enter into contracts with, eligible entities to address other areas
    that are of high priority to nurse retention, as determined by the
    Secretary.
        ``(e) Report.--The Secretary shall submit to the Congress before
    the end of each fiscal year a report on the grants awarded and the
    contracts entered into under this section. Each such report shall
    identify the overall number of such grants and contracts and provide an
    explanation of why each such grant or contract will meet the priority
    need of the nursing workforce.
        ``(f) Eligible Entity.--For purposes of this section, the term
    `eligible entity' includes an accredited school of nursing, as defined
    by section 801(2), a health care facility, or a partnership of such a
    school and facility.
        ``(g) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this section such sums as may be necessary
    for each of fiscal years 2010 through 2012.''.

    SEC. 5310. LOAN REPAYMENT AND SCHOLARSHIP PROGRAM.

        (a) Loan Repayments and Scholarships.--Section 846(a)(3) of the
    Public Health Service Act (42 U.S.C. 297n(a)(3)) is amended by
    inserting before the semicolon the following: ``, or in a accredited
    school of nursing, as defined by section 801(2), as nurse faculty''.
        (b) Technical and Conforming Amendments.--Title VIII (42 U.S.C. 296
    et seq.) is amended--
                (1) by redesignating section 810 (relating to prohibition
            against discrimination by schools on the basis of sex) as
            section 809 and moving such section so that it follows section
            808;
                (2) in sections 835, 836, 838, 840, and 842, by striking
            the term ``this subpart'' each place it appears and inserting
            ``this part'';
                (3) in section 836(h), by striking the last sentence;
                (4) in section 836, by redesignating subsection (l) as
            subsection (k);
                (5) in section 839, by striking ``839'' and all that
            follows through ``(a)'' and inserting ``839. (a)'';
                (6) in section 835(b), by striking ``841'' each place it
            appears and inserting ``871'';
                (7) by redesignating section 841 as section 871, moving
            part F to the end of the title, and redesignating such part as
            part I;
                (8) in part G--
                        (A) by redesignating section 845 as section 851;
                    and
                        (B) by redesignating part G as part F;
                (9) in part H--
                        (A) by redesignating sections 851 and 852 as
                    sections 861 and 862, respectively; and
                        (B) by redesignating part H as part G; and
                (10) in part I--
                        (A) by redesignating section 855, as amended by
                    section 5305, as section 865; and
                        (B) by redesignating part I as part H.

    SEC. 5311. NURSE FACULTY LOAN PROGRAM.

        (a) In General.--Section 846A of the Public Health Service Act (42
    U.S.C. 297n-1) is amended--
                (1) in subsection (a)--
                        (A) in the subsection heading, by striking
                    ``Establishment'' and inserting ``School of Nursing
                    Student Loan Fund''; and
                        (B) by inserting ``accredited'' after ``agreement
                    with any'';
                (2) in subsection (c)--
                        (A) in paragraph (2), by striking ``$30,000'' and
                    all that follows through the semicolon and inserting
                    ``$35,500, during fiscal years 2010 and 2011 fiscal
                    years (after fiscal year 2011, such amounts shall be
                    adjusted to provide for a cost-of-attendance increase
                    for the yearly loan rate and the aggregate loan;''; and
                        (B) in paragraph (3)(A), by inserting ``an
                    accredited'' after ``faculty member in'';
                (3) in subsection (e), by striking ``a school'' and
            inserting ``an accredited school''; and
                (4) in subsection (f), by striking ``2003 through 2007''
            and inserting ``2010 through 2014''.
        (b) Eligible Individual Student Loan Repayment.--Title VIII of the
    Public Health Service Act is amended by inserting after section 846A
    (42 U.S.C. 297n-1) the following:

    ``SEC. 847. ELIGIBLE INDIVIDUAL STUDENT LOAN REPAYMENT.

        ``(a) In General.--The Secretary, acting through the Administrator
    of the Health Resources and Services Administration, may enter into an
    agreement with eligible individuals for the repayment of education
    loans, in accordance with this section, to increase the number of
    qualified nursing faculty.
        ``(b) Agreements.--Each agreement entered into under this
    subsection shall require that the eligible individual shall serve as a
    full-time member of the faculty of an accredited school of nursing, for
    a total period, in the aggregate, of at least 4 years during the 6-year
    period beginning on the later of--
                ``(1) the date on which the individual receives a master's
            or doctorate nursing degree from an accredited school of
            nursing; or
                ``(2) the date on which the individual enters into an
            agreement under this subsection.
        ``(c) Agreement Provisions.--Agreements entered into pursuant to
    subsection (b) shall be entered into on such terms and conditions as
    the Secretary may determine, except that--
                ``(1) not more than 10 months after the date on which the
            6-year period described under subsection (b) begins, but in no
            case before the individual starts as a full-time member of the
            faculty of an accredited school of nursing the Secretary shall
            begin making payments, for and on behalf of that individual, on
            the outstanding principal of, and interest on, any loan of that
            individual obtained to pay for such degree;
                ``(2) for an individual who has completed a master's in
            nursing or equivalent degree in nursing--
                        ``(A) payments may not exceed $10,000 per calendar
                    year; and
                        ``(B) total payments may not exceed $40,000 during
                    the 2010 and 2011 fiscal years (after fiscal year 2011,
                    such amounts shall be adjusted to provide for a cost-
                    of-attendance increase for the yearly loan rate and the
                    aggregate loan); and
                ``(3) for an individual who has completed a doctorate or
            equivalent degree in nursing--
                        ``(A) payments may not exceed $20,000 per calendar
                    year; and
                        ``(B) total payments may not exceed $80,000 during
                    the 2010 and 2011 fiscal years (adjusted for subsequent
                    fiscal years as provided for in the same manner as in
                    paragraph (2)(B)).
        ``(d) Breach of Agreement.--
                ``(1) In general.--In the case of any agreement made under
            subsection (b), the individual is liable to the Federal
            Government for the total amount paid by the Secretary under
            such agreement, and for interest on such amount at the maximum
            legal prevailing rate, if the individual fails to meet the
            agreement terms required under such subsection.
                ``(2) Waiver or suspension of liability.--In the case of an
            individual making an agreement for purposes of paragraph (1),
            the Secretary shall provide for the waiver or suspension of
            liability under such paragraph if compliance by the individual
            with the agreement involved is impossible or would involve
            extreme hardship to the individual or if enforcement of the
            agreement with respect to the individual would be
            unconscionable.
                ``(3) Date certain for recovery.--Subject to paragraph (2),
            any amount that the Federal Government is entitled to recover
            under paragraph (1) shall be paid to the United States not
            later than the expiration of the 3-year period beginning on the
            date the United States becomes so entitled.
                ``(4) Availability.--Amounts recovered under paragraph (1)
            shall be available to the Secretary for making loan repayments
            under this section and shall remain available for such purpose
            until expended.
        ``(e) Eligible Individual Defined.--For purposes of this section,
    the term `eligible individual' means an individual who--
                ``(1) is a United States citizen, national, or lawful
            permanent resident;
                ``(2) holds an unencumbered license as a registered nurse;
            and
                ``(3) has either already completed a master's or doctorate
            nursing program at an accredited school of nursing or is
            currently enrolled on a full-time or part-time basis in such a
            program.
        ``(f) Priority.--For the purposes of this section and section 846A,
    funding priority will be awarded to School of Nursing Student Loans
    that support doctoral nursing students or Individual Student Loan
    Repayment that support doctoral nursing students.
        ``(g) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this section such sums as may be necessary
    for each of fiscal years 2010 through 2014.''.

    SEC. 5312. AUTHORIZATION OF APPROPRIATIONS FOR PARTS B THROUGH D OF
                  TITLE VIII.

        Section 871 of the Public Health Service Act, as redesignated and
    moved by section 5310, is amended to read as follows:

    ``SEC. 871. AUTHORIZATION OF APPROPRIATIONS.

        ``For the purpose of carrying out parts B, C, and D (subject to
    section 851(g)), there are authorized to be appropriated $338,000,000
    for fiscal year 2010, and such sums as may be necessary for each of the
    fiscal years 2011 through 2016.''.

    SEC. 5313. GRANTS TO PROMOTE THE COMMUNITY HEALTH WORKFORCE.

        (a) In General.--Part P of title III of the Public Health Service
    Act (42 U.S.C. 280g et seq.) is amended by adding at the end the
    following:

    ``SEC. 399V. GRANTS TO PROMOTE POSITIVE HEALTH BEHAVIORS AND OUTCOMES.

        ``(a) Grants Authorized.--The Director of the Centers for Disease
    Control and Prevention, in collaboration with the Secretary, shall
    award grants to eligible entities to promote positive health behaviors
    and outcomes for populations in medically underserved communities
    through the use of community health workers.
        ``(b) Use of Funds.--Grants awarded under subsection (a) shall be
    used to support community health workers--
                ``(1) to educate, guide, and provide outreach in a
            community setting regarding health problems prevalent in
            medically underserved communities, particularly racial and
            ethnic minority populations;
                ``(2) to educate and provide guidance regarding effective
            strategies to promote positive health behaviors and discourage
            risky health behaviors;
                ``(3) to educate and provide outreach regarding enrollment
            in health insurance including the Children's Health Insurance
            Program under title XXI of the Social Security Act, Medicare
            under title XVIII of such Act and Medicaid under title XIX of
            such Act;
                ``(4) to identify, educate, refer, and enroll underserved
            populations to appropriate healthcare agencies and community-
            based programs and organizations in order to increase access to
            quality healthcare services and to eliminate duplicative care;
            or
                ``(5) to educate, guide, and provide home visitation
            services regarding maternal health and prenatal care.
        ``(c) Application.--Each eligible entity that desires to receive a
    grant under subsection (a) shall submit an application to the
    Secretary, at such time, in such manner, and accompanied by such
    information as the Secretary may require.
        ``(d) Priority.--In awarding grants under subsection (a), the
    Secretary shall give priority to applicants that--
                ``(1) propose to target geographic areas--
                        ``(A) with a high percentage of residents who are
                    eligible for health insurance but are uninsured or
                    underinsured;
                        ``(B) with a high percentage of residents who
                    suffer from chronic diseases; or
                        ``(C) with a high infant mortality rate;
                ``(2) have experience in providing health or health-related
            social services to individuals who are underserved with respect
            to such services; and
                ``(3) have documented community activity and experience
            with community health workers.
        ``(e) Collaboration With Academic Institutions and the One-stop
    Delivery System.--The Secretary shall encourage community health worker
    programs receiving funds under this section to collaborate with
    academic institutions and one-stop delivery systems under section
    134(c) of the Workforce Investment Act of 1998. Nothing in this section
    shall be construed to require such collaboration.
        ``(f) Evidence-based Interventions.--The Secretary shall encourage
    community health worker programs receiving funding under this section
    to implement a process or an outcome-based payment system that rewards
    community health workers for connecting underserved populations with
    the most appropriate services at the most appropriate time. Nothing in
    this section shall be construed to require such a payment.
        ``(g) Quality Assurance and Cost Effectiveness.--The Secretary
    shall establish guidelines for assuring the quality of the training and
    supervision of community health workers under the programs funded under
    this section and for assuring the cost-effectiveness of such programs.
        ``(h) Monitoring.--The Secretary shall monitor community health
    worker programs identified in approved applications under this section
    and shall determine whether such programs are in compliance with the
    guidelines established under subsection (g).
        ``(i) Technical Assistance.--The Secretary may provide technical
    assistance to community health worker programs identified in approved
    applications under this section with respect to planning, developing,
    and operating programs under the grant.
        ``(j) 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 2010 through 2014.
        ``(k) Definitions.--In this section:
                ``(1) Community health worker.--The term `community health
            worker', as defined by the Department of Labor as Standard
            Occupational Classification [21-1094] means an individual who
            promotes health or nutrition within the community in which the
            individual resides--
                        ``(A) by serving as a liaison between communities
                    and healthcare agencies;
                        ``(B) by providing guidance and social assistance
                    to community residents;
                        ``(C) by enhancing community residents' ability to
                    effectively communicate with healthcare providers;
                        ``(D) by providing culturally and linguistically
                    appropriate health or nutrition education;
                        ``(E) by advocating for individual and community
                    health;
                        ``(F) by providing referral and follow-up services
                    or otherwise coordinating care; and
                        ``(G) by proactively identifying and enrolling
                    eligible individuals in Federal, State, local, private
                    or nonprofit health and human services programs.
                ``(2) Community setting.--The term `community setting'
            means a home or a community organization located in the
            neighborhood in which a participant in the program under this
            section resides.
                ``(3) Eligible entity.--The term `eligible entity' means a
            public or nonprofit private entity (including a State or public
            subdivision of a State, a public health department, a free
            health clinic, a hospital, or a Federally-qualified health
            center (as defined in section 1861(aa) of the Social Security
            Act)), or a consortium of any such entities.
                ``(4) Medically underserved community.--The term `medically
            underserved community' means a community identified by a
            State--
                        ``(A) that has a substantial number of individuals
                    who are members of a medically underserved population,
                    as defined by section 330(b)(3); and
                        ``(B) a significant portion of which is a health
                    professional shortage area as designated under section
                    332.''.

    SEC. 5314. FELLOWSHIP TRAINING IN PUBLIC HEALTH.

        Part E of title VII of the Public Health Service Act (42 U.S.C.
    294n et seq.), as amended by section 5206, is further amended by adding
    at the end the following:

    ``SEC. 778. FELLOWSHIP TRAINING IN APPLIED PUBLIC HEALTH EPIDEMIOLOGY,
                  PUBLIC HEALTH LABORATORY SCIENCE, PUBLIC HEALTH
                  INFORMATICS, AND EXPANSION OF THE EPIDEMIC INTELLIGENCE
                  SERVICE.

        ``(a) In General.--The Secretary may carry out activities to
    address documented workforce shortages in State and local health
    departments in the critical areas of applied public health epidemiology
    and public health laboratory science and informatics and may expand the
    Epidemic Intelligence Service.
        ``(b) Specific Uses.--In carrying out subsection (a), the Secretary
    shall provide for the expansion of existing fellowship programs
    operated through the Centers for Disease Control and Prevention in a
    manner that is designed to alleviate shortages of the type described in
    subsection (a).
        ``(c) Other Programs.--The Secretary may provide for the expansion
    of other applied epidemiology training programs that meet objectives
    similar to the objectives of the programs described in subsection (b).
        ``(d) Work Obligation.--Participation in fellowship training
    programs under this section shall be deemed to be service for purposes
    of satisfying work obligations stipulated in contracts under section
    338I(j).
        ``(e) General Support.--Amounts may be used from grants awarded
    under this section to expand the Public Health Informatics Fellowship
    Program at the Centers for Disease Control and Prevention to better
    support all public health systems at all levels of government.
        ``(f) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this section $39,500,000 for each of fiscal
    years 2010 through 2013, of which--
                ``(1) $5,000,000 shall be made available in each such
            fiscal year for epidemiology fellowship training program
            activities under subsections (b) and (c);
                ``(2) $5,000,000 shall be made available in each such
            fiscal year for laboratory fellowship training programs under
            subsection (b);
                ``(3) $5,000,000 shall be made available in each such
            fiscal year for the Public Health Informatics Fellowship
            Program under subsection (e); and
                ``(4) $24,500,000 shall be made available for expanding the
            Epidemic Intelligence Service under subsection (a).''.

    SEC. 5315. UNITED STATES PUBLIC HEALTH SCIENCES TRACK.

        Title II of the Public Health Service Act (42 U.S.C. 202 et seq.)
    is amended by adding at the end the following:

              ``PART D--UNITED STATES PUBLIC HEALTH SCIENCES TRACK

    ``SEC. 271. ESTABLISHMENT.

        ``(a) United States Public Health Services Track.--
                ``(1) In general.--There is hereby authorized to be
            established a United States Public Health Sciences Track
            (referred to in this part as the `Track'), at sites to be
            selected by the Secretary, with authority to grant appropriate
            advanced degrees in a manner that uniquely emphasizes team-
            based service, public health, epidemiology, and emergency
            preparedness and response. It shall be so organized as to
            graduate not less than--
                        ``(A) 150 medical students annually, 10 of whom
                    shall be awarded studentships to the Uniformed Services
                    University of Health Sciences;
                        ``(B) 100 dental students annually;
                        ``(C) 250 nursing students annually;
                        ``(D) 100 public health students annually;
                        ``(E) 100 behavioral and mental health professional
                    students annually;
                        ``(F) 100 physician assistant or nurse practitioner
                    students annually; and
                        ``(G) 50 pharmacy students annually.
                ``(2) Locations.--The Track shall be located at existing
            and accredited, affiliated health professions education
            training programs at academic health centers located in regions
            of the United States determined appropriate by the Surgeon
            General, in consultation with the National Health Care
            Workforce Commission established in section 5101 of the Patient
            Protection and Affordable Care Act.
        ``(b) Number of Graduates.--Except as provided in subsection (a),
    the number of persons to be graduated from the Track shall be
    prescribed by the Secretary. In so prescribing the number of persons to
    be graduated from the Track, the Secretary shall institute actions
    necessary to ensure the maximum number of first-year enrollments in the
    Track consistent with the academic capacity of the affiliated sites and
    the needs of the United States for medical, dental, and nursing
    personnel.
        ``(c) Development.--The development of the Track may be by such
    phases as the Secretary may prescribe subject to the requirements of
    subsection (a).
        ``(d) Integrated Longitudinal Plan.--The Surgeon General shall
    develop an integrated longitudinal plan for health professions
    continuing education throughout the continuum of health-related
    education, training, and practice. Training under such plan shall
    emphasize patient-centered, interdisciplinary, and care coordination
    skills. Experience with deployment of emergency response teams shall be
    included during the clinical experiences.
        ``(e) Faculty Development.--The Surgeon General shall develop
    faculty development programs and curricula in decentralized venues of
    health care, to balance urban, tertiary, and inpatient venues.

    ``SEC. 272. ADMINISTRATION.

        ``(a) In General.--The business of the Track shall be conducted by
    the Surgeon General with funds appropriated for and provided by the
    Department of Health and Human Services. The National Health Care
    Workforce Commission shall assist the Surgeon General in an advisory
    capacity.
        ``(b) Faculty.--
                ``(1) In general.--The Surgeon General, after considering
            the recommendations of the National Health Care Workforce
            Commission, shall obtain the services of such professors,
            instructors, and administrative and other employees as may be
            necessary to operate the Track, but utilize when possible,
            existing affiliated health professions training institutions.
            Members of the faculty and staff shall be employed under salary
            schedules and granted retirement and other related benefits
            prescribed by the Secretary so as to place the employees of the
            Track faculty on a comparable basis with the employees of fully
            accredited schools of the health professions within the United
            States.
                ``(2) Titles.--The Surgeon General may confer academic
            titles, as appropriate, upon the members of the faculty.
                ``(3) Nonapplication of provisions.--The limitations in
            section 5373 of title 5, United States Code, shall not apply to
            the authority of the Surgeon General under paragraph (1) to
            prescribe salary schedules and other related benefits.
        ``(c) Agreements.--The Surgeon General may negotiate agreements
    with agencies of the Federal Government to utilize on a reimbursable
    basis appropriate existing Federal medical resources located in the
    United States (or locations selected in accordance with section
    271(a)(2)). Under such agreements the facilities concerned will retain
    their identities and basic missions. The Surgeon General may negotiate
    affiliation agreements with accredited universities and health
    professions training institutions in the United States. Such agreements
    may include provisions for payments for educational services provided
    students participating in Department of Health and Human Services
    educational programs.
        ``(d) Programs.--The Surgeon General may establish the following
    educational programs for Track students:
                ``(1) Postdoctoral, postgraduate, and technological
            programs.
                ``(2) A cooperative program for medical, dental, physician
            assistant, pharmacy, behavioral and mental health, public
            health, and nursing students.
                ``(3) Other programs that the Surgeon General determines
            necessary in order to operate the Track in a cost-effective
            manner.
        ``(e) Continuing Medical Education.--The Surgeon General shall
    establish programs in continuing medical education for members of the
    health professions to the end that high standards of health care may be
    maintained within the United States.
        ``(f) Authority of the Surgeon General.--
                ``(1) In general.--The Surgeon General is authorized--
                        ``(A) to enter into contracts with, accept grants
                    from, and make grants to any nonprofit entity for the
                    purpose of carrying out cooperative enterprises in
                    medical, dental, physician assistant, pharmacy,
                    behavioral and mental health, public health, and
                    nursing research, consultation, and education;
                        ``(B) to enter into contracts with entities under
                    which the Surgeon General may furnish the services of
                    such professional, technical, or clerical personnel as
                    may be necessary to fulfill cooperative enterprises
                    undertaken by the Track;
                        ``(C) to accept, hold, administer, invest, and
                    spend any gift, devise, or bequest of personal property
                    made to the Track, including any gift, devise, or
                    bequest for the support of an academic chair, teaching,
                    research, or demonstration project;
                        ``(D) to enter into agreements with entities that
                    may be utilized by the Track for the purpose of
                    enhancing the activities of the Track in education,
                    research, and technological applications of knowledge;
                    and
                        ``(E) to accept the voluntary services of guest
                    scholars and other persons.
                ``(2) Limitation.--The Surgeon General may not enter into
            any contract with an entity if the contract would obligate the
            Track to make outlays in advance of the enactment of budget
            authority for such outlays.
                ``(3) Scientists.--Scientists or other medical, dental, or
            nursing personnel utilized by the Track under an agreement
            described in paragraph (1) may be appointed to any position
            within the Track and may be permitted to perform such duties
            within the Track as the Surgeon General may approve.
                ``(4) Volunteer services.--A person who provides voluntary
            services under the authority of subparagraph (E) of paragraph
            (1) shall be considered to be an employee of the Federal
            Government for the purposes of chapter 81 of title 5, relating
            to compensation for work-related injuries, and to be an
            employee of the Federal Government for the purposes of chapter
            171 of title 28, relating to tort claims. Such a person who is
            not otherwise employed by the Federal Government shall not be
            considered to be a Federal employee for any other purpose by
            reason of the provision of such services.

    ``SEC. 273. STUDENTS; SELECTION; OBLIGATION.

        ``(a) Student Selection.--
                ``(1) In general.--Medical, dental, physician assistant,
            pharmacy, behavioral and mental health, public health, and
            nursing students at the Track shall be selected under
            procedures prescribed by the Surgeon General. In so
            prescribing, the Surgeon General shall consider the
            recommendations of the National Health Care Workforce
            Commission.
                ``(2) Priority.--In developing admissions procedures under
            paragraph (1), the Surgeon General shall ensure that such
            procedures give priority to applicant medical, dental,
            physician assistant, pharmacy, behavioral and mental health,
            public health, and nursing students from rural communities and
            underrepresented minorities.
        ``(b) Contract and Service Obligation.--
                ``(1) Contract.--Upon being admitted to the Track, a
            medical, dental, physician assistant, pharmacy, behavioral and
            mental health, public health, or nursing student shall enter
            into a written contract with the Surgeon General that shall
            contain--
                        ``(A) an agreement under which--
                                ``(i) subject to subparagraph (B), the
                            Surgeon General agrees to provide the student
                            with tuition (or tuition remission) and a
                            student stipend (described in paragraph (2)) in
                            each school year for a period of years (not to
                            exceed 4 school years) determined by the
                            student, during which period the student is
                            enrolled in the Track at an affiliated or other
                            participating health professions institution
                            pursuant to an agreement between the Track and
                            such institution; and
                                ``(ii) subject to subparagraph (B), the
                            student agrees--
                                        ``(I) to accept the provision of
                                    such tuition and student stipend to the
                                    student;
                                        ``(II) to maintain enrollment at
                                    the Track until the student completes
                                    the course of study involved;
                                        ``(III) while enrolled in such
                                    course of study, to maintain an
                                    acceptable level of academic standing
                                    (as determined by the Surgeon General);
                                        ``(IV) if pursuing a degree from a
                                    school of medicine or osteopathic
                                    medicine, dental, public health, or
                                    nursing school or a physician
                                    assistant, pharmacy, or behavioral and
                                    mental health professional program, to
                                    complete a residency or internship in a
                                    specialty that the Surgeon General
                                    determines is appropriate; and
                                        ``(V) to serve for a period of time
                                    (referred to in this part as the
                                    `period of obligated service') within
                                    the Commissioned Corps of the Public
                                    Health Service equal to 2 years for
                                    each school year during which such
                                    individual was enrolled at the College,
                                    reduced as provided for in paragraph
                                    (3);
                        ``(B) a provision that any financial obligation of
                    the United States arising out of a contract entered
                    into under this part and any obligation of the student
                    which is conditioned thereon, is contingent upon funds
                    being appropriated to carry out this part;
                        ``(C) a statement of the damages to which the
                    United States is entitled for the student's breach of
                    the contract; and
                        ``(D) such other statements of the rights and
                    liabilities of the Secretary and of the individual, not
                    inconsistent with the provisions of this part.
                ``(2) Tuition and student stipend.--
                        ``(A) Tuition remission rates.--The Surgeon
                    General, based on the recommendations of the National
                    Health Care Workforce Commission, shall establish
                    Federal tuition remission rates to be used by the Track
                    to provide reimbursement to affiliated and other
                    participating health professions institutions for the
                    cost of educational services provided by such
                    institutions to Track students. The agreement entered
                    into by such participating institutions under paragraph
                    (1)(A)(i) shall contain an agreement to accept as
                    payment in full the established remission rate under
                    this subparagraph.
                        ``(B) Stipend.--The Surgeon General, based on the
                    recommendations of the National Health Care Workforce
                    Commission, shall establish and update Federal stipend
                    rates for payment to students under this part.
                ``(3) Reductions in the period of obligated service.--The
            period of obligated service under paragraph (1)(A)(ii)(V) shall
            be reduced--
                        ``(A) in the case of a student who elects to
                    participate in a high-needs speciality residency (as
                    determined by the National Health Care Workforce
                    Commission), by 3 months for each year of such
                    participation (not to exceed a total of 12 months); and
                        ``(B) in the case of a student who, upon completion
                    of their residency, elects to practice in a Federal
                    medical facility (as defined in section 781(e)) that is
                    located in a health professional shortage area (as
                    defined in section 332), by 3 months for year of full-
                    time practice in such a facility (not to exceed a total
                    of 12 months).
        ``(c) Second 2 Years of Service.--During the third and fourth years
    in which a medical, dental, physician assistant, pharmacy, behavioral
    and mental health, public health, or nursing student is enrolled in the
    Track, training should be designed to prioritize clinical rotations in
    Federal medical facilities in health professional shortage areas, and
    emphasize a balance of hospital and community-based experiences, and
    training within interdisciplinary teams.
        ``(d) Dentist, Physician Assistant, Pharmacist, Behavioral and
    Mental Health Professional, Public Health Professional, and Nurse
    Training.--The Surgeon General shall establish provisions applicable
    with respect to dental, physician assistant, pharmacy, behavioral and
    mental health, public health, and nursing students that are comparable
    to those for medical students under this section, including service
    obligations, tuition support, and stipend support. The Surgeon General
    shall give priority to health professions training institutions that
    train medical, dental, physician assistant, pharmacy, behavioral and
    mental health, public health, and nursing students for some significant
    period of time together, but at a minimum have a discrete and shared
    core curriculum.
        ``(e) Elite Federal Disaster Teams.--The Surgeon General, in
    consultation with the Secretary, the Director of the Centers for
    Disease Control and Prevention, and other appropriate military and
    Federal government agencies, shall develop criteria for the appointment
    of highly qualified Track faculty, medical, dental, physician
    assistant, pharmacy, behavioral and mental health, public health, and
    nursing students, and graduates to elite Federal disaster preparedness
    teams to train and to respond to public health emergencies, natural
    disasters, bioterrorism events, and other emergencies.
        ``(f) Student Dropped From Track in Affiliate School.--A medical,
    dental, physician assistant, pharmacy, behavioral and mental health,
    public health, or nursing student who, under regulations prescribed by
    the Surgeon General, is dropped from the Track in an affiliated school
    for deficiency in conduct or studies, or for other reasons, shall be
    liable to the United States for all tuition and stipend support
    provided to the student.

    ``SEC. 274. FUNDING.

        ``Beginning with fiscal year 2010, the Secretary shall transfer
    from the Public Health and Social Services Emergency Fund such sums as
    may be necessary to carry out this part.''.

           Subtitle E--Supporting the Existing Health Care Workforce

    SEC. 5401. CENTERS OF EXCELLENCE.

        Section 736 of the Public Health Service Act (42 U.S.C. 293) is
    amended by striking subsection (h) and inserting the following:
        ``(h) Formula for Allocations.--
                ``(1) Allocations.--Based on the amount appropriated under
            subsection (i) for a fiscal year, the following subparagraphs
            shall apply as appropriate:
                        ``(A) In general.--If the amounts appropriated
                    under subsection (i) for a fiscal year are $24,000,000
                    or less--
                                ``(i) the Secretary shall make available
                            $12,000,000 for grants under subsection (a) to
                            health professions schools that meet the
                            conditions described in subsection (c)(2)(A);
                            and
                                ``(ii) and available after grants are made
                            with funds under clause (i), the Secretary
                            shall make available--
                                        ``(I) 60 percent of such amount for
                                    grants under subsection (a) to health
                                    professions schools that meet the
                                    conditions described in paragraph (3)
                                    or (4) of subsection (c) (including
                                    meeting the conditions under subsection
                                    (e)); and
                                        ``(II) 40 percent of such amount
                                    for grants under subsection (a) to
                                    health professions schools that meet
                                    the conditions described in subsection
                                    (c)(5).
                        ``(B) Funding in excess of $24,000,000.--If amounts
                    appropriated under subsection (i) for a fiscal year
                    exceed $24,000,000 but are less than $30,000,000--
                                ``(i) 80 percent of such excess amounts
                            shall be made available for grants under
                            subsection (a) to health professions schools
                            that meet the requirements described in
                            paragraph (3) or (4) of subsection (c)
                            (including meeting conditions pursuant to
                            subsection (e)); and
                                ``(ii) 20 percent of such excess amount
                            shall be made available for grants under
                            subsection (a) to health professions schools
                            that meet the conditions described in
                            subsection (c)(5).
                        ``(C) Funding in excess of $30,000,000.--If amounts
                    appropriated under subsection (i) for a fiscal year
                    exceed $30,000,000 but are less than $40,000,000, the
                    Secretary shall make available--
                                ``(i) not less than $12,000,000 for grants
                            under subsection (a) to health professions
                            schools that meet the conditions described in
                            subsection (c)(2)(A);
                                ``(ii) not less than $12,000,000 for grants
                            under subsection (a) to health professions
                            schools that meet the conditions described in
                            paragraph (3) or (4) of subsection (c)
                            (including meeting conditions pursuant to
                            subsection (e));
                                ``(iii) not less than $6,000,000 for grants
                            under subsection (a) to health professions
                            schools that meet the conditions described in
                            subsection (c)(5); and
                                ``(iv) after grants are made with funds
                            under clauses (i) through (iii), any remaining
                            excess amount for grants under subsection (a)
                            to health professions schools that meet the
                            conditions described in paragraph (2)(A), (3),
                            (4), or (5) of subsection (c).
                        ``(D) Funding in excess of $40,000,000.--If amounts
                    appropriated under subsection (i) for a fiscal year are
                    $40,000,000 or more, the Secretary shall make
                    available--
                                ``(i) not less than $16,000,000 for grants
                            under subsection (a) to health professions
                            schools that meet the conditions described in
                            subsection (c)(2)(A);
                                ``(ii) not less than $16,000,000 for grants
                            under subsection (a) to health professions
                            schools that meet the conditions described in
                            paragraph (3) or (4) of subsection (c)
                            (including meeting conditions pursuant to
                            subsection (e));
                                ``(iii) not less than $8,000,000 for grants
                            under subsection (a) to health professions
                            schools that meet the conditions described in
                            subsection (c)(5); and
                                ``(iv) after grants are made with funds
                            under clauses (i) through (iii), any remaining
                            funds for grants under subsection (a) to health
                            professions schools that meet the conditions
                            described in paragraph (2)(A), (3), (4), or (5)
                            of subsection (c).
                ``(2) No limitation.--Nothing in this subsection shall be
            construed as limiting the centers of excellence referred to in
            this section to the designated amount, or to preclude such
            entities from competing for grants under this section.
                ``(3) Maintenance of effort.--
                        ``(A) In general.--With respect to activities for
                    which a grant made under this part are authorized to be
                    expended, the Secretary may not make such a grant to a
                    center of excellence for any fiscal year unless the
                    center agrees to maintain expenditures of non-Federal
                    amounts for such activities at a level that is not less
                    than the level of such expenditures maintained by the
                    center for the fiscal year preceding the fiscal year
                    for which the school receives such a grant.
                        ``(B) Use of federal funds.--With respect to any
                    Federal amounts received by a center of excellence and
                    available for carrying out activities for which a grant
                    under this part is authorized to be expended, the
                    center shall, before expending the grant, expend the
                    Federal amounts obtained from sources other than the
                    grant, unless given prior approval from the Secretary.
        ``(i) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this section--
                ``(1) $50,000,000 for each of the fiscal years 2010 through
            2015; and
                ``(2) and such sums as are necessary for each subsequent
            fiscal year.''.

    SEC. 5402. HEALTH CARE PROFESSIONALS TRAINING FOR DIVERSITY.

        (a) Loan Repayments and Fellowships Regarding Faculty Positions.--
    Section 738(a)(1) of the Public Health Service Act (42 U.S.C.
    293b(a)(1)) is amended by striking ``$20,000 of the principal and
    interest of the educational loans of such individuals.'' and inserting
    ``$30,000 of the principal and interest of the educational loans of
    such individuals.''.
        (b) Scholarships for Disadvantaged Students.--Section 740(a) of
    such Act (42 U.S.C. 293d(a)) is amended by striking ``$37,000,000'' and
    all that follows through ``2002'' and inserting ``$51,000,000 for
    fiscal year 2010, and such sums as may be necessary for each of the
    fiscal years 2011 through 2014''.
        (c) Reauthorization for Loan Repayments and Fellowships Regarding
    Faculty Positions.--Section 740(b) of such Act (42 U.S.C. 293d(b)) is
    amended by striking ``appropriated'' and all that follows through the
    period at the end and inserting ``appropriated, $5,000,000 for each of
    the fiscal years 2010 through 2014.''.
        (d) Reauthorization for Educational Assistance in the Health
    Professions Regarding Individuals From a Disadvantaged Background.--
    Section 740(c) of such Act (42 U.S.C. 293d(c)) is amended by striking
    the first sentence and inserting the following: ``For the purpose of
    grants and contracts under section 739(a)(1), there is authorized to be
    appropriated $60,000,000 for fiscal year 2010 and such sums as may be
    necessary for each of the fiscal years 2011 through 2014.''

    SEC. 5403. INTERDISCIPLINARY, COMMUNITY-BASED LINKAGES.

        (a) Area Health Education Centers.--Section 751 of the Public
    Health Service Act (42 U.S.C. 294a) is amended to read as follows:

    ``SEC. 751. AREA HEALTH EDUCATION CENTERS.

        ``(a) Establishment of Awards.--The Secretary shall make the
    following 2 types of awards in accordance with this section:
                ``(1) Infrastructure development award.--The Secretary
            shall make awards to eligible entities to enable such entities
            to initiate health care workforce educational programs or to
            continue to carry out comparable programs that are operating at
            the time the award is made by planning, developing, operating,
            and evaluating an area health education center program.
                ``(2) Point of service maintenance and enhancement award.--
            The Secretary shall make awards to eligible entities to
            maintain and improve the effectiveness and capabilities of an
            existing area health education center program, and make other
            modifications to the program that are appropriate due to
            changes in demographics, needs of the populations served, or
            other similar issues affecting the area health education center
            program. For the purposes of this section, the term `Program'
            refers to the area health education center program.
        ``(b) Eligible Entities; Application.--
                ``(1) Eligible entities.--
                        ``(A) Infrastructure development.--For purposes of
                    subsection (a)(1), the term `eligible entity' means a
                    school of medicine or osteopathic medicine, an
                    incorporated consortium of such schools, or the parent
                    institutions of such a school. With respect to a State
                    in which no area health education center program is in
                    operation, the Secretary may award a grant or contract
                    under subsection (a)(1) to a school of nursing.
                        ``(B) Point of service maintenance and
                    enhancement.--For purposes of subsection (a)(2), the
                    term `eligible entity' means an entity that has
                    received funds under this section, is operating an area
                    health education center program, including an area
                    health education center or centers, and has a center or
                    centers that are no longer eligible to receive
                    financial assistance under subsection (a)(1).
                ``(2) Application.--An eligible entity desiring to receive
            an award under this section shall submit to the Secretary an
            application at such time, in such manner, and containing such
            information as the Secretary may require.
        ``(c) Use of Funds.--
                ``(1) Required activities.--An eligible entity shall use
            amounts awarded under a grant under subsection (a)(1) or (a)(2)
            to carry out the following activities:
                        ``(A) Develop and implement strategies, in
                    coordination with the applicable one-stop delivery
                    system under section 134(c) of the Workforce Investment
                    Act of 1998, to recruit individuals from
                    underrepresented minority populations or from
                    disadvantaged or rural backgrounds into health
                    professions, and support such individuals in attaining
                    such careers.
                        ``(B) Develop and implement strategies to foster
                    and provide community-based training and education to
                    individuals seeking careers in health professions
                    within underserved areas for the purpose of developing
                    and maintaining a diverse health care workforce that is
                    prepared to deliver high-quality care, with an emphasis
                    on primary care, in underserved areas or for health
                    disparity populations, in collaboration with other
                    Federal and State health care workforce development
                    programs, the State workforce agency, and local
                    workforce investment boards, and in health care safety
                    net sites.
                        ``(C) Prepare individuals to more effectively
                    provide health services to underserved areas and health
                    disparity populations through field placements or
                    preceptorships in conjunction with community-based
                    organizations, accredited primary care residency
                    training programs, Federally qualified health centers,
                    rural health clinics, public health departments, or
                    other appropriate facilities.
                        ``(D) Conduct and participate in interdisciplinary
                    training that involves physicians, physician
                    assistants, nurse practitioners, nurse midwives,
                    dentists, psychologists, pharmacists, optometrists,
                    community health workers, public and allied health
                    professionals, or other health professionals, as
                    practicable.
                        ``(E) Deliver or facilitate continuing education
                    and information dissemination programs for health care
                    professionals, with an emphasis on individuals
                    providing care in underserved areas and for health
                    disparity populations.
                        ``(F) Propose and implement effective program and
                    outcomes measurement and evaluation strategies.
                        ``(G) Establish a youth public health program to
                    expose and recruit high school students into health
                    careers, with a focus on careers in public health.
                ``(2) Innovative opportunities.--An eligible entity may use
            amounts awarded under a grant under subsection (a)(1) or
            subsection (a)(2) to carry out any of the following activities:
                        ``(A) Develop and implement innovative curricula in
                    collaboration with community-based accredited primary
                    care residency training programs, Federally qualified
                    health centers, rural health clinics, behavioral and
                    mental health facilities, public health departments, or
                    other appropriate facilities, with the goal of
                    increasing the number of primary care physicians and
                    other primary care providers prepared to serve in
                    underserved areas and health disparity populations.
                        ``(B) Coordinate community-based participatory
                    research with academic health centers, and facilitate
                    rapid flow and dissemination of evidence-based health
                    care information, research results, and best practices
                    to improve quality, efficiency, and effectiveness of
                    health care and health care systems within community
                    settings.
                        ``(C) Develop and implement other strategies to
                    address identified workforce needs and increase and
                    enhance the health care workforce in the area served by
                    the area health education center program.
        ``(d) Requirements.--
                ``(1) Area health education center program.--In carrying
            out this section, the Secretary shall ensure the following:
                        ``(A) An entity that receives an award under this
                    section shall conduct at least 10 percent of clinical
                    education required for medical students in community
                    settings that are removed from the primary teaching
                    facility of the contracting institution for grantees
                    that operate a school of medicine or osteopathic
                    medicine. In States in which an entity that receives an
                    award under this section is a nursing school or its
                    parent institution, the Secretary shall alternatively
                    ensure that--
                                ``(i) the nursing school conducts at least
                            10 percent of clinical education required for
                            nursing students in community settings that are
                            remote from the primary teaching facility of
                            the school; and
                                ``(ii) the entity receiving the award
                            maintains a written agreement with a school of
                            medicine or osteopathic medicine to place
                            students from that school in training sites in
                            the area health education center program area.
                        ``(B) An entity receiving funds under subsection
                    (a)(2) does not distribute such funding to a center
                    that is eligible to receive funding under subsection
                    (a)(1).
                ``(2) Area health education center.--The Secretary shall
            ensure that each area health education center program includes
            at least 1 area health education center, and that each such
            center--
                        ``(A) is a public or private organization whose
                    structure, governance, and operation is independent
                    from the awardee and the parent institution of the
                    awardee;
                        ``(B) is not a school of medicine or osteopathic
                    medicine, the parent institution of such a school, or a
                    branch campus or other subunit of a school of medicine
                    or osteopathic medicine or its parent institution, or a
                    consortium of such entities;
                        ``(C) designates an underserved area or population
                    to be served by the center which is in a location
                    removed from the main location of the teaching
                    facilities of the schools participating in the program
                    with such center and does not duplicate, in whole or in
                    part, the geographic area or population served by any
                    other center;
                        ``(D) fosters networking and collaboration among
                    communities and between academic health centers and
                    community-based centers;
                        ``(E) serves communities with a demonstrated need
                    of health professionals in partnership with academic
                    medical centers;
                        ``(F) addresses the health care workforce needs of
                    the communities served in coordination with the public
                    workforce investment system; and
                        ``(G) has a community-based governing or advisory
                    board that reflects the diversity of the communities
                    involved.
        ``(e) Matching Funds.--With respect to the costs of operating a
    program through a grant under this section, to be eligible for
    financial assistance under this section, an entity shall make available
    (directly or through contributions from State, county or municipal
    governments, or the private sector) recurring non-Federal contributions
    in cash or in kind, toward such costs in an amount that is equal to not
    less than 50 percent of such costs. At least 25 percent of the total
    required non-Federal contributions shall be in cash. An entity may
    apply to the Secretary for a waiver of not more than 75 percent of the
    matching fund amount required by the entity for each of the first 3
    years the entity is funded through a grant under subsection (a)(1).
        ``(f) Limitation.--Not less than 75 percent of the total amount
    provided to an area health education center program under subsection
    (a)(1) or (a)(2) shall be allocated to the area health education
    centers participating in the program under this section. To provide
    needed flexibility to newly funded area health education center
    programs, the Secretary may waive the requirement in the sentence for
    the first 2 years of a new area health education center program funded
    under subsection (a)(1).
        ``(g) Award.--An award to an entity under this section shall be not
    less than $250,000 annually per area health education center included
    in the program involved. If amounts appropriated to carry out this
    section are not sufficient to comply with the preceding sentence, the
    Secretary may reduce the per center amount provided for in such
    sentence as necessary, provided the distribution established in
    subsection (j)(2) is maintained.
        ``(h) Project Terms.--
                ``(1) In general.--Except as provided in paragraph (2), the
            period during which payments may be made under an award under
            subsection (a)(1) may not exceed--
                        ``(A) in the case of a program, 12 years; or
                        ``(B) in the case of a center within a program, 6
                    years.
                ``(2) Exception.--The periods described in paragraph (1)
            shall not apply to programs receiving point of service
            maintenance and enhancement awards under subsection (a)(2) to
            maintain existing centers and activities.
        ``(i) Inapplicability of Provision.--Notwithstanding any other
    provision of this title, section 791(a) shall not apply to an area
    health education center funded under this section.
        ``(j) Authorization of Appropriations.--
                ``(1) In general.--There is authorized to be appropriated
            to carry out this section $125,000,000 for each of the fiscal
            years 2010 through 2014.
                ``(2) Requirements.--Of the amounts appropriated for a
            fiscal year under paragraph (1)--
                        ``(A) not more than 35 percent shall be used for
                    awards under subsection (a)(1);
                        ``(B) not less than 60 percent shall be used for
                    awards under subsection (a)(2);
                        ``(C) not more than 1 percent shall be used for
                    grants and contracts to implement outcomes evaluation
                    for the area health education centers; and
                        ``(D) not more than 4 percent shall be used for
                    grants and contracts to provide technical assistance to
                    entities receiving awards under this section.
                ``(3) Carryover funds.--An entity that receives an award
            under this section may carry over funds from 1 fiscal year to
            another without obtaining approval from the Secretary. In no
            case may any funds be carried over pursuant to the preceding
            sentence for more than 3 years.
        ``(k) Sense of Congress.--It is the sense of the Congress that
    every State have an area health education center program in effect
    under this section.''.
        (b) Continuing Educational Support for Health Professionals Serving
    in Underserved Communities.--Part D of title VII of the Public Health
    Service Act (42 U.S.C. 294 et seq.) is amended by striking section 752
    and inserting the following:

    ``SEC. 752. CONTINUING EDUCATIONAL SUPPORT FOR HEALTH PROFESSIONALS
                  SERVING IN UNDERSERVED COMMUNITIES.

        ``(a) In General.--The Secretary shall make grants to, and enter
    into contracts with, eligible entities to improve health care, increase
    retention, increase representation of minority faculty members, enhance
    the practice environment, and provide information dissemination and
    educational support to reduce professional isolation through the timely
    dissemination of research findings using relevant resources.
        ``(b) Eligible Entities.--For purposes of this section, the term
    `eligible entity' means an entity described in section 799(b).
        ``(c) Application.--An eligible entity desiring to receive an award
    under this section shall submit to the Secretary an application at such
    time, in such manner, and containing such information as the Secretary
    may require.
        ``(d) Use of Funds.--An eligible entity shall use amounts awarded
    under a grant or contract under this section to provide innovative
    supportive activities to enhance education through distance learning,
    continuing educational activities, collaborative conferences, and
    electronic and telelearning activities, with priority for primary care.
        ``(e) Authorization.--There is authorized to be appropriated to
    carry out this section $5,000,000 for each of the fiscal years 2010
    through 2014, and such sums as may be necessary for each subsequent
    fiscal year.''.

    SEC. 5404. WORKFORCE DIVERSITY GRANTS.

        Section 821 of the Public Health Service Act (42 U.S.C. 296m) is
    amended--
                (1) in subsection (a)--
                        (A) by striking ``The Secretary may'' and inserting
                    the following:
                ``(1) Authority.--The Secretary may'';
                        (B) by striking ``pre-entry preparation, and
                    retention activities'' and inserting the following:
                    ``stipends for diploma or associate degree nurses to
                    enter a bridge or degree completion program, student
                    scholarships or stipends for accelerated nursing degree
                    programs, pre-entry preparation, advanced education
                    preparation, and retention activities''; and
                (2) in subsection (b)--
                        (A) by striking ``First'' and all that follows
                    through ``including the'' and inserting ``National
                    Advisory Council on Nurse Education and Practice and
                    consult with nursing associations including the
                    National Coalition of Ethnic Minority Nurse
                    Associations,''; and
                        (B) by inserting before the period the following:
                    ``, and other organizations determined appropriate by
                    the Secretary''.

    SEC. 5405. PRIMARY CARE EXTENSION PROGRAM.

        Part P of title III of the Public Health Service Act (42 U.S.C.
    280g et seq.), as amended by section 5313, is further amended by adding
    at the end the following:

    ``SEC. 399W. PRIMARY CARE EXTENSION PROGRAM.

        ``(a) Establishment, Purpose and Definition.--
                ``(1) In general.--The Secretary, acting through the
            Director of the Agency for Healthcare Research and Quality,
            shall establish a Primary Care Extension Program.
                ``(2) Purpose.--The Primary Care Extension Program shall
            provide support and assistance to primary care providers to
            educate providers about preventive medicine, health promotion,
            chronic disease management, mental and behavioral health
            services (including substance abuse prevention and treatment
            services), and evidence-based and evidence-informed therapies
            and techniques, in order to enable providers to incorporate
            such matters into their practice and to improve community
            health by working with community-based health connectors
            (referred to in this section as `Health Extension Agents').
                ``(3) Definitions.--In this section:
                        ``(A) Health extension agent.--The term `Health
                    Extension Agent' means any local, community-based
                    health worker who facilitates and provides assistance
                    to primary care practices by implementing quality
                    improvement or system redesign, incorporating the
                    principles of the patient-centered medical home to
                    provide high-quality, effective, efficient, and safe
                    primary care and to provide guidance to patients in
                    culturally and linguistically appropriate ways, and
                    linking practices to diverse health system resources.
                        ``(B) Primary care provider.--The term `primary
                    care provider' means a clinician who provides
                    integrated, accessible health care services and who is
                    accountable for addressing a large majority of personal
                    health care needs, including providing preventive and
                    health promotion services for men, women, and children
                    of all ages, developing a sustained partnership with
                    patients, and practicing in the context of family and
                    community, as recognized by a State licensing or
                    regulatory authority, unless otherwise specified in
                    this section.
        ``(b) Grants To Establish State Hubs and Local Primary Care
    Extension Agencies.--
                ``(1) Grants.--The Secretary shall award competitive grants
            to States for the establishment of State- or multistate-level
            primary care Primary Care Extension Program State Hubs
            (referred to in this section as `Hubs').
                ``(2) Composition of hubs.--A Hub established by a State
            pursuant to paragraph (1)--
                        ``(A) shall consist of, at a minimum, the State
                    health department, the entity responsible for
                    administering the State Medicaid program (if other than
                    the State health department), the State-level entity
                    administering the Medicare program, and the departments
                    of 1 or more health professions schools in the State
                    that train providers in primary care; and
                        ``(B) may include entities such as hospital
                    associations, primary care practice-based research
                    networks, health professional societies, State primary
                    care associations, State licensing boards,
                    organizations with a contract with the Secretary under
                    section 1153 of the Social Security Act, consumer
                    groups, and other appropriate entities.
        ``(c) State and Local Activities.--
                ``(1) Hub activities.--Hubs established under a grant under
            subsection (b) shall--
                        ``(A) submit to the Secretary a plan to coordinate
                    functions with quality improvement organizations and
                    area health education centers if such entities are
                    members of the Hub not described in subsection
                    (b)(2)(A);
                        ``(B) contract with a county- or local-level entity
                    that shall serve as the Primary Care Extension Agency
                    to administer the services described in paragraph (2);
                        ``(C) organize and administer grant funds to
                    county- or local-level Primary Care Extension Agencies
                    that serve a catchment area, as determined by the
                    State; and
                        ``(D) organize State-wide or multistate networks of
                    local-level Primary Care Extension Agencies to share
                    and disseminate information and practices.
                ``(2) Local primary care extension agency activities.--
                        ``(A) Required activities.--Primary Care Extension
                    Agencies established by a Hub under paragraph (1)
                    shall--
                                ``(i) assist primary care providers to
                            implement a patient-centered medical home to
                            improve the accessibility, quality, and
                            efficiency of primary care services, including
                            health homes;
                                ``(ii) develop and support primary care
                            learning communities to enhance the
                            dissemination of research findings for
                            evidence-based practice, assess implementation
                            of practice improvement, share best practices,
                            and involve community clinicians in the
                            generation of new knowledge and identification
                            of important questions for research;
                                ``(iii) participate in a national network
                            of Primary Care Extension Hubs and propose how
                            the Primary Care Extension Agency will share
                            and disseminate lessons learned and best
                            practices; and
                                ``(iv) develop a plan for financial
                            sustainability involving State, local, and
                            private contributions, to provide for the
                            reduction in Federal funds that is expected
                            after an initial 6-year period of program
                            establishment, infrastructure development, and
                            planning.
                        ``(B) Discretionary activities.--Primary Care
                    Extension Agencies established by a Hub under paragraph
                    (1) may--
                                ``(i) provide technical assistance,
                            training, and organizational support for
                            community health teams established under
                            section 3602 of the Patient Protection and
                            Affordable Care Act;
                                ``(ii) collect data and provision of
                            primary care provider feedback from
                            standardized measurements of processes and
                            outcomes to aid in continuous performance
                            improvement;
                                ``(iii) collaborate with local health
                            departments, community health centers, tribes
                            and tribal entities, and other community
                            agencies to identify community health
                            priorities and local health workforce needs,
                            and participate in community-based efforts to
                            address the social and primary determinants of
                            health, strengthen the local primary care
                            workforce, and eliminate health disparities;
                                ``(iv) develop measures to monitor the
                            impact of the proposed program on the health of
                            practice enrollees and of the wider community
                            served; and
                                ``(v) participate in other activities, as
                            determined appropriate by the Secretary.
        ``(d) Federal Program Administration.--
                ``(1) Grants; types.--Grants awarded under subsection (b)
            shall be--
                        ``(A) program grants, that are awarded to State or
                    multistate entities that submit fully-developed plans
                    for the implementation of a Hub, for a period of 6
                    years; or
                        ``(B) planning grants, that are awarded to State or
                    multistate entities with the goal of developing a plan
                    for a Hub, for a period of 2 years.
                ``(2) Applications.--To be eligible for a grant under
            subsection (b), a State or multistate entity shall submit to
            the Secretary an application, at such time, in such manner, and
            containing such information as the Secretary may require.
                ``(3) Evaluation.--A State that receives a grant under
            subsection (b) shall be evaluated at the end of the grant
            period by an evaluation panel appointed by the Secretary.
                ``(4) Continuing support.--After the sixth year in which
            assistance is provided to a State under a grant awarded under
            subsection (b), the State may receive additional support under
            this section if the State program has received satisfactory
            evaluations with respect to program performance and the merits
            of the State sustainability plan, as determined by the
            Secretary.
                ``(5) Limitation.--A State shall not use in excess of 10
            percent of the amount received under a grant to carry out
            administrative activities under this section. Funds awarded
            pursuant to this section shall not be used for funding direct
            patient care.
        ``(e) Requirements on the Secretary.--In carrying out this section,
    the Secretary shall consult with the heads of other Federal agencies
    with demonstrated experience and expertise in health care and
    preventive medicine, such as the Centers for Disease Control and
    Prevention, the Substance Abuse and Mental Health Administration, the
    Health Resources and Services Administration, the National Institutes
    of Health, the Office of the National Coordinator for Health
    Information Technology, the Indian Health Service, the Agricultural
    Cooperative Extension Service of the Department of Agriculture, and
    other entities, as the Secretary determines appropriate.
        ``(f) Authorization of Appropriations.--To awards grants as
    provided in subsection (d), there are authorized to be appropriated
    $120,000,000 for each of fiscal years 2011 and 2012, and such sums as
    may be necessary to carry out this section for each of fiscal years
    2013 through 2014.''.

    Subtitle F--Strengthening Primary Care and Other Workforce Improvements

    SEC. 5501. EXPANDING ACCESS TO PRIMARY CARE SERVICES AND GENERAL
                  SURGERY SERVICES.

        (a) Incentive Payment Program for Primary Care Services.--
                (1) In general.--Section 1833 of the Social Security Act
            (42 U.S.C. 1395l) is amended by adding at the end the following
            new subsection:
        ``(x) Incentive Payments for Primary Care Services.--
                ``(1) In general.--In the case of primary care services
            furnished on or after January 1, 2011, and before January 1,
            2016, by a primary care practitioner, in addition to the amount
            of payment that would otherwise be made for such services under
            this part, there also shall be paid (on a monthly or quarterly
            basis) an amount equal to 10 percent of the payment amount for
            the service under this part.
                ``(2) Definitions.--In this subsection:
                        ``(A) Primary care practitioner.--The term `primary
                    care practitioner' means an individual--
                                ``(i) who--
                                        ``(I) is a physician (as described
                                    in section 1861(r)(1)) who has a
                                    primary specialty designation of family
                                    medicine, internal medicine, geriatric
                                    medicine, or pediatric medicine; or
                                        ``(II) is a nurse practitioner,
                                    clinical nurse specialist, or physician
                                    assistant (as those terms are defined
                                    in section 1861(aa)(5)); and
                                ``(ii) for whom primary care services
                            accounted for at least 60 percent of the
                            allowed charges under this part for such
                            physician or practitioner in a prior period as
                            determined appropriate by the Secretary.
                        ``(B) Primary care services.--The term `primary
                    care services' means services identified, as of January
                    1, 2009, by the following HCPCS codes (and as
                    subsequently modified by the Secretary):
                                ``(i) 99201 through 99215.
                                ``(ii) 99304 through 99340.
                                ``(iii) 99341 through 99350.
                ``(3) Coordination with other payments.--The amount of the
            additional payment for a service under this subsection and
            subsection (m) shall be determined without regard to any
            additional payment for the service under subsection (m) and
            this subsection, respectively.
                ``(4) Limitation on review.--There shall be no
            administrative or judicial review under section 1869, 1878, or
            otherwise, respecting the identification of primary care
            practitioners under this subsection.''.
                (2) Conforming amendment.--Section 1834(g)(2)(B) of the
            Social Security Act (42 U.S.C. 1395m(g)(2)(B)) is amended by
            adding at the end the following sentence: ``Section 1833(x)
            shall not be taken into account in determining the amounts that
            would otherwise be paid pursuant to the preceding sentence.''.
        (b) Incentive Payment Program for Major Surgical Procedures
    Furnished in Health Professional Shortage Areas.--
                (1) In general.--Section 1833 of the Social Security Act
            (42 U.S.C. 1395l), as amended by subsection (a)(1), is amended
            by adding at the end the following new subsection:
        ``(y) Incentive Payments for Major Surgical Procedures Furnished in
    Health Professional Shortage Areas.--
                ``(1) In general.--In the case of major surgical procedures
            furnished on or after January 1, 2011, and before January 1,
            2016, by a general surgeon in an area that is designated (under
            section 332(a)(1)(A) of the Public Health Service Act) as a
            health professional shortage area as identified by the
            Secretary prior to the beginning of the year involved, in
            addition to the amount of payment that would otherwise be made
            for such services under this part, there also shall be paid (on
            a monthly or quarterly basis) an amount equal to 10 percent of
            the payment amount for the service under this part.
                ``(2) Definitions.--In this subsection:
                        ``(A) General surgeon.--In this subsection, the
                    term `general surgeon' means a physician (as described
                    in section 1861(r)(1)) who has designated CMS specialty
                    code 02-General Surgery as their primary specialty code
                    in the physician's enrollment under section 1866(j).
                        ``(B) Major surgical procedures.--The term `major
                    surgical procedures' means physicians' services which
                    are surgical procedures for which a 10-day or 90-day
                    global period is used for payment under the fee
                    schedule under section 1848(b).
                ``(3) Coordination with other payments.--The amount of the
            additional payment for a service under this subsection and
            subsection (m) shall be determined without regard to any
            additional payment for the service under subsection (m) and
            this subsection, respectively.
                ``(4) Application.--The provisions of paragraph (2) and (4)
            of subsection (m) shall apply to the determination of
            additional payments under this subsection in the same manner as
            such provisions apply to the determination of additional
            payments under subsection (m).''.
                (2) Conforming amendment.--Section 1834(g)(2)(B) of the
            Social Security Act (42 U.S.C. 1395m(g)(2)(B)), as amended by
            subsection (a)(2), is amended by striking ``Section 1833(x)''
            and inserting ``Subsections (x) and (y) of section 1833'' in
            the last sentence.
        (c) Budget-neutrality Adjustment.--Section 1848(c)(2)(B) of the
    Social Security Act (42 U.S.C. 1395w-4(c)(2)(B)) is amended by adding
    at the end the following new clause:
                                ``(vii) Adjustment for certain physician
                            incentive payments.--Fifty percent of the
                            additional expenditures under this part
                            attributable to subsections (x) and (y) of
                            section 1833 for a year (as estimated by the
                            Secretary) shall be taken into account in
                            applying clause (ii)(II) for 2011 and
                            subsequent years. In lieu of applying the
                            budget-neutrality adjustments required under
                            clause (ii)(II) to relative value units to
                            account for such costs for the year, the
                            Secretary shall apply such budget-neutrality
                            adjustments to the conversion factor otherwise
                            determined for the year. For 2011 and
                            subsequent years, the Secretary shall increase
                            the incentive payment otherwise applicable
                            under section 1833(m) by a percent estimated to
                            be equal to the additional expenditures
                            estimated under the first sentence of this
                            clause for such year that is applicable to
                            physicians who primarily furnish services in
                            areas designated (under section 332(a)(1)(A) of
                            the Public Health Service Act) as health
                            professional shortage areas.''.

    SEC. 5502. MEDICARE FEDERALLY QUALIFIED HEALTH CENTER IMPROVEMENTS.

        (a)  Expansion of Medicare-Covered Preventive Services at Federally
    Qualified Health Centers.--
                (1) In general.--Section 1861(aa)(3)(A) of the Social
            Security Act (42 U.S.C. 1395w (aa)(3)(A)) is amended to read as
            follows:
                        ``(A) services of the type described subparagraphs
                    (A) through (C) of paragraph (1) and preventive
                    services (as defined in section 1861(ddd)(3)); and''.
                (2) Effective date.--The amendment made by paragraph (1)
            shall apply to services furnished on or after January 1, 2011.
        (b) Prospective Payment System for Federally Qualified Health
    Centers.--Section 1834 of the Social Security Act (42 U.S.C. 1395m) is
    amended by adding at the end the following new subsection:
        ``(n) Development and Implementation of Prospective Payment
    System.--
                ``(1) Development.--
                        ``(A) In general.--The Secretary shall develop a
                    prospective payment system for payment for Federally
                    qualified health services furnished by Federally
                    qualified health centers under this title. Such system
                    shall include a process for appropriately describing
                    the services furnished by Federally qualified health
                    centers.
                        ``(B) Collection of data and evaluation.--The
                    Secretary shall require Federally qualified health
                    centers to submit to the Secretary such information as
                    the Secretary may require in order to develop and
                    implement the prospective payment system under this
                    paragraph and paragraph (2), respectively, including
                    the reporting of services using HCPCS codes.
                ``(2) Implementation.--
                        ``(A) In general.--Notwithstanding section
                    1833(a)(3)(B), the Secretary shall provide, for cost
                    reporting periods beginning on or after October 1,
                    2014, for payments for Federally qualified health
                    services furnished by Federally qualified health
                    centers under this title in accordance with the
                    prospective payment system developed by the Secretary
                    under paragraph (1).
                        ``(B) Payments.--
                                ``(i) Initial payments.--The Secretary
                            shall implement such prospective payment system
                            so that the estimated amount of expenditures
                            under this title for Federally qualified health
                            services in the first year that the prospective
                            payment system is implemented is equal to 103
                            percent of the estimated amount of expenditures
                            under this title that would have occurred for
                            such services in such year if the system had
                            not been implemented.
                                ``(ii) Payments in subsequent years.--In
                            the year after the first year of implementation
                            of such system, and in each subsequent year,
                            the payment rate for Federally qualified health
                            services furnished in the year shall be equal
                            to the payment rate established for such
                            services furnished in the preceding year under
                            this subparagraph increased by the percentage
                            increase in the MEI (as defined in 1842(i)(3))
                            for the year involved.''.

    SEC. 5503. DISTRIBUTION OF ADDITIONAL RESIDENCY POSITIONS.

        (a) In General.--Section 1886(h) of the Social Security Act (42
    U.S.C. 1395ww(h)) is amended--
                (1) in paragraph (4)(F)(i), by striking ``paragraph (7)''
            and inserting ``paragraphs (7) and (8)'';
                (2) in paragraph (4)(H)(i), by striking ``paragraph (7)''
            and inserting ``paragraphs (7) and (8)'';
                (3) in paragraph (7)(E), by inserting ``or paragraph (8)''
            before the period at the end; and
                (4) by adding at the end the following new paragraph:
                ``(8) Distribution of additional residency positions.--
                        ``(A) Reductions in limit based on unused
                    positions.--
                                ``(i) In general.--Except as provided in
                            clause (ii), if a hospital's reference resident
                            level (as defined in subparagraph (H)(i)) is
                            less than the otherwise applicable resident
                            limit (as defined in subparagraph (H)(iii)),
                            effective for portions of cost reporting
                            periods occurring on or after July 1, 2011, the
                            otherwise applicable resident limit shall be
                            reduced by 65 percent of the difference between
                            such otherwise applicable resident limit and
                            such reference resident level.
                                ``(ii) Exceptions.--This subparagraph shall
                            not apply to--
                                        ``(I) a hospital located in a rural
                                    area (as defined in subsection
                                    (d)(2)(D)(ii)) with fewer than 250
                                    acute care inpatient beds;
                                        ``(II) a hospital that was part of
                                    a qualifying entity which had a
                                    voluntary residency reduction plan
                                    approved under paragraph (6)(B) or
                                    under the authority of section 402 of
                                    Public Law 90-248, if the hospital
                                    demonstrates to the Secretary that it
                                    has a specified plan in place for
                                    filling the unused positions by not
                                    later than 2 years after the date of
                                    enactment of this paragraph; or
                                        ``(III) a hospital described in
                                    paragraph (4)(H)(v).
                        ``(B) Distribution.--
                                ``(i) In general.--The Secretary shall
                            increase the otherwise applicable resident
                            limit for each qualifying hospital that submits
                            an application under this subparagraph by such
                            number as the Secretary may approve for
                            portions of cost reporting periods occurring on
                            or after July 1, 2011. The aggregate number of
                            increases in the otherwise applicable resident
                            limit under this subparagraph shall be equal to
                            the aggregate reduction in such limits
                            attributable to subparagraph (A) (as estimated
                            by the Secretary).
                                ``(ii) Requirements.--Subject to clause
                            (iii), a hospital that receives an increase in
                            the otherwise applicable resident limit under
                            this subparagraph shall ensure, during the 5-
                            year period beginning on the date of such
                            increase, that--
                                        ``(I) the number of full-time
                                    equivalent primary care residents, as
                                    defined in paragraph (5)(H) (as
                                    determined by the Secretary), excluding
                                    any additional positions under
                                    subclause (II), is not less than the
                                    average number of full-time equivalent
                                    primary care residents (as so
                                    determined) during the 3 most recent
                                    cost reporting periods ending prior to
                                    the date of enactment of this
                                    paragraph; and
                                        ``(II) not less than 75 percent of
                                    the positions attributable to such
                                    increase are in a primary care or
                                    general surgery residency (as
                                    determined by the Secretary).
                            The Secretary may determine whether a hospital
                            has met the requirements under this clause
                            during such 5-year period in such manner and at
                            such time as the Secretary determines
                            appropriate, including at the end of such 5-
                            year period.
                                ``(iii) Redistribution of positions if
                            hospital no longer meets certain
                            requirements.--In the case where the Secretary
                            determines that a hospital described in clause
                            (ii) does not meet either of the requirements
                            under subclause (I) or (II) of such clause, the
                            Secretary shall--
                                        ``(I) reduce the otherwise
                                    applicable resident limit of the
                                    hospital by the amount by which such
                                    limit was increased under this
                                    paragraph; and
                                        ``(II) provide for the distribution
                                    of positions attributable to such
                                    reduction in accordance with the
                                    requirements of this paragraph.
                        ``(C) Considerations in redistribution.--In
                    determining for which hospitals the increase in the
                    otherwise applicable resident limit is provided under
                    subparagraph (B), the Secretary shall take into
                    account--
                                ``(i) the demonstration likelihood of the
                            hospital filling the positions made available
                            under this paragraph within the first 3 cost
                            reporting periods beginning on or after July 1,
                            2011, as determined by the Secretary; and
                                ``(ii) whether the hospital has an
                            accredited rural training track (as described
                            in paragraph (4)(H)(iv)).
                        ``(D) Priority for certain areas.--In determining
                    for which hospitals the increase in the otherwise
                    applicable resident limit is provided under
                    subparagraph (B), subject to subparagraph (E), the
                    Secretary shall distribute the increase to hospitals
                    based on the following factors:
                                ``(i) Whether the hospital is located in a
                            State with a resident-to-population ratio in
                            the lowest quartile (as determined by the
                            Secretary).
                                ``(ii) Whether the hospital is located in a
                            State, a territory of the United States, or the
                            District of Columbia that is among the top 10
                            States, territories, or Districts in terms of
                            the ratio of--
                                        ``(I) the total population of the
                                    State, territory, or District living in
                                    an area designated (under such section
                                    332(a)(1)(A)) as a health professional
                                    shortage area (as of the date of
                                    enactment of this paragraph); to
                                        ``(II) the total population of the
                                    State, territory, or District (as
                                    determined by the Secretary based on
                                    the most recent available population
                                    data published by the Bureau of the
                                    Census).
                                ``(iii) Whether the hospital is located in
                            a rural area (as defined in subsection
                            (d)(2)(D)(ii)).
                        ``(E) Reservation of positions for certain
                    hospitals.--
                                ``(i) In general.--Subject to clause (ii),
                            the Secretary shall reserve the positions
                            available for distribution under this paragraph
                            as follows:
                                        ``(I) 70 percent of such positions
                                    for distribution to hospitals described
                                    in clause (i) of subparagraph (D).
                                        ``(II) 30 percent of such positions
                                    for distribution to hospitals described
                                    in clause (ii) and (iii) of such
                                    subparagraph.
                                ``(ii) Exception if positions not
                            redistributed by july 1, 2011.--In the case
                            where the Secretary does not distribute
                            positions to hospitals in accordance with
                            clause (i) by July 1, 2011, the Secretary shall
                            distribute such positions to other hospitals in
                            accordance with the considerations described in
                            subparagraph (C) and the priority described in
                            subparagraph (D).
                        ``(F) Limitation.--A hospital may not receive more
                    than 75 full-time equivalent additional residency
                    positions under this paragraph.
                        ``(G) Application of per resident amounts for
                    primary care and nonprimary care.--With respect to
                    additional residency positions in a hospital
                    attributable to the increase provided under this
                    paragraph, the approved FTE per resident amounts are
                    deemed to be equal to the hospital per resident amounts
                    for primary care and nonprimary care computed under
                    paragraph (2)(D) for that hospital.
                        ``(H) Definitions.--In this paragraph:
                                ``(i) Reference resident level.--The term
                            `reference resident level' means, with respect
                            to a hospital, the highest resident level for
                            any of the 3 most recent cost reporting periods
                            (ending before the date of the enactment of
                            this paragraph) of the hospital for which a
                            cost report has been settled (or, if not,
                            submitted (subject to audit)), as determined by
                            the Secretary.
                                ``(ii) Resident level.--The term `resident
                            level' has the meaning given such term in
                            paragraph (7)(C)(i).
                                ``(iii) Otherwise applicable resident
                            limit.--The term `otherwise applicable resident
                            limit' means, with respect to a hospital, the
                            limit otherwise applicable under subparagraphs
                            (F)(i) and (H) of paragraph (4) on the resident
                            level for the hospital determined without
                            regard to this paragraph but taking into
                            account paragraph (7)(A).''.
        (b) IME.--
                (1) In general.--Section 1886(d)(5)(B)(v) of the Social
            Security Act (42 U.S.C. 1395ww(d)(5)(B)(v)), in the second
            sentence, is amended--
                        (A) by striking ``subsection (h)(7)'' and inserting
                    ``subsections (h)(7) and (h)(8)''; and
                        (B) by striking ``it applies'' and inserting ``they
                    apply''.
                (2) Conforming amendment.--Section 1886(d)(5)(B) of the
            Social Security Act (42 U.S.C. 1395ww(d)(5)(B)) is amended by
            adding at the end the following clause:
                ``(x) For discharges occurring on or after July 1, 2011,
            insofar as an additional payment amount under this subparagraph
            is attributable to resident positions distributed to a hospital
            under subsection (h)(8)(B), the indirect teaching adjustment
            factor shall be computed in the same manner as provided under
            clause (ii) with respect to such resident positions.''.
        (c) Conforming Amendment.--Section 422(b)(2) of the Medicare
    Prescription Drug, Improvement, and Modernization Act of 2003 (Public
    Law 108-173) is amended by striking ``section 1886(h)(7)'' and all that
    follows and inserting ``paragraphs (7) and (8) of subsection (h) of
    section 1886 of the Social Security Act''.

    SEC. 5504. COUNTING RESIDENT TIME IN NONPROVIDER SETTINGS.

        (a) GME.--Section 1886(h)(4)(E) of the Social Security Act (42
    U.S.C. 1395ww(h)(4)(E)) is amended--
                (1) by striking ``shall be counted and that all the time''
            and inserting ``shall be counted and that--
                                ``(i) effective for cost reporting periods
                            beginning before July 1, 2010, all the time;'';
                (2) in clause (i), as inserted by paragraph (1), by
            striking the period at the end and inserting ``; and'';
                (3) by inserting after clause (i), as so inserted, the
            following new clause:
                                ``(ii) effective for cost reporting periods
                            beginning on or after July 1, 2010, all the
                            time so spent by a resident shall be counted
                            towards the determination of full-time
                            equivalency, without regard to the setting in
                            which the activities are performed, if a
                            hospital incurs the costs of the stipends and
                            fringe benefits of the resident during the time
                            the resident spends in that setting. If more
                            than one hospital incurs these costs, either
                            directly or through a third party, such
                            hospitals shall count a proportional share of
                            the time, as determined by written agreement
                            between the hospitals, that a resident spends
                            training in that setting.''; and
                (4) by adding at the end the following flush sentence:
                    ``Any hospital claiming under this subparagraph for
                    time spent in a nonprovider setting shall maintain and
                    make available to the Secretary records regarding the
                    amount of such time and such amount in comparison with
                    amounts of such time in such base year as the Secretary
                    shall specify.''.
        (b) IME.--Section 1886(d)(5)(B)(iv) of the Social Security Act (42
    U.S.C. 1395ww(d)(5)) is amended--
                (1) by striking ``(iv) Effective for discharges occurring
            on or after October 1, 1997'' and inserting ``(iv)(I) Effective
            for discharges occurring on or after October 1, 1997, and
            before July 1, 2010''; and
                (2) by inserting after clause (I), as inserted by paragraph
            (1), the following new subparagraph:
                ``(II) Effective for discharges occurring on or after July
            1, 2010, all the time spent by an intern or resident in patient
            care activities in a nonprovider setting shall be counted
            towards the determination of full-time equivalency if a
            hospital incurs the costs of the stipends and fringe benefits
            of the intern or resident during the time the intern or
            resident spends in that setting. If more than one hospital
            incurs these costs, either directly or through a third party,
            such hospitals shall count a proportional share of the time, as
            determined by written agreement between the hospitals, that a
            resident spends training in that setting.''.
        (c) Application.--The amendments made by this section shall not be
    applied in a manner that requires reopening of any settled hospital
    cost reports as to which there is not a jurisdictionally proper appeal
    pending as of the date of the enactment of this Act on the issue of
    payment for indirect costs of medical education under section
    1886(d)(5)(B) of the Social Security Act (42 U.S.C. 1395ww(d)(5)(B)) or
    for direct graduate medical education costs under section 1886(h) of
    such Act (42 U.S.C. 1395ww(h)).

    SEC. 5505. RULES FOR COUNTING RESIDENT TIME FOR DIDACTIC AND SCHOLARLY
                  ACTIVITIES AND OTHER ACTIVITIES.

        (a) GME.--Section 1886(h) of the Social Security Act (42 U.S.C.
    1395ww(h)), as amended by section 5504, is amended--
                (1) in paragraph (4)--
                        (A) in subparagraph (E), by striking ``Such rules''
                    and inserting ``Subject to subparagraphs (J) and (K),
                    such rules''; and
                        (B) by adding at the end the following new
                    subparagraphs:
                        ``(J) Treatment of certain nonprovider and didactic
                    activities.--Such rules shall provide that all time
                    spent by an intern or resident in an approved medical
                    residency training program in a nonprovider setting
                    that is primarily engaged in furnishing patient care
                    (as defined in paragraph (5)(K)) in non-patient care
                    activities, such as didactic conferences and seminars,
                    but not including research not associated with the
                    treatment or diagnosis of a particular patient, as such
                    time and activities are defined by the Secretary, shall
                    be counted toward the determination of full-time
                    equivalency.
                        ``(K) Treatment of certain other activities.--In
                    determining the hospital's number of full-time
                    equivalent residents for purposes of this subsection,
                    all the time that is spent by an intern or resident in
                    an approved medical residency training program on
                    vacation, sick leave, or other approved leave, as such
                    time is defined by the Secretary, and that does not
                    prolong the total time the resident is participating in
                    the approved program beyond the normal duration of the
                    program shall be counted toward the determination of
                    full-time equivalency.''; and
                (2) in paragraph (5), by adding at the end the following
            new subparagraph:
                        ``(K) Nonprovider setting that is primarily engaged
                    in furnishing patient care.--The term `nonprovider
                    setting that is primarily engaged in furnishing patient
                    care' means a nonprovider setting in which the primary
                    activity is the care and treatment of patients, as
                    defined by the Secretary.''.
        (b) IME Determinations.--Section 1886(d)(5)(B) of such Act (42
    U.S.C. 1395ww(d)(5)(B)) is amended by adding at the end the following
    new clause:
                                ``(x)(I) The provisions of subparagraph (K)
                            of subsection (h)(4) shall apply under this
                            subparagraph in the same manner as they apply
                            under such subsection.
                                ``(II) In determining the hospital's number
                            of full-time equivalent residents for purposes
                            of this subparagraph, all the time spent by an
                            intern or resident in an approved medical
                            residency training program in non-patient care
                            activities, such as didactic conferences and
                            seminars, as such time and activities are
                            defined by the Secretary, that occurs in the
                            hospital shall be counted toward the
                            determination of full-time equivalency if the
                            hospital--
                                        ``(aa) is recognized as a
                                    subsection (d) hospital;
                                        ``(bb) is recognized as a
                                    subsection (d) Puerto Rico hospital;
                                        ``(cc) is reimbursed under a
                                    reimbursement system authorized under
                                    section 1814(b)(3); or
                                        ``(dd) is a provider-based hospital
                                    outpatient department.
                                ``(III) In determining the hospital's
                            number of full-time equivalent residents for
                            purposes of this subparagraph, all the time
                            spent by an intern or resident in an approved
                            medical residency training program in research
                            activities that are not associated with the
                            treatment or diagnosis of a particular patient,
                            as such time and activities are defined by the
                            Secretary, shall not be counted toward the
                            determination of full-time equivalency.''.
        (c) Effective Dates.--
                (1) In general.--Except as otherwise provided, the
            Secretary of Health and Human Services shall implement the
            amendments made by this section in a manner so as to apply to
            cost reporting periods beginning on or after January 1, 1983.
                (2) GME.--Section 1886(h)(4)(J) of the Social Security Act,
            as added by subsection (a)(1)(B), shall apply to cost reporting
            periods beginning on or after July 1, 2009.
                (3) IME.--Section 1886(d)(5)(B)(x)(III) of the Social
            Security Act, as added by subsection (b), shall apply to cost
            reporting periods beginning on or after October 1, 2001. Such
            section, as so added, shall not give rise to any inference as
            to how the law in effect prior to such date should be
            interpreted.

    SEC. 5506. PRESERVATION OF RESIDENT CAP POSITIONS FROM CLOSED
                  HOSPITALS.

        (a) GME.--Section 1886(h)(4)(H) of the Social Security Act (42
    U.S.C. Section 1395ww(h)(4)(H)) is amended by adding at the end the
    following new clause:
                                ``(vi) Redistribution of residency slots
                            after a hospital closes.--
                                        ``(I) In general.--Subject to the
                                    succeeding provisions of this clause,
                                    the Secretary shall, by regulation,
                                    establish a process under which, in the
                                    case where a hospital (other than a
                                    hospital described in clause (v)) with
                                    an approved medical residency program
                                    closes on or after a date that is 2
                                    years before the date of enactment of
                                    this clause, the Secretary shall
                                    increase the otherwise applicable
                                    resident limit under this paragraph for
                                    other hospitals in accordance with this
                                    clause.
                                        ``(II) Priority for hospitals in
                                    certain areas.--Subject to the
                                    succeeding provisions of this clause,
                                    in determining for which hospitals the
                                    increase in the otherwise applicable
                                    resident limit is provided under such
                                    process, the Secretary shall distribute
                                    the increase to hospitals in the
                                    following priority order (with
                                    preference given within each category
                                    to hospitals that are members of the
                                    same affiliated group (as defined by
                                    the Secretary under clause (ii)) as the
                                    closed hospital):
                                                ``(aa) First, to hospitals
                                            located in the same core-based
                                            statistical area as, or a core-
                                            based statistical area
                                            contiguous to, the hospital
                                            that closed.
                                                ``(bb) Second, to hospitals
                                            located in the same State as
                                            the hospital that closed.
                                                ``(cc) Third, to hospitals
                                            located in the same region of
                                            the country as the hospital
                                            that closed.
                                                ``(dd) Fourth, only if the
                                            Secretary is not able to
                                            distribute the increase to
                                            hospitals described in item
                                            (cc), to qualifying hospitals
                                            in accordance with the
                                            provisions of paragraph (8).
                                        ``(III) Requirement hospital likely
                                    to fill position within certain time
                                    period.--The Secretary may only
                                    increase the otherwise applicable
                                    resident limit of a hospital under such
                                    process if the Secretary determines the
                                    hospital has demonstrated a likelihood
                                    of filling the positions made available
                                    under this clause within 3 years.
                                        ``(IV) Limitation.--The aggregate
                                    number of increases in the otherwise
                                    applicable resident limits for
                                    hospitals under this clause shall be
                                    equal to the number of resident
                                    positions in the approved medical
                                    residency programs that closed on or
                                    after the date described in subclause
                                    (I).
                                        ``(V) Administration.--Chapter 35
                                    of title 44, United States Code, shall
                                    not apply to the implementation of this
                                    clause.''.
        (b) IME.--Section 1886(d)(5)(B)(v) of the Social Security Act (42
    U.S.C. 1395ww(d)(5)(B)(v)), in the second sentence, as amended by
    section 5503, is amended by striking ``subsections (h)(7) and (h)(8)''
    and inserting ``subsections (h)(4)(H)(vi), (h)(7), and (h)(8)''.
        (c) Application.--The amendments made by this section shall not be
    applied in a manner that requires reopening of any settled hospital
    cost reports as to which there is not a jurisdictionally proper appeal
    pending as of the date of the enactment of this Act on the issue of
    payment for indirect costs of medical education under section
    1886(d)(5)(B) of the Social Security Act (42 U.S.C. 1395ww(d)(5)(B)) or
    for direct graduate medical education costs under section 1886(h) of
    such Act (42 U.S.C. Section 1395ww(h)).
        (d) Effect on Temporary FTE Cap Adjustments.--The Secretary of
    Health and Human Services shall give consideration to the effect of the
    amendments made by this section on any temporary adjustment to a
    hospital's FTE cap under section 413.79(h) of title 42, Code of Federal
    Regulations (as in effect on the date of enactment of this Act) in
    order to ensure that there is no duplication of FTE slots. Such
    amendments shall not affect the application of section 1886(h)(4)(H)(v)
    of the Social Security Act (42 U.S.C. 1395ww(h)(4)(H)(v)).
        (e) Conforming Amendment.--Section 1886(h)(7)(E) of the Social
    Security Act (42 U.S.C. 1395ww(h)(7)(E)), as amended by section
    5503(a), is amended by striking ``paragraph or paragraph (8)'' and
    inserting ``this paragraph, paragraph (8), or paragraph (4)(H)(vi)''.

    SEC. 5507. DEMONSTRATION PROJECTS TO ADDRESS HEALTH PROFESSIONS
                  WORKFORCE NEEDS; EXTENSION OF FAMILY-TO-FAMILY HEALTH
                  INFORMATION CENTERS.

        (a) Authority To Conduct Demonstration Projects.--Title XX of the
    Social Security Act (42 U.S.C. 1397 et seq.) is amended by adding at
    the end the following:

    ``SEC. 2008. DEMONSTRATION PROJECTS TO ADDRESS HEALTH PROFESSIONS
                  WORKFORCE NEEDS.

        ``(a) Demonstration Projects To Provide Low-Income Individuals With
    Opportunities for Education, Training, and Career Advancement To
    Address Health Professions Workforce Needs.--
                ``(1) Authority to award grants.--The Secretary, in
            consultation with the Secretary of Labor, shall award grants to
            eligible entities to conduct demonstration projects that are
            designed to provide eligible individuals with the opportunity
            to obtain education and training for occupations in the health
            care field that pay well and are expected to either experience
            labor shortages or be in high demand.
                ``(2) Requirements.--
                        ``(A) Aid and supportive services.--
                                ``(i) In general.--A demonstration project
                            conducted by an eligible entity awarded a grant
                            under this section shall, if appropriate,
                            provide eligible individuals participating in
                            the project with financial aid, child care,
                            case management, and other supportive services.
                                ``(ii) Treatment.--Any aid, services, or
                            incentives provided to an eligible beneficiary
                            participating in a demonstration project under
                            this section shall not be considered income,
                            and shall not be taken into account for
                            purposes of determining the individual's
                            eligibility for, or amount of, benefits under
                            any means-tested program.
                        ``(B) Consultation and coordination.--An eligible
                    entity applying for a grant to carry out a
                    demonstration project under this section shall
                    demonstrate in the application that the entity has
                    consulted with the State agency responsible for
                    administering the State TANF program, the local
                    workforce investment board in the area in which the
                    project is to be conducted (unless the applicant is
                    such board), the State workforce investment board
                    established under section 111 of the Workforce
                    Investment Act of 1998, and the State Apprenticeship
                    Agency recognized under the Act of August 16, 1937
                    (commonly known as the `National Apprenticeship Act')
                    (or if no agency has been recognized in the State, the
                    Office of Apprenticeship of the Department of Labor)
                    and that the project will be carried out in
                    coordination with such entities.
                        ``(C) Assurance of opportunities for indian
                    populations.--The Secretary shall award at least 3
                    grants under this subsection to an eligible entity that
                    is an Indian tribe, tribal organization, or Tribal
                    College or University.
                ``(3) Reports and evaluation.--
                        ``(A) Eligible entities.--An eligible entity
                    awarded a grant to conduct a demonstration project
                    under this subsection shall submit interim reports to
                    the Secretary on the activities carried out under the
                    project and a final report on such activities upon the
                    conclusion of the entities' participation in the
                    project. Such reports shall include assessments of the
                    effectiveness of such activities with respect to
                    improving outcomes for the eligible individuals
                    participating in the project and with respect to
                    addressing health professions workforce needs in the
                    areas in which the project is conducted.
                        ``(B) Evaluation.--The Secretary shall, by grant,
                    contract, or interagency agreement, evaluate the
                    demonstration projects conducted under this subsection.
                    Such evaluation shall include identification of
                    successful activities for creating opportunities for
                    developing and sustaining, particularly with respect to
                    low-income individuals and other entry-level workers, a
                    health professions workforce that has accessible entry
                    points, that meets high standards for education,
                    training, certification, and professional development,
                    and that provides increased wages and affordable
                    benefits, including health care coverage, that are
                    responsive to the workforce's needs.
                        ``(C) Report to congress.--The Secretary shall
                    submit interim reports and, based on the evaluation
                    conducted under subparagraph (B), a final report to
                    Congress on the demonstration projects conducted under
                    this subsection.
                ``(4) Definitions.--In this subsection:
                        ``(A) Eligible entity.--The term `eligible entity'
                    means a State, an Indian tribe or tribal organization,
                    an institution of higher education, a local workforce
                    investment board established under section 117 of the
                    Workforce Investment Act of 1998, a sponsor of an
                    apprenticeship program registered under the National
                    Apprenticeship Act or a community-based organization.
                        ``(B) Eligible individual.--
                                ``(i) In general.--The term `eligible
                            individual' means a individual receiving
                            assistance under the State TANF program.
                                ``(ii) Other low-income individuals.--Such
                            term may include other low-income individuals
                            described by the eligible entity in its
                            application for a grant under this section.
                        ``(C) Indian tribe; tribal organization.--The terms
                    `Indian tribe' and `tribal organization' have the
                    meaning given such terms in section 4 of the Indian
                    Self-Determination and Education Assistance Act (25
                    U.S.C. 450b).
                        ``(D) Institution of higher education.--The term
                    `institution of higher education' has the meaning given
                    that term in section 101 of the Higher Education Act of
                    1965 (20 U.S.C. 1001).
                        ``(E) State.--The term `State' means each of the 50
                    States, the District of Columbia, the Commonwealth of
                    Puerto Rico, the United States Virgin Islands, Guam,
                    and American Samoa.
                        ``(F) State tanf program.--The term `State TANF
                    program' means the temporary assistance for needy
                    families program funded under part A of title IV.
                        ``(G) Tribal college or university.--The term
                    `Tribal College or University' has the meaning given
                    that term in section 316(b) of the Higher Education Act
                    of 1965 (20 U.S.C. 1059c(b)).
        ``(b) Demonstration Project To Develop Training and Certification
    Programs for Personal or Home Care Aides.--
                ``(1) Authority to award grants.--Not later than 18 months
            after the date of enactment of this section, the Secretary
            shall award grants to eligible entities that are States to
            conduct demonstration projects for purposes of developing core
            training competencies and certification programs for personal
            or home care aides. The Secretary shall--
                        ``(A) evaluate the efficacy of the core training
                    competencies described in paragraph (3)(A) for newly
                    hired personal or home care aides and the methods used
                    by States to implement such core training competencies
                    in accordance with the issues specified in paragraph
                    (3)(B); and
                        ``(B) ensure that the number of hours of training
                    provided by States under the demonstration project with
                    respect to such core training competencies are not less
                    than the number of hours of training required under any
                    applicable State or Federal law or regulation.
                ``(2) Duration.--A demonstration project shall be conducted
            under this subsection for not less than 3 years.
                ``(3) Core training competencies for personal or home care
            aides.--
                        ``(A) In general.--The core training competencies
                    for personal or home care aides described in this
                    subparagraph include competencies with respect to the
                    following areas:
                                ``(i) The role of the personal or home care
                            aide (including differences between a personal
                            or home care aide employed by an agency and a
                            personal or home care aide employed directly by
                            the health care consumer or an independent
                            provider).
                                ``(ii) Consumer rights, ethics, and
                            confidentiality (including the role of proxy
                            decision-makers in the case where a health care
                            consumer has impaired decision-making
                            capacity).
                                ``(iii) Communication, cultural and
                            linguistic competence and sensitivity, problem
                            solving, behavior management, and relationship
                            skills.
                                ``(iv) Personal care skills.
                                ``(v) Health care support.
                                ``(vi) Nutritional support.
                                ``(vii) Infection control.
                                ``(viii) Safety and emergency training.
                                ``(ix) Training specific to an individual
                            consumer's needs (including older individuals,
                            younger individuals with disabilities,
                            individuals with developmental disabilities,
                            individuals with dementia, and individuals with
                            mental and behavioral health needs).
                                ``(x) Self-Care.
                        ``(B) Implementation.--The implementation issues
                    specified in this subparagraph include the following:
                                ``(i) The length of the training.
                                ``(ii) The appropriate trainer to student
                            ratio.
                                ``(iii) The amount of instruction time
                            spent in the classroom as compared to on-site
                            in the home or a facility.
                                ``(iv) Trainer qualifications.
                                ``(v) Content for a `hands-on' and written
                            certification exam.
                                ``(vi) Continuing education requirements.
                ``(4) Application and selection criteria.--
                        ``(A) In general.--
                                ``(i) Number of states.--The Secretary
                            shall enter into agreements with not more than
                            6 States to conduct demonstration projects
                            under this subsection.
                                ``(ii) Requirements for states.--An
                            agreement entered into under clause (i) shall
                            require that a participating State--
                                        ``(I) implement the core training
                                    competencies described in paragraph
                                    (3)(A); and
                                        ``(II) develop written materials
                                    and protocols for such core training
                                    competencies, including the development
                                    of a certification test for personal or
                                    home care aides who have completed such
                                    training competencies.
                                ``(iii) Consultation and collaboration with
                            community and vocational colleges.--The
                            Secretary shall encourage participating States
                            to consult with community and vocational
                            colleges regarding the development of curricula
                            to implement the project with respect to
                            activities, as applicable, which may include
                            consideration of such colleges as partners in
                            such implementation.
                        ``(B) Application and eligibility.--A State seeking
                    to participate in the project shall--
                                ``(i) submit an application to the
                            Secretary containing such information and at
                            such time as the Secretary may specify;
                                ``(ii) meet the selection criteria
                            established under subparagraph (C); and
                                ``(iii) meet such additional criteria as
                            the Secretary may specify.
                        ``(C) Selection criteria.--In selecting States to
                    participate in the program, the Secretary shall
                    establish criteria to ensure (if applicable with
                    respect to the activities involved)--
                                ``(i) geographic and demographic diversity;
                                ``(ii) that participating States offer
                            medical assistance for personal care services
                            under the State Medicaid plan;
                                ``(iii) that the existing training
                            standards for personal or home care aides in
                            each participating State--
                                        ``(I) are different from such
                                    standards in the other participating
                                    States; and
                                        ``(II) are different from the core
                                    training competencies described in
                                    paragraph (3)(A);
                                ``(iv) that participating States do not
                            reduce the number of hours of training required
                            under applicable State law or regulation after
                            being selected to participate in the project;
                            and
                                ``(v) that participating States recruit a
                            minimum number of eligible health and long-term
                            care providers to participate in the project.
                        ``(D) Technical assistance.--The Secretary shall
                    provide technical assistance to States in developing
                    written materials and protocols for such core training
                    competencies.
                ``(5) Evaluation and report.--
                        ``(A) Evaluation.--The Secretary shall develop an
                    experimental or control group testing protocol in
                    consultation with an independent evaluation contractor
                    selected by the Secretary. Such contractor shall
                    evaluate--
                                ``(i) the impact of core training
                            competencies described in paragraph (3)(A),
                            including curricula developed to implement such
                            core training competencies, for personal or
                            home care aides within each participating State
                            on job satisfaction, mastery of job skills,
                            beneficiary and family caregiver satisfaction
                            with services, and additional measures
                            determined by the Secretary in consultation
                            with the expert panel;
                                ``(ii) the impact of providing such core
                            training competencies on the existing training
                            infrastructure and resources of States; and
                                ``(iii) whether a minimum number of hours
                            of initial training should be required for
                            personal or home care aides and, if so, what
                            minimum number of hours should be required.
                        ``(B) Reports.--
                                ``(i) Report on initial implementation.--
                            Not later than 2 years after the date of
                            enactment of this section, the Secretary shall
                            submit to Congress a report on the initial
                            implementation of activities conducted under
                            the demonstration project, including any
                            available results of the evaluation conducted
                            under subparagraph (A) with respect to such
                            activities, together with such recommendations
                            for legislation or administrative action as the
                            Secretary determines appropriate.
                                ``(ii) Final report.--Not later than 1 year
                            after the completion of the demonstration
                            project, the Secretary shall submit to Congress
                            a report containing the results of the
                            evaluation conducted under subparagraph (A),
                            together with such recommendations for
                            legislation or administrative action as the
                            Secretary determines appropriate.
                ``(6) Definitions.--In this subsection:
                        ``(A) Eligible health and long-term care
                    provider.--The term `eligible health and long-term care
                    provider' means a personal or home care agency
                    (including personal or home care public authorities), a
                    nursing home, a home health agency (as defined in
                    section 1861(o)), or any other health care provider the
                    Secretary determines appropriate which--
                                ``(i) is licensed or authorized to provide
                            services in a participating State; and
                                ``(ii) receives payment for services under
                            title XIX.
                        ``(B) Personal care services.--The term `personal
                    care services' has the meaning given such term for
                    purposes of title XIX.
                        ``(C) Personal or home care aide.--The term
                    `personal or home care aide' means an individual who
                    helps individuals who are elderly, disabled, ill, or
                    mentally disabled (including an individual with
                    Alzheimer's disease or other dementia) to live in their
                    own home or a residential care facility (such as a
                    nursing home, assisted living facility, or any other
                    facility the Secretary determines appropriate) by
                    providing routine personal care services and other
                    appropriate services to the individual.
                        ``(D) State.--The term `State' has the meaning
                    given that term for purposes of title XIX.
        ``(c) Funding.--
                ``(1) In general.--Subject to paragraph (2), out of any
            funds in the Treasury not otherwise appropriated, there are
            appropriated to the Secretary to carry out subsections (a) and
            (b), $85,000,000 for each of fiscal years 2010 through 2014.
                ``(2) Training and certification programs for personal and
            home care aides.--With respect to the demonstration projects
            under subsection (b), the Secretary shall use $5,000,000 of the
            amount appropriated under paragraph (1) for each of fiscal
            years 2010 through 2012 to carry out such projects. No funds
            appropriated under paragraph (1) shall be used to carry out
            demonstration projects under subsection (b) after fiscal year
            2012.
        ``(d) Nonapplication.--
                ``(1) In general.--Except as provided in paragraph (2), the
            preceding sections of this title shall not apply to grant
            awarded under this section.
                ``(2) Limitations on use of grants.--Section 2005(a) (other
            than paragraph (6)) shall apply to a grant awarded under this
            section to the same extent and in the same manner as such
            section applies to payments to States under this title.''.
        (b) Extension of Family-To-Family Health Information Centers.--
    Section 501(c)(1)(A)(iii) of the Social Security Act (42 U.S.C.
    701(c)(1)(A)(iii)) is amended by striking ``fiscal year 2009'' and
    inserting ``each of fiscal years 2009 through 2012''.

    SEC. 5508. INCREASING TEACHING CAPACITY.

        (a) Teaching Health Centers Training and Enhancement.--Part C of
    title VII of the Public Health Service Act (42 U.S.C. 293k et. seq.),
    as amended by section 5303, is further amended by inserting after
    section 749 the following:

    ``SEC. 749A. TEACHING HEALTH CENTERS DEVELOPMENT GRANTS.

        ``(a) Program Authorized.--The Secretary may award grants under
    this section to teaching health centers for the purpose of establishing
    new accredited or expanded primary care residency programs.
        ``(b) Amount and Duration.--Grants awarded under this section shall
    be for a term of not more than 3 years and the maximum award may not be
    more than $500,000.
        ``(c) Use of Funds.--Amounts provided under a grant under this
    section shall be used to cover the costs of--
                ``(1) establishing or expanding a primary care residency
            training program described in subsection (a), including costs
            associated with--
                        ``(A) curriculum development;
                        ``(B) recruitment, training and retention of
                    residents and faculty:
                        ``(C) accreditation by the Accreditation Council
                    for Graduate Medical Education (ACGME), the American
                    Dental Association (ADA), or the American Osteopathic
                    Association (AOA); and
                        ``(D) faculty salaries during the development
                    phase; and
                ``(2) technical assistance provided by an eligible entity.
        ``(d) Application.--A teaching health center seeking a grant under
    this section shall submit an application to the Secretary at such time,
    in such manner, and containing such information as the Secretary may
    require.
        ``(e) Preference for Certain Applications.--In selecting recipients
    for grants under this section, the Secretary shall give preference to
    any such application that documents an existing affiliation agreement
    with an area health education center program as defined in sections 751
    and 799B.
        ``(f) Definitions.--In this section:
                ``(1) Eligible entity.--The term `eligible entity' means an
            organization capable of providing technical assistance
            including an area health education center program as defined in
            sections 751 and 799B.
                ``(2) Primary care residency program.--The term `primary
            care residency program' means an approved graduate medical
            residency training program (as defined in section 340H) in
            family medicine, internal medicine, pediatrics, internal
            medicine-pediatrics, obstetrics and gynecology, psychiatry,
            general dentistry, pediatric dentistry, and geriatrics.
                ``(3) Teaching health center.--
                        ``(A) In general.--The term `teaching health
                    center' means an entity that--
                                ``(i) is a community based, ambulatory
                            patient care center; and
                                ``(ii) operates a primary care residency
                            program.
                        ``(B) Inclusion of certain entities.--Such term
                    includes the following:
                                ``(i) A Federally qualified health center
                            (as defined in section 1905(l)(2)(B), of the
                            Social Security Act).
                                ``(ii) A community mental health center (as
                            defined in section 1861(ff)(3)(B) of the Social
                            Security Act).
                                ``(iii) A rural health clinic, as defined
                            in section 1861(aa) of the Social Security Act.
                                ``(iv) A health center operated by the
                            Indian Health Service, an Indian tribe or
                            tribal organization, or an urban Indian
                            organization (as defined in section 4 of the
                            Indian Health Care Improvement Act).
                                ``(v) An entity receiving funds under title
                            X of the Public Health Service Act.
        ``(g) Authorization of Appropriations.--There is authorized to be
    appropriated, $25,000,000 for fiscal year 2010, $50,000,000 for fiscal
    year 2011, $50,000,000 for fiscal year 2012, and such sums as may be
    necessary for each fiscal year thereafter to carry out this section.
    Not to exceed $5,000,000 annually may be used for technical assistance
    program grants.''.
        (b) National Health Service Corps Teaching Capacity.--Section
    338C(a) of the Public Health Service Act (42 U.S.C. 254m(a)) is amended
    to read as follows:
        ``(a) Service in Full-time Clinical Practice.--Except as provided
    in section 338D, each individual who has entered into a written
    contract with the Secretary under section 338A or 338B shall provide
    service in the full-time clinical practice of such individual's
    profession as a member of the Corps for the period of obligated service
    provided in such contract. For the purpose of calculating time spent in
    full-time clinical practice under this subsection, up to 50 percent of
    time spent teaching by a member of the Corps may be counted toward his
    or her service obligation.''.
        (c) Payments to Qualified Teaching Health Centers.--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:

       ``Subpart XI--Support of Graduate Medical Education in Qualified
                            Teaching Health Centers

    ``SEC. 340H. PROGRAM OF PAYMENTS TO TEACHING HEALTH CENTERS THAT
                  OPERATE GRADUATE MEDICAL EDUCATION PROGRAMS.

        ``(a) Payments.--Subject to subsection (h)(2), the Secretary shall
    make payments under this section for direct expenses and for indirect
    expenses to qualified teaching health centers that are listed as
    sponsoring institutions by the relevant accrediting body for expansion
    of existing or establishment of new approved graduate medical residency
    training programs.
        ``(b) Amount of Payments.--
                ``(1) In general.--Subject to paragraph (2), the amounts
            payable under this section to qualified teaching health centers
            for an approved graduate medical residency training program for
            a fiscal year are each of the following amounts:
                        ``(A) Direct expense amount.--The amount determined
                    under subsection (c) for direct expenses associated
                    with sponsoring approved graduate medical residency
                    training programs.
                        ``(B) Indirect expense amount.--The amount
                    determined under subsection (d) for indirect expenses
                    associated with the additional costs relating to
                    teaching residents in such programs.
                ``(2) Capped amount.--
                        ``(A) In general.--The total of the payments made
                    to qualified teaching health centers under paragraph
                    (1)(A) or paragraph (1)(B) in a fiscal year shall not
                    exceed the amount of funds appropriated under
                    subsection (g) for such payments for that fiscal year.
                        ``(B) Limitation.--The Secretary shall limit the
                    funding of full-time equivalent residents in order to
                    ensure the direct and indirect payments as determined
                    under subsection (c) and (d) do not exceed the total
                    amount of funds appropriated in a fiscal year under
                    subsection (g).
        ``(c) Amount of Payment for Direct Graduate Medical Education.--
                ``(1) In general.--The amount determined under this
            subsection for payments to qualified teaching health centers
            for direct graduate expenses relating to approved graduate
            medical residency training programs for a fiscal year is equal
            to the product of--
                        ``(A) the updated national per resident amount for
                    direct graduate medical education, as determined under
                    paragraph (2); and
                        ``(B) the average number of full-time equivalent
                    residents in the teaching health center's graduate
                    approved medical residency training programs as
                    determined under section 1886(h)(4) of the Social
                    Security Act (without regard to the limitation under
                    subparagraph (F) of such section) during the fiscal
                    year.
                ``(2) Updated national per resident amount for direct
            graduate medical education.--The updated per resident amount
            for direct graduate medical education for a qualified teaching
            health center for a fiscal year is an amount determined as
            follows:
                        ``(A) Determination of qualified teaching health
                    center per resident amount.--The Secretary shall
                    compute for each individual qualified teaching health
                    center a per resident amount--
                                ``(i) by dividing the national average per
                            resident amount computed under section
                            340E(c)(2)(D) into a wage-related portion and a
                            non-wage related portion by applying the
                            proportion determined under subparagraph (B);
                                ``(ii) by multiplying the wage-related
                            portion by the factor applied under section
                            1886(d)(3)(E) of the Social Security Act (but
                            without application of section 4410 of the
                            Balanced Budget Act of 1997 (42 U.S.C. 1395ww
                            note)) during the preceding fiscal year for the
                            teaching health center's area; and
                                ``(iii) by adding the non-wage-related
                            portion to the amount computed under clause
                            (ii).
                        ``(B) Updating rate.--The Secretary shall update
                    such per resident amount for each such qualified
                    teaching health center as determined appropriate by the
                    Secretary.
        ``(d) Amount of Payment for Indirect Medical Education.--
                ``(1) In general.--The amount determined under this
            subsection for payments to qualified teaching health centers
            for indirect expenses associated with the additional costs of
            teaching residents for a fiscal year is equal to an amount
            determined appropriate by the Secretary.
                ``(2) Factors.--In determining the amount under paragraph
            (1), the Secretary shall--
                        ``(A) evaluate indirect training costs relative to
                    supporting a primary care residency program in
                    qualified teaching health centers; and
                        ``(B) based on this evaluation, assure that the
                    aggregate of the payments for indirect expenses under
                    this section and the payments for direct graduate
                    medical education as determined under subsection (c) in
                    a fiscal year do not exceed the amount appropriated for
                    such expenses as determined in subsection (g).
                ``(3) Interim payment.--Before the Secretary makes a
            payment under this subsection pursuant to a determination of
            indirect expenses under paragraph (1), the Secretary may
            provide to qualified teaching health centers a payment, in
            addition to any payment made under subsection (c), for expected
            indirect expenses associated with the additional costs of
            teaching residents for a fiscal year, based on an estimate by
            the Secretary.
        ``(e) Clarification Regarding Relationship to Other Payments for
    Graduate Medical Education.--Payments under this section--
                ``(1) shall be in addition to any payments--
                        ``(A) for the indirect costs of medical education
                    under section 1886(d)(5)(B) of the Social Security Act;
                        ``(B) for direct graduate medical education costs
                    under section 1886(h) of such Act; and
                        ``(C) for direct costs of medical education under
                    section 1886(k) of such Act;
                ``(2) shall not be taken into account in applying the
            limitation on the number of total full-time equivalent
            residents under subparagraphs (F) and (G) of section 1886(h)(4)
            of such Act and clauses (v), (vi)(I), and (vi)(II) of section
            1886(d)(5)(B) of such Act for the portion of time that a
            resident rotates to a hospital; and
                ``(3) shall not include the time in which a resident is
            counted toward full-time equivalency by a hospital under
            paragraph (2) or under section 1886(d)(5)(B)(iv) of the Social
            Security Act, section 1886(h)(4)(E) of such Act, or section
            340E of this Act.
        ``(f) Reconciliation.--The Secretary shall determine any changes to
    the number of residents reported by a hospital in the application of
    the hospital for the current fiscal year to determine the final amount
    payable to the hospital for the current fiscal year for both direct
    expense and indirect expense amounts. Based on such determination, the
    Secretary shall recoup any overpayments made to pay any balance due to
    the extent possible. The final amount so determined shall be considered
    a final intermediary determination for the purposes of section 1878 of
    the Social Security Act and shall be subject to administrative and
    judicial review under that section in the same manner as the amount of
    payment under section 1186(d) of such Act is subject to review under
    such section.
        ``(g) Funding.--To carry out this section, there are appropriated
    such sums as may be necessary, not to exceed $230,000,000, for the
    period of fiscal years 2011 through 2015.
        ``(h) Annual Reporting Required.--
                ``(1) Annual report.--The report required under this
            paragraph for a qualified teaching health center for a fiscal
            year is a report that includes (in a form and manner specified
            by the Secretary) the following information for the residency
            academic year completed immediately prior to such fiscal year:
                        ``(A) The types of primary care resident approved
                    training programs that the qualified teaching health
                    center provided for residents.
                        ``(B) The number of approved training positions for
                    residents described in paragraph (4).
                        ``(C) The number of residents described in
                    paragraph (4) who completed their residency training at
                    the end of such residency academic year and care for
                    vulnerable populations living in underserved areas.
                        ``(D) Other information as deemed appropriate by
                    the Secretary.
                ``(2) Audit authority; limitation on payment.--
                        ``(A) Audit authority.--The Secretary may audit a
                    qualified teaching health center to ensure the accuracy
                    and completeness of the information submitted in a
                    report under paragraph (1).
                        ``(B) Limitation on payment.--A teaching health
                    center may only receive payment in a cost reporting
                    period for a number of such resident positions that is
                    greater than the base level of primary care resident
                    positions, as determined by the Secretary. For purposes
                    of this subparagraph, the `base level of primary care
                    residents' for a teaching health center is the level of
                    such residents as of a base period.
                ``(3) Reduction in payment for failure to report.--
                        ``(A) In general.--The amount payable under this
                    section to a qualified teaching health center for a
                    fiscal year shall be reduced by at least 25 percent if
                    the Secretary determines that--
                                ``(i) the qualified teaching health center
                            has failed to provide the Secretary, as an
                            addendum to the qualified teaching health
                            center's application under this section for
                            such fiscal year, the report required under
                            paragraph (1) for the previous fiscal year; or
                                ``(ii) such report fails to provide
                            complete and accurate information required
                            under any subparagraph of such paragraph.
                        ``(B) Notice and opportunity to provide accurate
                    and missing information.--Before imposing a reduction
                    under subparagraph (A) on the basis of a qualified
                    teaching health center's failure to provide complete
                    and accurate information described in subparagraph
                    (A)(ii), the Secretary shall provide notice to the
                    teaching health center of such failure and the
                    Secretary's intention to impose such reduction and
                    shall provide the teaching health center with the
                    opportunity to provide the required information within
                    the period of 30 days beginning on the date of such
                    notice. If the teaching health center provides such
                    information within such period, no reduction shall be
                    made under subparagraph (A) on the basis of the
                    previous failure to provide such information.
                ``(4) Residents.--The residents described in this paragraph
            are those who are in part-time or full-time equivalent resident
            training positions at a qualified teaching health center in any
            approved graduate medical residency training program.
        ``(i) Regulations.--The Secretary shall promulgate regulations to
    carry out this section.
        ``(j) Definitions.--In this section:
                ``(1) Approved graduate medical residency training
            program.--The term `approved graduate medical residency
            training program' means a residency or other postgraduate
            medical training program--
                        ``(A) participation in which may be counted toward
                    certification in a specialty or subspecialty and
                    includes formal postgraduate training programs in
                    geriatric medicine approved by the Secretary; and
                        ``(B) that meets criteria for accreditation (as
                    established by the Accreditation Council for Graduate
                    Medical Education, the American Osteopathic
                    Association, or the American Dental Association).
                ``(2) Primary care residency program.--The term `primary
            care residency program' has the meaning given that term in
            section 749A.
                ``(3) Qualified teaching health center.--The term
            `qualified teaching health center' has the meaning given the
            term `teaching health center' in section 749A.''.

    SEC. 5509. GRADUATE NURSE EDUCATION DEMONSTRATION.

        (a) In General.--
                (1) Establishment.--
                        (A) In general.--The Secretary shall establish a
                    graduate nurse education demonstration under title
                    XVIII of the Social Security Act (42 U.S.C. 1395 et
                    seq.) under which an eligible hospital may receive
                    payment for the hospital's reasonable costs (described
                    in paragraph (2)) for the provision of qualified
                    clinical training to advance practice nurses.
                        (B) Number.--The demonstration shall include up to
                    5 eligible hospitals.
                        (C) Written agreements.--Eligible hospitals
                    selected to participate in the demonstration shall
                    enter into written agreements pursuant to subsection
                    (b) in order to reimburse the eligible partners of the
                    hospital the share of the costs attributable to each
                    partner.
                (2) Costs described.--
                        (A) In general.--Subject to subparagraph (B) and
                    subsection (d), the costs described in this paragraph
                    are the reasonable costs (as described in section
                    1861(v) of the Social Security Act (42 U.S.C.
                    1395x(v))) of each eligible hospital for the clinical
                    training costs (as determined by the Secretary) that
                    are attributable to providing advanced practice
                    registered nurses with qualified training.
                        (B) Limitation.--With respect to a year, the amount
                    reimbursed under subparagraph (A) may not exceed the
                    amount of costs described in subparagraph (A) that are
                    attributable to an increase in the number of advanced
                    practice registered nurses enrolled in a program that
                    provides qualified training during the year and for
                    which the hospital is being reimbursed under the
                    demonstration, as compared to the average number of
                    advanced practice registered nurses who graduated in
                    each year during the period beginning on January 1,
                    2006, and ending on December 31, 2010 (as determined by
                    the Secretary) from the graduate nursing education
                    program operated by the applicable school of nursing
                    that is an eligible partner of the hospital for
                    purposes of the demonstration.
                (3) Waiver authority.--The Secretary may waive such
            requirements of titles XI and XVIII of the Social Security Act
            as may be necessary to carry out the demonstration.
                (4) Administration.--Chapter 35 of title 44, United States
            Code, shall not apply to the implementation of this section.
        (b) Written Agreements With Eligible Partners.--No payment shall be
    made under this section to an eligible hospital unless such hospital
    has in effect a written agreement with the eligible partners of the
    hospital. Such written agreement shall describe, at a minimum--
                (1) the obligations of the eligible partners with respect
            to the provision of qualified training; and
                (2) the obligation of the eligible hospital to reimburse
            such eligible partners applicable (in a timely manner) for the
            costs of such qualified training attributable to partner.
        (c) Evaluation.--Not later than October 17, 2017, the Secretary
    shall submit to Congress a report on the demonstration. Such report
    shall include an analysis of the following:
                (1) The growth in the number of advanced practice
            registered nurses with respect to a specific base year as a
            result of the demonstration.
                (2) The growth for each of the specialties described in
            subparagraphs (A) through (D) of subsection (e)(1).
                (3) The costs to the Medicare program under title XVIII of
            the Social Security Act as a result of the demonstration.
                (4) Other items the Secretary determines appropriate and
            relevant.
        (d) Funding.--
                (1) In general.--There is hereby appropriated to the
            Secretary, out of any funds in the Treasury not otherwise
            appropriated, $50,000,000 for each of fiscal years 2012 through
            2015 to carry out this section, including the design,
            implementation, monitoring, and evaluation of the
            demonstration.
                (2) Proration.--If the aggregate payments to eligible
            hospitals under the demonstration exceed $50,000,000 for a
            fiscal year described in paragraph (1), the Secretary shall
            prorate the payment amounts to each eligible hospital in order
            to ensure that the aggregate payments do not exceed such
            amount.
                (3) Without fiscal year limitation.--Amounts appropriated
            under this subsection shall remain available without fiscal
            year limitation.
        (e) Definitions.--In this section:
                (1) Advanced practice registered nurse.--The term
            ``advanced practice registered nurse'' includes the following:
                        (A) A clinical nurse specialist (as defined in
                    subsection (aa)(5) of section 1861 of the Social
                    Security Act (42 U.S.C. 1395x)).
                        (B) A nurse practitioner (as defined in such
                    subsection).
                        (C) A certified registered nurse anesthetist (as
                    defined in subsection (bb)(2) of such section).
                        (D) A certified nurse-midwife (as defined in
                    subsection (gg)(2) of such section).
                (2) Applicable non-hospital community-based care setting.--
            The term ``applicable non-hospital community-based care
            setting'' means a non-hospital community-based care setting
            which has entered into a written agreement (as described in
            subsection (b)) with the eligible hospital participating in the
            demonstration. Such settings include Federally qualified health
            centers, rural health clinics, and other non-hospital settings
            as determined appropriate by the Secretary.
                (3) Applicable school of nursing.--The term ``applicable
            school of nursing'' means an accredited school of nursing (as
            defined in section 801 of the Public Health Service Act) which
            has entered into a written agreement (as described in
            subsection (b)) with the eligible hospital participating in the
            demonstration.
                (4) Demonstration.--The term ``demonstration'' means the
            graduate nurse education demonstration established under
            subsection (a).
                (5) Eligible hospital.--The term ``eligible hospital''
            means a hospital (as defined in subsection (e) of section 1861
            of the Social Security Act (42 U.S.C. 1395x)) or a critical
            access hospital (as defined in subsection (mm)(1) of such
            section) that has a written agreement in place with--
                        (A) 1 or more applicable schools of nursing; and
                        (B) 2 or more applicable non-hospital community-
                    based care settings.
                (6) Eligible partners.--The term ``eligible partners''
            includes the following:
                        (A) An applicable non-hospital community-based care
                    setting.
                        (B) An applicable school of nursing.
                (7) Qualified training.--
                        (A) In general.--The term ``qualified training''
                    means training--
                                (i) that provides an advanced practice
                            registered nurse with the clinical skills
                            necessary to provide primary care, preventive
                            care, transitional care, chronic care
                            management, and other services appropriate for
                            individuals entitled to, or enrolled for,
                            benefits under part A of title XVIII of the
                            Social Security Act, or enrolled under part B
                            of such title; and
                                (ii) subject to subparagraph (B), at least
                            half of which is provided in a non-hospital
                            community-based care setting.
                        (B) Waiver of requirement half of training be
                    provided in non-hospital community-based care setting
                    in certain areas.--The Secretary may waive the
                    requirement under subparagraph (A)(ii) with respect to
                    eligible hospitals located in rural or medically
                    underserved areas.
                (8) Secretary.--The term ``Secretary'' means the Secretary
            of Health and Human Services.

              Subtitle G--Improving Access to Health Care Services

    SEC. 5601. SPENDING FOR FEDERALLY QUALIFIED HEALTH CENTERS (FQHCS).

        (a) In General.--Section 330(r) of the Public Health Service Act
    (42 U.S.C. 254b(r)) is amended by striking paragraph (1) and inserting
    the following:
                ``(1) General amounts for grants.--For the purpose of
            carrying out this section, in addition to the amounts
            authorized to be appropriated under subsection (d), there is
            authorized to be appropriated the following:
                        ``(A) For fiscal year 2010, $2,988,821,592.
                        ``(B) For fiscal year 2011, $3,862,107,440.
                        ``(C) For fiscal year 2012, $4,990,553,440.
                        ``(D) For fiscal year 2013, $6,448,713,307.
                        ``(E) For fiscal year 2014, $7,332,924,155.
                        ``(F) For fiscal year 2015, $8,332,924,155.
                        ``(G) For fiscal year 2016, and each subsequent
                    fiscal year, the amount appropriated for the preceding
                    fiscal year adjusted by the product of--
                                ``(i) one plus the average percentage
                            increase in costs incurred per patient served;
                            and
                                ``(ii) one plus the average percentage
                            increase in the total number of patients
                            served.''.
        (b) Rule of Construction.--Section 330(r) of the Public Health
    Service Act (42 U.S.C. 254b(r)) is amended by adding at the end the
    following:
                ``(4) Rule of construction with respect to rural health
            clinics.--
                        ``(A) In general.--Nothing in this section shall be
                    construed to prevent a community health center from
                    contracting with a Federally certified rural health
                    clinic (as defined in section 1861(aa)(2) of the Social
                    Security Act), a low-volume hospital (as defined for
                    purposes of section 1886 of such Act), a critical
                    access hospital, a sole community hospital (as defined
                    for purposes of section 1886(d)(5)(D)(iii) of such
                    Act), or a medicare-dependent share hospital (as
                    defined for purposes of section 1886(d)(5)(G)(iv) of
                    such Act) for the delivery of primary health care
                    services that are available at the clinic or hospital
                    to individuals who would otherwise be eligible for free
                    or reduced cost care if that individual were able to
                    obtain that care at the community health center. Such
                    services may be limited in scope to those primary
                    health care services available in that clinic or
                    hospitals.
                        ``(B) Assurances.--In order for a clinic or
                    hospital to receive funds under this section through a
                    contract with a community health center under
                    subparagraph (A), such clinic or hospital shall
                    establish policies to ensure--
                                ``(i) nondiscrimination based on the
                            ability of a patient to pay; and
                                ``(ii) the establishment of a sliding fee
                            scale for low-income patients.''.

    SEC. 5602. NEGOTIATED RULEMAKING FOR DEVELOPMENT OF METHODOLOGY AND
                  CRITERIA FOR DESIGNATING MEDICALLY UNDERSERVED
                  POPULATIONS AND HEALTH PROFESSIONS SHORTAGE AREAS.

        (a) Establishment.--
                (1) In general.--The Secretary of Health and Human Services
            (in this section referred to as the ``Secretary'') shall
            establish, through a negotiated rulemaking process under
            subchapter 3 of chapter 5 of title 5, United States Code, a
            comprehensive methodology and criteria for designation of--
                        (A) medically underserved populations in accordance
                    with section 330(b)(3) of the Public Health Service Act
                    (42 U.S.C. 254b(b)(3));
                        (B) health professions shortage areas under section
                    332 of the Public Health Service Act (42 U.S.C. 254e).
                (2) Factors to consider.--In establishing the methodology
            and criteria under paragraph (1), the Secretary--
                        (A) shall consult with relevant stakeholders who
                    will be significantly affected by a rule (such as
                    national, State and regional organizations representing
                    affected entities), State health offices, community
                    organizations, health centers and other affected
                    entities, and other interested parties; and
                        (B) shall take into account--
                                (i) the timely availability and
                            appropriateness of data used to determine a
                            designation to potential applicants for such
                            designations;
                                (ii) the impact of the methodology and
                            criteria on communities of various types and on
                            health centers and other safety net providers;
                                (iii) the degree of ease or difficulty that
                            will face potential applicants for such
                            designations in securing the necessary data;
                            and
                                (iv) the extent to which the methodology
                            accurately measures various barriers that
                            confront individuals and population groups in
                            seeking health care services.
        (b) Publication of Notice.--In carrying out the rulemaking process
    under this subsection, the Secretary shall publish the notice provided
    for under section 564(a) of title 5, United States Code, by not later
    than 45 days after the date of the enactment of this Act.
        (c) Target Date for Publication of Rule.--As part of the notice
    under subsection (b), and for purposes of this subsection, the ``target
    date for publication'', as referred to in section 564(a)(5) of title 5,
    United Sates Code, shall be July 1, 2010.
        (d) Appointment of Negotiated Rulemaking Committee and
    Facilitator.--The Secretary shall provide for--
                (1) the appointment of a negotiated rulemaking committee
            under section 565(a) of title 5, United States Code, by not
            later than 30 days after the end of the comment period provided
            for under section 564(c) of such title; and
                (2) the nomination of a facilitator under section 566(c) of
            such title 5 by not later than 10 days after the date of
            appointment of the committee.
        (e) Preliminary Committee Report.--The negotiated rulemaking
    committee appointed under subsection (d) shall report to the Secretary,
    by not later than April 1, 2010, regarding the committee's progress on
    achieving a consensus with regard to the rulemaking proceeding and
    whether such consensus is likely to occur before one month before the
    target date for publication of the rule. If the committee reports that
    the committee has failed to make significant progress toward such
    consensus or is unlikely to reach such consensus by the target date,
    the Secretary may terminate such process and provide for the
    publication of a rule under this section through such other methods as
    the Secretary may provide.
        (f) Final Committee Report.--If the committee is not terminated
    under subsection (e), the rulemaking committee shall submit a report
    containing a proposed rule by not later than one month before the
    target publication date.
        (g) Interim Final Effect.--The Secretary shall publish a rule under
    this section in the Federal Register by not later than the target
    publication date. Such rule shall be effective and final immediately on
    an interim basis, but is subject to change and revision after public
    notice and opportunity for a period (of not less than 90 days) for
    public comment. In connection with such rule, the Secretary shall
    specify the process for the timely review and approval of applications
    for such designations pursuant to such rules and consistent with this
    section.
        (h) Publication of Rule After Public Comment.--The Secretary shall
    provide for consideration of such comments and republication of such
    rule by not later than 1 year after the target publication date.

    SEC. 5603. REAUTHORIZATION OF THE WAKEFIELD EMERGENCY MEDICAL SERVICES
                  FOR CHILDREN PROGRAM.

        Section 1910 of the Public Health Service Act (42 U.S.C. 300w-9) is
    amended--
                (1) in subsection (a), by striking ``3-year period (with an
            optional 4th year'' and inserting ``4-year period (with an
            optional 5th year''; and
                (2) in subsection (d)--
                        (A) by striking ``and such sums'' and inserting
                    ``such sums''; and
                        (B) by inserting before the period the following:
                    ``, $25,000,000 for fiscal year 2010, $26,250,000 for
                    fiscal year 2011, $27,562,500 for fiscal year 2012,
                    $28,940,625 for fiscal year 2013, and $30,387,656 for
                    fiscal year 2014''.

    SEC. 5604. CO-LOCATING PRIMARY AND SPECIALTY CARE IN COMMUNITY-BASED
                  MENTAL HEALTH SETTINGS.

        Subpart 3 of part B of title V of the Public Health Service Act (42
    U.S.C. 290bb-31 et seq.) is amended by adding at the end the following:

    ``SEC. 520K. AWARDS FOR CO-LOCATING PRIMARY AND SPECIALTY CARE IN
                  COMMUNITY-BASED MENTAL HEALTH SETTINGS.

        ``(a) Definitions.--In this section:
                ``(1) Eligible entity.--The term `eligible entity' means a
            qualified community mental health program defined under section
            1913(b)(1).
                ``(2) Special populations.--The term `special populations'
            means adults with mental illnesses who have co-occurring
            primary care conditions and chronic diseases.
        ``(b) Program Authorized.--The Secretary, acting through the
    Administrator shall award grants and cooperative agreements to eligible
    entities to establish demonstration projects for the provision of
    coordinated and integrated services to special populations through the
    co-location of primary and specialty care services in community-based
    mental and behavioral health settings.
        ``(c) Application.--To be eligible to receive a grant or
    cooperative agreement under this section, an eligible entity shall
    submit an application to the Administrator at such time, in such
    manner, and accompanied by such information as the Administrator may
    require, including a description of partnerships, or other arrangements
    with local primary care providers, including community health centers,
    to provide services to special populations.
        ``(d) Use of Funds.--
                ``(1) In general.--For the benefit of special populations,
            an eligible entity shall use funds awarded under this section
            for--
                        ``(A) the provision, by qualified primary care
                    professionals, of on site primary care services;
                        ``(B) reasonable costs associated with medically
                    necessary referrals to qualified specialty care
                    professionals, other coordinators of care or, if
                    permitted by the terms of the grant or cooperative
                    agreement, by qualified specialty care professionals on
                    a reasonable cost basis on site at the eligible entity;
                        ``(C) information technology required to
                    accommodate the clinical needs of primary and specialty
                    care professionals; or
                        ``(D) facility modifications needed to bring
                    primary and specialty care professionals on site at the
                    eligible entity.
                ``(2) Limitation.--Not to exceed 15 percent of grant or
            cooperative agreement funds may be used for activities
            described in subparagraphs (C) and (D) of paragraph (1).
        ``(e) Evaluation.--Not later than 90 days after a grant or
    cooperative agreement awarded under this section expires, an eligible
    entity shall submit to the Secretary the results of an evaluation to be
    conducted by the entity concerning the effectiveness of the activities
    carried out under the grant or agreement.
        ``(f) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this section, $50,000,000 for fiscal year
    2010 and such sums as may be necessary for each of fiscal years 2011
    through 2014.''.

    SEC. 5605. KEY NATIONAL INDICATORS.

        (a) Definitions.--In this section:
                (1) Academy.--The term ``Academy'' means the National
            Academy of Sciences.
                (2) Commission.--The term ``Commission'' means the
            Commission on Key National Indicators established under
            subsection (b).
                (3) Institute.--The term ``Institute'' means a Key National
            Indicators Institute as designated under subsection (c)(3).
        (b) Commission on Key National Indicators.--
                (1) Establishment.--There is established a ``Commission on
            Key National Indicators''.
                (2) Membership.--
                        (A) Number and appointment.--The Commission shall
                    be composed of 8 members, to be appointed equally by
                    the majority and minority leaders of the Senate and the
                    Speaker and minority leader of the House of
                    Representatives.
                        (B) Prohibited appointments.--Members of the
                    Commission shall not include Members of Congress or
                    other elected Federal, State, or local government
                    officials.
                        (C) Qualifications.--In making appointments under
                    subparagraph (A), the majority and minority leaders of
                    the Senate and the Speaker and minority leader of the
                    House of Representatives shall appoint individuals who
                    have shown a dedication to improving civic dialogue and
                    decision-making through the wide use of scientific
                    evidence and factual information.
                        (D) Period of appointment.--Each member of the
                    Commission shall be appointed for a 2-year term, except
                    that 1 initial appointment shall be for 3 years. Any
                    vacancies shall not affect the power and duties of the
                    Commission but shall be filled in the same manner as
                    the original appointment and shall last only for the
                    remainder of that term.
                        (E) Date.--Members of the Commission shall be
                    appointed by not later than 30 days after the date of
                    enactment of this Act.
                        (F) Initial organizing period.---Not later than 60
                    days after the date of enactment of this Act, the
                    Commission shall develop and implement a schedule for
                    completion of the review and reports required under
                    subsection (d).
                        (G) Co-chairpersons.--The Commission shall select 2
                    Co-Chairpersons from among its members.
        (c) Duties of the Commission.--
                (1) In general.--The Commission shall--
                        (A) conduct comprehensive oversight of a newly
                    established key national indicators system consistent
                    with the purpose described in this subsection;
                        (B) make recommendations on how to improve the key
                    national indicators system;
                        (C) coordinate with Federal Government users and
                    information providers to assure access to relevant and
                    quality data; and
                        (D) enter into contracts with the Academy.
                (2) Reports.--
                        (A) Annual report to congress.--Not later than 1
                    year after the selection of the 2 Co-Chairpersons of
                    the Commission, and each subsequent year thereafter,
                    the Commission shall prepare and submit to the
                    appropriate Committees of Congress and the President a
                    report that contains a detailed statement of the
                    recommendations, findings, and conclusions of the
                    Commission on the activities of the Academy and a
                    designated Institute related to the establishment of a
                    Key National Indicator System.
                        (B) Annual report to the academy.--
                                (i) In general.--Not later than 6 months
                            after the selection of the 2 Co-Chairpersons of
                            the Commission, and each subsequent year
                            thereafter, the Commission shall prepare and
                            submit to the Academy and a designated
                            Institute a report making recommendations
                            concerning potential issue areas and key
                            indicators to be included in the Key National
                            Indicators.
                                (ii) Limitation.--The Commission shall not
                            have the authority to direct the Academy or, if
                            established, the Institute, to adopt, modify,
                            or delete any key indicators.
                (3) Contract with the national academy of sciences.--
                        (A) In general.---As soon as practicable after the
                    selection of the 2 Co-Chairpersons of the Commission,
                    the Co-Chairpersons shall enter into an arrangement
                    with the National Academy of Sciences under which the
                    Academy shall--
                                (i) review available public and private
                            sector research on the selection of a set of
                            key national indicators;
                                (ii) determine how best to establish a key
                            national indicator system for the United
                            States, by either creating its own
                            institutional capability or designating an
                            independent private nonprofit organization as
                            an Institute to implement a key national
                            indicator system;
                                (iii) if the Academy designates an
                            independent Institute under clause (ii),
                            provide scientific and technical advice to the
                            Institute and create an appropriate governance
                            mechanism that balances Academy involvement and
                            the independence of the Institute; and
                                (iv) provide an annual report to the
                            Commission addressing scientific and technical
                            issues related to the key national indicator
                            system and, if established, the Institute, and
                            governance of the Institute's budget and
                            operations.
                        (B) Participation.--In executing the arrangement
                    under subparagraph (A), the National Academy of
                    Sciences shall convene a multi-sector, multi-
                    disciplinary process to define major scientific and
                    technical issues associated with developing,
                    maintaining, and evolving a Key National Indicator
                    System and, if an Institute is established, to provide
                    it with scientific and technical advice.
                        (C) Establishment of a key national indicator
                    system.--
                                (i) In general.--In executing the
                            arrangement under subparagraph (A), the
                            National Academy of Sciences shall enable the
                            establishment of a key national indicator
                            system by--
                                        (I) creating its own institutional
                                    capability; or
                                        (II) partnering with an independent
                                    private nonprofit organization as an
                                    Institute to implement a key national
                                    indicator system.
                                (ii) Institute.--If the Academy designates
                            an Institute under clause (i)(II), such
                            Institute shall be a non-profit entity (as
                            defined for purposes of section 501(c)(3) of
                            the Internal Revenue Code of 1986) with an
                            educational mission, a governance structure
                            that emphasizes independence, and
                            characteristics that make such entity
                            appropriate for establishing a key national
                            indicator system.
                                (iii) Responsibilities.--Either the Academy
                            or the Institute designated under clause
                            (i)(II) shall be responsible for the following:
                                        (I) Identifying and selecting issue
                                    areas to be represented by the key
                                    national indicators.
                                        (II) Identifying and selecting the
                                    measures used for key national
                                    indicators within the issue areas under
                                    subclause (I).
                                        (III) Identifying and selecting
                                    data to populate the key national
                                    indicators described under subclause
                                    (II).
                                        (IV) Designing, publishing, and
                                    maintaining a public website that
                                    contains a freely accessible database
                                    allowing public access to the key
                                    national indicators.
                                        (V) Developing a quality assurance
                                    framework to ensure rigorous and
                                    independent processes and the selection
                                    of quality data.
                                        (VI) Developing a budget for the
                                    construction and management of a
                                    sustainable, adaptable, and evolving
                                    key national indicator system that
                                    reflects all Commission funding of
                                    Academy and, if an Institute is
                                    established, Institute activities.
                                        (VII) Reporting annually to the
                                    Commission regarding its selection of
                                    issue areas, key indicators, data, and
                                    progress toward establishing a web-
                                    accessible database.
                                        (VIII) Responding directly to the
                                    Commission in response to any
                                    Commission recommendations and to the
                                    Academy regarding any inquiries by the
                                    Academy.
                                (iv) Governance.--Upon the establishment of
                            a key national indicator system, the Academy
                            shall create an appropriate governance
                            mechanism that incorporates advisory and
                            control functions. If an Institute is
                            designated under clause (i)(II), the governance
                            mechanism shall balance appropriate Academy
                            involvement and the independence of the
                            Institute.
                                (v) Modification and changes.--The Academy
                            shall retain the sole discretion, at any time,
                            to alter its approach to the establishment of a
                            key national indicator system or, if an
                            Institute is designated under clause (i)(II),
                            to alter any aspect of its relationship with
                            the Institute or to designate a different non-
                            profit entity to serve as the Institute.
                                (vi) Construction.--Nothing in this section
                            shall be construed to limit the ability of the
                            Academy or the Institute designated under
                            clause (i)(II) to receive private funding for
                            activities related to the establishment of a
                            key national indicator system.
                        (D) Annual report.--As part of the arrangement
                    under subparagraph (A), the National Academy of
                    Sciences shall, not later than 270 days after the date
                    of enactment of this Act, and annually thereafter,
                    submit to the Co-Chairpersons of the Commission a
                    report that contains the findings and recommendations
                    of the Academy.
        (d) Government Accountability Office Study and Report.--
                (1) GAO study.--The Comptroller General of the United
            States shall conduct a study of previous work conducted by all
            public agencies, private organizations, or foreign countries
            with respect to best practices for a key national indicator
            system. The study shall be submitted to the appropriate
            authorizing committees of Congress.
                (2) GAO financial audit.--If an Institute is established
            under this section, the Comptroller General shall conduct an
            annual audit of the financial statements of the Institute, in
            accordance with generally accepted government auditing
            standards and submit a report on such audit to the Commission
            and the appropriate authorizing committees of Congress.
                (3) GAO programmatic review.--The Comptroller General of
            the United States shall conduct programmatic assessments of the
            Institute established under this section as determined
            necessary by the Comptroller General and report the findings to
            the Commission and to the appropriate authorizing committees of
            Congress.
        (e) Authorization of Appropriations.--
                (1) In general.---There are authorized to be appropriated
            to carry out the purposes of this section, $10,000,000 for
            fiscal year 2010, and $7,500,000 for each of fiscal year 2011
            through 2018.
                (2) Availability.---Amounts appropriated under paragraph
            (1) shall remain available until expended.

                         Subtitle H--General Provisions

    SEC. 5701. REPORTS.

        (a) Reports by Secretary of Health and Human Services.--On an
    annual basis, the Secretary of Health and Human Services shall submit
    to the appropriate Committees of Congress a report on the activities
    carried out under the amendments made by this title, and the
    effectiveness of such activities.
        (b) Reports by Recipients of Funds.--The Secretary of Health and
    Human Services may require, as a condition of receiving funds under the
    amendments made by this title, that the entity receiving such award
    submit to such Secretary such reports as the such Secretary may require
    on activities carried out with such award, and the effectiveness of
    such activities.

                  TITLE VI--TRANSPARENCY AND PROGRAM INTEGRITY

             Subtitle A--Physician Ownership and Other Transparency

    SEC. 6001. LIMITATION ON MEDICARE EXCEPTION TO THE PROHIBITION ON
                  CERTAIN PHYSICIAN REFERRALS FOR HOSPITALS.

        (a) In General.--Section 1877 of the Social Security Act (42 U.S.C.
    1395nn) is amended--
                (1) in subsection (d)(2)--
                        (A) in subparagraph (A), by striking ``and'' at the
                    end;
                        (B) in subparagraph (B), by striking the period at
                    the end and inserting ``; and''; and
                        (C) by adding at the end the following new
                    subparagraph:
                        ``(C) in the case where the entity is a hospital,
                    the hospital meets the requirements of paragraph
                    (3)(D).'';
                (2) in subsection (d)(3)--
                        (A) in subparagraph (B), by striking ``and'' at the
                    end;
                        (B) in subparagraph (C), by striking the period at
                    the end and inserting ``; and''; and
                        (C) by adding at the end the following new
                    subparagraph:
                        ``(D) the hospital meets the requirements described
                    in subsection (i)(1) not later than 18 months after the
                    date of the enactment of this subparagraph.''; and
                (3) by adding at the end the following new subsection:
        ``(i) Requirements for Hospitals To Qualify for Rural Provider and
    Hospital Exception to Ownership or Investment Prohibition.--
                ``(1) Requirements described.--For purposes of subsection
            (d)(3)(D), the requirements described in this paragraph for a
            hospital are as follows:
                        ``(A) Provider agreement.--The hospital had--
                                ``(i) physician ownership or investment on
                            February 1, 2010; and
                                ``(ii) a provider agreement under section
                            1866 in effect on such date.
                        ``(B) Limitation on expansion of facility
                    capacity.--Except as provided in paragraph (3), the
                    number of operating rooms, procedure rooms, and beds
                    for which the hospital is licensed at any time on or
                    after the date of the enactment of this subsection is
                    no greater than the number of operating rooms,
                    procedure rooms, and beds for which the hospital is
                    licensed as of such date.
                        ``(C) Preventing conflicts of interest.--
                                ``(i) The hospital submits to the Secretary
                            an annual report containing a detailed
                            description of--
                                        ``(I) the identity of each
                                    physician owner or investor and any
                                    other owners or investors of the
                                    hospital; and
                                        ``(II) the nature and extent of all
                                    ownership and investment interests in
                                    the hospital.
                                ``(ii) The hospital has procedures in place
                            to require that any referring physician owner
                            or investor discloses to the patient being
                            referred, by a time that permits the patient to
                            make a meaningful decision regarding the
                            receipt of care, as determined by the
                            Secretary--
                                        ``(I) the ownership or investment
                                    interest, as applicable, of such
                                    referring physician in the hospital;
                                    and
                                        ``(II) if applicable, any such
                                    ownership or investment interest of the
                                    treating physician.
                                ``(iii) The hospital does not condition any
                            physician ownership or investment interests
                            either directly or indirectly on the physician
                            owner or investor making or influencing
                            referrals to the hospital or otherwise
                            generating business for the hospital.
                                ``(iv) The hospital discloses the fact that
                            the hospital is partially owned or invested in
                            by physicians--
                                        ``(I) on any public website for the
                                    hospital; and
                                        ``(II) in any public advertising
                                    for the hospital.
                        ``(D) Ensuring bona fide investment.--
                                ``(i) The percentage of the total value of
                            the ownership or investment interests held in
                            the hospital, or in an entity whose assets
                            include the hospital, by physician owners or
                            investors in the aggregate does not exceed such
                            percentage as of the date of enactment of this
                            subsection.
                                ``(ii) Any ownership or investment
                            interests that the hospital offers to a
                            physician owner or investor are not offered on
                            more favorable terms than the terms offered to
                            a person who is not a physician owner or
                            investor.
                                ``(iii) The hospital (or any owner or
                            investor in the hospital) does not directly or
                            indirectly provide loans or financing for any
                            investment in the hospital by a physician owner
                            or investor.
                                ``(iv) The hospital (or any owner or
                            investor in the hospital) does not directly or
                            indirectly guarantee a loan, make a payment
                            toward a loan, or otherwise subsidize a loan,
                            for any individual physician owner or investor
                            or group of physician owners or investors that
                            is related to acquiring any ownership or
                            investment interest in the hospital.
                                ``(v) Ownership or investment returns are
                            distributed to each owner or investor in the
                            hospital in an amount that is directly
                            proportional to the ownership or investment
                            interest of such owner or investor in the
                            hospital.
                                ``(vi) Physician owners and investors do
                            not receive, directly or indirectly, any
                            guaranteed receipt of or right to purchase
                            other business interests related to the
                            hospital, including the purchase or lease of
                            any property under the control of other owners
                            or investors in the hospital or located near
                            the premises of the hospital.
                                ``(vii) The hospital does not offer a
                            physician owner or investor the opportunity to
                            purchase or lease any property under the
                            control of the hospital or any other owner or
                            investor in the hospital on more favorable
                            terms than the terms offered to an individual
                            who is not a physician owner or investor.
                        ``(E) Patient safety.--
                                ``(i) Insofar as the hospital admits a
                            patient and does not have any physician
                            available on the premises to provide services
                            during all hours in which the hospital is
                            providing services to such patient, before
                            admitting the patient--
                                        ``(I) the hospital discloses such
                                    fact to a patient; and
                                        ``(II) following such disclosure,
                                    the hospital receives from the patient
                                    a signed acknowledgment that the
                                    patient understands such fact.
                                ``(ii) The hospital has the capacity to--
                                        ``(I) provide assessment and
                                    initial treatment for patients; and
                                        ``(II) refer and transfer patients
                                    to hospitals with the capability to
                                    treat the needs of the patient
                                    involved.
                        ``(F) Limitation on application to certain
                    converted facilities.--The hospital was not converted
                    from an ambulatory surgical center to a hospital on or
                    after the date of enactment of this subsection.
                ``(2) Publication of information reported.--The Secretary
            shall publish, and update on an annual basis, the information
            submitted by hospitals under paragraph (1)(C)(i) on the public
            Internet website of the Centers for Medicare & Medicaid
            Services.
                ``(3) Exception to prohibition on expansion of facility
            capacity.--
                        ``(A) Process.--
                                ``(i) Establishment.--The Secretary shall
                            establish and implement a process under which
                            an applicable hospital (as defined in
                            subparagraph (E)) may apply for an exception
                            from the requirement under paragraph (1)(B).
                                ``(ii) Opportunity for community input.--
                            The process under clause (i) shall provide
                            individuals and entities in the community in
                            which the applicable hospital applying for an
                            exception is located with the opportunity to
                            provide input with respect to the application.
                                ``(iii) Timing for implementation.--The
                            Secretary shall implement the process under
                            clause (i) on August 1, 2011.
                                ``(iv) Regulations.--Not later than July 1,
                            2011, the Secretary shall promulgate
                            regulations to carry out the process under
                            clause (i).
                        ``(B) Frequency.--The process described in
                    subparagraph (A) shall permit an applicable hospital to
                    apply for an exception up to once every 2 years.
                        ``(C) Permitted increase.--
                                ``(i) In general.--Subject to clause (ii)
                            and subparagraph (D), an applicable hospital
                            granted an exception under the process
                            described in subparagraph (A) may increase the
                            number of operating rooms, procedure rooms, and
                            beds for which the applicable hospital is
                            licensed above the baseline number of operating
                            rooms, procedure rooms, and beds of the
                            applicable hospital (or, if the applicable
                            hospital has been granted a previous exception
                            under this paragraph, above the number of
                            operating rooms, procedure rooms, and beds for
                            which the hospital is licensed after the
                            application of the most recent increase under
                            such an exception).
                                ``(ii) 100 percent increase limitation.--
                            The Secretary shall not permit an increase in
                            the number of operating rooms, procedure rooms,
                            and beds for which an applicable hospital is
                            licensed under clause (i) to the extent such
                            increase would result in the number of
                            operating rooms, procedure rooms, and beds for
                            which the applicable hospital is licensed
                            exceeding 200 percent of the baseline number of
                            operating rooms, procedure rooms, and beds of
                            the applicable hospital.
                                ``(iii) Baseline number of operating rooms,
                            procedure rooms, and beds.--In this paragraph,
                            the term `baseline number of operating rooms,
                            procedure rooms, and beds' means the number of
                            operating rooms, procedure rooms, and beds for
                            which the applicable hospital is licensed as of
                            the date of enactment of this subsection.
                        ``(D) Increase limited to facilities on the main
                    campus of the hospital.--Any increase in the number of
                    operating rooms, procedure rooms, and beds for which an
                    applicable hospital is licensed pursuant to this
                    paragraph may only occur in facilities on the main
                    campus of the applicable hospital.
                        ``(E) Applicable hospital.--In this paragraph, the
                    term `applicable hospital' means a hospital--
                                ``(i) that is located in a county in which
                            the percentage increase in the population
                            during the most recent 5-year period (as of the
                            date of the application under subparagraph (A))
                            is at least 150 percent of the percentage
                            increase in the population growth of the State
                            in which the hospital is located during that
                            period, as estimated by Bureau of the Census;
                                ``(ii) whose annual percent of total
                            inpatient admissions that represent inpatient
                            admissions under the program under title XIX is
                            equal to or greater than the average percent
                            with respect to such admissions for all
                            hospitals located in the county in which the
                            hospital is located;
                                ``(iii) that does not discriminate against
                            beneficiaries of Federal health care programs
                            and does not permit physicians practicing at
                            the hospital to discriminate against such
                            beneficiaries;
                                ``(iv) that is located in a State in which
                            the average bed capacity in the State is less
                            than the national average bed capacity; and
                                ``(v) that has an average bed occupancy
                            rate that is greater than the average bed
                            occupancy rate in the State in which the
                            hospital is located.
                        ``(F) Procedure rooms.--In this subsection, the
                    term `procedure rooms' includes rooms in which
                    catheterizations, angiographies, angiograms, and
                    endoscopies are performed, except such term shall not
                    include emergency rooms or departments (exclusive of
                    rooms in which catheterizations, angiographies,
                    angiograms, and endoscopies are performed).
                        ``(G) Publication of final decisions.--Not later
                    than 60 days after receiving a complete application
                    under this paragraph, the Secretary shall publish in
                    the Federal Register the final decision with respect to
                    such application.
                        ``(H) Limitation on review.--There shall be no
                    administrative or judicial review under section 1869,
                    section 1878, or otherwise of the process under this
                    paragraph (including the establishment of such
                    process).
                ``(4) Collection of ownership and investment information.--
            For purposes of subparagraphs (A)(i) and (D)(i) of paragraph
            (1), the Secretary shall collect physician ownership and
            investment information for each hospital.
                ``(5) Physician owner or investor defined.--For purposes of
            this subsection, the term `physician owner or investor' means a
            physician (or an immediate family member of such physician)
            with a direct or an indirect ownership or investment interest
            in the hospital.
                ``(6) Clarification.--Nothing in this subsection shall be
            construed as preventing the Secretary from revoking a
            hospital's provider agreement if not in compliance with
            regulations implementing section 1866.''.
        (b) Enforcement.--
                (1) Ensuring compliance.--The Secretary of Health and Human
            Services shall establish policies and procedures to ensure
            compliance with the requirements described in subsection (i)(1)
            of section 1877 of the Social Security Act, as added by
            subsection (a)(3), beginning on the date such requirements
            first apply. Such policies and procedures may include
            unannounced site reviews of hospitals.
                (2) Audits.--Beginning not later than November 1, 2011, the
            Secretary of Health and Human Services shall conduct audits to
            determine if hospitals violate the requirements referred to in
            paragraph (1).

    SEC. 6002. TRANSPARENCY REPORTS AND REPORTING OF PHYSICIAN OWNERSHIP OR
                  INVESTMENT INTERESTS.

        Part A of title XI of the Social Security Act (42 U.S.C. 1301 et
    seq.) is amended by inserting after section 1128F the following new
    section:

    ``SEC. 1128G. TRANSPARENCY REPORTS AND REPORTING OF PHYSICIAN OWNERSHIP
                  OR INVESTMENT INTERESTS.

        ``(a) Transparency Reports.--
                ``(1) Payments or other transfers of value.--
                        ``(A) In general.--On March 31, 2013, and on the
                    90th day of each calendar year beginning thereafter,
                    any applicable manufacturer that provides a payment or
                    other transfer of value to a covered recipient (or to
                    an entity or individual at the request of or designated
                    on behalf of a covered recipient), shall submit to the
                    Secretary, in such electronic form as the Secretary
                    shall require, the following information with respect
                    to the preceding calendar year:
                                ``(i) The name of the covered recipient.
                                ``(ii) The business address of the covered
                            recipient and, in the case of a covered
                            recipient who is a physician, the specialty and
                            National Provider Identifier of the covered
                            recipient.
                                ``(iii) The amount of the payment or other
                            transfer of value.
                                ``(iv) The dates on which the payment or
                            other transfer of value was provided to the
                            covered recipient.
                                ``(v) A description of the form of the
                            payment or other transfer of value, indicated
                            (as appropriate for all that apply) as--
                                        ``(I) cash or a cash equivalent;
                                        ``(II) in-kind items or services;
                                        ``(III) stock, a stock option, or
                                    any other ownership interest, dividend,
                                    profit, or other return on investment;
                                    or
                                        ``(IV) any other form of payment or
                                    other transfer of value (as defined by
                                    the Secretary).
                                ``(vi) A description of the nature of the
                            payment or other transfer of value, indicated
                            (as appropriate for all that apply) as--
                                        ``(I) consulting fees;
                                        ``(II) compensation for services
                                    other than consulting;
                                        ``(III) honoraria;
                                        ``(IV) gift;
                                        ``(V) entertainment;
                                        ``(VI) food;
                                        ``(VII) travel (including the
                                    specified destinations);
                                        ``(VIII) education;
                                        ``(IX) research;
                                        ``(X) charitable contribution;
                                        ``(XI) royalty or license;
                                        ``(XII) current or prospective
                                    ownership or investment interest;
                                        ``(XIII) direct compensation for
                                    serving as faculty or as a speaker for
                                    a medical education program;
                                        ``(XIV) grant; or
                                        ``(XV) any other nature of the
                                    payment or other transfer of value (as
                                    defined by the Secretary).
                                ``(vii) If the payment or other transfer of
                            value is related to marketing, education, or
                            research specific to a covered drug, device,
                            biological, or medical supply, the name of that
                            covered drug, device, biological, or medical
                            supply.
                                ``(viii) Any other categories of
                            information regarding the payment or other
                            transfer of value the Secretary determines
                            appropriate.
                        ``(B) Special rule for certain payments or other
                    transfers of value.--In the case where an applicable
                    manufacturer provides a payment or other transfer of
                    value to an entity or individual at the request of or
                    designated on behalf of a covered recipient, the
                    applicable manufacturer shall disclose that payment or
                    other transfer of value under the name of the covered
                    recipient.
                ``(2) Physician ownership.--In addition to the requirement
            under paragraph (1)(A), on March 31, 2013, and on the 90th day
            of each calendar year beginning thereafter, any applicable
            manufacturer or applicable group purchasing organization shall
            submit to the Secretary, in such electronic form as the
            Secretary shall require, the following information regarding
            any ownership or investment interest (other than an ownership
            or investment interest in a publicly traded security and mutual
            fund, as described in section 1877(c)) held by a physician (or
            an immediate family member of such physician (as defined for
            purposes of section 1877(a))) in the applicable manufacturer or
            applicable group purchasing organization during the preceding
            year:
                        ``(A) The dollar amount invested by each physician
                    holding such an ownership or investment interest.
                        ``(B) The value and terms of each such ownership or
                    investment interest.
                        ``(C) Any payment or other transfer of value
                    provided to a physician holding such an ownership or
                    investment interest (or to an entity or individual at
                    the request of or designated on behalf of a physician
                    holding such an ownership or investment interest),
                    including the information described in clauses (i)
                    through (viii) of paragraph (1)(A), except that in
                    applying such clauses, `physician' shall be substituted
                    for `covered recipient' each place it appears.
                        ``(D) Any other information regarding the ownership
                    or investment interest the Secretary determines
                    appropriate.
        ``(b) Penalties for Noncompliance.--
                ``(1) Failure to report.--
                        ``(A) In general.--Subject to subparagraph (B)
                    except as provided in paragraph (2), any applicable
                    manufacturer or applicable group purchasing
                    organization that fails to submit information required
                    under subsection (a) in a timely manner in accordance
                    with rules or regulations promulgated to carry out such
                    subsection, shall be subject to a civil money penalty
                    of not less than $1,000, but not more than $10,000, for
                    each payment or other transfer of value or ownership or
                    investment interest not reported as required under such
                    subsection. Such penalty shall be imposed and collected
                    in the same manner as civil money penalties under
                    subsection (a) of section 1128A are imposed and
                    collected under that section.
                        ``(B) Limitation.--The total amount of civil money
                    penalties imposed under subparagraph (A) with respect
                    to each annual submission of information under
                    subsection (a) by an applicable manufacturer or
                    applicable group purchasing organization shall not
                    exceed $150,000.
                ``(2) Knowing failure to report.--
                        ``(A) In general.--Subject to subparagraph (B), any
                    applicable manufacturer or applicable group purchasing
                    organization that knowingly fails to submit information
                    required under subsection (a) in a timely manner in
                    accordance with rules or regulations promulgated to
                    carry out such subsection, shall be subject to a civil
                    money penalty of not less than $10,000, but not more
                    than $100,000, for each payment or other transfer of
                    value or ownership or investment interest not reported
                    as required under such subsection. Such penalty shall
                    be imposed and collected in the same manner as civil
                    money penalties under subsection (a) of section 1128A
                    are imposed and collected under that section.
                        ``(B) Limitation.--The total amount of civil money
                    penalties imposed under subparagraph (A) with respect
                    to each annual submission of information under
                    subsection (a) by an applicable manufacturer or
                    applicable group purchasing organization shall not
                    exceed $1,000,000.
                ``(3) Use of funds.--Funds collected by the Secretary as a
            result of the imposition of a civil money penalty under this
            subsection shall be used to carry out this section.
        ``(c) Procedures for Submission of Information and Public
    Availability.--
                ``(1) In general.--
                        ``(A) Establishment.--Not later than October 1,
                    2011, the Secretary shall establish procedures--
                                ``(i) for applicable manufacturers and
                            applicable group purchasing organizations to
                            submit information to the Secretary under
                            subsection (a); and
                                ``(ii) for the Secretary to make such
                            information submitted available to the public.
                        ``(B) Definition of terms.--The procedures
                    established under subparagraph (A) shall provide for
                    the definition of terms (other than those terms defined
                    in subsection (e)), as appropriate, for purposes of
                    this section.
                        ``(C) Public availability.--Except as provided in
                    subparagraph (E), the procedures established under
                    subparagraph (A)(ii) shall ensure that, not later than
                    September 30, 2013, and on June 30 of each calendar
                    year beginning thereafter, the information submitted
                    under subsection (a) with respect to the preceding
                    calendar year is made available through an Internet
                    website that--
                                ``(i) is searchable and is in a format that
                            is clear and understandable;
                                ``(ii) contains information that is
                            presented by the name of the applicable
                            manufacturer or applicable group purchasing
                            organization, the name of the covered
                            recipient, the business address of the covered
                            recipient, the specialty of the covered
                            recipient, the value of the payment or other
                            transfer of value, the date on which the
                            payment or other transfer of value was provided
                            to the covered recipient, the form of the
                            payment or other transfer of value, indicated
                            (as appropriate) under subsection (a)(1)(A)(v),
                            the nature of the payment or other transfer of
                            value, indicated (as appropriate) under
                            subsection (a)(1)(A)(vi), and the name of the
                            covered drug, device, biological, or medical
                            supply, as applicable;
                                ``(iii) contains information that is able
                            to be easily aggregated and downloaded;
                                ``(iv) contains a description of any
                            enforcement actions taken to carry out this
                            section, including any penalties imposed under
                            subsection (b), during the preceding year;
                                ``(v) contains background information on
                            industry-physician relationships;
                                ``(vi) in the case of information submitted
                            with respect to a payment or other transfer of
                            value described in subparagraph (E)(i), lists
                            such information separately from the other
                            information submitted under subsection (a) and
                            designates such separately listed information
                            as funding for clinical research;
                                ``(vii) contains any other information the
                            Secretary determines would be helpful to the
                            average consumer;
                                ``(viii) does not contain the National
                            Provider Identifier of the covered recipient,
                            and
                                ``(ix) subject to subparagraph (D),
                            provides the applicable manufacturer,
                            applicable group purchasing organization, or
                            covered recipient an opportunity to review and
                            submit corrections to the information submitted
                            with respect to the applicable manufacturer,
                            applicable group purchasing organization, or
                            covered recipient, respectively, for a period
                            of not less than 45 days prior to such
                            information being made available to the public.
                        ``(D) Clarification of time period for review and
                    corrections.--In no case may the 45-day period for
                    review and submission of corrections to information
                    under subparagraph (C)(ix) prevent such information
                    from being made available to the public in accordance
                    with the dates described in the matter preceding clause
                    (i) in subparagraph (C).
                        ``(E) Delayed publication for payments made
                    pursuant to product research or development agreements
                    and clinical investigations.--
                                ``(i) In general.--In the case of
                            information submitted under subsection (a) with
                            respect to a payment or other transfer of value
                            made to a covered recipient by an applicable
                            manufacturer pursuant to a product research or
                            development agreement for services furnished in
                            connection with research on a potential new
                            medical technology or a new application of an
                            existing medical technology or the development
                            of a new drug, device, biological, or medical
                            supply, or by an applicable manufacturer in
                            connection with a clinical investigation
                            regarding a new drug, device, biological, or
                            medical supply, the procedures established
                            under subparagraph (A)(ii) shall provide that
                            such information is made available to the
                            public on the first date described in the
                            matter preceding clause (i) in subparagraph (C)
                            after the earlier of the following:
                                        ``(I) The date of the approval or
                                    clearance of the covered drug, device,
                                    biological, or medical supply by the
                                    Food and Drug Administration.
                                        ``(II) Four calendar years after
                                    the date such payment or other transfer
                                    of value was made.
                                ``(ii) Confidentiality of information prior
                            to publication.--Information described in
                            clause (i) shall be considered confidential and
                            shall not be subject to disclosure under
                            section 552 of title 5, United States Code, or
                            any other similar Federal, State, or local law,
                            until on or after the date on which the
                            information is made available to the public
                            under such clause.
                ``(2) Consultation.--In establishing the procedures under
            paragraph (1), the Secretary shall consult with the Inspector
            General of the Department of Health and Human Services,
            affected industry, consumers, consumer advocates, and other
            interested parties in order to ensure that the information made
            available to the public under such paragraph is presented in
            the appropriate overall context.
        ``(d) Annual Reports and Relation to State Laws.--
                ``(1) Annual report to congress.--Not later than April 1 of
            each year beginning with 2013, the Secretary shall submit to
            Congress a report that includes the following:
                        ``(A) The information submitted under subsection
                    (a) during the preceding year, aggregated for each
                    applicable manufacturer and applicable group purchasing
                    organization that submitted such information during
                    such year (except, in the case of information submitted
                    with respect to a payment or other transfer of value
                    described in subsection (c)(1)(E)(i), such information
                    shall be included in the first report submitted to
                    Congress after the date on which such information is
                    made available to the public under such subsection).
                        ``(B) A description of any enforcement actions
                    taken to carry out this section, including any
                    penalties imposed under subsection (b), during the
                    preceding year.
                ``(2) Annual reports to states.--Not later than September
            30, 2013 and on June 30 of each calendar year thereafter, the
            Secretary shall submit to States a report that includes a
            summary of the information submitted under subsection (a)
            during the preceding year with respect to covered recipients in
            the State (except, in the case of information submitted with
            respect to a payment or other transfer of value described in
            subsection (c)(1)(E)(i), such information shall be included in
            the first report submitted to States after the date on which
            such information is made available to the public under such
            subsection).
                ``(3) Relation to state laws.--
                        ``(A) In general.--In the case of a payment or
                    other transfer of value provided by an applicable
                    manufacturer that is received by a covered recipient
                    (as defined in subsection (e)) on or after January 1,
                    2012, subject to subparagraph (B), the provisions of
                    this section shall preempt any statute or regulation of
                    a State or of a political subdivision of a State that
                    requires an applicable manufacturer (as so defined) to
                    disclose or report, in any format, the type of
                    information (as described in subsection (a)) regarding
                    such payment or other transfer of value.
                        ``(B) No preemption of additional requirements.--
                    Subparagraph (A) shall not preempt any statute or
                    regulation of a State or of a political subdivision of
                    a State that requires the disclosure or reporting of
                    information--
                                ``(i) not of the type required to be
                            disclosed or reported under this section;
                                ``(ii) described in subsection (e)(10)(B),
                            except in the case of information described in
                            clause (i) of such subsection;
                                ``(iii) by any person or entity other than
                            an applicable manufacturer (as so defined) or a
                            covered recipient (as defined in subsection
                            (e)); or
                                ``(iv) to a Federal, State, or local
                            governmental agency for public health
                            surveillance, investigation, or other public
                            health purposes or health oversight purposes.
                        ``(C) Nothing in subparagraph (A) shall be
                    construed to limit the discovery or admissibility of
                    information described in such subparagraph in a
                    criminal, civil, or administrative proceeding.
                ``(4) Consultation.--The Secretary shall consult with the
            Inspector General of the Department of Health and Human
            Services on the implementation of this section.
        ``(e) Definitions.--In this section:
                ``(1) Applicable group purchasing organization.--The term
            `applicable group purchasing organization' means a group
            purchasing organization (as defined by the Secretary) that
            purchases, arranges for, or negotiates the purchase of a
            covered drug, device, biological, or medical supply which is
            operating in the United States, or in a territory, possession,
            or commonwealth of the United States.
                ``(2) Applicable manufacturer.--The term `applicable
            manufacturer' means a manufacturer of a covered drug, device,
            biological, or medical supply which is operating in the United
            States, or in a territory, possession, or commonwealth of the
            United States.
                ``(3) Clinical investigation.--The term `clinical
            investigation' means any experiment involving 1 or more human
            subjects, or materials derived from human subjects, in which a
            drug or device is administered, dispensed, or used.
                ``(4) Covered device.--The term `covered device' means any
            device for which payment is available under title XVIII or a
            State plan under title XIX or XXI (or a waiver of such a plan).
                ``(5) Covered drug, device, biological, or medical
            supply.--The term `covered drug, device, biological, or medical
            supply' means any drug, biological product, device, or medical
            supply for which payment is available under title XVIII or a
            State plan under title XIX or XXI (or a waiver of such a plan).
                ``(6) Covered recipient.--
                        ``(A) In general.--Except as provided in
                    subparagraph (B), the term `covered recipient' means
                    the following:
                                ``(i) A physician.
                                ``(ii) A teaching hospital.
                        ``(B) Exclusion.--Such term does not include a
                    physician who is an employee of the applicable
                    manufacturer that is required to submit information
                    under subsection (a).
                ``(7) Employee.--The term `employee' has the meaning given
            such term in section 1877(h)(2).
                ``(8) Knowingly.--The term `knowingly' has the meaning
            given such term in section 3729(b) of title 31, United States
            Code.
                ``(9) Manufacturer of a covered drug, device, biological,
            or medical supply.--The term `manufacturer of a covered drug,
            device, biological, or medical supply' means any entity which
            is engaged in the production, preparation, propagation,
            compounding, or conversion of a covered drug, device,
            biological, or medical supply (or any entity under common
            ownership with such entity which provides assistance or support
            to such entity with respect to the production, preparation,
            propagation, compounding, conversion, marketing, promotion,
            sale, or distribution of a covered drug, device, biological, or
            medical supply).
                ``(10) Payment or other transfer of value.--
                        ``(A) In general.--The term `payment or other
                    transfer of value' means a transfer of anything of
                    value. Such term does not include a transfer of
                    anything of value that is made indirectly to a covered
                    recipient through a third party in connection with an
                    activity or service in the case where the applicable
                    manufacturer is unaware of the identity of the covered
                    recipient.
                        ``(B) Exclusions.--An applicable manufacturer shall
                    not be required to submit information under subsection
                    (a) with respect to the following:
                                ``(i) A transfer of anything the value of
                            which is less than $10, unless the aggregate
                            amount transferred to, requested by, or
                            designated on behalf of the covered recipient
                            by the applicable manufacturer during the
                            calendar year exceeds $100. For calendar years
                            after 2012, the dollar amounts specified in the
                            preceding sentence shall be increased by the
                            same percentage as the percentage increase in
                            the consumer price index for all urban
                            consumers (all items; U.S. city average) for
                            the 12-month period ending with June of the
                            previous year.
                                ``(ii) Product samples that are not
                            intended to be sold and are intended for
                            patient use.
                                ``(iii) Educational materials that directly
                            benefit patients or are intended for patient
                            use.
                                ``(iv) The loan of a covered device for a
                            short-term trial period, not to exceed 90 days,
                            to permit evaluation of the covered device by
                            the covered recipient.
                                ``(v) Items or services provided under a
                            contractual warranty, including the replacement
                            of a covered device, where the terms of the
                            warranty are set forth in the purchase or lease
                            agreement for the covered device.
                                ``(vi) A transfer of anything of value to a
                            covered recipient when the covered recipient is
                            a patient and not acting in the professional
                            capacity of a covered recipient.
                                ``(vii) Discounts (including rebates).
                                ``(viii) In-kind items used for the
                            provision of charity care.
                                ``(ix) A dividend or other profit
                            distribution from, or ownership or investment
                            interest in, a publicly traded security and
                            mutual fund (as described in section 1877(c)).
                                ``(x) In the case of an applicable
                            manufacturer who offers a self-insured plan,
                            payments for the provision of health care to
                            employees under the plan.
                                ``(xi) In the case of a covered recipient
                            who is a licensed non-medical professional, a
                            transfer of anything of value to the covered
                            recipient if the transfer is payment solely for
                            the non-medical professional services of such
                            licensed non-medical professional.
                                ``(xii) In the case of a covered recipient
                            who is a physician, a transfer of anything of
                            value to the covered recipient if the transfer
                            is payment solely for the services of the
                            covered recipient with respect to a civil or
                            criminal action or an administrative
                            proceeding.
                ``(11) Physician.--The term `physician' has the meaning
            given that term in section 1861(r).''.

    SEC. 6003. DISCLOSURE REQUIREMENTS FOR IN-OFFICE ANCILLARY SERVICES
                  EXCEPTION TO THE PROHIBITION ON PHYSICIAN SELF-REFERRAL
                  FOR CERTAIN IMAGING SERVICES.

        (a) In General.--Section 1877(b)(2) of the Social Security Act (42
    U.S.C. 1395nn(b)(2)) is amended by adding at the end the following new
    sentence: ``Such requirements shall, with respect to magnetic resonance
    imaging, computed tomography, positron emission tomography, and any
    other designated health services specified under subsection (h)(6)(D)
    that the Secretary determines appropriate, include a requirement that
    the referring physician inform the individual in writing at the time of
    the referral that the individual may obtain the services for which the
    individual is being referred from a person other than a person
    described in subparagraph (A)(i) and provide such individual with a
    written list of suppliers (as defined in section 1861(d)) who furnish
    such services in the area in which such individual resides.''.
        (b) Effective Date.--The amendment made by this section shall apply
    to services furnished on or after January 1, 2010.

    SEC. 6004. PRESCRIPTION DRUG SAMPLE TRANSPARENCY.

        Part A of title XI of the Social Security Act (42 U.S.C. 1301 et
    seq.), as amended by section 6002, is amended by inserting after
    section 1128G the following new section:

    ``SEC. 1128H. REPORTING OF INFORMATION RELATING TO DRUG SAMPLES.

        ``(a) In General.--Not later than April 1 of each year (beginning
    with 2012), each manufacturer and authorized distributor of record of
    an applicable drug shall submit to the Secretary (in a form and manner
    specified by the Secretary) the following information with respect to
    the preceding year:
                ``(1) In the case of a manufacturer or authorized
            distributor of record which makes distributions by mail or
            common carrier under subsection (d)(2) of section 503 of the
            Federal Food, Drug, and Cosmetic Act (21 U.S.C. 353), the
            identity and quantity of drug samples requested and the
            identity and quantity of drug samples distributed under such
            subsection during that year, aggregated by--
                        ``(A) the name, address, professional designation,
                    and signature of the practitioner making the request
                    under subparagraph (A)(i) of such subsection, or of any
                    individual who makes or signs for the request on behalf
                    of the practitioner; and
                        ``(B) any other category of information determined
                    appropriate by the Secretary.
                ``(2) In the case of a manufacturer or authorized
            distributor of record which makes distributions by means other
            than mail or common carrier under subsection (d)(3) of such
            section 503, the identity and quantity of drug samples
            requested and the identity and quantity of drug samples
            distributed under such subsection during that year, aggregated
            by--
                        ``(A) the name, address, professional designation,
                    and signature of the practitioner making the request
                    under subparagraph (A)(i) of such subsection, or of any
                    individual who makes or signs for the request on behalf
                    of the practitioner; and
                        ``(B) any other category of information determined
                    appropriate by the Secretary.
        ``(b) Definitions.--In this section:
                ``(1) Applicable drug.--The term `applicable drug' means a
            drug--
                        ``(A) which is subject to subsection (b) of such
                    section 503; and
                        ``(B) for which payment is available under title
                    XVIII or a State plan under title XIX or XXI (or a
                    waiver of such a plan).
                ``(2) Authorized distributor of record.--The term
            `authorized distributor of record' has the meaning given that
            term in subsection (e)(3)(A) of such section.
                ``(3) Manufacturer.--The term `manufacturer' has the
            meaning given that term for purposes of subsection (d) of such
            section.''.

    SEC. 6005. PHARMACY BENEFIT MANAGERS TRANSPARENCY REQUIREMENTS.

        Part A of title XI of the Social Security Act (42 U.S.C. 1301 et
    seq.) is amended by inserting after section 1150 the following new
    section:

    ``SEC. 1150A. PHARMACY BENEFIT MANAGERS TRANSPARENCY REQUIREMENTS.

        ``(a) Provision of Information.--A health benefits plan or any
    entity that provides pharmacy benefits management services on behalf of
    a health benefits plan (in this section referred to as a `PBM') that
    manages prescription drug coverage under a contract with--
                ``(1) a PDP sponsor of a prescription drug plan or an MA
            organization offering an MA-PD plan under part D of title
            XVIII; or
                ``(2) a qualified health benefits plan offered through an
            exchange established by a State under section 1311 of the
            Patient Protection and Affordable Care Act,
    shall provide the information described in subsection (b) to the
    Secretary and, in the case of a PBM, to the plan with which the PBM is
    under contract with, at such times, and in such form and manner, as the
    Secretary shall specify.
        ``(b) Information Described.--The information described in this
    subsection is the following with respect to services provided by a
    health benefits plan or PBM for a contract year:
                ``(1) The percentage of all prescriptions that were
            provided through retail pharmacies compared to mail order
            pharmacies, and the percentage of prescriptions for which a
            generic drug was available and dispensed (generic dispensing
            rate), by pharmacy type (which includes an independent
            pharmacy, chain pharmacy, supermarket pharmacy, or mass
            merchandiser pharmacy that is licensed as a pharmacy by the
            State and that dispenses medication to the general public),
            that is paid by the health benefits plan or PBM under the
            contract.
                ``(2) The aggregate amount, and the type of rebates,
            discounts, or price concessions (excluding bona fide service
            fees, which include but are not limited to distribution service
            fees, inventory management fees, product stocking allowances,
            and fees associated with administrative services agreements and
            patient care programs (such as medication compliance programs
            and patient education programs)) that the PBM negotiates that
            are attributable to patient utilization under the plan, and the
            aggregate amount of the rebates, discounts, or price
            concessions that are passed through to the plan sponsor, and
            the total number of prescriptions that were dispensed.
                ``(3) The aggregate amount of the difference between the
            amount the health benefits plan pays the PBM and the amount
            that the PBM pays retail pharmacies, and mail order pharmacies,
            and the total number of prescriptions that were dispensed.
        ``(c) Confidentiality.--Information disclosed by a health benefits
    plan or PBM under this section is confidential and shall not be
    disclosed by the Secretary or by a plan receiving the information,
    except that the Secretary may disclose the information in a form which
    does not disclose the identity of a specific PBM, plan, or prices
    charged for drugs, for the following purposes:
                ``(1) As the Secretary determines to be necessary to carry
            out this section or part D of title XVIII.
                ``(2) To permit the Comptroller General to review the
            information provided.
                ``(3) To permit the Director of the Congressional Budget
            Office to review the information provided.
                ``(4) To States to carry out section 1311 of the Patient
            Protection and Affordable Care Act.
        ``(d) Penalties.--The provisions of subsection (b)(3)(C) of section
    1927 shall apply to a health benefits plan or PBM that fails to provide
    information required under subsection (a) on a timely basis or that
    knowingly provides false information in the same manner as such
    provisions apply to a manufacturer with an agreement under that
    section.''.

             Subtitle B--Nursing Home Transparency and Improvement

                 PART I--IMPROVING TRANSPARENCY OF INFORMATION

    SEC. 6101. REQUIRED DISCLOSURE OF OWNERSHIP AND ADDITIONAL DISCLOSABLE
                  PARTIES INFORMATION.

        (a) In General.--Section 1124 of the Social Security Act (42 U.S.C.
    1320a-3) is amended by adding at the end the following new subsection:
        ``(c) Required Disclosure of Ownership and Additional Disclosable
    Parties Information.--
                ``(1) Disclosure.--A facility shall have the information
            described in paragraph (2) available--
                        ``(A) during the period beginning on the date of
                    the enactment of this subsection and ending on the date
                    such information is made available to the public under
                    section 6101(b) of the Patient Protection and
                    Affordable Care Act for submission to the Secretary,
                    the Inspector General of the Department of Health and
                    Human Services, the State in which the facility is
                    located, and the State long-term care ombudsman in the
                    case where the Secretary, the Inspector General, the
                    State, or the State long-term care ombudsman requests
                    such information; and
                        ``(B) beginning on the effective date of the final
                    regulations promulgated under paragraph (3)(A), for
                    reporting such information in accordance with such
                    final regulations.
            Nothing in subparagraph (A) shall be construed as authorizing a
            facility to dispose of or delete information described in such
            subparagraph after the effective date of the final regulations
            promulgated under paragraph (3)(A).
                ``(2) Information described.--
                        ``(A) In general.--The following information is
                    described in this paragraph:
                                ``(i) The information described in
                            subsections (a) and (b), subject to
                            subparagraph (C).
                                ``(ii) The identity of and information on--
                                        ``(I) each member of the governing
                                    body of the facility, including the
                                    name, title, and period of service of
                                    each such member;
                                        ``(II) each person or entity who is
                                    an officer, director, member, partner,
                                    trustee, or managing employee of the
                                    facility, including the name, title,
                                    and period of service of each such
                                    person or entity; and
                                        ``(III) each person or entity who
                                    is an additional disclosable party of
                                    the facility.
                                ``(iii) The organizational structure of
                            each additional disclosable party of the
                            facility and a description of the relationship
                            of each such additional disclosable party to
                            the facility and to one another.
                        ``(B) Special rule where information is already
                    reported or submitted.--To the extent that information
                    reported by a facility to the Internal Revenue Service
                    on Form 990, information submitted by a facility to the
                    Securities and Exchange Commission, or information
                    otherwise submitted to the Secretary or any other
                    Federal agency contains the information described in
                    clauses (i), (ii), or (iii) of subparagraph (A), the
                    facility may provide such Form or such information
                    submitted to meet the requirements of paragraph (1).
                        ``(C) Special rule.--In applying subparagraph
                    (A)(i)--
                                ``(i) with respect to subsections (a) and
                            (b), `ownership or control interest' shall
                            include direct or indirect interests, including
                            such interests in intermediate entities; and
                                ``(ii) subsection (a)(3)(A)(ii) shall
                            include the owner of a whole or part interest
                            in any mortgage, deed of trust, note, or other
                            obligation secured, in whole or in part, by the
                            entity or any of the property or assets
                            thereof, if the interest is equal to or exceeds
                            5 percent of the total property or assets of
                            the entirety.
                ``(3) Reporting.--
                        ``(A) In general.--Not later than the date that is
                    2 years after the date of the enactment of this
                    subsection, the Secretary shall promulgate final
                    regulations requiring, effective on the date that is 90
                    days after the date on which such final regulations are
                    published in the Federal Register, a facility to report
                    the information described in paragraph (2) to the
                    Secretary in a standardized format, and such other
                    regulations as are necessary to carry out this
                    subsection. Such final regulations shall ensure that
                    the facility certifies, as a condition of participation
                    and payment under the program under title XVIII or XIX,
                    that the information reported by the facility in
                    accordance with such final regulations is, to the best
                    of the facility's knowledge, accurate and current.
                        ``(B) Guidance.--The Secretary shall provide
                    guidance and technical assistance to States on how to
                    adopt the standardized format under subparagraph (A).
                ``(4) No effect on existing reporting requirements.--
            Nothing in this subsection shall reduce, diminish, or alter any
            reporting requirement for a facility that is in effect as of
            the date of the enactment of this subsection.
                ``(5) Definitions.--In this subsection:
                        ``(A) Additional disclosable party.--The term
                    `additional disclosable party' means, with respect to a
                    facility, any person or entity who--
                                ``(i) exercises operational, financial, or
                            managerial control over the facility or a part
                            thereof, or provides policies or procedures for
                            any of the operations of the facility, or
                            provides financial or cash management services
                            to the facility;
                                ``(ii) leases or subleases real property to
                            the facility, or owns a whole or part interest
                            equal to or exceeding 5 percent of the total
                            value of such real property; or
                                ``(iii) provides management or
                            administrative services, management or clinical
                            consulting services, or accounting or financial
                            services to the facility.
                        ``(B) Facility.--The term `facility' means a
                    disclosing entity which is--
                                ``(i) a skilled nursing facility (as
                            defined in section 1819(a)); or
                                ``(ii) a nursing facility (as defined in
                            section 1919(a)).
                        ``(C) Managing employee.--The term `managing
                    employee' means, with respect to a facility, an
                    individual (including a general manager, business
                    manager, administrator, director, or consultant) who
                    directly or indirectly manages, advises, or supervises
                    any element of the practices, finances, or operations
                    of the facility.
                        ``(D) Organizational structure.--The term
                    `organizational structure' means, in the case of--
                                ``(i) a corporation, the officers,
                            directors, and shareholders of the corporation
                            who have an ownership interest in the
                            corporation which is equal to or exceeds 5
                            percent;
                                ``(ii) a limited liability company, the
                            members and managers of the limited liability
                            company (including, as applicable, what
                            percentage each member and manager has of the
                            ownership interest in the limited liability
                            company);
                                ``(iii) a general partnership, the partners
                            of the general partnership;
                                ``(iv) a limited partnership, the general
                            partners and any limited partners of the
                            limited partnership who have an ownership
                            interest in the limited partnership which is
                            equal to or exceeds 10 percent;
                                ``(v) a trust, the trustees of the trust;
                                ``(vi) an individual, contact information
                            for the individual; and
                                ``(vii) any other person or entity, such
                            information as the Secretary determines
                            appropriate.''.
        (b) Public Availability of Information.--Not later than the date
    that is 1 year after the date on which the final regulations
    promulgated under section 1124(c)(3)(A) of the Social Security Act, as
    added by subsection (a), are published in the Federal Register, the
    Secretary of Health and Human Services shall make the information
    reported in accordance with such final regulations available to the
    public in accordance with procedures established by the Secretary.
        (c) Conforming Amendments.--
                (1) In general.--
                        (A) Skilled nursing facilities.--Section 1819(d)(1)
                    of the Social Security Act (42 U.S.C. 1395i-3(d)(1)) is
                    amended by striking subparagraph (B) and redesignating
                    subparagraph (C) as subparagraph (B).
                        (B) Nursing facilities.--Section 1919(d)(1) of the
                    Social Security Act (42 U.S.C. 1396r(d)(1)) is amended
                    by striking subparagraph (B) and redesignating
                    subparagraph (C) as subparagraph (B).
                (2) Effective date.--The amendments made by paragraph (1)
            shall take effect on the date on which the Secretary makes the
            information described in subsection (b)(1) available to the
            public under such subsection.

    SEC. 6102. ACCOUNTABILITY REQUIREMENTS FOR SKILLED NURSING FACILITIES
                  AND NURSING FACILITIES.

        Part A of title XI of the Social Security Act (42 U.S.C. 1301 et
    seq.), as amended by sections 6002 and 6004, is amended by inserting
    after section 1128H the following new section:

    ``SEC. 1128I. ACCOUNTABILITY REQUIREMENTS FOR FACILITIES.

        ``(a) Definition of Facility.--In this section, the term `facility'
    means--
                ``(1) a skilled nursing facility (as defined in section
            1819(a)); or
                ``(2) a nursing facility (as defined in section 1919(a)).
        ``(b) Effective Compliance and Ethics Programs.--
                ``(1) Requirement.--On or after the date that is 36 months
            after the date of the enactment of this section, a facility
            shall, with respect to the entity that operates the facility
            (in this subparagraph referred to as the `operating
            organization' or `organization'), have in operation a
            compliance and ethics program that is effective in preventing
            and detecting criminal, civil, and administrative violations
            under this Act and in promoting quality of care consistent with
            regulations developed under paragraph (2).
                ``(2) Development of regulations.--
                        ``(A) In general.--Not later than the date that is
                    2 years after such date of the enactment, the
                    Secretary, working jointly with the Inspector General
                    of the Department of Health and Human Services, shall
                    promulgate regulations for an effective compliance and
                    ethics program for operating organizations, which may
                    include a model compliance program.
                        ``(B)  Design of regulations.--Such regulations
                    with respect to specific elements or formality of a
                    program shall, in the case of an organization that
                    operates 5 or more facilities, vary with the size of
                    the organization, such that larger organizations should
                    have a more formal program and include established
                    written policies defining the standards and procedures
                    to be followed by its employees. Such requirements may
                    specifically apply to the corporate level management of
                    multi unit nursing home chains.
                        ``(C) Evaluation.--Not later than 3 years after the
                    date of the promulgation of regulations under this
                    paragraph, the Secretary shall complete an evaluation
                    of the compliance and ethics programs required to be
                    established under this subsection. Such evaluation
                    shall determine if such programs led to changes in
                    deficiency citations, changes in quality performance,
                    or changes in other metrics of patient quality of care.
                    The Secretary shall submit to Congress a report on such
                    evaluation and shall include in such report such
                    recommendations regarding changes in the requirements
                    for such programs as the Secretary determines
                    appropriate.
                ``(3) Requirements for compliance and ethics programs.--In
            this subsection, the term `compliance and ethics program'
            means, with respect to a facility, a program of the operating
            organization that--
                        ``(A) has been reasonably designed, implemented,
                    and enforced so that it generally will be effective in
                    preventing and detecting criminal, civil, and
                    administrative violations under this Act and in
                    promoting quality of care; and
                        ``(B) includes at least the required components
                    specified in paragraph (4).
                ``(4) Required components of program.--The required
            components of a compliance and ethics program of an operating
            organization are the following:
                        ``(A) The organization must have established
                    compliance standards and procedures to be followed by
                    its employees and other agents that are reasonably
                    capable of reducing the prospect of criminal, civil,
                    and administrative violations under this Act.
                        ``(B) Specific individuals within high-level
                    personnel of the organization must have been assigned
                    overall responsibility to oversee compliance with such
                    standards and procedures and have sufficient resources
                    and authority to assure such compliance.
                        ``(C) The organization must have used due care not
                    to delegate substantial discretionary authority to
                    individuals whom the organization knew, or should have
                    known through the exercise of due diligence, had a
                    propensity to engage in criminal, civil, and
                    administrative violations under this Act.
                        ``(D) The organization must have taken steps to
                    communicate effectively its standards and procedures to
                    all employees and other agents, such as by requiring
                    participation in training programs or by disseminating
                    publications that explain in a practical manner what is
                    required.
                        ``(E) The organization must have taken reasonable
                    steps to achieve compliance with its standards, such as
                    by utilizing monitoring and auditing systems reasonably
                    designed to detect criminal, civil, and administrative
                    violations under this Act by its employees and other
                    agents and by having in place and publicizing a
                    reporting system whereby employees and other agents
                    could report violations by others within the
                    organization without fear of retribution.
                        ``(F) The standards must have been consistently
                    enforced through appropriate disciplinary mechanisms,
                    including, as appropriate, discipline of individuals
                    responsible for the failure to detect an offense.
                        ``(G) After an offense has been detected, the
                    organization must have taken all reasonable steps to
                    respond appropriately to the offense and to prevent
                    further similar offenses, including any necessary
                    modification to its program to prevent and detect
                    criminal, civil, and administrative violations under
                    this Act.
                        ``(H) The organization must periodically undertake
                    reassessment of its compliance program to identify
                    changes necessary to reflect changes within the
                    organization and its facilities.
        ``(c) Quality Assurance and Performance Improvement Program.--
                ``(1) In general.--Not later than December 31, 2011, the
            Secretary shall establish and implement a quality assurance and
            performance improvement program (in this subparagraph referred
            to as the `QAPI program') for facilities, including multi unit
            chains of facilities. Under the QAPI program, the Secretary
            shall establish standards relating to quality assurance and
            performance improvement with respect to facilities and provide
            technical assistance to facilities on the development of best
            practices in order to meet such standards. Not later than 1
            year after the date on which the regulations are promulgated
            under paragraph (2), a facility must submit to the Secretary a
            plan for the facility to meet such standards and implement such
            best practices, including how to coordinate the implementation
            of such plan with quality assessment and assurance activities
            conducted under sections 1819(b)(1)(B) and 1919(b)(1)(B), as
            applicable.
                ``(2) Regulations.--The Secretary shall promulgate
            regulations to carry out this subsection.''.

    SEC. 6103. NURSING HOME COMPARE MEDICARE WEBSITE.

        (a) Skilled Nursing Facilities.--
                (1) In general.--Section 1819 of the Social Security Act
            (42 U.S.C. 1395i-3) is amended--
                        (A) by redesignating subsection (i) as subsection
                    (j); and
                        (B) by inserting after subsection (h) the following
                    new subsection:
        ``(i) Nursing Home Compare Website.--
                ``(1) Inclusion of additional information.--
                        ``(A) In general.--The Secretary shall ensure that
                    the Department of Health and Human Services includes,
                    as part of the information provided for comparison of
                    nursing homes on the official Internet website of the
                    Federal Government for Medicare beneficiaries (commonly
                    referred to as the `Nursing Home Compare' Medicare
                    website) (or a successor website), the following
                    information in a manner that is prominent, updated on a
                    timely basis, easily accessible, readily understandable
                    to consumers of long-term care services, and
                    searchable:
                                ``(i) Staffing data for each facility
                            (including resident census data and data on the
                            hours of care provided per resident per day)
                            based on data submitted under section 1128I(g),
                            including information on staffing turnover and
                            tenure, in a format that is clearly
                            understandable to consumers of long-term care
                            services and allows such consumers to compare
                            differences in staffing between facilities and
                            State and national averages for the facilities.
                            Such format shall include--
                                        ``(I) concise explanations of how
                                    to interpret the data (such as a plain
                                    English explanation of data reflecting
                                    `nursing home staff hours per resident
                                    day');
                                        ``(II) differences in types of
                                    staff (such as training associated with
                                    different categories of staff);
                                        ``(III) the relationship between
                                    nurse staffing levels and quality of
                                    care; and
                                        ``(IV) an explanation that
                                    appropriate staffing levels vary based
                                    on patient case mix.
                                ``(ii) Links to State Internet websites
                            with information regarding State survey and
                            certification programs, links to Form 2567
                            State inspection reports (or a successor form)
                            on such websites, information to guide
                            consumers in how to interpret and understand
                            such reports, and the facility plan of
                            correction or other response to such report.
                            Any such links shall be posted on a timely
                            basis.
                                ``(iii) The standardized complaint form
                            developed under section 1128I(f), including
                            explanatory material on what complaint forms
                            are, how they are used, and how to file a
                            complaint with the State survey and
                            certification program and the State long-term
                            care ombudsman program.
                                ``(iv) Summary information on the number,
                            type, severity, and outcome of substantiated
                            complaints.
                                ``(v) The number of adjudicated instances
                            of criminal violations by a facility or the
                            employees of a facility--
                                        ``(I) that were committed inside
                                    the facility;
                                        ``(II) with respect to such
                                    instances of violations or crimes
                                    committed inside of the facility that
                                    were the violations or crimes of abuse,
                                    neglect, and exploitation, criminal
                                    sexual abuse, or other violations or
                                    crimes that resulted in serious bodily
                                    injury; and
                                        ``(III) the number of civil
                                    monetary penalties levied against the
                                    facility, employees, contractors, and
                                    other agents.
                        ``(B) Deadline for provision of information.--
                                ``(i) In general.--Except as provided in
                            clause (ii), the Secretary shall ensure that
                            the information described in subparagraph (A)
                            is included on such website (or a successor
                            website) not later than 1 year after the date
                            of the enactment of this subsection.
                                ``(ii) Exception.--The Secretary shall
                            ensure that the information described in
                            subparagraph (A)(i) is included on such website
                            (or a successor website) not later than the
                            date on which the requirements under section
                            1128I(g) are implemented.
                ``(2) Review and modification of website.--
                        ``(A) In general.--The Secretary shall establish a
                    process--
                                ``(i) to review the accuracy, clarity of
                            presentation, timeliness, and comprehensiveness
                            of information reported on such website as of
                            the day before the date of the enactment of
                            this subsection; and
                                ``(ii) not later than 1 year after the date
                            of the enactment of this subsection, to modify
                            or revamp such website in accordance with the
                            review conducted under clause (i).
                        ``(B) Consultation.--In conducting the review under
                    subparagraph (A)(i), the Secretary shall consult with--
                                ``(i) State long-term care ombudsman
                            programs;
                                ``(ii) consumer advocacy groups;
                                ``(iii) provider stakeholder groups; and
                                ``(iv) any other representatives of
                            programs or groups the Secretary determines
                            appropriate.''.
                (2) Timeliness of submission of survey and certification
            information.--
                        (A) In general.--Section 1819(g)(5) of the Social
                    Security Act (42 U.S.C. 1395i-3(g)(5)) is amended by
                    adding at the end the following new subparagraph:
                        ``(E) Submission of survey and certification
                    information to the secretary.--In order to improve the
                    timeliness of information made available to the public
                    under subparagraph (A) and provided on the Nursing Home
                    Compare Medicare website under subsection (i), each
                    State shall submit information respecting any survey or
                    certification made respecting a skilled nursing
                    facility (including any enforcement actions taken by
                    the State) to the Secretary not later than the date on
                    which the State sends such information to the facility.
                    The Secretary shall use the information submitted under
                    the preceding sentence to update the information
                    provided on the Nursing Home Compare Medicare website
                    as expeditiously as practicable but not less frequently
                    than quarterly.''.
                        (B) Effective date.--The amendment made by this
                    paragraph shall take effect 1 year after the date of
                    the enactment of this Act.
                (3) Special focus facility program.--Section 1819(f) of the
            Social Security Act (42 U.S.C. 1395i-3(f)) is amended by adding
            at the end the following new paragraph:
                ``(8) Special focus facility program.--
                        ``(A) In general.--The Secretary shall conduct a
                    special focus facility program for enforcement of
                    requirements for skilled nursing facilities that the
                    Secretary has identified as having substantially failed
                    to meet applicable requirement of this Act.
                        ``(B) Periodic surveys.--Under such program the
                    Secretary shall conduct surveys of each facility in the
                    program not less than once every 6 months.''.
        (b) Nursing Facilities.--
                (1) In general.--Section 1919 of the Social Security Act
            (42 U.S.C. 1396r) is amended--
                        (A) by redesignating subsection (i) as subsection
                    (j); and
                        (B) by inserting after subsection (h) the following
                    new subsection:
        ``(i) Nursing Home Compare Website.--
                ``(1) Inclusion of additional information.--
                        ``(A) In general.--The Secretary shall ensure that
                    the Department of Health and Human Services includes,
                    as part of the information provided for comparison of
                    nursing homes on the official Internet website of the
                    Federal Government for Medicare beneficiaries (commonly
                    referred to as the `Nursing Home Compare' Medicare
                    website) (or a successor website), the following
                    information in a manner that is prominent, updated on a
                    timely basis, easily accessible, readily understandable
                    to consumers of long-term care services, and
                    searchable:
                                ``(i) Staffing data for each facility
                            (including resident census data and data on the
                            hours of care provided per resident per day)
                            based on data submitted under section 1128I(g),
                            including information on staffing turnover and
                            tenure, in a format that is clearly
                            understandable to consumers of long-term care
                            services and allows such consumers to compare
                            differences in staffing between facilities and
                            State and national averages for the facilities.
                            Such format shall include--
                                        ``(I) concise explanations of how
                                    to interpret the data (such as plain
                                    English explanation of data reflecting
                                    `nursing home staff hours per resident
                                    day');
                                        ``(II) differences in types of
                                    staff (such as training associated with
                                    different categories of staff);
                                        ``(III) the relationship between
                                    nurse staffing levels and quality of
                                    care; and
                                        ``(IV) an explanation that
                                    appropriate staffing levels vary based
                                    on patient case mix.
                                ``(ii) Links to State Internet websites
                            with information regarding State survey and
                            certification programs, links to Form 2567
                            State inspection reports (or a successor form)
                            on such websites, information to guide
                            consumers in how to interpret and understand
                            such reports, and the facility plan of
                            correction or other response to such report.
                            Any such links shall be posted on a timely
                            basis.
                                ``(iii) The standardized complaint form
                            developed under section 1128I(f), including
                            explanatory material on what complaint forms
                            are, how they are used, and how to file a
                            complaint with the State survey and
                            certification program and the State long-term
                            care ombudsman program.
                                ``(iv) Summary information on the number,
                            type, severity, and outcome of substantiated
                            complaints.
                                ``(v) The number of adjudicated instances
                            of criminal violations by a facility or the
                            employees of a facility--
                                        ``(I) that were committed inside of
                                    the facility; and
                                        ``(II) with respect to such
                                    instances of violations or crimes
                                    committed outside of the facility, that
                                    were violations or crimes that resulted
                                    in the serious bodily injury of an
                                    elder.
                        ``(B) Deadline for provision of information.--
                                ``(i) In general.--Except as provided in
                            clause (ii), the Secretary shall ensure that
                            the information described in subparagraph (A)
                            is included on such website (or a successor
                            website) not later than 1 year after the date
                            of the enactment of this subsection.
                                ``(ii) Exception.--The Secretary shall
                            ensure that the information described in
                            subparagraph (A)(i) is included on such website
                            (or a successor website) not later than the
                            date on which the requirements under section
                            1128I(g) are implemented.
                ``(2) Review and modification of website.--
                        ``(A) In general.--The Secretary shall establish a
                    process--
                                ``(i) to review the accuracy, clarity of
                            presentation, timeliness, and comprehensiveness
                            of information reported on such website as of
                            the day before the date of the enactment of
                            this subsection; and
                                ``(ii) not later than 1 year after the date
                            of the enactment of this subsection, to modify
                            or revamp such website in accordance with the
                            review conducted under clause (i).
                        ``(B) Consultation.--In conducting the review under
                    subparagraph (A)(i), the Secretary shall consult with--
                                ``(i) State long-term care ombudsman
                            programs;
                                ``(ii) consumer advocacy groups;
                                ``(iii) provider stakeholder groups;
                                ``(iv) skilled nursing facility employees
                            and their representatives; and
                                ``(v) any other representatives of programs
                            or groups the Secretary determines
                            appropriate.''.
                (2) Timeliness of submission of survey and certification
            information.--
                        (A) In general.--Section 1919(g)(5) of the Social
                    Security Act (42 U.S.C. 1396r(g)(5)) is amended by
                    adding at the end the following new subparagraph:
                        ``(E) Submission of survey and certification
                    information to the secretary.--In order to improve the
                    timeliness of information made available to the public
                    under subparagraph (A) and provided on the Nursing Home
                    Compare Medicare website under subsection (i), each
                    State shall submit information respecting any survey or
                    certification made respecting a nursing facility
                    (including any enforcement actions taken by the State)
                    to the Secretary not later than the date on which the
                    State sends such information to the facility. The
                    Secretary shall use the information submitted under the
                    preceding sentence to update the information provided
                    on the Nursing Home Compare Medicare website as
                    expeditiously as practicable but not less frequently
                    than quarterly.''.
                        (B) Effective date.--The amendment made by this
                    paragraph shall take effect 1 year after the date of
                    the enactment of this Act.
                (3) Special focus facility program.--Section 1919(f) of the
            Social Security Act (42 U.S.C. 1396r(f)) is amended by adding
            at the end of the following new paragraph:
                ``(10) Special focus facility program.--
                        ``(A) In general.--The Secretary shall conduct a
                    special focus facility program for enforcement of
                    requirements for nursing facilities that the Secretary
                    has identified as having substantially failed to meet
                    applicable requirements of this Act.
                        ``(B) Periodic surveys.--Under such program the
                    Secretary shall conduct surveys of each facility in the
                    program not less often than once every 6 months.''.
        (c) Availability of Reports on Surveys, Certifications, and
    Complaint Investigations.--
                (1) Skilled nursing facilities.--Section 1819(d)(1) of the
            Social Security Act (42 U.S.C. 1395i-3(d)(1)), as amended by
            section 6101, is amended by adding at the end the following new
            subparagraph:
                        ``(C) Availability of survey, certification, and
                    complaint investigation reports.--A skilled nursing
                    facility must--
                                ``(i) have reports with respect to any
                            surveys, certifications, and complaint
                            investigations made respecting the facility
                            during the 3 preceding years available for any
                            individual to review upon request; and
                                ``(ii) post notice of the availability of
                            such reports in areas of the facility that are
                            prominent and accessible to the public.
                    The facility shall not make available under clause (i)
                    identifying information about complainants or
                    residents.''.
                (2) Nursing facilities.--Section 1919(d)(1) of the Social
            Security Act (42 U.S.C. 1396r(d)(1)), as amended by section
            6101, is amended by adding at the end the following new
            subparagraph:
                        ``(V) Availability of survey, certification, and
                    complaint investigation reports.--A nursing facility
                    must--
                                ``(i) have reports with respect to any
                            surveys, certifications, and complaint
                            investigations made respecting the facility
                            during the 3 preceding years available for any
                            individual to review upon request; and
                                ``(ii) post notice of the availability of
                            such reports in areas of the facility that are
                            prominent and accessible to the public.
                    The facility shall not make available under clause (i)
                    identifying information about complainants or
                    residents.''.
                (3) Effective date.--The amendments made by this subsection
            shall take effect 1 year after the date of the enactment of
            this Act.
        (d) Guidance to States on Form 2567 State Inspection Reports and
    Complaint Investigation Reports.--
                (1) Guidance.--The Secretary of Health and Human Services
            (in this subtitle referred to as the ``Secretary'') shall
            provide guidance to States on how States can establish
            electronic links to Form 2567 State inspection reports (or a
            successor form), complaint investigation reports, and a
            facility's plan of correction or other response to such Form
            2567 State inspection reports (or a successor form) on the
            Internet website of the State that provides information on
            skilled nursing facilities and nursing facilities and the
            Secretary shall, if possible, include such information on
            Nursing Home Compare.
                (2) Requirement.--Section 1902(a)(9) of the Social Security
            Act (42 U.S.C. 1396a(a)(9)) is amended--
                        (A) by striking ``and'' at the end of subparagraph
                    (B);
                        (B) by striking the semicolon at the end of
                    subparagraph (C) and inserting ``, and''; and
                        (C) by adding at the end the following new
                    subparagraph:
                        ``(D) that the State maintain a consumer-oriented
                    website providing useful information to consumers
                    regarding all skilled nursing facilities and all
                    nursing facilities in the State, including for each
                    facility, Form 2567 State inspection reports (or a
                    successor form), complaint investigation reports, the
                    facility's plan of correction, and such other
                    information that the State or the Secretary considers
                    useful in assisting the public to assess the quality of
                    long term care options and the quality of care provided
                    by individual facilities;''.
                (3) Definitions.--In this subsection:
                        (A) Nursing facility.--The term ``nursing
                    facility'' has the meaning given such term in section
                    1919(a) of the Social Security Act (42 U.S.C.
                    1396r(a)).
                        (B) Secretary.--The term ``Secretary'' means the
                    Secretary of Health and Human Services.
                        (C) Skilled nursing facility.--The term ``skilled
                    nursing facility'' has the meaning given such term in
                    section 1819(a) of the Social Security Act (42 U.S.C.
                    1395i-3(a)).
        (e) Development of Consumer Rights Information Page on Nursing Home
    Compare Website.--Not later than 1 year after the date of enactment of
    this Act, the Secretary shall ensure that the Department of Health and
    Human Services, as part of the information provided for comparison of
    nursing facilities on the Nursing Home Compare Medicare website
    develops and includes a consumer rights information page that contains
    links to descriptions of, and information with respect to, the
    following:
                (1) The documentation on nursing facilities that is
            available to the public.
                (2) General information and tips on choosing a nursing
            facility that meets the needs of the individual.
                (3) General information on consumer rights with respect to
            nursing facilities.
                (4) The nursing facility survey process (on a national and
            State-specific basis).
                (5) On a State-specific basis, the services available
            through the State long-term care ombudsman for such State.

    SEC. 6104. REPORTING OF EXPENDITURES.

        Section 1888 of the Social Security Act (42 U.S.C. 1395yy) is
    amended by adding at the end the following new subsection:
        ``(f) Reporting of Direct Care Expenditures.--
                ``(1) In general.--For cost reports submitted under this
            title for cost reporting periods beginning on or after the date
            that is 2 years after the date of the enactment of this
            subsection, skilled nursing facilities shall separately report
            expenditures for wages and benefits for direct care staff
            (breaking out (at a minimum) registered nurses, licensed
            professional nurses, certified nurse assistants, and other
            medical and therapy staff).
                ``(2) Modification of form.--The Secretary, in consultation
            with private sector accountants experienced with Medicare and
            Medicaid nursing facility home cost reports, shall redesign
            such reports to meet the requirement of paragraph (1) not later
            than 1 year after the date of the enactment of this subsection.
                ``(3) Categorization by functional accounts.--Not later
            than 30 months after the date of the enactment of this
            subsection, the Secretary, working in consultation with the
            Medicare Payment Advisory Commission, the Medicaid and CHIP
            Payment and Access Commission, the Inspector General of the
            Department of Health and Human Services, and other expert
            parties the Secretary determines appropriate, shall take the
            expenditures listed on cost reports, as modified under
            paragraph (1), submitted by skilled nursing facilities and
            categorize such expenditures, regardless of any source of
            payment for such expenditures, for each skilled nursing
            facility into the following functional accounts on an annual
            basis:
                        ``(A) Spending on direct care services (including
                    nursing, therapy, and medical services).
                        ``(B) Spending on indirect care (including
                    housekeeping and dietary services).
                        ``(C) Capital assets (including building and land
                    costs).
                        ``(D) Administrative services costs.
                ``(4) Availability of information submitted.--The Secretary
            shall establish procedures to make information on expenditures
            submitted under this subsection readily available to interested
            parties upon request, subject to such requirements as the
            Secretary may specify under the procedures established under
            this paragraph.''.

    SEC. 6105. STANDARDIZED COMPLAINT FORM.

        (a) In General.--Section 1128I of the Social Security Act, as added
    and amended by this Act, is amended by adding at the end the following
    new subsection:
        ``(f) Standardized Complaint Form.--
                ``(1) Development by the secretary.--The Secretary shall
            develop a standardized complaint form for use by a resident (or
            a person acting on the resident's behalf) in filing a complaint
            with a State survey and certification agency and a State long-
            term care ombudsman program with respect to a facility.
                ``(2) Complaint forms and resolution processes.--
                        ``(A) Complaint forms.--The State must make the
                    standardized complaint form developed under paragraph
                    (1) available upon request to--
                                ``(i) a resident of a facility; and
                                ``(ii) any person acting on the resident's
                            behalf.
                        ``(B) Complaint resolution process.--The State must
                    establish a complaint resolution process in order to
                    ensure that the legal representative of a resident of a
                    facility or other responsible party is not denied
                    access to such resident or otherwise retaliated against
                    if they have complained about the quality of care
                    provided by the facility or other issues relating to
                    the facility. Such complaint resolution process shall
                    include--
                                ``(i) procedures to assure accurate
                            tracking of complaints received, including
                            notification to the complainant that a
                            complaint has been received;
                                ``(ii) procedures to determine the likely
                            severity of a complaint and for the
                            investigation of the complaint; and
                                ``(iii) deadlines for responding to a
                            complaint and for notifying the complainant of
                            the outcome of the investigation.
                ``(3) Rule of construction.--Nothing in this subsection
            shall be construed as preventing a resident of a facility (or a
            person acting on the resident's behalf) from submitting a
            complaint in a manner or format other than by using the
            standardized complaint form developed under paragraph (1)
            (including submitting a complaint orally).''.
        (b) Effective Date.--The amendment made by this section shall take
    effect 1 year after the date of the enactment of this Act.

    SEC. 6106. ENSURING STAFFING ACCOUNTABILITY.

        Section 1128I of the Social Security Act, as added and amended by
    this Act, is amended by adding at the end the following new subsection:
        ``(g) Submission of Staffing Information Based on Payroll Data in a
    Uniform Format.--Beginning not later than 2 years after the date of the
    enactment of this subsection, and after consulting with State long-term
    care ombudsman programs, consumer advocacy groups, provider stakeholder
    groups, employees and their representatives, and other parties the
    Secretary deems appropriate, the Secretary shall require a facility to
    electronically submit to the Secretary direct care staffing information
    (including information with respect to agency and contract staff) based
    on payroll and other verifiable and auditable data in a uniform format
    (according to specifications established by the Secretary in
    consultation with such programs, groups, and parties). Such
    specifications shall require that the information submitted under the
    preceding sentence--
                ``(1) specify the category of work a certified employee
            performs (such as whether the employee is a registered nurse,
            licensed practical nurse, licensed vocational nurse, certified
            nursing assistant, therapist, or other medical personnel);
                ``(2) include resident census data and information on
            resident case mix;
                ``(3) include a regular reporting schedule; and
                ``(4) include information on employee turnover and tenure
            and on the hours of care provided by each category of certified
            employees referenced in paragraph (1) per resident per day.
    Nothing in this subsection shall be construed as preventing the
    Secretary from requiring submission of such information with respect to
    specific categories, such as nursing staff, before other categories of
    certified employees. Information under this subsection with respect to
    agency and contract staff shall be kept separate from information on
    employee staffing.''.

    SEC. 6107. GAO STUDY AND REPORT ON FIVE-STAR QUALITY RATING SYSTEM.

        (a) Study.--The Comptroller General of the United States (in this
    section referred to as the ``Comptroller General'') shall conduct a
    study on the Five-Star Quality Rating System for nursing homes of the
    Centers for Medicare & Medicaid Services. Such study shall include an
    analysis of--
                (1) how such system is being implemented;
                (2) any problems associated with such system or its
            implementation; and
                (3) how such system could be improved.
        (b) Report.--Not later than 2 years after the date of enactment of
    this Act, the Comptroller General shall submit to Congress a report
    containing the results of the study conducted under subsection (a),
    together with recommendations for such legislation and administrative
    action as the Comptroller General determines appropriate.

                         PART II--TARGETING ENFORCEMENT

    SEC. 6111. CIVIL MONEY PENALTIES.

        (a) Skilled Nursing Facilities.--
                (1) In general.--Section 1819(h)(2)(B)(ii) of the Social
            Security Act (42 U.S.C. 1395i-3(h)(2)(B)(ii)) is amended--
                        (A) by striking ``Penalties.--The Secretary'' and
                    inserting ``penalties.--
                                        ``(I) In general.--Subject to
                                    subclause (II), the Secretary''; and
                        (B) by adding at the end the following new
                    subclauses:
                                        ``(II) Reduction of civil money
                                    penalties in certain circumstances.--
                                    Subject to subclause (III), in the case
                                    where a facility self-reports and
                                    promptly corrects a deficiency for
                                    which a penalty was imposed under this
                                    clause not later than 10 calendar days
                                    after the date of such imposition, the
                                    Secretary may reduce the amount of the
                                    penalty imposed by not more than 50
                                    percent.
                                        ``(III) Prohibitions on reduction
                                    for certain deficiencies.--
                                                ``(aa) Repeat
                                            deficiencies.--The Secretary
                                            may not reduce the amount of a
                                            penalty under subclause (II) if
                                            the Secretary had reduced a
                                            penalty imposed on the facility
                                            in the preceding year under
                                            such subclause with respect to
                                            a repeat deficiency.
                                                ``(bb) Certain other
                                            deficiencies.--The Secretary
                                            may not reduce the amount of a
                                            penalty under subclause (II) if
                                            the penalty is imposed on the
                                            facility for a deficiency that
                                            is found to result in a pattern
                                            of harm or widespread harm,
                                            immediately jeopardizes the
                                            health or safety of a resident
                                            or residents of the facility,
                                            or results in the death of a
                                            resident of the facility.
                                        ``(IV) Collection of civil money
                                    penalties.--In the case of a civil
                                    money penalty imposed under this
                                    clause, the Secretary shall issue
                                    regulations that--
                                                ``(aa) subject to item
                                            (cc), not later than 30 days
                                            after the imposition of the
                                            penalty, provide for the
                                            facility to have the
                                            opportunity to participate in
                                            an independent informal dispute
                                            resolution process which
                                            generates a written record
                                            prior to the collection of such
                                            penalty;
                                                ``(bb) in the case where
                                            the penalty is imposed for each
                                            day of noncompliance, provide
                                            that a penalty may not be
                                            imposed for any day during the
                                            period beginning on the initial
                                            day of the imposition of the
                                            penalty and ending on the day
                                            on which the informal dispute
                                            resolution process under item
                                            (aa) is completed;
                                                ``(cc) may provide for the
                                            collection of such civil money
                                            penalty and the placement of
                                            such amounts collected in an
                                            escrow account under the
                                            direction of the Secretary on
                                            the earlier of the date on
                                            which the informal dispute
                                            resolution process under item
                                            (aa) is completed or the date
                                            that is 90 days after the date
                                            of the imposition of the
                                            penalty;
                                                ``(dd) may provide that
                                            such amounts collected are kept
                                            in such account pending the
                                            resolution of any subsequent
                                            appeals;
                                                ``(ee) in the case where
                                            the facility successfully
                                            appeals the penalty, may
                                            provide for the return of such
                                            amounts collected (plus
                                            interest) to the facility; and
                                                ``(ff) in the case where
                                            all such appeals are
                                            unsuccessful, may provide that
                                            some portion of such amounts
                                            collected may be used to
                                            support activities that benefit
                                            residents, including assistance
                                            to support and protect
                                            residents of a facility that
                                            closes (voluntarily or
                                            involuntarily) or is
                                            decertified (including
                                            offsetting costs of relocating
                                            residents to home and
                                            community-based settings or
                                            another facility), projects
                                            that support resident and
                                            family councils and other
                                            consumer involvement in
                                            assuring quality care in
                                            facilities, and facility
                                            improvement initiatives
                                            approved by the Secretary
                                            (including joint training of
                                            facility staff and surveyors,
                                            technical assistance for
                                            facilities implementing quality
                                            assurance programs, the
                                            appointment of temporary
                                            management firms, and other
                                            activities approved by the
                                            Secretary).''.
                (2) Conforming amendment.--The second sentence of section
            1819(h)(5) of the Social Security Act (42 U.S.C. 1395i-3(h)(5))
            is amended by inserting ``(ii)(IV),'' after ``(i),''.
        (b) Nursing Facilities.--
                (1) In general.--Section 1919(h)(3)(C)(ii) of the Social
            Security Act (42 U.S.C. 1396r(h)(3)(C)) is amended--
                        (A) by striking ``Penalties.--The Secretary'' and
                    inserting ``penalties.--
                                        ``(I) In general.--Subject to
                                    subclause (II), the Secretary''; and
                        (B) by adding at the end the following new
                    subclauses:
                                        ``(II) Reduction of civil money
                                    penalties in certain circumstances.--
                                    Subject to subclause (III), in the case
                                    where a facility self-reports and
                                    promptly corrects a deficiency for
                                    which a penalty was imposed under this
                                    clause not later than 10 calendar days
                                    after the date of such imposition, the
                                    Secretary may reduce the amount of the
                                    penalty imposed by not more than 50
                                    percent.
                                        ``(III) Prohibitions on reduction
                                    for certain deficiencies.--
                                                ``(aa) Repeat
                                            deficiencies.--The Secretary
                                            may not reduce the amount of a
                                            penalty under subclause (II) if
                                            the Secretary had reduced a
                                            penalty imposed on the facility
                                            in the preceding year under
                                            such subclause with respect to
                                            a repeat deficiency.
                                                ``(bb) Certain other
                                            deficiencies.--The Secretary
                                            may not reduce the amount of a
                                            penalty under subclause (II) if
                                            the penalty is imposed on the
                                            facility for a deficiency that
                                            is found to result in a pattern
                                            of harm or widespread harm,
                                            immediately jeopardizes the
                                            health or safety of a resident
                                            or residents of the facility,
                                            or results in the death of a
                                            resident of the facility.
                                        ``(IV) Collection of civil money
                                    penalties.--In the case of a civil
                                    money penalty imposed under this
                                    clause, the Secretary shall issue
                                    regulations that--
                                                ``(aa) subject to item
                                            (cc), not later than 30 days
                                            after the imposition of the
                                            penalty, provide for the
                                            facility to have the
                                            opportunity to participate in
                                            an independent informal dispute
                                            resolution process which
                                            generates a written record
                                            prior to the collection of such
                                            penalty;
                                                ``(bb) in the case where
                                            the penalty is imposed for each
                                            day of noncompliance, provide
                                            that a penalty may not be
                                            imposed for any day during the
                                            period beginning on the initial
                                            day of the imposition of the
                                            penalty and ending on the day
                                            on which the informal dispute
                                            resolution process under item
                                            (aa) is completed;
                                                ``(cc) may provide for the
                                            collection of such civil money
                                            penalty and the placement of
                                            such amounts collected in an
                                            escrow account under the
                                            direction of the Secretary on
                                            the earlier of the date on
                                            which the informal dispute
                                            resolution process under item
                                            (aa) is completed or the date
                                            that is 90 days after the date
                                            of the imposition of the
                                            penalty;
                                                ``(dd) may provide that
                                            such amounts collected are kept
                                            in such account pending the
                                            resolution of any subsequent
                                            appeals;
                                                ``(ee) in the case where
                                            the facility successfully
                                            appeals the penalty, may
                                            provide for the return of such
                                            amounts collected (plus
                                            interest) to the facility; and
                                                ``(ff) in the case where
                                            all such appeals are
                                            unsuccessful, may provide that
                                            some portion of such amounts
                                            collected may be used to
                                            support activities that benefit
                                            residents, including assistance
                                            to support and protect
                                            residents of a facility that
                                            closes (voluntarily or
                                            involuntarily) or is
                                            decertified (including
                                            offsetting costs of relocating
                                            residents to home and
                                            community-based settings or
                                            another facility), projects
                                            that support resident and
                                            family councils and other
                                            consumer involvement in
                                            assuring quality care in
                                            facilities, and facility
                                            improvement initiatives
                                            approved by the Secretary
                                            (including joint training of
                                            facility staff and surveyors,
                                            technical assistance for
                                            facilities implementing quality
                                            assurance programs, the
                                            appointment of temporary
                                            management firms, and other
                                            activities approved by the
                                            Secretary).''.
                (2) Conforming amendment.--Section 1919(h)(5)(8) of the
            Social Security Act (42 U.S.C. 1396r(h)(5)(8)) is amended by
            inserting ``(ii)(IV),'' after ``(i),''.
        (c) Effective Date.--The amendments made by this section shall take
    effect 1 year after the date of the enactment of this Act.

    SEC. 6112. NATIONAL INDEPENDENT MONITOR DEMONSTRATION PROJECT.

        (a) Establishment.--
                (1) In general.--The Secretary, in consultation with the
            Inspector General of the Department of Health and Human
            Services, shall conduct a demonstration project to develop,
            test, and implement an independent monitor program to oversee
            interstate and large intrastate chains of skilled nursing
            facilities and nursing facilities.
                (2) Selection.--The Secretary shall select chains of
            skilled nursing facilities and nursing facilities described in
            paragraph (1) to participate in the demonstration project under
            this section from among those chains that submit an application
            to the Secretary at such time, in such manner, and containing
            such information as the Secretary may require.
                (3) Duration.--The Secretary shall conduct the
            demonstration project under this section for a 2-year period.
                (4) Implementation.--The Secretary shall implement the
            demonstration project under this section not later than 1 year
            after the date of the enactment of this Act.
        (b) Requirements.--The Secretary shall evaluate chains selected to
    participate in the demonstration project under this section based on
    criteria selected by the Secretary, including where evidence suggests
    that a number of the facilities of the chain are experiencing serious
    safety and quality of care problems. Such criteria may include the
    evaluation of a chain that includes a number of facilities
    participating in the ``Special Focus Facility'' program (or a successor
    program) or multiple facilities with a record of repeated serious
    safety and quality of care deficiencies.
        (c) Responsibilities.--An independent monitor that enters into a
    contract with the Secretary to participate in the conduct of the
    demonstration project under this section shall--
                (1) conduct periodic reviews and prepare root-cause quality
            and deficiency analyses of a chain to assess if facilities of
            the chain are in compliance with State and Federal laws and
            regulations applicable to the facilities;
                (2) conduct sustained oversight of the efforts of the
            chain, whether publicly or privately held, to achieve
            compliance by facilities of the chain with State and Federal
            laws and regulations applicable to the facilities;
                (3) analyze the management structure, distribution of
            expenditures, and nurse staffing levels of facilities of the
            chain in relation to resident census, staff turnover rates, and
            tenure;
                (4) report findings and recommendations with respect to
            such reviews, analyses, and oversight to the chain and
            facilities of the chain, to the Secretary, and to relevant
            States; and
                (5) publish the results of such reviews, analyses, and
            oversight.
        (d) Implementation of Recommendations.--
                (1) Receipt of finding by chain.--Not later than 10 days
            after receipt of a finding of an independent monitor under
            subsection (c)(4), a chain participating in the demonstration
            project shall submit to the independent monitor a report--
                        (A) outlining corrective actions the chain will
                    take to implement the recommendations in such report;
                    or
                        (B) indicating that the chain will not implement
                    such recommendations, and why it will not do so.
                (2) Receipt of report by independent monitor.--Not later
            than 10 days after receipt of a report submitted by a chain
            under paragraph (1), an independent monitor shall finalize its
            recommendations and submit a report to the chain and facilities
            of the chain, the Secretary, and the State or States, as
            appropriate, containing such final recommendations.
        (e) Cost of Appointment.--A chain shall be responsible for a
    portion of the costs associated with the appointment of independent
    monitors under the demonstration project under this section. The chain
    shall pay such portion to the Secretary (in an amount and in accordance
    with procedures established by the Secretary).
        (f) Waiver Authority.--The Secretary may waive such requirements of
    titles XVIII and XIX of the Social Security Act (42 U.S.C. 1395 et
    seq.; 1396 et seq.) as may be necessary for the purpose of carrying out
    the demonstration project under this section.
        (g) Authorization of Appropriations.--There are authorized to be
    appropriated such sums as may be necessary to carry out this section.
        (h) Definitions.--In this section:
                (1) Additional disclosable party.--The term ``additional
            disclosable party'' has the meaning given such term in section
            1124(c)(5)(A) of the Social Security Act, as added by section
            4201(a).
                (2) Facility.--The term ``facility'' means a skilled
            nursing facility or a nursing facility.
                (3) Nursing facility.--The term ``nursing facility'' has
            the meaning given such term in section 1919(a) of the Social
            Security Act (42 U.S.C. 1396r(a)).
                (4) Secretary.--The term ``Secretary'' means the Secretary
            of Health and Human Services, acting through the Assistant
            Secretary for Planning and Evaluation.
                (5) Skilled nursing facility.--The term ``skilled nursing
            facility'' has the meaning given such term in section 1819(a)
            of the Social Security Act (42 U.S.C. 1395(a)).
        (i) Evaluation and Report.--
                (1) Evaluation.--The Secretary, in consultation with the
            Inspector General of the Department of Health and Human
            Services, shall evaluate the demonstration project conducted
            under this section.
                (2) Report.--Not later than 180 days after the completion
            of the demonstration project under this section, the Secretary
            shall submit to Congress a report containing the results of the
            evaluation conducted under paragraph (1), together with
            recommendations--
                        (A) as to whether the independent monitor program
                    should be established on a permanent basis;
                        (B) if the Secretary recommends that such program
                    be so established, on appropriate procedures and
                    mechanisms for such establishment; and
                        (C) for such legislation and administrative action
                    as the Secretary determines appropriate.

    SEC. 6113. NOTIFICATION OF FACILITY CLOSURE.

        (a) In General.--Section 1128I of the Social Security Act, as added
    and amended by this Act, is amended by adding at the end the following
    new subsection:
        ``(h) Notification of Facility Closure.--
                ``(1) In general.--Any individual who is the administrator
            of a facility must--
                        ``(A) submit to the Secretary, the State long-term
                    care ombudsman, residents of the facility, and the
                    legal representatives of such residents or other
                    responsible parties, written notification of an
                    impending closure--
                                ``(i) subject to clause (ii), not later
                            than the date that is 60 days prior to the date
                            of such closure; and
                                ``(ii) in the case of a facility where the
                            Secretary terminates the facility's
                            participation under this title, not later than
                            the date that the Secretary determines
                            appropriate;
                        ``(B) ensure that the facility does not admit any
                    new residents on or after the date on which such
                    written notification is submitted; and
                        ``(C) include in the notice a plan for the transfer
                    and adequate relocation of the residents of the
                    facility by a specified date prior to closure that has
                    been approved by the State, including assurances that
                    the residents will be transferred to the most
                    appropriate facility or other setting in terms of
                    quality, services, and location, taking into
                    consideration the needs, choice, and best interests of
                    each resident.
                ``(2) Relocation.--
                        ``(A) In general.--The State shall ensure that,
                    before a facility closes, all residents of the facility
                    have been successfully relocated to another facility or
                    an alternative home and community-based setting.
                        ``(B) Continuation of payments until residents
                    relocated.--The Secretary may, as the Secretary
                    determines appropriate, continue to make payments under
                    this title with respect to residents of a facility that
                    has submitted a notification under paragraph (1) during
                    the period beginning on the date such notification is
                    submitted and ending on the date on which the resident
                    is successfully relocated.
                ``(3) Sanctions.--Any individual who is the administrator
            of a facility that fails to comply with the requirements of
            paragraph (1)--
                        ``(A) shall be subject to a civil monetary penalty
                    of up to $100,000;
                        ``(B) may be subject to exclusion from
                    participation in any Federal health care program (as
                    defined in section 1128B(f)); and
                        ``(C) shall be subject to any other penalties that
                    may be prescribed by law.
                ``(4) Procedure.--The provisions of section 1128A (other
            than subsections (a) and (b) and the second sentence of
            subsection (f)) shall apply to a civil money penalty or
            exclusion under paragraph (3) in the same manner as such
            provisions apply to a penalty or proceeding under section
            1128A(a).''.
        (b) Conforming Amendments.--Section 1819(h)(4) of the Social
    Security Act (42 U.S.C. 1395i-3(h)(4)) is amended--
                (1) in the first sentence, by striking ``the Secretary
            shall terminate'' and inserting ``the Secretary, subject to
            section 1128I(h), shall terminate''; and
                (2) in the second sentence, by striking ``subsection
            (c)(2)'' and inserting ``subsection (c)(2) and section
            1128I(h)''.
        (c) Effective Date.--The amendments made by this section shall take
    effect 1 year after the date of the enactment of this Act.

    SEC. 6114. NATIONAL DEMONSTRATION PROJECTS ON CULTURE CHANGE AND USE OF
                  INFORMATION TECHNOLOGY IN NURSING HOMES.

        (a) In General.--The Secretary shall conduct 2 demonstration
    projects, 1 for the development of best practices in skilled nursing
    facilities and nursing facilities that are involved in the culture
    change movement (including the development of resources for facilities
    to find and access funding in order to undertake culture change) and 1
    for the development of best practices in skilled nursing facilities and
    nursing facilities for the use of information technology to improve
    resident care.
        (b) Conduct of Demonstration Projects.--
                (1) Grant award.--Under each demonstration project
            conducted under this section, the Secretary shall award 1 or
            more grants to facility-based settings for the development of
            best practices described in subsection (a) with respect to the
            demonstration project involved. Such award shall be made on a
            competitive basis and may be allocated in 1 lump-sum payment.
                (2) Consideration of special needs of residents.--Each
            demonstration project conducted under this section shall take
            into consideration the special needs of residents of skilled
            nursing facilities and nursing facilities who have cognitive
            impairment, including dementia.
        (c) Duration and Implementation.--
                (1) Duration.--The demonstration projects shall each be
            conducted for a period not to exceed 3 years.
                (2) Implementation.--The demonstration projects shall each
            be implemented not later than 1 year after the date of the
            enactment of this Act.
        (d) Definitions.--In this section:
                (1) Nursing facility.--The term ``nursing facility'' has
            the meaning given such term in section 1919(a) of the Social
            Security Act (42 U.S.C. 1396r(a)).
                (2) Secretary.--The term ``Secretary'' means the Secretary
            of Health and Human Services.
                (3) Skilled nursing facility.--The term ``skilled nursing
            facility'' has the meaning given such term in section 1819(a)
            of the Social Security Act (42 U.S.C. 1395(a)).
        (e) Authorization of Appropriations.--There are authorized to be
    appropriated such sums as may be necessary to carry out this section.
        (f) Report.--Not later than 9 months after the completion of the
    demonstration project, the Secretary shall submit to Congress a report
    on such project, together with recommendations for such legislation and
    administrative action as the Secretary determines appropriate.

                       PART III--IMPROVING STAFF TRAINING

    SEC. 6121. DEMENTIA AND ABUSE PREVENTION TRAINING.

        (a) Skilled Nursing Facilities.--
                (1) In general.--Section 1819(f)(2)(A)(i)(I) of the Social
            Security Act (42 U.S.C. 1395i-3(f)(2)(A)(i)(I)) is amended by
            inserting ``(including, in the case of initial training and, if
            the Secretary determines appropriate, in the case of ongoing
            training, dementia management training, and patient abuse
            prevention training'' before ``, (II)''.
                (2) Clarification of definition of nurse aide.--Section
            1819(b)(5)(F) of the Social Security Act (42 U.S.C. 1395i-
            3(b)(5)(F)) is amended by adding at the end the following flush
            sentence:
                    ``Such term includes an individual who provides such
                    services through an agency or under a contract with the
                    facility.''.
        (b) Nursing Facilities.--
                (1) In general.--Section 1919(f)(2)(A)(i)(I) of the Social
            Security Act (42 U.S.C. 1396r(f)(2)(A)(i)(I)) is amended by
            inserting ``(including, in the case of initial training and, if
            the Secretary determines appropriate, in the case of ongoing
            training, dementia management training, and patient abuse
            prevention training'' before ``, (II)''.
                (2) Clarification of definition of nurse aide.--Section
            1919(b)(5)(F) of the Social Security Act (42 U.S.C.
            1396r(b)(5)(F)) is amended by adding at the end the following
            flush sentence:
                    ``Such term includes an individual who provides such
                    services through an agency or under a contract with the
                    facility.''.
        (c) Effective Date.--The amendments made by this section shall take
    effect 1 year after the date of the enactment of this Act.

    Subtitle C--Nationwide Program for National and State Background Checks
      on Direct Patient Access Employees of Long-term Care Facilities and
                                   Providers

    SEC. 6201. NATIONWIDE PROGRAM FOR NATIONAL AND STATE BACKGROUND CHECKS
                  ON DIRECT PATIENT ACCESS EMPLOYEES OF LONG-TERM CARE
                  FACILITIES AND PROVIDERS.

        (a) In General.--The Secretary of Health and Human Services (in
    this section referred to as the ``Secretary''), shall establish a
    program to identify efficient, effective, and economical procedures for
    long term care facilities or providers to conduct background checks on
    prospective direct patient access employees on a nationwide basis (in
    this subsection, such program shall be referred to as the ``nationwide
    program''). Except for the following modifications, the Secretary shall
    carry out the nationwide program under similar terms and conditions as
    the pilot program under section 307 of the Medicare Prescription Drug,
    Improvement, and Modernization Act of 2003 (Public Law 108-173; 117
    Stat. 2257), including the prohibition on hiring abusive workers and
    the authorization of the imposition of penalties by a participating
    State under subsection (b)(3)(A) and (b)(6), respectively, of such
    section 307:
                (1) Agreements.--
                        (A) Newly participating states.--The Secretary
                    shall enter into agreements with each State--
                                (i) that the Secretary has not entered into
                            an agreement with under subsection (c)(1) of
                            such section 307;
                                (ii) that agrees to conduct background
                            checks under the nationwide program on a
                            Statewide basis; and
                                (iii) that submits an application to the
                            Secretary containing such information and at
                            such time as the Secretary may specify.
                        (B) Certain previously participating states.--The
                    Secretary shall enter into agreements with each State--
                                (i) that the Secretary has entered into an
                            agreement with under such subsection (c)(1),
                            but only in the case where such agreement did
                            not require the State to conduct background
                            checks under the program established under
                            subsection (a) of such section 307 on a
                            Statewide basis;
                                (ii) that agrees to conduct background
                            checks under the nationwide program on a
                            Statewide basis; and
                                (iii) that submits an application to the
                            Secretary containing such information and at
                            such time as the Secretary may specify.
                (2) Nonapplication of selection criteria.--The selection
            criteria required under subsection (c)(3)(B) of such section
            307 shall not apply.
                (3) Required fingerprint check as part of criminal history
            background check.--The procedures established under subsection
            (b)(1) of such section 307 shall--
                        (A) require that the long-term care facility or
                    provider (or the designated agent of the long-term care
                    facility or provider) obtain State and national
                    criminal history background checks on the prospective
                    employee through such means as the Secretary determines
                    appropriate, efficient, and effective that utilize a
                    search of State-based abuse and neglect registries and
                    databases, including the abuse and neglect registries
                    of another State in the case where a prospective
                    employee previously resided in that State, State
                    criminal history records, the records of any
                    proceedings in the State that may contain disqualifying
                    information about prospective employees (such as
                    proceedings conducted by State professional licensing
                    and disciplinary boards and State Medicaid Fraud
                    Control Units), and Federal criminal history records,
                    including a fingerprint check using the Integrated
                    Automated Fingerprint Identification System of the
                    Federal Bureau of Investigation;
                        (B) require States to describe and test methods
                    that reduce duplicative fingerprinting, including
                    providing for the development of ``rap back''
                    capability by the State such that, if a direct patient
                    access employee of a long-term care facility or
                    provider is convicted of a crime following the initial
                    criminal history background check conducted with
                    respect to such employee, and the employee's
                    fingerprints match the prints on file with the State
                    law enforcement department, the department will
                    immediately inform the State and the State will
                    immediately inform the long-term care facility or
                    provider which employs the direct patient access
                    employee of such conviction; and
                        (C) require that criminal history background checks
                    conducted under the nationwide program remain valid for
                    a period of time specified by the Secretary.
                (4) State requirements.--An agreement entered into under
            paragraph (1) shall require that a participating State--
                        (A) be responsible for monitoring compliance with
                    the requirements of the nationwide program;
                        (B) have procedures in place to--
                                (i) conduct screening and criminal history
                            background checks under the nationwide program
                            in accordance with the requirements of this
                            section;
                                (ii) monitor compliance by long-term care
                            facilities and providers with the procedures
                            and requirements of the nationwide program;
                                (iii) as appropriate, provide for a
                            provisional period of employment by a long-term
                            care facility or provider of a direct patient
                            access employee, not to exceed 60 days, pending
                            completion of the required criminal history
                            background check and, in the case where the
                            employee has appealed the results of such
                            background check, pending completion of the
                            appeals process, during which the employee
                            shall be subject to direct on-site supervision
                            (in accordance with procedures established by
                            the State to ensure that a long-term care
                            facility or provider furnishes such direct on-
                            site supervision);
                                (iv) provide an independent process by
                            which a provisional employee or an employee may
                            appeal or dispute the accuracy of the
                            information obtained in a background check
                            performed under the nationwide program,
                            including the specification of criteria for
                            appeals for direct patient access employees
                            found to have disqualifying information which
                            shall include consideration of the passage of
                            time, extenuating circumstances, demonstration
                            of rehabilitation, and relevancy of the
                            particular disqualifying information with
                            respect to the current employment of the
                            individual;
                                (v) provide for the designation of a single
                            State agency as responsible for--
                                        (I) overseeing the coordination of
                                    any State and national criminal history
                                    background checks requested by a long-
                                    term care facility or provider (or the
                                    designated agent of the long-term care
                                    facility or provider) utilizing a
                                    search of State and Federal criminal
                                    history records, including a
                                    fingerprint check of such records;
                                        (II) overseeing the design of
                                    appropriate privacy and security
                                    safeguards for use in the review of the
                                    results of any State or national
                                    criminal history background checks
                                    conducted regarding a prospective
                                    direct patient access employee to
                                    determine whether the employee has any
                                    conviction for a relevant crime;
                                        (III) immediately reporting to the
                                    long-term care facility or provider
                                    that requested the criminal history
                                    background check the results of such
                                    review; and
                                        (IV) in the case of an employee
                                    with a conviction for a relevant crime
                                    that is subject to reporting under
                                    section 1128E of the Social Security
                                    Act (42 U.S.C. 1320a-7e), reporting the
                                    existence of such conviction to the
                                    database established under that
                                    section;
                                (vi) determine which individuals are direct
                            patient access employees (as defined in
                            paragraph (6)(B)) for purposes of the
                            nationwide program;
                                (vii) as appropriate, specify offenses,
                            including convictions for violent crimes, for
                            purposes of the nationwide program; and
                                (viii) describe and test methods that
                            reduce duplicative fingerprinting, including
                            providing for the development of ``rap back''
                            capability such that, if a direct patient
                            access employee of a long-term care facility or
                            provider is convicted of a crime following the
                            initial criminal history background check
                            conducted with respect to such employee, and
                            the employee's fingerprints match the prints on
                            file with the State law enforcement
                            department--
                                        (I) the department will immediately
                                    inform the State agency designated
                                    under clause (v) and such agency will
                                    immediately inform the facility or
                                    provider which employs the direct
                                    patient access employee of such
                                    conviction; and
                                        (II) the State will provide, or
                                    will require the facility to provide,
                                    to the employee a copy of the results
                                    of the criminal history background
                                    check conducted with respect to the
                                    employee at no charge in the case where
                                    the individual requests such a copy.
                (5) Payments.--
                        (A) Newly participating states.--
                                (i) In general.--As part of the application
                            submitted by a State under paragraph
                            (1)(A)(iii), the State shall guarantee, with
                            respect to the costs to be incurred by the
                            State in carrying out the nationwide program,
                            that the State will make available (directly or
                            through donations from public or private
                            entities) a particular amount of non-Federal
                            contributions, as a condition of receiving the
                            Federal match under clause (ii).
                                (ii) Federal match.--The payment amount to
                            each State that the Secretary enters into an
                            agreement with under paragraph (1)(A) shall be
                            3 times the amount that the State guarantees to
                            make available under clause (i), except that in
                            no case may the payment amount exceed
                            $3,000,000.
                        (B) Previously participating states.--
                                (i) In general.--As part of the application
                            submitted by a State under paragraph
                            (1)(B)(iii), the State shall guarantee, with
                            respect to the costs to be incurred by the
                            State in carrying out the nationwide program,
                            that the State will make available (directly or
                            through donations from public or private
                            entities) a particular amount of non-Federal
                            contributions, as a condition of receiving the
                            Federal match under clause (ii).
                                (ii) Federal match.--The payment amount to
                            each State that the Secretary enters into an
                            agreement with under paragraph (1)(B) shall be
                            3 times the amount that the State guarantees to
                            make available under clause (i), except that in
                            no case may the payment amount exceed
                            $1,500,000.
                (6) Definitions.--Under the nationwide program:
                        (A) Conviction for a relevant crime.--The term
                    ``conviction for a relevant crime'' means any Federal
                    or State criminal conviction for--
                                (i) any offense described in section
                            1128(a) of the Social Security Act (42 U.S.C.
                            1320a-7); or
                                (ii) such other types of offenses as a
                            participating State may specify for purposes of
                            conducting the program in such State.
                        (B) Disqualifying information.--The term
                    ``disqualifying information'' means a conviction for a
                    relevant crime or a finding of patient or resident
                    abuse.
                        (C) Finding of patient or resident abuse.--The term
                    ``finding of patient or resident abuse'' means any
                    substantiated finding by a State agency under section
                    1819(g)(1)(C) or 1919(g)(1)(C) of the Social Security
                    Act (42 U.S.C. 1395i-3(g)(1)(C), 1396r(g)(1)(C)) or a
                    Federal agency that a direct patient access employee
                    has committed--
                                (i) an act of patient or resident abuse or
                            neglect or a misappropriation of patient or
                            resident property; or
                                (ii) such other types of acts as a
                            participating State may specify for purposes of
                            conducting the program in such State.
                        (D) Direct patient access employee.--The term
                    ``direct patient access employee'' means any individual
                    who has access to a patient or resident of a long-term
                    care facility or provider through employment or through
                    a contract with such facility or provider and has
                    duties that involve (or may involve) one-on-one contact
                    with a patient or resident of the facility or provider,
                    as determined by the State for purposes of the
                    nationwide program. Such term does not include a
                    volunteer unless the volunteer has duties that are
                    equivalent to the duties of a direct patient access
                    employee and those duties involve (or may involve) one-
                    on-one contact with a patient or resident of the long-
                    term care facility or provider.
                        (E) Long-term care facility or provider.--The term
                    ``long-term care facility or provider'' means the
                    following facilities or providers which receive payment
                    for services under title XVIII or XIX of the Social
                    Security Act:
                                (i) A skilled nursing facility (as defined
                            in section 1819(a) of the Social Security Act
                            (42 U.S.C. 1395i-3(a))).
                                (ii) A nursing facility (as defined in
                            section 1919(a) of such Act (42 U.S.C.
                            1396r(a))).
                                (iii) A home health agency.
                                (iv) A provider of hospice care (as defined
                            in section 1861(dd)(1) of such Act (42 U.S.C.
                            1395x(dd)(1))).
                                (v) A long-term care hospital (as described
                            in section 1886(d)(1)(B)(iv) of such Act (42
                            U.S.C. 1395ww(d)(1)(B)(iv))).
                                (vi) A provider of personal care services.
                                (vii) A provider of adult day care.
                                (viii) A residential care provider that
                            arranges for, or directly provides, long-term
                            care services, including an assisted living
                            facility that provides a level of care
                            established by the Secretary.
                                (ix) An intermediate care facility for the
                            mentally retarded (as defined in section
                            1905(d) of such Act (42 U.S.C. 1396d(d))).
                                (x) Any other facility or provider of long-
                            term care services under such titles as the
                            participating State determines appropriate.
                (7) Evaluation and report.--
                        (A) Evaluation.--
                                (i) In general.--The Inspector General of
                            the Department of Health and Human Services
                            shall conduct an evaluation of the nationwide
                            program.
                                (ii) Inclusion of specific topics.--The
                            evaluation conducted under clause (i) shall
                            include the following:
                                        (I) A review of the various
                                    procedures implemented by participating
                                    States for long-term care facilities or
                                    providers, including staffing agencies,
                                    to conduct background checks of direct
                                    patient access employees under the
                                    nationwide program and identification
                                    of the most appropriate, efficient, and
                                    effective procedures for conducting
                                    such background checks.
                                        (II) An assessment of the costs of
                                    conducting such background checks
                                    (including start up and administrative
                                    costs).
                                        (III) A determination of the extent
                                    to which conducting such background
                                    checks leads to any unintended
                                    consequences, including a reduction in
                                    the available workforce for long-term
                                    care facilities or providers.
                                        (IV) An assessment of the impact of
                                    the nationwide program on reducing the
                                    number of incidents of neglect, abuse,
                                    and misappropriation of resident
                                    property to the extent practicable.
                                        (V) An evaluation of other aspects
                                    of the nationwide program, as
                                    determined appropriate by the
                                    Secretary.
                        (B) Report.--Not later than 180 days after the
                    completion of the nationwide program, the Inspector
                    General of the Department of Health and Human Services
                    shall submit a report to Congress containing the
                    results of the evaluation conducted under subparagraph
                    (A).
        (b) Funding.--
                (1) Notification.--The Secretary of Health and Human
            Services shall notify the Secretary of the Treasury of the
            amount necessary to carry out the nationwide program under this
            section for the period of fiscal years 2010 through 2012,
            except that in no case shall such amount exceed $160,000,000.
                (2) Transfer of funds.--
                        (A) In general.--Out of any funds in the Treasury
                    not otherwise appropriated, the Secretary of the
                    Treasury shall provide for the transfer to the
                    Secretary of Health and Human Services of the amount
                    specified as necessary to carry out the nationwide
                    program under paragraph (1). Such amount shall remain
                    available until expended.
                        (B) Reservation of funds for conduct of
                    evaluation.--The Secretary may reserve not more than
                    $3,000,000 of the amount transferred under subparagraph
                    (A) to provide for the conduct of the evaluation under
                    subsection (a)(7)(A).

                 Subtitle D--Patient-Centered Outcomes Research

    SEC. 6301. PATIENT-CENTERED OUTCOMES RESEARCH.

        (a) In General.--Title XI of the Social Security Act (42 U.S.C.
    1301 et seq.) is amended by adding at the end the following new part:

             ``Part D--Comparative Clinical Effectiveness Research

                 ``comparative clinical effectiveness research

        ``Sec. 1181.  (a) Definitions.--In this section:
                ``(1) Board.--The term `Board' means the Board of Governors
            established under subsection (f).
                ``(2) Comparative clinical effectiveness research;
            research.--
                        ``(A) In general.--The terms `comparative clinical
                    effectiveness research' and `research' mean research
                    evaluating and comparing health outcomes and the
                    clinical effectiveness, risks, and benefits of 2 or
                    more medical treatments, services, and items described
                    in subparagraph (B).
                        ``(B) Medical treatments, services, and items
                    described.--The medical treatments, services, and items
                    described in this subparagraph are health care
                    interventions, protocols for treatment, care
                    management, and delivery, procedures, medical devices,
                    diagnostic tools, pharmaceuticals (including drugs and
                    biologicals), integrative health practices, and any
                    other strategies or items being used in the treatment,
                    management, and diagnosis of, or prevention of illness
                    or injury in, individuals.
                ``(3) Conflict of interest.--The term `conflict of
            interest' means an association, including a financial or
            personal association, that have the potential to bias or have
            the appearance of biasing an individual's decisions in matters
            related to the Institute or the conduct of activities under
            this section.
                ``(4) Real conflict of interest.--The term `real conflict
            of interest' means any instance where a member of the Board,
            the methodology committee established under subsection (d)(6),
            or an advisory panel appointed under subsection (d)(4), or a
            close relative of such member, has received or could receive
            either of the following:
                        ``(A) A direct financial benefit of any amount
                    deriving from the result or findings of a study
                    conducted under this section.
                        ``(B) A financial benefit from individuals or
                    companies that own or manufacture medical treatments,
                    services, or items to be studied under this section
                    that in the aggregate exceeds $10,000 per year. For
                    purposes of the preceding sentence, a financial benefit
                    includes honoraria, fees, stock, or other financial
                    benefit and the current value of the member or close
                    relative's already existing stock holdings, in addition
                    to any direct financial benefit deriving from the
                    results or findings of a study conducted under this
                    section.
        ``(b) Patient-Centered Outcomes Research Institute.--
                ``(1) Establishment.--There is authorized to be established
            a nonprofit corporation, to be known as the `Patient-Centered
            Outcomes Research Institute' (referred to in this section as
            the `Institute') which is neither an agency nor establishment
            of the United States Government.
                ``(2) Application of provisions.--The Institute shall be
            subject to the provisions of this section, and, to the extent
            consistent with this section, to the District of Columbia
            Nonprofit Corporation Act.
                ``(3) Funding of comparative clinical effectiveness
            research.--For fiscal year 2010 and each subsequent fiscal
            year, amounts in the Patient-Centered Outcomes Research Trust
            Fund (referred to in this section as the `PCORTF') under
            section 9511 of the Internal Revenue Code of 1986 shall be
            available, without further appropriation, to the Institute to
            carry out this section.
        ``(c) Purpose.--The purpose of the Institute is to assist patients,
    clinicians, purchasers, and policy-makers in making informed health
    decisions by advancing the quality and relevance of evidence concerning
    the manner in which diseases, disorders, and other health conditions
    can effectively and appropriately be prevented, diagnosed, treated,
    monitored, and managed through research and evidence synthesis that
    considers variations in patient subpopulations, and the dissemination
    of research findings with respect to the relative health outcomes,
    clinical effectiveness, and appropriateness of the medical treatments,
    services, and items described in subsection (a)(2)(B).
        ``(d) Duties.--
                ``(1) Identifying research priorities and establishing
            research project agenda.--
                        ``(A) Identifying research priorities.--The
                    Institute shall identify national priorities for
                    research, taking into account factors of disease
                    incidence, prevalence, and burden in the United States
                    (with emphasis on chronic conditions), gaps in evidence
                    in terms of clinical outcomes, practice variations and
                    health disparities in terms of delivery and outcomes of
                    care, the potential for new evidence to improve patient
                    health, well-being, and the quality of care, the effect
                    on national expenditures associated with a health care
                    treatment, strategy, or health conditions, as well as
                    patient needs, outcomes, and preferences, the relevance
                    to patients and clinicians in making informed health
                    decisions, and priorities in the National Strategy for
                    quality care established under section 399H of the
                    Public Health Service Act that are consistent with this
                    section.
                        ``(B) Establishing research project agenda.--The
                    Institute shall establish and update a research project
                    agenda for research to address the priorities
                    identified under subparagraph (A), taking into
                    consideration the types of research that might address
                    each priority and the relative value (determined based
                    on the cost of conducting research compared to the
                    potential usefulness of the information produced by
                    research) associated with the different types of
                    research, and such other factors as the Institute
                    determines appropriate.
                ``(2) Carrying out research project agenda.--
                        ``(A) Research.--The Institute shall carry out the
                    research project agenda established under paragraph
                    (1)(B) in accordance with the methodological standards
                    adopted under paragraph (9) using methods, including
                    the following:
                                ``(i) Systematic reviews and assessments of
                            existing and future research and evidence
                            including original research conducted
                            subsequent to the date of the enactment of this
                            section.
                                ``(ii) Primary research, such as randomized
                            clinical trials, molecularly informed trials,
                            and observational studies.
                                ``(iii) Any other methodologies recommended
                            by the methodology committee established under
                            paragraph (6) that are adopted by the Board
                            under paragraph (9).
                        ``(B) Contracts for the management of funding and
                    conduct of research.--
                                ``(i) Contracts.--
                                        ``(I) In general.--In accordance
                                    with the research project agenda
                                    established under paragraph (1)(B), the
                                    Institute shall enter into contracts
                                    for the management of funding and
                                    conduct of research in accordance with
                                    the following:
                                                ``(aa) Appropriate agencies
                                            and instrumentalities of the
                                            Federal Government.
                                                ``(bb) Appropriate academic
                                            research, private sector
                                            research, or study-conducting
                                            entities.
                                        ``(II) Preference.--In entering
                                    into contracts under subclause (I), the
                                    Institute shall give preference to the
                                    Agency for Healthcare Research and
                                    Quality and the National Institutes of
                                    Health, but only if the research to be
                                    conducted or managed under such
                                    contract is authorized by the governing
                                    statutes of such Agency or Institutes.
                                ``(ii) Conditions for contracts.--A
                            contract entered into under this subparagraph
                            shall require that the agency, instrumentality,
                            or other entity--
                                        ``(I) abide by the transparency and
                                    conflicts of interest requirements
                                    under subsection (h) that apply to the
                                    Institute with respect to the research
                                    managed or conducted under such
                                    contract;
                                        ``(II) comply with the
                                    methodological standards adopted under
                                    paragraph (9) with respect to such
                                    research;
                                        ``(III) consult with the expert
                                    advisory panels for clinical trials and
                                    rare disease appointed under clauses
                                    (ii) and (iii), respectively, of
                                    paragraph (4)(A);
                                        ``(IV) subject to clause (iv),
                                    permit a researcher who conducts
                                    original research under the contract
                                    for the agency, instrumentality, or
                                    other entity to have such research
                                    published in a peer-reviewed journal or
                                    other publication;
                                        ``(V) have appropriate processes in
                                    place to manage data privacy and meet
                                    ethical standards for the research;
                                        ``(VI) comply with the requirements
                                    of the Institute for making the
                                    information available to the public
                                    under paragraph (8); and
                                        ``(VII) comply with other terms and
                                    conditions determined necessary by the
                                    Institute to carry out the research
                                    agenda adopted under paragraph (2).
                                ``(iii) Coverage of copayments or
                            coinsurance.--A contract entered into under
                            this subparagraph may allow for the coverage of
                            copayments or coinsurance, or allow for other
                            appropriate measures, to the extent that such
                            coverage or other measures are necessary to
                            preserve the validity of a research project,
                            such as in the case where the research project
                            must be blinded.
                                ``(iv) Requirements for publication of
                            research.--Any research published under clause
                            (ii)(IV) shall be within the bounds of and
                            entirely consistent with the evidence and
                            findings produced under the contract with the
                            Institute under this subparagraph. If the
                            Institute determines that those requirements
                            are not met, the Institute shall not enter into
                            another contract with the agency,
                            instrumentality, or entity which managed or
                            conducted such research for a period determined
                            appropriate by the Institute (but not less than
                            5 years).
                        ``(C) Review and update of evidence.--The Institute
                    shall review and update evidence on a periodic basis as
                    appropriate.
                        ``(D) Taking into account potential differences.--
                    Research shall be designed, as appropriate, to take
                    into account the potential for differences in the
                    effectiveness of health care treatments, services, and
                    items as used with various subpopulations, such as
                    racial and ethnic minorities, women, age, and groups of
                    individuals with different comorbidities, genetic and
                    molecular sub-types, or quality of life preferences and
                    include members of such subpopulations as subjects in
                    the research as feasible and appropriate.
                        ``(E) Differences in treatment modalities.--
                    Research shall be designed, as appropriate, to take
                    into account different characteristics of treatment
                    modalities that may affect research outcomes, such as
                    the phase of the treatment modality in the innovation
                    cycle and the impact of the skill of the operator of
                    the treatment modality.
                ``(3) Data collection.--
                        ``(A) In general.--The Secretary shall, with
                    appropriate safeguards for privacy, make available to
                    the Institute such data collected by the Centers for
                    Medicare & Medicaid Services under the programs under
                    titles XVIII, XIX, and XXI, as well as provide access
                    to the data networks developed under section 937(f) of
                    the Public Health Service Act, as the Institute and its
                    contractors may require to carry out this section. The
                    Institute may also request and obtain data from
                    Federal, State, or private entities, including data
                    from clinical databases and registries.
                        ``(B) Use of data.--The Institute shall only use
                    data provided to the Institute under subparagraph (A)
                    in accordance with laws and regulations governing the
                    release and use of such data, including applicable
                    confidentiality and privacy standards.
                ``(4) Appointing expert advisory panels.--
                        ``(A) Appointment.--
                                ``(i) In general.--The Institute may
                            appoint permanent or ad hoc expert advisory
                            panels as determined appropriate to assist in
                            identifying research priorities and
                            establishing the research project agenda under
                            paragraph (1) and for other purposes.
                                ``(ii) Expert advisory panels for clinical
                            trials.--The Institute shall appoint expert
                            advisory panels in carrying out randomized
                            clinical trials under the research project
                            agenda under paragraph (2)(A)(ii). Such expert
                            advisory panels shall advise the Institute and
                            the agency, instrumentality, or entity
                            conducting the research on the research
                            question involved and the research design or
                            protocol, including important patient subgroups
                            and other parameters of the research. Such
                            panels shall be available as a resource for
                            technical questions that may arise during the
                            conduct of such research.
                                ``(iii) Expert advisory panel for rare
                            disease.--In the case of a research study for
                            rare disease, the Institute shall appoint an
                            expert advisory panel for purposes of assisting
                            in the design of the research study and
                            determining the relative value and feasibility
                            of conducting the research study.
                        ``(B) Composition.--An expert advisory panel
                    appointed under subparagraph (A) shall include
                    representatives of practicing and research clinicians,
                    patients, and experts in scientific and health services
                    research, health services delivery, and evidence-based
                    medicine who have experience in the relevant topic, and
                    as appropriate, experts in integrative health and
                    primary prevention strategies. The Institute may
                    include a technical expert of each manufacturer or each
                    medical technology that is included under the relevant
                    topic, project, or category for which the panel is
                    established.
                ``(5) Supporting patient and consumer representatives.--The
            Institute shall provide support and resources to help patient
            and consumer representatives effectively participate on the
            Board and expert advisory panels appointed by the Institute
            under paragraph (4).
                ``(6) Establishing methodology committee.--
                        ``(A) In general.--The Institute shall establish a
                    standing methodology committee to carry out the
                    functions described in subparagraph (C).
                        ``(B) Appointment and composition.--The methodology
                    committee established under subparagraph (A) shall be
                    composed of not more than 15 members appointed by the
                    Comptroller General of the United States. Members
                    appointed to the methodology committee shall be experts
                    in their scientific field, such as health services
                    research, clinical research, comparative clinical
                    effectiveness research, biostatistics, genomics, and
                    research methodologies. Stakeholders with such
                    expertise may be appointed to the methodology
                    committee. In addition to the members appointed under
                    the first sentence, the Directors of the National
                    Institutes of Health and the Agency for Healthcare
                    Research and Quality (or their designees) shall each be
                    included as members of the methodology committee.
                        ``(C) Functions.--Subject to subparagraph (D), the
                    methodology committee shall work to develop and improve
                    the science and methods of comparative clinical
                    effectiveness research by, not later than 18 months
                    after the establishment of the Institute, directly or
                    through subcontract, developing and periodically
                    updating the following:
                                ``(i) Methodological standards for
                            research. Such methodological standards shall
                            provide specific criteria for internal
                            validity, generalizability, feasibility, and
                            timeliness of research and for health outcomes
                            measures, risk adjustment, and other relevant
                            aspects of research and assessment with respect
                            to the design of research. Any methodological
                            standards developed and updated under this
                            subclause shall be scientifically based and
                            include methods by which new information, data,
                            or advances in technology are considered and
                            incorporated into ongoing research projects by
                            the Institute, as appropriate. The process for
                            developing and updating such standards shall
                            include input from relevant experts,
                            stakeholders, and decisionmakers, and shall
                            provide opportunities for public comment. Such
                            standards shall also include methods by which
                            patient subpopulations can be accounted for and
                            evaluated in different types of research. As
                            appropriate, such standards shall build on
                            existing work on methodological standards for
                            defined categories of health interventions and
                            for each of the major categories of comparative
                            clinical effectiveness research methods
                            (determined as of the date of enactment of the
                            Patient Protection and Affordable Care Act).
                                ``(ii) A translation table that is designed
                            to provide guidance and act as a reference for
                            the Board to determine research methods that
                            are most likely to address each specific
                            research question.
                        ``(D) Consultation and conduct of examinations.--
                    The methodology committee may consult and contract with
                    the Institute of Medicine of the National Academies and
                    academic, nonprofit, or other private and governmental
                    entities with relevant expertise to carry out
                    activities described in subparagraph (C) and may
                    consult with relevant stakeholders to carry out such
                    activities.
                        ``(E) Reports.--The methodology committee shall
                    submit reports to the Board on the committee's
                    performance of the functions described in subparagraph
                    (C). Reports shall contain recommendations for the
                    Institute to adopt methodological standards developed
                    and updated by the methodology committee as well as
                    other actions deemed necessary to comply with such
                    methodological standards.
                ``(7) Providing for a peer-review process for primary
            research.--
                        ``(A) In general.--The Institute shall ensure that
                    there is a process for peer review of primary research
                    described in subparagraph (A)(ii) of paragraph (2) that
                    is conducted under such paragraph. Under such process--
                                ``(i) evidence from such primary research
                            shall be reviewed to assess scientific
                            integrity and adherence to methodological
                            standards adopted under paragraph (9); and
                                ``(ii) a list of the names of individuals
                            contributing to any peer-review process during
                            the preceding year or years shall be made
                            public and included in annual reports in
                            accordance with paragraph (10)(D).
                        ``(B) Composition.--Such peer-review process shall
                    be designed in a manner so as to avoid bias and
                    conflicts of interest on the part of the reviewers and
                    shall be composed of experts in the scientific field
                    relevant to the research under review.
                        ``(C) Use of existing processes.--
                                ``(i) Processes of another entity.--In the
                            case where the Institute enters into a contract
                            or other agreement with another entity for the
                            conduct or management of research under this
                            section, the Institute may utilize the peer-
                            review process of such entity if such process
                            meets the requirements under subparagraphs (A)
                            and (B).
                                ``(ii) Processes of appropriate medical
                            journals.--The Institute may utilize the peer-
                            review process of appropriate medical journals
                            if such process meets the requirements under
                            subparagraphs (A) and (B).
                ``(8) Release of research findings.--
                        ``(A) In general.--The Institute shall, not later
                    than 90 days after the conduct or receipt of research
                    findings under this part, make such research findings
                    available to clinicians, patients, and the general
                    public. The Institute shall ensure that the research
                    findings--
                                ``(i) convey the findings of research in a
                            manner that is comprehensible and useful to
                            patients and providers in making health care
                            decisions;
                                ``(ii) fully convey findings and discuss
                            considerations specific to certain
                            subpopulations, risk factors, and
                            comorbidities, as appropriate;
                                ``(iii) include limitations of the research
                            and what further research may be needed as
                            appropriate;
                                ``(iv) not be construed as mandates for
                            practice guidelines, coverage recommendations,
                            payment, or policy recommendations; and
                                ``(v) not include any data which would
                            violate the privacy of research participants or
                            any confidentiality agreements made with
                            respect to the use of data under this section.
                        ``(B) Definition of research findings.--In this
                    paragraph, the term `research findings' means the
                    results of a study or assessment.
                ``(9) Adoption.--Subject to subsection (h)(1), the
            Institute shall adopt the national priorities identified under
            paragraph (1)(A), the research project agenda established under
            paragraph (1)(B), the methodological standards developed and
            updated by the methodology committee under paragraph (6)(C)(i),
            and any peer-review process provided under paragraph (7) by
            majority vote. In the case where the Institute does not adopt
            such processes in accordance with the preceding sentence, the
            processes shall be referred to the appropriate staff or entity
            within the Institute (or, in the case of the methodological
            standards, the methodology committee) for further review.
                ``(10) Annual reports.--The Institute shall submit an
            annual report to Congress and the President, and shall make the
            annual report available to the public. Such report shall
            contain--
                        ``(A) a description of the activities conducted
                    under this section, research priorities identified
                    under paragraph (1)(A) and methodological standards
                    developed and updated by the methodology committee
                    under paragraph (6)(C)(i) that are adopted under
                    paragraph (9) during the preceding year;
                        ``(B) the research project agenda and budget of the
                    Institute for the following year;
                        ``(C) any administrative activities conducted by
                    the Institute during the preceding year;
                        ``(D) the names of individuals contributing to any
                    peer-review process under paragraph (7), without
                    identifying them with a particular research project;
                    and
                        ``(E) any other relevant information (including
                    information on the membership of the Board, expert
                    advisory panels, methodology committee, and the
                    executive staff of the Institute, any conflicts of
                    interest with respect to these individuals, and any
                    bylaws adopted by the Board during the preceding year).
        ``(e) Administration.--
                ``(1) In general.--Subject to paragraph (2), the Board
            shall carry out the duties of the Institute.
                ``(2) Nondelegable duties.--The activities described in
            subsections (d)(1) and (d)(9) are nondelegable.
        ``(f) Board of Governors.--
                ``(1) In general.--The Institute shall have a Board of
            Governors, which shall consist of the following members:
                        ``(A) The Director of Agency for Healthcare
                    Research and Quality (or the Director's designee).
                        ``(B) The Director of the National Institutes of
                    Health (or the Director's designee).
                        ``(C) Seventeen members appointed, not later than 6
                    months after the date of enactment of this section, by
                    the Comptroller General of the United States as
                    follows:
                                ``(i) 3 members representing patients and
                            health care consumers.
                                ``(ii) 5 members representing physicians
                            and providers, including at least 1 surgeon,
                            nurse, State-licensed integrative health care
                            practitioner, and representative of a hospital.
                                ``(iii) 3 members representing private
                            payers, of whom at least 1 member shall
                            represent health insurance issuers and at least
                            1 member shall represent employers who self-
                            insure employee benefits.
                                ``(iv) 3 members representing
                            pharmaceutical, device, and diagnostic
                            manufacturers or developers.
                                ``(v) 1 member representing quality
                            improvement or independent health service
                            researchers.
                                ``(vi) 2 members representing the Federal
                            Government or the States, including at least 1
                            member representing a Federal health program or
                            agency.
                ``(2) Qualifications.--The Board shall represent a broad
            range of perspectives and collectively have scientific
            expertise in clinical health sciences research, including
            epidemiology, decisions sciences, health economics, and
            statistics. In appointing the Board, the Comptroller General of
            the United States shall consider and disclose any conflicts of
            interest in accordance with subsection (h)(4)(B). Members of
            the Board shall be recused from relevant Institute activities
            in the case where the member (or an immediate family member of
            such member) has a real conflict of interest directly related
            to the research project or the matter that could affect or be
            affected by such participation.
                ``(3) Terms; vacancies.--A member of the Board shall be
            appointed for a term of 6 years, except with respect to the
            members first appointed, whose terms of appointment shall be
            staggered evenly over 2-year increments. No individual shall be
            appointed to the Board for more than 2 terms. Vacancies shall
            be filled in the same manner as the original appointment was
            made.
                ``(4) Chairperson and vice-chairperson.--The Comptroller
            General of the United States shall designate a Chairperson and
            Vice Chairperson of the Board from among the members of the
            Board. Such members shall serve as Chairperson or Vice
            Chairperson for a period of 3 years.
                ``(5) Compensation.--Each member of the Board who is not an
            officer or employee of the Federal Government shall be entitled
            to compensation (equivalent to the rate provided for level IV
            of the Executive Schedule under section 5315 of title 5, United
            States Code) and expenses incurred while performing the duties
            of the Board. An officer or employee of the Federal government
            who is a member of the Board shall be exempt from compensation.
                ``(6) Director and staff; experts and consultants.--The
            Board may employ and fix the compensation of an Executive
            Director and such other personnel as may be necessary to carry
            out the duties of the Institute and may seek such assistance
            and support of, or contract with, experts and consultants that
            may be necessary for the performance of the duties of the
            Institute.
                ``(7) Meetings and hearings.--The Board shall meet and hold
            hearings at the call of the Chairperson or a majority of its
            members. Meetings not solely concerning matters of personnel
            shall be advertised at least 7 days in advance and open to the
            public. A majority of the Board members shall constitute a
            quorum, but a lesser number of members may meet and hold
            hearings.
        ``(g) Financial and Governmental Oversight.--
                ``(1) Contract for audit.--The Institute shall provide for
            the conduct of financial audits of the Institute on an annual
            basis by a private entity with expertise in conducting
            financial audits.
                ``(2) Review and annual reports.--
                        ``(A) Review.--The Comptroller General of the
                    United States shall review the following:
                                ``(i) Not less frequently than on an annual
                            basis, the financial audits conducted under
                            paragraph (1).
                                ``(ii) Not less frequently than every 5
                            years, the processes established by the
                            Institute, including the research priorities
                            and the conduct of research projects, in order
                            to determine whether information produced by
                            such research projects is objective and
                            credible, is produced in a manner consistent
                            with the requirements under this section, and
                            is developed through a transparent process.
                                ``(iii) Not less frequently than every 5
                            years, the dissemination and training
                            activities and data networks established under
                            section 937 of the Public Health Service Act,
                            including the methods and products used to
                            disseminate research, the types of training
                            conducted and supported, and the types and
                            functions of the data networks established, in
                            order to determine whether the activities and
                            data are produced in a manner consistent with
                            the requirements under such section.
                                ``(iv) Not less frequently than every 5
                            years, the overall effectiveness of activities
                            conducted under this section and the
                            dissemination, training, and capacity building
                            activities conducted under section 937 of the
                            Public Health Service Act. Such review shall
                            include an analysis of the extent to which
                            research findings are used by health care
                            decision-makers, the effect of the
                            dissemination of such findings on reducing
                            practice variation and disparities in health
                            care, and the effect of the research conducted
                            and disseminated on innovation and the health
                            care economy of the United States.
                                ``(v) Not later than 8 years after the date
                            of enactment of this section, the adequacy and
                            use of the funding for the Institute and the
                            activities conducted under section 937 of the
                            Public Health Service Act, including a
                            determination as to whether, based on the
                            utilization of research findings by public and
                            private payers, funding sources for the
                            Patient-Centered Outcomes Research Trust Fund
                            under section 9511 of the Internal Revenue Code
                            of 1986 are appropriate and whether such
                            sources of funding should be continued or
                            adjusted.
                        ``(B) Annual reports.--Not later than April 1 of
                    each year, the Comptroller General of the United States
                    shall submit to Congress a report containing the
                    results of the review conducted under subparagraph (A)
                    with respect to the preceding year (or years, if
                    applicable), together with recommendations for such
                    legislation and administrative action as the
                    Comptroller General determines appropriate.
        ``(h) Ensuring Transparency, Credibility, and Access.--The
    Institute shall establish procedures to ensure that the following
    requirements for ensuring transparency, credibility, and access are
    met:
                ``(1) Public comment periods.--The Institute shall provide
            for a public comment period of not less than 45 days and not
            more than 60 days prior to the adoption under subsection (d)(9)
            of the national priorities identified under subsection
            (d)(1)(A), the research project agenda established under
            subsection (d)(1)(B), the methodological standards developed
            and updated by the methodology committee under subsection
            (d)(6)(C)(i), and the peer-review process provided under
            paragraph (7), and after the release of draft findings with
            respect to systematic reviews of existing research and
            evidence.
                ``(2) Additional forums.--The Institute shall support
            forums to increase public awareness and obtain and incorporate
            public input and feedback through media (such as an Internet
            website) on research priorities, research findings, and other
            duties, activities, or processes the Institute determines
            appropriate.
                ``(3) Public availability.--The Institute shall make
            available to the public and disclose through the official
            public Internet website of the Institute the following:
                        ``(A) Information contained in research findings as
                    specified in subsection (d)(9).
                        ``(B) The process and methods for the conduct of
                    research, including the identity of the entity and the
                    investigators conducing such research and any conflicts
                    of interests of such parties, any direct or indirect
                    links the entity has to industry, and research
                    protocols, including measures taken, methods of
                    research and analysis, research results, and such other
                    information the Institute determines appropriate)
                    concurrent with the release of research findings.
                        ``(C) Notice of public comment periods under
                    paragraph (1), including deadlines for public comments.
                        ``(D) Subsequent comments received during each of
                    the public comment periods.
                        ``(E) In accordance with applicable laws and
                    processes and as the Institute determines appropriate,
                    proceedings of the Institute.
                ``(4) Disclosure of conflicts of interest.--
                        ``(A) In general.--A conflict of interest shall be
                    disclosed in the following manner:
                                ``(i) By the Institute in appointing
                            members to an expert advisory panel under
                            subsection (d)(4), in selecting individuals to
                            contribute to any peer-review process under
                            subsection (d)(7), and for employment as
                            executive staff of the Institute.
                                ``(ii) By the Comptroller General in
                            appointing members of the methodology committee
                            under subsection (d)(6);
                                ``(iii) By the Institute in the annual
                            report under subsection (d)(10), except that,
                            in the case of individuals contributing to any
                            such peer review process, such description
                            shall be in a manner such that those
                            individuals cannot be identified with a
                            particular research project.
                        ``(B) Manner of disclosure.--Conflicts of interest
                    shall be disclosed as described in subparagraph (A) as
                    soon as practicable on the Internet web site of the
                    Institute and of the Government Accountability Office.
                    The information disclosed under the preceding sentence
                    shall include the type, nature, and magnitude of the
                    interests of the individual involved, except to the
                    extent that the individual recuses himself or herself
                    from participating in the consideration of or any other
                    activity with respect to the study as to which the
                    potential conflict exists.
        ``(i) Rules.--The Institute, its Board or staff, shall be
    prohibited from accepting gifts, bequeaths, or donations of services or
    property. In addition, the Institute shall be prohibited from
    establishing a corporation or generating revenues from activities other
    than as provided under this section.
        ``(j) Rules of Construction.--
                ``(1) Coverage.--Nothing in this section shall be
            construed--
                        ``(A) to permit the Institute to mandate coverage,
                    reimbursement, or other policies for any public or
                    private payer; or
                        ``(B) as preventing the Secretary from covering the
                    routine costs of clinical care received by an
                    individual entitled to, or enrolled for, benefits under
                    title XVIII, XIX, or XXI in the case where such
                    individual is participating in a clinical trial and
                    such costs would otherwise be covered under such title
                    with respect to the beneficiary.''.
        (b) Dissemination and Building Capacity for Research.--Title IX of
    the Public Health Service Act (42 U.S.C. 299 et seq.), as amended by
    section 3606, is further amended by inserting after section 936 the
    following:

    ``SEC. 937. DISSEMINATION AND BUILDING CAPACITY FOR RESEARCH.

        ``(a) In General.--
                ``(1) Dissemination.--The Office of Communication and
            Knowledge Transfer (referred to in this section as the
            `Office') at the Agency for Healthcare Research and Quality (or
            any other relevant office designated by Agency for Healthcare
            Research and Quality), in consultation with the National
            Institutes of Health, shall broadly disseminate the research
            findings that are published by the Patient Centered Outcomes
            Research Institute established under section 1181(b) of the
            Social Security Act (referred to in this section as the
            `Institute') and other government-funded research relevant to
            comparative clinical effectiveness research. The Office shall
            create informational tools that organize and disseminate
            research findings for physicians, health care providers,
            patients, payers, and policy makers. The Office shall also
            develop a publicly available resource database that collects
            and contains government-funded evidence and research from
            public, private, not-for profit, and academic sources.
                ``(2) Requirements.--The Office shall provide for the
            dissemination of the Institute's research findings and
            government-funded research relevant to comparative clinical
            effectiveness research to physicians, health care providers,
            patients, vendors of health information technology focused on
            clinical decision support, appropriate professional
            associations, and Federal and private health plans. Materials,
            forums, and media used to disseminate the findings,
            informational tools, and resource databases shall--
                        ``(A) include a description of considerations for
                    specific subpopulations, the research methodology, and
                    the limitations of the research, and the names of the
                    entities, agencies, instrumentalities, and individuals
                    who conducted any research which was published by the
                    Institute; and
                        ``(B) not be construed as mandates, guidelines, or
                    recommendations for payment, coverage, or treatment.
        ``(b) Incorporation of Research Findings.--The Office, in
    consultation with relevant medical and clinical associations, shall
    assist users of health information technology focused on clinical
    decision support to promote the timely incorporation of research
    findings disseminated under subsection (a) into clinical practices and
    to promote the ease of use of such incorporation.
        ``(c) Feedback.--The Office shall establish a process to receive
    feedback from physicians, health care providers, patients, and vendors
    of health information technology focused on clinical decision support,
    appropriate professional associations, and Federal and private health
    plans about the value of the information disseminated and the
    assistance provided under this section.
        ``(d) Rule of Construction.--Nothing in this section shall preclude
    the Institute from making its research findings publicly available as
    required under section 1181(d)(8) of the Social Security Act.
        ``(e) Training of Researchers.--The Agency for Health Care Research
    and Quality, in consultation with the National Institutes of Health,
    shall build capacity for comparative clinical effectiveness research by
    establishing a grant program that provides for the training of
    researchers in the methods used to conduct such research, including
    systematic reviews of existing research and primary research such as
    clinical trials. At a minimum, such training shall be in methods that
    meet the methodological standards adopted under section 1181(d)(9) of
    the Social Security Act.
        ``(f) Building Data for Research.--The Secretary shall provide for
    the coordination of relevant Federal health programs to build data
    capacity for comparative clinical effectiveness research, including the
    development and use of clinical registries and health outcomes research
    data networks, in order to develop and maintain a comprehensive,
    interoperable data network to collect, link, and analyze data on
    outcomes and effectiveness from multiple sources, including electronic
    health records.
        ``(g) Authority To Contract With the Institute.--Agencies and
    instrumentalities of the Federal Government may enter into agreements
    with the Institute, and accept and retain funds, for the conduct and
    support of research described in this part, provided that the research
    to be conducted or supported under such agreements is authorized under
    the governing statutes of such agencies and instrumentalities.''.
        (c) In General.--Part D of title XI of the Social Security Act, as
    added by subsection (a), is amended by adding at the end the following
    new section:

      ``limitations on certain uses of comparative clinical effectiveness
                                    research

        ``Sec. 1182.  (a) The Secretary may only use evidence and findings
    from research conducted under section 1181 to make a determination
    regarding coverage under title XVIII if such use is through an
    iterative and transparent process which includes public comment and
    considers the effect on subpopulations.
        ``(b) Nothing in section 1181 shall be construed as--
                ``(1) superceding or modifying the coverage of items or
            services under title XVIII that the Secretary determines are
            reasonable and necessary under section 1862(l)(1); or
                ``(2) authorizing the Secretary to deny coverage of items
            or services under such title solely on the basis of comparative
            clinical effectiveness research.
        ``(c)(1) The Secretary shall not use evidence or findings from
    comparative clinical effectiveness research conducted under section
    1181 in determining coverage, reimbursement, or incentive programs
    under title XVIII in a manner that treats extending the life of an
    elderly, disabled, or terminally ill individual as of lower value than
    extending the life of an individual who is younger, nondisabled, or not
    terminally ill.
        ``(2) Paragraph (1) shall not be construed as preventing the
    Secretary from using evidence or findings from such comparative
    clinical effectiveness research in determining coverage, reimbursement,
    or incentive programs under title XVIII based upon a comparison of the
    difference in the effectiveness of alternative treatments in extending
    an individual's life due to the individual's age, disability, or
    terminal illness.
        ``(d)(1) The Secretary shall not use evidence or findings from
    comparative clinical effectiveness research conducted under section
    1181 in determining coverage, reimbursement, or incentive programs
    under title XVIII in a manner that precludes, or with the intent to
    discourage, an individual from choosing a health care treatment based
    on how the individual values the tradeoff between extending the length
    of their life and the risk of disability.
        ``(2)(A) Paragraph (1) shall not be construed to--
                ``(i) limit the application of differential copayments
            under title XVIII based on factors such as cost or type of
            service; or
                ``(ii) prevent the Secretary from using evidence or
            findings from such comparative clinical effectiveness research
            in determining coverage, reimbursement, or incentive programs
            under such title based upon a comparison of the difference in
            the effectiveness of alternative health care treatments in
            extending an individual's life due to that individual's age,
            disability, or terminal illness.
        ``(3) Nothing in the provisions of, or amendments made by the
    Patient Protection and Affordable Care Act, shall be construed to limit
    comparative clinical effectiveness research or any other research,
    evaluation, or dissemination of information concerning the likelihood
    that a health care treatment will result in disability.
        ``(e) The Patient-Centered Outcomes Research Institute established
    under section 1181(b)(1) shall not develop or employ a dollars-per-
    quality adjusted life year (or similar measure that discounts the value
    of a life because of an individual's disability) as a threshold to
    establish what type of health care is cost effective or recommended.
    The Secretary shall not utilize such an adjusted life year (or such a
    similar measure) as a threshold to determine coverage, reimbursement,
    or incentive programs under title XVIII.''.
        (d) In General.--Part D of title XI of the Social Security Act, as
    added by subsection (a) and amended by subsection (c), is amended by
    adding at the end the following new section:

    ``trust fund transfers to patient-centered outcomes research trust fund

        ``Sec. 1183.  (a) In General.--The Secretary shall provide for the
    transfer, from the Federal Hospital Insurance Trust Fund under section
    1817 and the Federal Supplementary Medical Insurance Trust Fund under
    section 1841, in proportion (as estimated by the Secretary) to the
    total expenditures during such fiscal year that are made under title
    XVIII from the respective trust fund, to the Patient-Centered Outcomes
    Research Trust Fund (referred to in this section as the `PCORTF') under
    section 9511 of the Internal Revenue Code of 1986, of the following:
                ``(1) For fiscal year 2013, an amount equal to $1
            multiplied by the average number of individuals entitled to
            benefits under part A, or enrolled under part B, of title XVIII
            during such fiscal year.
                ``(2) For each of fiscal years 2014, 2015, 2016, 2017,
            2018, and 2019, an amount equal to $2 multiplied by the average
            number of individuals entitled to benefits under part A, or
            enrolled under part B, of title XVIII during such fiscal year.
        ``(b) Adjustments for Increases in Health Care Spending.--In the
    case of any fiscal year beginning after September 30, 2014, the dollar
    amount in effect under subsection (a)(2) for such fiscal year shall be
    equal to the sum of such dollar amount for the previous fiscal year
    (determined after the application of this subsection), plus an amount
    equal to the product of--
                ``(1) such dollar amount for the previous fiscal year,
            multiplied by
                ``(2) the percentage increase in the projected per capita
            amount of National Health Expenditures, as most recently
            published by the Secretary before the beginning of the fiscal
            year.''.
        (e) Patient-Centered Outcomes Research Trust Fund; Financing for
    Trust Fund.--
                (1) Establishment of trust fund.--
                        (A) In general.--Subchapter A of chapter 98 of the
                    Internal Revenue Code of 1986 (relating to
                    establishment of trust funds) is amended by adding at
                    the end the following new section:

    ``SEC. 9511. PATIENT-CENTERED OUTCOMES RESEARCH TRUST FUND.

        ``(a) Creation of Trust Fund.--There is established in the Treasury
    of the United States a trust fund to be known as the `Patient-Centered
    Outcomes Research Trust Fund' (hereafter in this section referred to as
    the `PCORTF'), consisting of such amounts as may be appropriated or
    credited to such Trust Fund as provided in this section and section
    9602(b).
        ``(b) Transfers to Fund.--
                ``(1) Appropriation.--There are hereby appropriated to the
            Trust Fund the following:
                        ``(A) For fiscal year 2010, $10,000,000.
                        ``(B) For fiscal year 2011, $50,000,000.
                        ``(C) For fiscal year 2012, $150,000,000.
                        ``(D) For fiscal year 2013--
                                ``(i) an amount equivalent to the net
                            revenues received in the Treasury from the fees
                            imposed under subchapter B of chapter 34
                            (relating to fees on health insurance and self-
                            insured plans) for such fiscal year; and
                                ``(ii) $150,000,000.
                        ``(E) For each of fiscal years 2014, 2015, 2016,
                    2017, 2018, and 2019--
                                ``(i) an amount equivalent to the net
                            revenues received in the Treasury from the fees
                            imposed under subchapter B of chapter 34
                            (relating to fees on health insurance and self-
                            insured plans) for such fiscal year; and
                                ``(ii) $150,000,000.
                    The amounts appropriated under subparagraphs (A), (B),
                    (C), (D)(ii), and (E)(ii) shall be transferred from the
                    general fund of the Treasury, from funds not otherwise
                    appropriated.
                ``(2) Trust fund transfers.--In addition to the amounts
            appropriated under paragraph (1), there shall be credited to
            the PCORTF the amounts transferred under section 1183 of the
            Social Security Act.
                ``(3) Limitation on transfers to pcortf.--No amount may be
            appropriated or transferred to the PCORTF on and after the date
            of any expenditure from the PCORTF which is not an expenditure
            permitted under this section. The determination of whether an
            expenditure is so permitted shall be made without regard to--
                        ``(A) any provision of law which is not contained
                    or referenced in this chapter or in a revenue Act, and
                        ``(B) whether such provision of law is a
                    subsequently enacted provision or directly or
                    indirectly seeks to waive the application of this
                    paragraph.
        ``(c) Trustee.--The Secretary of the Treasury shall be a trustee of
    the PCORTF.
        ``(d) Expenditures From Fund.--
                ``(1) Amounts available to the patient-centered outcomes
            research institute.--Subject to paragraph (2), amounts in the
            PCORTF are available, without further appropriation, to the
            Patient-Centered Outcomes Research Institute established under
            section 1181(b) of the Social Security Act for carrying out
            part D of title XI of the Social Security Act (as in effect on
            the date of enactment of such Act).
                ``(2) Transfer of funds.--
                        ``(A) In general.--The trustee of the PCORTF shall
                    provide for the transfer from the PCORTF of 20 percent
                    of the amounts appropriated or credited to the PCORTF
                    for each of fiscal years 2011 through 2019 to the
                    Secretary of Health and Human Services to carry out
                    section 937 of the Public Health Service Act.
                        ``(B) Availability.--Amounts transferred under
                    subparagraph (A) shall remain available until expended.
                        ``(C) Requirements.--Of the amounts transferred
                    under subparagraph (A) with respect to a fiscal year,
                    the Secretary of Health and Human Services shall
                    distribute--
                                ``(i) 80 percent to the Office of
                            Communication and Knowledge Transfer of the
                            Agency for Healthcare Research and Quality (or
                            any other relevant office designated by Agency
                            for Healthcare Research and Quality) to carry
                            out the activities described in section 937 of
                            the Public Health Service Act; and
                                ``(ii) 20 percent to the Secretary to carry
                            out the activities described in such section
                            937.
        ``(e) Net Revenues.--For purposes of this section, the term `net
    revenues' means the amount estimated by the Secretary of the Treasury
    based on the excess of--
                ``(1) the fees received in the Treasury under subchapter B
            of chapter 34, over
                ``(2) the decrease in the tax imposed by chapter 1
            resulting from the fees imposed by such subchapter.
        ``(f) Termination.--No amounts shall be available for expenditure
    from the PCORTF after September 30, 2019, and any amounts in such Trust
    Fund after such date shall be transferred to the general fund of the
    Treasury.''.
                        (B) Clerical amendment.--The table of sections for
                    subchapter A of chapter 98 of such Code is amended by
                    adding at the end the following new item:

    ``Sec. 9511. Patient-centered outcomes research trust fund.''.
                (2) Financing for fund from fees on insured and self-
            insured health plans.--
                        (A) General rule.--Chapter 34 of the Internal
                    Revenue Code of 1986 is amended by adding at the end
                    the following new subchapter:

             ``Subchapter B--Insured and Self-Insured Health Plans

    ``Sec. 4375. Health insurance.
    ``Sec. 4376. Self-insured health plans.
    ``Sec. 4377. Definitions and special rules.

    ``SEC. 4375. HEALTH INSURANCE.

        ``(a) Imposition of Fee.--There is hereby imposed on each specified
    health insurance policy for each policy year ending after September 30,
    2012, a fee equal to the product of $2 ($1 in the case of policy years
    ending during fiscal year 2013) multiplied by the average number of
    lives covered under the policy.
        ``(b) Liability for Fee.--The fee imposed by subsection (a) shall
    be paid by the issuer of the policy.
        ``(c) Specified Health Insurance Policy.--For purposes of this
    section:
                ``(1) In general.--Except as otherwise provided in this
            section, the term `specified health insurance policy' means any
            accident or health insurance policy (including a policy under a
            group health plan) issued with respect to individuals residing
            in the United States.
                ``(2) Exemption for certain policies.--The term `specified
            health insurance policy' does not include any insurance if
            substantially all of its coverage is of excepted benefits
            described in section 9832(c).
                ``(3) Treatment of prepaid health coverage arrangements.--
                        ``(A) In general.--In the case of any arrangement
                    described in subparagraph (B), such arrangement shall
                    be treated as a specified health insurance policy, and
                    the person referred to in such subparagraph shall be
                    treated as the issuer.
                        ``(B) Description of arrangements.--An arrangement
                    is described in this subparagraph if under such
                    arrangement fixed payments or premiums are received as
                    consideration for any person's agreement to provide or
                    arrange for the provision of accident or health
                    coverage to residents of the United States, regardless
                    of how such coverage is provided or arranged to be
                    provided.
        ``(d) Adjustments for Increases in Health Care Spending.--In the
    case of any policy year ending in any fiscal year beginning after
    September 30, 2014, the dollar amount in effect under subsection (a)
    for such policy year shall be equal to the sum of such dollar amount
    for policy years ending in the previous fiscal year (determined after
    the application of this subsection), plus an amount equal to the
    product of--
                ``(1) such dollar amount for policy years ending in the
            previous fiscal year, multiplied by
                ``(2) the percentage increase in the projected per capita
            amount of National Health Expenditures, as most recently
            published by the Secretary before the beginning of the fiscal
            year.
        ``(e) Termination.--This section shall not apply to policy years
    ending after September 30, 2019.

    ``SEC. 4376. SELF-INSURED HEALTH PLANS.

        ``(a) Imposition of Fee.--In the case of any applicable self-
    insured health plan for each plan year ending after September 30, 2012,
    there is hereby imposed a fee equal to $2 ($1 in the case of plan years
    ending during fiscal year 2013) multiplied by the average number of
    lives covered under the plan.
        ``(b) Liability for Fee.--
                ``(1) In general.--The fee imposed by subsection (a) shall
            be paid by the plan sponsor.
                ``(2) Plan sponsor.--For purposes of paragraph (1) the term
            `plan sponsor' means--
                        ``(A) the employer in the case of a plan
                    established or maintained by a single employer,
                        ``(B) the employee organization in the case of a
                    plan established or maintained by an employee
                    organization,
                        ``(C) in the case of--
                                ``(i) a plan established or maintained by 2
                            or more employers or jointly by 1 or more
                            employers and 1 or more employee organizations,
                                ``(ii) a multiple employer welfare
                            arrangement, or
                                ``(iii) a voluntary employees' beneficiary
                            association described in section 501(c)(9), the
                            association, committee, joint board of
                            trustees, or other similar group of
                            representatives of the parties who establish or
                            maintain the plan, or
                        ``(D) the cooperative or association described in
                    subsection (c)(2)(F) in the case of a plan established
                    or maintained by such a cooperative or association.
        ``(c) Applicable Self-insured Health Plan.--For purposes of this
    section, the term `applicable self-insured health plan' means any plan
    for providing accident or health coverage if--
                ``(1) any portion of such coverage is provided other than
            through an insurance policy, and
                ``(2) such plan is established or maintained--
                        ``(A) by 1 or more employers for the benefit of
                    their employees or former employees,
                        ``(B) by 1 or more employee organizations for the
                    benefit of their members or former members,
                        ``(C) jointly by 1 or more employers and 1 or more
                    employee organizations for the benefit of employees or
                    former employees,
                        ``(D) by a voluntary employees' beneficiary
                    association described in section 501(c)(9),
                        ``(E) by any organization described in section
                    501(c)(6), or
                        ``(F) in the case of a plan not described in the
                    preceding subparagraphs, by a multiple employer welfare
                    arrangement (as defined in section 3(40) of Employee
                    Retirement Income Security Act of 1974), a rural
                    electric cooperative (as defined in section
                    3(40)(B)(iv) of such Act), or a rural telephone
                    cooperative association (as defined in section
                    3(40)(B)(v) of such Act).
        ``(d) Adjustments for Increases in Health Care Spending.--In the
    case of any plan year ending in any fiscal year beginning after
    September 30, 2014, the dollar amount in effect under subsection (a)
    for such plan year shall be equal to the sum of such dollar amount for
    plan years ending in the previous fiscal year (determined after the
    application of this subsection), plus an amount equal to the product
    of--
                ``(1) such dollar amount for plan years ending in the
            previous fiscal year, multiplied by
                ``(2) the percentage increase in the projected per capita
            amount of National Health Expenditures, as most recently
            published by the Secretary before the beginning of the fiscal
            year.
        ``(e) Termination.--This section shall not apply to plan years
    ending after September 30, 2019.

    ``SEC. 4377. DEFINITIONS AND SPECIAL RULES.

        ``(a) Definitions.--For purposes of this subchapter--
                ``(1) Accident and health coverage.--The term `accident and
            health coverage' means any coverage which, if provided by an
            insurance policy, would cause such policy to be a specified
            health insurance policy (as defined in section 4375(c)).
                ``(2) Insurance policy.--The term `insurance policy' means
            any policy or other instrument whereby a contract of insurance
            is issued, renewed, or extended.
                ``(3) United states.--The term `United States' includes any
            possession of the United States.
        ``(b) Treatment of Governmental Entities.--
                ``(1) In general.--For purposes of this subchapter--
                        ``(A) the term `person' includes any governmental
                    entity, and
                        ``(B) notwithstanding any other law or rule of law,
                    governmental entities shall not be exempt from the fees
                    imposed by this subchapter except as provided in
                    paragraph (2).
                ``(2) Treatment of exempt governmental programs.--In the
            case of an exempt governmental program, no fee shall be imposed
            under section 4375 or section 4376 on any covered life under
            such program.
                ``(3) Exempt governmental program defined.--For purposes of
            this subchapter, the term `exempt governmental program' means--
                        ``(A) any insurance program established under title
                    XVIII of the Social Security Act,
                        ``(B) the medical assistance program established by
                    title XIX or XXI of the Social Security Act,
                        ``(C) any program established by Federal law for
                    providing medical care (other than through insurance
                    policies) to individuals (or the spouses and dependents
                    thereof) by reason of such individuals being members of
                    the Armed Forces of the United States or veterans, and
                        ``(D) any program established by Federal law for
                    providing medical care (other than through insurance
                    policies) to members of Indian tribes (as defined in
                    section 4(d) of the Indian Health Care Improvement
                    Act).
        ``(c) Treatment as Tax.--For purposes of subtitle F, the fees
    imposed by this subchapter shall be treated as if they were taxes.
        ``(d) No Cover Over to Possessions.--Notwithstanding any other
    provision of law, no amount collected under this subchapter shall be
    covered over to any possession of the United States.''.
                        (B) Clerical amendments.--
                                (i) Chapter 34 of such Code is amended by
                            striking the chapter heading and inserting the
                            following:

               ``CHAPTER 34--TAXES ON CERTAIN INSURANCE POLICIES

              ``subchapter a. policies issued by foreign insurers

             ``subchapter b. insured and self-insured health plans

             ``Subchapter A--Policies Issued By Foreign Insurers''.

                                (ii) The table of chapters for subtitle D
                            of such Code is amended by striking the item
                            relating to chapter 34 and inserting the
                            following new item:

              ``Chapter 34--Taxes on Certain Insurance Policies''.

        (f) Tax-exempt Status of the Patient-centered Outcomes Research
    Institute.--Subsection 501(l) of the Internal Revenue Code of 1986 is
    amended by adding at the end the following new paragraph:
                ``(4) The Patient-Centered Outcomes Research Institute
            established under section 1181(b) of the Social Security
            Act.''.

    SEC. 6302. FEDERAL COORDINATING COUNCIL FOR COMPARATIVE EFFECTIVENESS
                  RESEARCH.

        Notwithstanding any other provision of law, the Federal
    Coordinating Council for Comparative Effectiveness Research established
    under section 804 of Division A of the American Recovery and
    Reinvestment Act of 2009 (42 U.S.C. 299b-8), including the requirement
    under subsection (e)(2) of such section, shall terminate on the date of
    enactment of this Act.

     Subtitle E--Medicare, Medicaid, and CHIP Program Integrity Provisions

    SEC. 6401. PROVIDER SCREENING AND OTHER ENROLLMENT REQUIREMENTS UNDER
                  MEDICARE, MEDICAID, AND CHIP.

        (a) Medicare.--Section 1866(j) of the Social Security Act (42
    U.S.C. 1395cc(j)) is amended--
                (1) in paragraph (1)(A), by adding at the end the
            following: ``Such process shall include screening of providers
            and suppliers in accordance with paragraph (2), a provisional
            period of enhanced oversight in accordance with paragraph (3),
            disclosure requirements in accordance with paragraph (4), the
            imposition of temporary enrollment moratoria in accordance with
            paragraph (5), and the establishment of compliance programs in
            accordance with paragraph (6).'';
                (2) by redesignating paragraph (2) as paragraph (7); and
                (3) by inserting after paragraph (1) the following:
                ``(2) Provider screening.--
                        ``(A) Procedures.--Not later than 180 days after
                    the date of enactment of this paragraph, the Secretary,
                    in consultation with the Inspector General of the
                    Department of Health and Human Services, shall
                    establish procedures under which screening is conducted
                    with respect to providers of medical or other items or
                    services and suppliers under the program under this
                    title, the Medicaid program under title XIX, and the
                    CHIP program under title XXI.
                        ``(B) Level of screening.--The Secretary shall
                    determine the level of screening conducted under this
                    paragraph according to the risk of fraud, waste, and
                    abuse, as determined by the Secretary, with respect to
                    the category of provider of medical or other items or
                    services or supplier. Such screening--
                                ``(i) shall include a licensure check,
                            which may include such checks across States;
                            and
                                ``(ii) may, as the Secretary determines
                            appropriate based on the risk of fraud, waste,
                            and abuse described in the preceding sentence,
                            include--
                                        ``(I) a criminal background check;
                                        ``(II) fingerprinting;
                                        ``(III) unscheduled and unannounced
                                    site visits, including preenrollment
                                    site visits;
                                        ``(IV) database checks (including
                                    such checks across States); and
                                        ``(V) such other screening as the
                                    Secretary determines appropriate.
                        ``(C) Application fees.--
                                ``(i) Individual providers.--Except as
                            provided in clause (iii), the Secretary shall
                            impose a fee on each individual provider of
                            medical or other items or services or supplier
                            (such as a physician, physician assistant,
                            nurse practitioner, or clinical nurse
                            specialist) with respect to which screening is
                            conducted under this paragraph in an amount
                            equal to--
                                        ``(I) for 2010, $200; and
                                        ``(II) for 2011 and each subsequent
                                    year, the amount determined under this
                                    clause for the preceding year, adjusted
                                    by the percentage change in the
                                    consumer price index for all urban
                                    consumers (all items; United States
                                    city average) for the 12-month period
                                    ending with June of the previous year.
                                ``(ii) Institutional providers.--Except as
                            provided in clause (iii), the Secretary shall
                            impose a fee on each institutional provider of
                            medical or other items or services or supplier
                            (such as a hospital or skilled nursing
                            facility) with respect to which screening is
                            conducted under this paragraph in an amount
                            equal to--
                                        ``(I) for 2010, $500; and
                                        ``(II) for 2011 and each subsequent
                                    year, the amount determined under this
                                    clause for the preceding year, adjusted
                                    by the percentage change in the
                                    consumer price index for all urban
                                    consumers (all items; United States
                                    city average) for the 12-month period
                                    ending with June of the previous year.
                                ``(iii) Hardship exception; waiver for
                            certain medicaid providers.--The Secretary may,
                            on a case-by-case basis, exempt a provider of
                            medical or other items or services or supplier
                            from the imposition of an application fee under
                            this subparagraph if the Secretary determines
                            that the imposition of the application fee
                            would result in a hardship. The Secretary may
                            waive the application fee under this
                            subparagraph for providers enrolled in a State
                            Medicaid program for whom the State
                            demonstrates that imposition of the fee would
                            impede beneficiary access to care.
                                ``(iv) Use of funds.--Amounts collected as
                            a result of the imposition of a fee under this
                            subparagraph shall be used by the Secretary for
                            program integrity efforts, including to cover
                            the costs of conducting screening under this
                            paragraph and to carry out this subsection and
                            section 1128J.
                        ``(D) Application and enforcement.--
                                ``(i) New providers of services and
                            suppliers.--The screening under this paragraph
                            shall apply, in the case of a provider of
                            medical or other items or services or supplier
                            who is not enrolled in the program under this
                            title, title XIX , or title XXI as of the date
                            of enactment of this paragraph, on or after the
                            date that is 1 year after such date of
                            enactment.
                                ``(ii) Current providers of services and
                            suppliers.--The screening under this paragraph
                            shall apply, in the case of a provider of
                            medical or other items or services or supplier
                            who is enrolled in the program under this
                            title, title XIX, or title XXI as of such date
                            of enactment, on or after the date that is 2
                            years after such date of enactment.
                                ``(iii) Revalidation of enrollment.--
                            Effective beginning on the date that is 180
                            days after such date of enactment, the
                            screening under this paragraph shall apply with
                            respect to the revalidation of enrollment of a
                            provider of medical or other items or services
                            or supplier in the program under this title,
                            title XIX, or title XXI.
                                ``(iv) Limitation on enrollment and
                            revalidation of enrollment.--In no case may a
                            provider of medical or other items or services
                            or supplier who has not been screened under
                            this paragraph be initially enrolled or
                            reenrolled in the program under this title,
                            title XIX, or title XXI on or after the date
                            that is 3 years after such date of enactment.
                        ``(E) Expedited rulemaking.--The Secretary may
                    promulgate an interim final rule to carry out this
                    paragraph.
                ``(3) Provisional period of enhanced oversight for new
            providers of services and suppliers.--
                        ``(A) In general.--The Secretary shall establish
                    procedures to provide for a provisional period of not
                    less than 30 days and not more than 1 year during which
                    new providers of medical or other items or services and
                    suppliers, as the Secretary determines appropriate,
                    including categories of providers or suppliers, would
                    be subject to enhanced oversight, such as prepayment
                    review and payment caps, under the program under this
                    title, the Medicaid program under title XIX. and the
                    CHIP program under title XXI.
                        ``(B) Implementation.--The Secretary may establish
                    by program instruction or otherwise the procedures
                    under this paragraph.
                ``(4) Increased disclosure requirements.--
                        ``(A) Disclosure.--A provider of medical or other
                    items or services or supplier who submits an
                    application for enrollment or revalidation of
                    enrollment in the program under this title, title XIX,
                    or title XXI on or after the date that is 1 year after
                    the date of enactment of this paragraph shall disclose
                    (in a form and manner and at such time as determined by
                    the Secretary) any current or previous affiliation
                    (directly or indirectly) with a provider of medical or
                    other items or services or supplier that has
                    uncollected debt, has been or is subject to a payment
                    suspension under a Federal health care program (as
                    defined in section 1128B(f)), has been excluded from
                    participation under the program under this title, the
                    Medicaid program under title XIX, or the CHIP program
                    under title XXI, or has had its billing privileges
                    denied or revoked.
                        ``(B) Authority to deny enrollment.--If the
                    Secretary determines that such previous affiliation
                    poses an undue risk of fraud, waste, or abuse, the
                    Secretary may deny such application. Such a denial
                    shall be subject to appeal in accordance with paragraph
                    (7).
                ``(5) Authority to adjust payments of providers of services
            and suppliers with the same tax identification number for past-
            due obligations.--
                        ``(A) In general.--Notwithstanding any other
                    provision of this title, in the case of an applicable
                    provider of services or supplier, the Secretary may
                    make any necessary adjustments to payments to the
                    applicable provider of services or supplier under the
                    program under this title in order to satisfy any past-
                    due obligations described in subparagraph (B)(ii) of an
                    obligated provider of services or supplier.
                        ``(B) Definitions.--In this paragraph:
                                ``(i) In general.--The term `applicable
                            provider of services or supplier' means a
                            provider of services or supplier that has the
                            same taxpayer identification number assigned
                            under section 6109 of the Internal Revenue Code
                            of 1986 as is assigned to the obligated
                            provider of services or supplier under such
                            section, regardless of whether the applicable
                            provider of services or supplier is assigned a
                            different billing number or national provider
                            identification number under the program under
                            this title than is assigned to the obligated
                            provider of services or supplier.
                                ``(ii) Obligated provider of services or
                            supplier.--The term `obligated provider of
                            services or supplier' means a provider of
                            services or supplier that owes a past-due
                            obligation under the program under this title
                            (as determined by the Secretary).
                ``(6) Temporary moratorium on enrollment of new
            providers.--
                        ``(A) In general.--The Secretary may impose a
                    temporary moratorium on the enrollment of new providers
                    of services and suppliers, including categories of
                    providers of services and suppliers, in the program
                    under this title, under the Medicaid program under
                    title XIX, or under the CHIP program under title XXI if
                    the Secretary determines such moratorium is necessary
                    to prevent or combat fraud, waste, or abuse under
                    either such program.
                        ``(B) Limitation on review.--There shall be no
                    judicial review under section 1869, section 1878, or
                    otherwise, of a temporary moratorium imposed under
                    subparagraph (A).
                ``(7) Compliance programs.--
                        ``(A) In general.--On or after the date of
                    implementation determined by the Secretary under
                    subparagraph (C), a provider of medical or other items
                    or services or supplier within a particular industry
                    sector or category shall, as a condition of enrollment
                    in the program under this title, title XIX, or title
                    XXI, establish a compliance program that contains the
                    core elements established under subparagraph (B) with
                    respect to that provider or supplier and industry or
                    category.
                        ``(B) Establishment of core elements.--The
                    Secretary, in consultation with the Inspector General
                    of the Department of Health and Human Services, shall
                    establish core elements for a compliance program under
                    subparagraph (A) for providers or suppliers within a
                    particular industry or category.
                        ``(C) Timeline for implementation.--The Secretary
                    shall determine the timeline for the establishment of
                    the core elements under subparagraph (B) and the date
                    of the implementation of subparagraph (A) for providers
                    or suppliers within a particular industry or category.
                    The Secretary shall, in determining such date of
                    implementation, consider the extent to which the
                    adoption of compliance programs by a provider of
                    medical or other items or services or supplier is
                    widespread in a particular industry sector or with
                    respect to a particular provider or supplier
                    category.''.
        (b) Medicaid.--
                (1) State plan amendment.--Section 1902(a) of the Social
            Security Act (42 U.S.C. 1396a(a)), as amended by section
            4302(b), is amended--
                        (A) in subsection (a)--
                                (i) by striking ``and'' at the end of
                            paragraph (75);
                                (ii) by striking the period at the end of
                            paragraph (76) and inserting a semicolon; and
                                (iii) by inserting after paragraph (76) the
                            following:
                ``(77) provide that the State shall comply with provider
            and supplier screening, oversight, and reporting requirements
            in accordance with subsection (ii);''; and
                        (B) by adding at the end the following:
        ``(ii) Provider and Supplier Screening, Oversight, and Reporting
    Requirements.--For purposes of subsection (a)(77), the requirements of
    this subsection are the following:
                ``(1) Screening.--The State complies with the process for
            screening providers and suppliers under this title, as
            established by the Secretary under section 1886(j)(2).
                ``(2) Provisional period of enhanced oversight for new
            providers and suppliers.--The State complies with procedures to
            provide for a provisional period of enhanced oversight for new
            providers and suppliers under this title, as established by the
            Secretary under section 1886(j)(3).
                ``(3) Disclosure requirements.--The State requires
            providers and suppliers under the State plan or under a waiver
            of the plan to comply with the disclosure requirements
            established by the Secretary under section 1886(j)(4).
                ``(4) Temporary moratorium on enrollment of new providers
            or suppliers.--
                        ``(A) Temporary moratorium imposed by the
                    secretary.--
                                ``(i) In general.--Subject to clause (ii),
                            the State complies with any temporary
                            moratorium on the enrollment of new providers
                            or suppliers imposed by the Secretary under
                            section 1886(j)(6).
                                ``(ii) Exception.--A State shall not be
                            required to comply with a temporary moratorium
                            described in clause (i) if the State determines
                            that the imposition of such temporary
                            moratorium would adversely impact
                            beneficiaries' access to medical assistance.
                        ``(B) Moratorium on enrollment of providers and
                    suppliers.--At the option of the State, the State
                    imposes, for purposes of entering into participation
                    agreements with providers or suppliers under the State
                    plan or under a waiver of the plan, periods of
                    enrollment moratoria, or numerical caps or other
                    limits, for providers or suppliers identified by the
                    Secretary as being at high-risk for fraud, waste, or
                    abuse as necessary to combat fraud, waste, or abuse,
                    but only if the State determines that the imposition of
                    any such period, cap, or other limits would not
                    adversely impact beneficiaries' access to medical
                    assistance.
                ``(5) Compliance programs.--The State requires providers
            and suppliers under the State plan or under a waiver of the
            plan to establish, in accordance with the requirements of
            section 1866(j)(7), a compliance program that contains the core
            elements established under subparagraph (B) of that section
            1866(j)(7) for providers or suppliers within a particular
            industry or category.
                ``(6) Reporting of adverse provider actions.--The State
            complies with the national system for reporting criminal and
            civil convictions, sanctions, negative licensure actions, and
            other adverse provider actions to the Secretary, through the
            Administrator of the Centers for Medicare & Medicaid Services,
            in accordance with regulations of the Secretary.
                ``(7) Enrollment and npi of ordering or referring
            providers.--The State requires--
                        ``(A) all ordering or referring physicians or other
                    professionals to be enrolled under the State plan or
                    under a waiver of the plan as a participating provider;
                    and
                        ``(B) the national provider identifier of any
                    ordering or referring physician or other professional
                    to be specified on any claim for payment that is based
                    on an order or referral of the physician or other
                    professional.
                ``(8) Other state oversight.--Nothing in this subsection
            shall be interpreted to preclude or limit the ability of a
            State to engage in provider and supplier screening or enhanced
            provider and supplier oversight activities beyond those
            required by the Secretary.''.
                (2) Disclosure of medicare terminated providers and
            suppliers to states.--The Administrator of the Centers for
            Medicare & Medicaid Services shall establish a process for
            making available to the each State agency with responsibility
            for administering a State Medicaid plan (or a waiver of such
            plan) under title XIX of the Social Security Act or a child
            health plan under title XXI the name, national provider
            identifier, and other identifying information for any provider
            of medical or other items or services or supplier under the
            Medicare program under title XVIII or under the CHIP program
            under title XXI that is terminated from participation under
            that program within 30 days of the termination (and, with
            respect to all such providers or suppliers who are terminated
            from the Medicare program on the date of enactment of this Act,
            within 90 days of such date).
                (3) Conforming amendment.--Section 1902(a)(23) of the
            Social Security Act (42 U.S.C. 1396a), is amended by inserting
            before the semicolon at the end the following: ``or by a
            provider or supplier to which a moratorium under subsection
            (ii)(4) is applied during the period of such moratorium''.
        (c) CHIP.--Section 2107(e)(1) of the Social Security Act (42 U.S.C.
    1397gg(e)(1)), as amended by section 2101(d), is amended--
                (1) by redesignating subparagraphs (D) through (M) as
            subparagraphs (E) through (N), respectively; and
                (2) by inserting after subparagraph (C), the following:
                        ``(D) Subsections (a)(77) and (ii) of section 1902
                    (relating to provider and supplier screening,
                    oversight, and reporting requirements).''.

    SEC. 6402. ENHANCED MEDICARE AND MEDICAID PROGRAM INTEGRITY PROVISIONS.

        (a) In General.--Part A of title XI of the Social Security Act (42
    U.S.C. 1301 et seq.), as amended by sections 6002, 6004, and 6102, is
    amended by inserting after section 1128I the following new section:

    ``SEC. 1128J. MEDICARE AND MEDICAID PROGRAM INTEGRITY PROVISIONS.

        ``(a) Data Matching.--
                ``(1) Integrated data repository.--
                        ``(A) Inclusion of certain data.--
                                ``(i) In general.--The Integrated Data
                            Repository of the Centers for Medicare &
                            Medicaid Services shall include, at a minimum,
                            claims and payment data from the following:
                                        ``(I) The programs under titles
                                    XVIII and XIX (including parts A, B, C,
                                    and D of title XVIII).
                                        ``(II) The program under title XXI.
                                        ``(III) Health-related programs
                                    administered by the Secretary of
                                    Veterans Affairs.
                                        ``(IV) Health-related programs
                                    administered by the Secretary of
                                    Defense.
                                        ``(V) The program of old-age,
                                    survivors, and disability insurance
                                    benefits established under title II.
                                        ``(VI) The Indian Health Service
                                    and the Contract Health Service
                                    program.
                                ``(ii) Priority for inclusion of certain
                            data.--Inclusion of the data described in
                            subclause (I) of such clause in the Integrated
                            Data Repository shall be a priority. Data
                            described in subclauses (II) through (VI) of
                            such clause shall be included in the Integrated
                            Data Repository as appropriate.
                        ``(B) Data sharing and matching.--
                                ``(i) In general.--The Secretary shall
                            enter into agreements with the individuals
                            described in clause (ii) under which such
                            individuals share and match data in the system
                            of records of the respective agencies of such
                            individuals with data in the system of records
                            of the Department of Health and Human Services
                            for the purpose of identifying potential fraud,
                            waste, and abuse under the programs under
                            titles XVIII and XIX.
                                ``(ii) Individuals described.--The
                            following individuals are described in this
                            clause:
                                        ``(I) The Commissioner of Social
                                    Security.
                                        ``(II) The Secretary of Veterans
                                    Affairs.
                                        ``(III) The Secretary of Defense.
                                        ``(IV) The Director of the Indian
                                    Health Service.
                                ``(iii) Definition of system of records.--
                            For purposes of this paragraph, the term
                            `system of records' has the meaning given such
                            term in section 552a(a)(5) of title 5, United
                            States Code.
                ``(2) Access to claims and payment databases.--For purposes
            of conducting law enforcement and oversight activities and to
            the extent consistent with applicable information, privacy,
            security, and disclosure laws, including the regulations
            promulgated under the Health Insurance Portability and
            Accountability Act of 1996 and section 552a of title 5, United
            States Code, and subject to any information systems security
            requirements under such laws or otherwise required by the
            Secretary, the Inspector General of the Department of Health
            and Human Services and the Attorney General shall have access
            to claims and payment data of the Department of Health and
            Human Services and its contractors related to titles XVIII,
            XIX, and XXI.
        ``(b) OIG Authority To Obtain Information.--
                ``(1) In general.--Notwithstanding and in addition to any
            other provision of law, the Inspector General of the Department
            of Health and Human Services may, for purposes of protecting
            the integrity of the programs under titles XVIII and XIX,
            obtain information from any individual (including a beneficiary
            provided all applicable privacy protections are followed) or
            entity that--
                        ``(A) is a provider of medical or other items or
                    services, supplier, grant recipient, contractor, or
                    subcontractor; or
                        ``(B) directly or indirectly provides, orders,
                    manufactures, distributes, arranges for, prescribes,
                    supplies, or receives medical or other items or
                    services payable by any Federal health care program (as
                    defined in section 1128B(f)) regardless of how the item
                    or service is paid for, or to whom such payment is
                    made.
                ``(2) Inclusion of certain information.--Information which
            the Inspector General may obtain under paragraph (1) includes
            any supporting documentation necessary to validate claims for
            payment or payments under title XVIII or XIX, including a
            prescribing physician's medical records for an individual who
            is prescribed an item or service which is covered under part B
            of title XVIII, a covered part D drug (as defined in section
            1860D-2(e)) for which payment is made under an MA-PD plan under
            part C of such title, or a prescription drug plan under part D
            of such title, and any records necessary for evaluation of the
            economy, efficiency, and effectiveness of the programs under
            titles XVIII and XIX.
        ``(c) Administrative Remedy for Knowing Participation by
    Beneficiary in Health Care Fraud Scheme.--
                ``(1) In general.--In addition to any other applicable
            remedies, if an applicable individual has knowingly
            participated in a Federal health care fraud offense or a
            conspiracy to commit a Federal health care fraud offense, the
            Secretary shall impose an appropriate administrative penalty
            commensurate with the offense or conspiracy.
                ``(2) Applicable individual.--For purposes of paragraph
            (1), the term `applicable individual' means an individual--
                        ``(A) entitled to, or enrolled for, benefits under
                    part A of title XVIII or enrolled under part B of such
                    title;
                        ``(B) eligible for medical assistance under a State
                    plan under title XIX or under a waiver of such plan; or
                        ``(C) eligible for child health assistance under a
                    child health plan under title XXI.
        ``(d) Reporting and Returning of Overpayments.--
                ``(1) In general.--If a person has received an overpayment,
            the person shall--
                        ``(A) report and return the overpayment to the
                    Secretary, the State, an intermediary, a carrier, or a
                    contractor, as appropriate, at the correct address; and
                        ``(B) notify the Secretary, State, intermediary,
                    carrier, or contractor to whom the overpayment was
                    returned in writing of the reason for the overpayment.
                ``(2) Deadline for reporting and returning overpayments.--
            An overpayment must be reported and returned under paragraph
            (1) by the later of--
                        ``(A) the date which is 60 days after the date on
                    which the overpayment was identified; or
                        ``(B) the date any corresponding cost report is
                    due, if applicable.
                ``(3) Enforcement.--Any overpayment retained by a person
            after the deadline for reporting and returning the overpayment
            under paragraph (2) is an obligation (as defined in section
            3729(b)(3) of title 31, United States Code) for purposes of
            section 3729 of such title.
                ``(4) Definitions.--In this subsection:
                        ``(A) Knowing and knowingly.--The terms `knowing'
                    and `knowingly' have the meaning given those terms in
                    section 3729(b) of title 31, United States Code.
                        ``(B) Overpayment.--The term ``overpayment'' means
                    any funds that a person receives or retains under title
                    XVIII or XIX to which the person, after applicable
                    reconciliation, is not entitled under such title.
                        ``(C) Person.--
                                ``(i) In general.--The term `person' means
                            a provider of services, supplier, medicaid
                            managed care organization (as defined in
                            section 1903(m)(1)(A)), Medicare Advantage
                            organization (as defined in section
                            1859(a)(1)), or PDP sponsor (as defined in
                            section 1860D-41(a)(13)).
                                ``(ii) Exclusion.--Such term does not
                            include a beneficiary.
        ``(e) Inclusion of National Provider Identifier on All Applications
    and Claims.--The Secretary shall promulgate a regulation that requires,
    not later than January 1, 2011, all providers of medical or other items
    or services and suppliers under the programs under titles XVIII and XIX
    that qualify for a national provider identifier to include their
    national provider identifier on all applications to enroll in such
    programs and on all claims for payment submitted under such
    programs.''.
        (b) Access to Data.--
                (1) Medicare part d.--Section 1860D-15(f)(2) of the Social
            Security Act (42 U.S.C. 1395w-116(f)(2)) is amended by striking
            ``may be used by'' and all that follows through the period at
            the end and inserting ``may be used--
                        ``(A) by officers, employees, and contractors of
                    the Department of Health and Human Services for the
                    purposes of, and to the extent necessary in--
                                ``(i) carrying out this section; and
                                ``(ii) conducting oversight, evaluation,
                            and enforcement under this title; and
                        ``(B) by the Attorney General and the Comptroller
                    General of the United States for the purposes of, and
                    to the extent necessary in, carrying out health
                    oversight activities.''.
                (2) Data matching.--Section 552a(a)(8)(B) of title 5,
            United States Code, is amended--
                        (A) in clause (vii), by striking ``or'' at the end;
                        (B) in clause (viii), by inserting ``or'' after the
                    semicolon; and
                        (C) by adding at the end the following new clause:
                                ``(ix) matches performed by the Secretary
                            of Health and Human Services or the Inspector
                            General of the Department of Health and Human
                            Services with respect to potential fraud,
                            waste, and abuse, including matches of a system
                            of records with non-Federal records;''.
                (3) Matching agreements with the commissioner of social
            security.--Section 205(r) of the Social Security Act (42 U.S.C.
            405(r)) is amended by adding at the end the following new
            paragraph:
                ``(9)(A) The Commissioner of Social Security shall, upon
            the request of the Secretary or the Inspector General of the
            Department of Health and Human Services--
                        ``(i) enter into an agreement with the Secretary or
                    such Inspector General for the purpose of matching data
                    in the system of records of the Social Security
                    Administration and the system of records of the
                    Department of Health and Human Services; and
                        ``(ii) include in such agreement safeguards to
                    assure the maintenance of the confidentiality of any
                    information disclosed.
                ``(B) For purposes of this paragraph, the term `system of
            records' has the meaning given such term in section 552a(a)(5)
            of title 5, United States Code.''.
        (c) Withholding of Federal Matching Payments for States That Fail
    To Report Enrollee Encounter Data in the Medicaid Statistical
    Information System.--Section 1903(i) of the Social Security Act (42
    U.S.C. 1396b(i)) is amended--
                (1) in paragraph (23), by striking ``or'' at the end;
                (2) in paragraph (24), by striking the period at the end
            and inserting ``; or''; and
                (3) by adding at the end the following new paragraph:.
                ``(25) with respect to any amounts expended for medical
            assistance for individuals for whom the State does not report
            enrollee encounter data (as defined by the Secretary) to the
            Medicaid Statistical Information System (MSIS) in a timely
            manner (as determined by the Secretary).''.
        (d) Permissive Exclusions and Civil Monetary Penalties.--
                (1) Permissive exclusions.--Section 1128(b) of the Social
            Security Act (42 U.S.C. 1320a-7(b)) is amended by adding at the
            end the following new paragraph:
                ``(16) Making false statements or misrepresentation of
            material facts.--Any individual or entity that knowingly makes
            or causes to be made any false statement, omission, or
            misrepresentation of a material fact in any application,
            agreement, bid, or contract to participate or enroll as a
            provider of services or supplier under a Federal health care
            program (as defined in section 1128B(f)), including Medicare
            Advantage organizations under part C of title XVIII,
            prescription drug plan sponsors under part D of title XVIII,
            medicaid managed care organizations under title XIX, and
            entities that apply to participate as providers of services or
            suppliers in such managed care organizations and such plans.''.
                (2) Civil monetary penalties.--
                        (A) In general.--Section 1128A(a) of the Social
                    Security Act (42 U.S.C. 1320a-7a(a)) is amended--
                                (i) in paragraph (1)(D), by striking ``was
                            excluded'' and all that follows through the
                            period at the end and inserting ``was excluded
                            from the Federal health care program (as
                            defined in section 1128B(f)) under which the
                            claim was made pursuant to Federal law.'';
                                (ii) in paragraph (6), by striking ``or''
                            at the end;
                                (iii) by inserting after paragraph (7), the
                            following new paragraphs:
                ``(8) orders or prescribes a medical or other item or
            service during a period in which the person was excluded from a
            Federal health care program (as so defined), in the case where
            the person knows or should know that a claim for such medical
            or other item or service will be made under such a program;
                ``(9) knowingly makes or causes to be made any false
            statement, omission, or misrepresentation of a material fact in
            any application, bid, or contract to participate or enroll as a
            provider of services or a supplier under a Federal health care
            program (as so defined), including Medicare Advantage
            organizations under part C of title XVIII, prescription drug
            plan sponsors under part D of title XVIII, medicaid managed
            care organizations under title XIX, and entities that apply to
            participate as providers of services or suppliers in such
            managed care organizations and such plans;
                ``(10) knows of an overpayment (as defined in paragraph (4)
            of section 1128J(d)) and does not report and return the
            overpayment in accordance with such section;'';
                                (iv) in the first sentence--
                                        (I) by striking the ``or'' after
                                    ``prohibited relationship occurs;'';
                                    and
                                        (II) by striking ``act)'' and
                                    inserting ``act; or in cases under
                                    paragraph (9), $50,000 for each false
                                    statement or misrepresentation of a
                                    material fact)''; and
                                (v) in the second sentence, by striking
                            ``purpose)'' and inserting ``purpose; or in
                            cases under paragraph (9), an assessment of not
                            more than 3 times the total amount claimed for
                            each item or service for which payment was made
                            based upon the application containing the false
                            statement or misrepresentation of a material
                            fact)''.
                        (B) Clarification of treatment of certain
                    charitable and other innocuous programs.--Section
                    1128A(i)(6) of the Social Security Act (42 U.S.C.
                    1320a-7a(i)(6)) is amended--
                                (i) in subparagraph (C), by striking ``or''
                            at the end;
                                (ii) in subparagraph (D), as redesignated
                            by section 4331(e) of the Balanced Budget Act
                            of 1997 (Public Law 105-33), by striking the
                            period at the end and inserting a semicolon;
                                (iii) by redesignating subparagraph (D), as
                            added by section 4523(c) of such Act, as
                            subparagraph (E) and striking the period at the
                            end and inserting ``; or''; and
                                (iv) by adding at the end the following new
                            subparagraphs:
                        ``(F) any other remuneration which promotes access
                    to care and poses a low risk of harm to patients and
                    Federal health care programs (as defined in section
                    1128B(f) and designated by the Secretary under
                    regulations);
                        ``(G) the offer or transfer of items or services
                    for free or less than fair market value by a person,
                    if--
                                ``(i) the items or services consist of
                            coupons, rebates, or other rewards from a
                            retailer;
                                ``(ii) the items or services are offered or
                            transferred on equal terms available to the
                            general public, regardless of health insurance
                            status; and
                                ``(iii) the offer or transfer of the items
                            or services is not tied to the provision of
                            other items or services reimbursed in whole or
                            in part by the program under title XVIII or a
                            State health care program (as defined in
                            section 1128(h));
                        ``(H) the offer or transfer of items or services
                    for free or less than fair market value by a person,
                    if--
                                ``(i) the items or services are not offered
                            as part of any advertisement or solicitation;
                                ``(ii) the items or services are not tied
                            to the provision of other services reimbursed
                            in whole or in part by the program under title
                            XVIII or a State health care program (as so
                            defined);
                                ``(iii) there is a reasonable connection
                            between the items or services and the medical
                            care of the individual; and
                                ``(iv) the person provides the items or
                            services after determining in good faith that
                            the individual is in financial need; or
                        ``(I) effective on a date specified by the
                    Secretary (but not earlier than January 1, 2011), the
                    waiver by a PDP sponsor of a prescription drug plan
                    under part D of title XVIII or an MA organization
                    offering an MA-PD plan under part C of such title of
                    any copayment for the first fill of a covered part D
                    drug (as defined in section 1860D-2(e)) that is a
                    generic drug for individuals enrolled in the
                    prescription drug plan or MA-PD plan, respectively.''.
        (e) Testimonial Subpoena Authority in Exclusion-only Cases.--
    Section 1128(f) of the Social Security Act (42 U.S.C. 1320a-7(f)) is
    amended by adding at the end the following new paragraph:
                ``(4) The provisions of subsections (d) and (e) of section
            205 shall apply with respect to this section to the same extent
            as they are applicable with respect to title II. The Secretary
            may delegate the authority granted by section 205(d) (as made
            applicable to this section) to the Inspector General of the
            Department of Health and Human Services for purposes of any
            investigation under this section.''.
        (f) Health Care Fraud.--
                (1) Kickbacks.--Section 1128B of the Social Security Act
            (42 U.S.C. 1320a-7b) is amended by adding at the end the
            following new subsection:
        ``(g) In addition to the penalties provided for in this section or
    section 1128A, a claim that includes items or services resulting from a
    violation of this section constitutes a false or fraudulent claim for
    purposes of subchapter III of chapter 37 of title 31, United States
    Code.''.
                (2) Revising the intent requirement.--Section 1128B of the
            Social Security Act (42 U.S.C. 1320a-7b), as amended by
            paragraph (1), is amended by adding at the end the following
            new subsection:
        ``(h) With respect to violations of this section, a person need not
    have actual knowledge of this section or specific intent to commit a
    violation of this section.''.
        (g) Surety Bond Requirements.--
                (1) Durable medical equipment.--Section 1834(a)(16)(B) of
            the Social Security Act (42 U.S.C. 1395m(a)(16)(B)) is amended
            by inserting ``that the Secretary determines is commensurate
            with the volume of the billing of the supplier'' before the
            period at the end.
                (2) Home health agencies.--Section 1861(o)(7)(C) of the
            Social Security Act (42 U.S.C. 1395x(o)(7)(C)) is amended by
            inserting ``that the Secretary determines is commensurate with
            the volume of the billing of the home health agency'' before
            the semicolon at the end.
                (3) Requirements for certain other providers of services
            and suppliers.--Section 1862 of the Social Security Act (42
            U.S.C. 1395y) is amended by adding at the end the following new
            subsection:
        ``(n) Requirement of a Surety Bond for Certain Providers of
    Services and Suppliers.--
                ``(1) In general.--The Secretary may require a provider of
            services or supplier described in paragraph (2) to provide the
            Secretary on a continuing basis with a surety bond in a form
            specified by the Secretary in an amount (not less than $50,000)
            that the Secretary determines is commensurate with the volume
            of the billing of the provider of services or supplier. The
            Secretary may waive the requirement of a bond under the
            preceding sentence in the case of a provider of services or
            supplier that provides a comparable surety bond under State
            law.
                ``(2) Provider of services or supplier described.--A
            provider of services or supplier described in this paragraph is
            a provider of services or supplier the Secretary determines
            appropriate based on the level of risk involved with respect to
            the provider of services or supplier, and consistent with the
            surety bond requirements under sections 1834(a)(16)(B) and
            1861(o)(7)(C).''.
        (h) Suspension of Medicare and Medicaid Payments Pending
    Investigation of Credible Allegations of Fraud.--
                (1) Medicare.--Section 1862 of the Social Security Act (42
            U.S.C. 1395y), as amended by subsection (g)(3), is amended by
            adding at the end the following new subsection:
        ``(o) Suspension of Payments Pending Investigation of Credible
    Allegations of Fraud.--
                ``(1) In general.--The Secretary may suspend payments to a
            provider of services or supplier under this title pending an
            investigation of a credible allegation of fraud against the
            provider of services or supplier, unless the Secretary
            determines there is good cause not to suspend such payments.
                ``(2) Consultation.--The Secretary shall consult with the
            Inspector General of the Department of Health and Human
            Services in determining whether there is a credible allegation
            of fraud against a provider of services or supplier.
                ``(3) Promulgation of regulations.--The Secretary shall
            promulgate regulations to carry out this subsection and section
            1903(i)(2)(C).''.
                (2) Medicaid.--Section 1903(i)(2) of such Act (42 U.S.C.
            1396b(i)(2)) is amended--
                        (A) in subparagraph (A), by striking ``or'' at the
                    end; and
                        (B) by inserting after subparagraph (B), the
                    following:
                        ``(C) by any individual or entity to whom the State
                    has failed to suspend payments under the plan during
                    any period when there is pending an investigation of a
                    credible allegation of fraud against the individual or
                    entity, as determined by the State in accordance with
                    regulations promulgated by the Secretary for purposes
                    of section 1862(o) and this subparagraph, unless the
                    State determines in accordance with such regulations
                    there is good cause not to suspend such payments; or''.
        (i) Increased Funding To Fight Fraud and Abuse.--
                (1) In general.--Section 1817(k) of the Social Security Act
            (42 U.S.C. 1395i(k)) is amended--
                        (A) by adding at the end the following new
                    paragraph:
                ``(7) Additional funding.--In addition to the funds
            otherwise appropriated to the Account from the Trust Fund under
            paragraphs (3) and (4) and for purposes described in paragraphs
            (3)(C) and (4)(A), there are hereby appropriated an additional
            $10,000,000 to such Account from such Trust Fund for each of
            fiscal years 2011 through 2020. The funds appropriated under
            this paragraph shall be allocated in the same proportion as the
            total funding appropriated with respect to paragraphs (3)(A)
            and (4)(A) was allocated with respect to fiscal year 2010, and
            shall be available without further appropriation until
            expended.''; and
                        (B) in paragraph (4)(A), by inserting ``until
                    expended'' after ``appropriation''.
                (2) Indexing of amounts appropriated.--
                        (A) Departments of health and human services and
                    justice.--Section 1817(k)(3)(A)(i) of the Social
                    Security Act (42 U.S.C. 1395i(k)(3)(A)(i)) is amended--
                                (i) in subclause (III), by inserting
                            ``and'' at the end;
                                (ii) in subclause (IV)--
                                        (I) by striking ``for each of
                                    fiscal years 2007, 2008, 2009, and
                                    2010'' and inserting ``for each fiscal
                                    year after fiscal year 2006''; and
                                        (II) by striking ``; and'' and
                                    inserting a period; and
                                (iii) by striking subclause (V).
                        (B) Office of the inspector general of the
                    department of health and human services.--Section
                    1817(k)(3)(A)(ii) of such Act (42 U.S.C.
                    1395i(k)(3)(A)(ii)) is amended--
                                (i) in subclause (VIII), by inserting
                            ``and'' at the end;
                                (ii) in subclause (IX)--
                                        (I) by striking ``for each of
                                    fiscal years 2008, 2009, and 2010'' and
                                    inserting ``for each fiscal year after
                                    fiscal year 2007''; and
                                        (II) by striking ``; and'' and
                                    inserting a period; and
                                (iii) by striking subclause (X).
                        (C) Federal bureau of investigation.--Section
                    1817(k)(3)(B) of the Social Security Act (42 U.S.C.
                    1395i(k)(3)(B)) is amended--
                                (i) in clause (vii), by inserting ``and''
                            at the end;
                                (ii) in clause (viii)--
                                        (I) by striking ``for each of
                                    fiscal years 2007, 2008, 2009, and
                                    2010'' and inserting ``for each fiscal
                                    year after fiscal year 2006''; and
                                        (II) by striking ``; and'' and
                                    inserting a period; and
                                (iii) by striking clause (ix).
                        (D) Medicare integrity program.--Section
                    1817(k)(4)(C) of the Social Security Act (42 U.S.C.
                    1395i(k)(4)(C)) is amended by adding at the end the
                    following new clause:
                                ``(ii) For each fiscal year after 2010, by
                            the percentage increase in the consumer price
                            index for all urban consumers (all items;
                            United States city average) over the previous
                            year.''.
        (j) Medicare Integrity Program and Medicaid Integrity Program.--
                (1) Medicare integrity program.--
                        (A) Requirement to provide performance
                    statistics.--Section 1893(c) of the Social Security Act
                    (42 U.S.C. 1395ddd(c)) is amended--
                                (i) in paragraph (3), by striking ``and''
                            at the end;
                                (ii) by redesignating paragraph (4) as
                            paragraph (5); and
                                (iii) by inserting after paragraph (3) the
                            following new paragraph:
                ``(4) the entity agrees to provide the Secretary and the
            Inspector General of the Department of Health and Human
            Services with such performance statistics (including the number
            and amount of overpayments recovered, the number of fraud
            referrals, and the return on investment of such activities by
            the entity) as the Secretary or the Inspector General may
            request; and''.
                        (B) Evaluations and annual report.--Section 1893 of
                    the Social Security Act (42 U.S.C. 1395ddd) is amended
                    by adding at the end the following new subsection:
        ``(i) Evaluations and Annual Report.--
                ``(1) Evaluations.--The Secretary shall conduct evaluations
            of eligible entities which the Secretary contracts with under
            the Program not less frequently than every 3 years.
                ``(2) Annual report.--Not later than 180 days after the end
            of each fiscal year (beginning with fiscal year 2011), the
            Secretary shall submit a report to Congress which identifies--
                        ``(A) the use of funds, including funds transferred
                    from the Federal Hospital Insurance Trust Fund under
                    section 1817 and the Federal Supplementary Insurance
                    Trust Fund under section 1841, to carry out this
                    section; and
                        ``(B) the effectiveness of the use of such
                    funds.''.
                        (C) Flexibility in pursuing fraud and abuse.--
                    Section 1893(a) of the Social Security Act (42 U.S.C.
                    1395ddd(a)) is amended by inserting ``, or otherwise,''
                    after ``entities''.
                (2) Medicaid integrity program.--
                        (A) Requirement to provide performance
                    statistics.--Section 1936(c)(2) of the Social Security
                    Act (42 U.S.C. 1396u-6(c)(2)) is amended--
                                (i) by redesignating subparagraph (D) as
                            subparagraph (E); and
                                (ii) by inserting after subparagraph (C)
                            the following new subparagraph:
                        ``(D) The entity agrees to provide the Secretary
                    and the Inspector General of the Department of Health
                    and Human Services with such performance statistics
                    (including the number and amount of overpayments
                    recovered, the number of fraud referrals, and the
                    return on investment of such activities by the entity)
                    as the Secretary or the Inspector General may
                    request.''.
                        (B) Evaluations and annual report.--Section 1936(e)
                    of the Social Security Act (42 U.S.C. 1396u-7(e)) is
                    amended--
                                (i) by redesignating paragraph (4) as
                            paragraph (5); and
                                (ii) by inserting after paragraph (3) the
                            following new paragraph:
                ``(4) Evaluations.--The Secretary shall conduct evaluations
            of eligible entities which the Secretary contracts with under
            the Program not less frequently than every 3 years.''.
        (k) Expanded Application of Hardship Waivers for Exclusions.--
    Section 1128(c)(3)(B) of the Social Security Act (42 U.S.C. 1320a-
    7(c)(3)(B)) is amended by striking ``individuals entitled to benefits
    under part A of title XVIII or enrolled under part B of such title, or
    both'' and inserting ``beneficiaries (as defined in section
    1128A(i)(5)) of that program''.

    SEC. 6403. ELIMINATION OF DUPLICATION BETWEEN THE HEALTHCARE INTEGRITY
                  AND PROTECTION DATA BANK AND THE NATIONAL PRACTITIONER
                  DATA BANK.

        (a) Information Reported by Federal Agencies and Health Plans.--
    Section 1128E of the Social Security Act (42 U.S.C. 1320a-7e) is
    amended--
                (1) by striking subsection (a) and inserting the following:
        ``(a) In General.--The Secretary shall maintain a national health
    care fraud and abuse data collection program under this section for the
    reporting of certain final adverse actions (not including settlements
    in which no findings of liability have been made) against health care
    providers, suppliers, or practitioners as required by subsection (b),
    with access as set forth in subsection (d), and shall furnish the
    information collected under this section to the National Practitioner
    Data Bank established pursuant to the Health Care Quality Improvement
    Act of 1986 (42 U.S.C. 11101 et seq.).'';
                (2) by striking subsection (d) and inserting the following:
        ``(d) Access to Reported Information.--
                ``(1) Availability.--The information collected under this
            section shall be available from the National Practitioner Data
            Bank to the agencies, authorities, and officials which are
            provided under section 1921(b) information reported under
            section 1921(a).
                ``(2) Fees for disclosure.--The Secretary may establish or
            approve reasonable fees for the disclosure of information under
            this section. The amount of such a fee may not exceed the costs
            of processing the requests for disclosure and of providing such
            information. Such fees shall be available to the Secretary to
            cover such costs.'';
                (3) by striking subsection (f) and inserting the following:
        ``(f) Appropriate Coordination.--In implementing this section, the
    Secretary shall provide for the maximum appropriate coordination with
    part B of the Health Care Quality Improvement Act of 1986 (42 U.S.C.
    11131 et seq.) and section 1921.''; and
                (4) in subsection (g)--
                        (A) in paragraph (1)(A)--
                                (i) in clause (iii)--
                                        (I) by striking ``or State'' each
                                    place it appears;
                                        (II) by redesignating subclauses
                                    (II) and (III) as subclauses (III) and
                                    (IV), respectively; and
                                        (III) by inserting after subclause
                                    (I) the following new subclause:
                                        ``(II) any dismissal or closure of
                                    the proceedings by reason of the
                                    provider, supplier, or practitioner
                                    surrendering their license or leaving
                                    the State or jurisdiction''; and
                                (ii) by striking clause (iv) and inserting
                            the following:
                                ``(iv) Exclusion from participation in a
                            Federal health care program (as defined in
                            section 1128B(f)).'';
                        (B) in paragraph (3)--
                                (i) by striking subparagraphs (D) and (E);
                            and
                                (ii) by redesignating subparagraph (F) as
                            subparagraph (D); and
                        (C) in subparagraph (D) (as so redesignated), by
                    striking ``or State''.
        (b) Information Reported by State Law or Fraud Enforcement
    Agencies.--Section 1921 of the Social Security Act (42 U.S.C. 1396r-2)
    is amended--
                (1) in subsection (a)--
                        (A) in paragraph (1)--
                                (i) by striking ``system.--The State'' and
                            all that follows through the semicolon and
                            inserting system.--
                        ``(A) Licensing or certification actions.--The
                    State must have in effect a system of reporting the
                    following information with respect to formal
                    proceedings (as defined by the Secretary in
                    regulations) concluded against a health care
                    practitioner or entity by a State licensing or
                    certification agency:'';
                                (ii) by redesignating subparagraphs (A)
                            through (D) as clauses (i) through (iv),
                            respectively, and indenting appropriately;
                                (iii) in subparagraph (A)(iii) (as so
                            redesignated)--
                                        (I) by striking ``the license of''
                                    and inserting ``license or the right to
                                    apply for, or renew, a license by'';
                                    and
                                        (II) by inserting
                                    ``nonrenewability,'' after ``voluntary
                                    surrender,''; and
                                (iv) by adding at the end the following new
                            subparagraph:
                        ``(B) Other final adverse actions.--The State must
                    have in effect a system of reporting information with
                    respect to any final adverse action (not including
                    settlements in which no findings of liability have been
                    made) taken against a health care provider, supplier,
                    or practitioner by a State law or fraud enforcement
                    agency.''; and
                        (B) in paragraph (2), by striking ``the authority
                    described in paragraph (1)'' and inserting ``a State
                    licensing or certification agency or State law or fraud
                    enforcement agency'';
                (2) in subsection (b)--
                        (A) by striking paragraph (2) and inserting the
                    following:
                ``(2) to State licensing or certification agencies and
            Federal agencies responsible for the licensing and
            certification of health care providers, suppliers, and licensed
            health care practitioners;'';
                        (B) in each of paragraphs (4) and (6), by inserting
                    ``, but only with respect to information provided
                    pursuant to subsection (a)(1)(A)'' before the comma at
                    the end;
                        (C) by striking paragraph (5) and inserting the
                    following:
                ``(5) to State law or fraud enforcement agencies,'';
                        (D) by redesignating paragraphs (7) and (8) as
                    paragraphs (8) and (9), respectively; and
                        (E) by inserting after paragraph (6) the following
                    new paragraph:
                ``(7) to health plans (as defined in section 1128C(c));'';
                (3) by redesignating subsection (d) as subsection (h), and
            by inserting after subsection (c) the following new
            subsections:
        ``(d) Disclosure and Correction of Information.--
                ``(1) Disclosure.--With respect to information reported
            pursuant to subsection (a)(1), the Secretary shall--
                        ``(A) provide for disclosure of the information,
                    upon request, to the health care practitioner who, or
                    the entity that, is the subject of the information
                    reported; and
                        ``(B) establish procedures for the case where the
                    health care practitioner or entity disputes the
                    accuracy of the information reported.
                ``(2) Corrections.--Each State licensing or certification
            agency and State law or fraud enforcement agency shall report
            corrections of information already reported about any formal
            proceeding or final adverse action described in subsection (a),
            in such form and manner as the Secretary prescribes by
            regulation.
        ``(e) Fees for Disclosure.--The Secretary may establish or approve
    reasonable fees for the disclosure of information under this section.
    The amount of such a fee may not exceed the costs of processing the
    requests for disclosure and of providing such information. Such fees
    shall be available to the Secretary to cover such costs.
        ``(f) Protection From Liability for Reporting.--No person or
    entity, including any agency designated by the Secretary in subsection
    (b), shall be held liable in any civil action with respect to any
    reporting of information as required under this section, without
    knowledge of the falsity of the information contained in the report.
        ``(g) References.--For purposes of this section:
                ``(1) State licensing or certification agency.--The term
            `State licensing or certification agency' includes any
            authority of a State (or of a political subdivision thereof)
            responsible for the licensing of health care practitioners (or
            any peer review organization or private accreditation entity
            reviewing the services provided by health care practitioners)
            or entities.
                ``(2) State law or fraud enforcement agency.--The term
            `State law or fraud enforcement agency' includes--
                        ``(A) a State law enforcement agency; and
                        ``(B) a State medicaid fraud control unit (as
                    defined in section 1903(q)).
                ``(3) Final adverse action.--
                        ``(A) In general.--Subject to subparagraph (B), the
                    term `final adverse action' includes--
                                ``(i) civil judgments against a health care
                            provider, supplier, or practitioner in State
                            court related to the delivery of a health care
                            item or service;
                                ``(ii) State criminal convictions related
                            to the delivery of a health care item or
                            service;
                                ``(iii) exclusion from participation in
                            State health care programs (as defined in
                            section 1128(h));
                                ``(iv) any licensing or certification
                            action described in subsection (a)(1)(A) taken
                            against a supplier by a State licensing or
                            certification agency; and
                                ``(v) any other adjudicated actions or
                            decisions that the Secretary shall establish by
                            regulation.
                        ``(B) Exception.--Such term does not include any
                    action with respect to a malpractice claim.''; and
                (4) in subsection (h), as so redesignated, by striking
            ``The Secretary'' and all that follows through the period at
            the end and inserting ``In implementing this section, the
            Secretary shall provide for the maximum appropriate
            coordination with part B of the Health Care Quality Improvement
            Act of 1986 (42 U.S.C. 11131 et seq.) and section 1128E.''.
        (c) Conforming Amendment.--Section 1128C(a)(1) of the Social
    Security Act (42 U.S.C. 1320a-7c(a)(1)) is amended--
                (1) in subparagraph (C), by adding ``and'' after the comma
            at the end;
                (2) in subparagraph (D), by striking ``, and'' and
            inserting a period; and
                (3) by striking subparagraph (E).
        (d) Transition Process; Effective Date.--
                (1) In general.--Effective on the date of enactment of this
            Act, the Secretary of Health and Human Services (in this
            section referred to as the ``Secretary'') shall implement a
            transition process under which, by not later than the end of
            the transition period described in paragraph (5), the Secretary
            shall cease operating the Healthcare Integrity and Protection
            Data Bank established under section 1128E of the Social
            Security Act (as in effect before the effective date specified
            in paragraph (6)) and shall transfer all data collected in the
            Healthcare Integrity and Protection Data Bank to the National
            Practitioner Data Bank established pursuant to the Health Care
            Quality Improvement Act of 1986 (42 U.S.C. 11101 et seq.).
            During such transition process, the Secretary shall have in
            effect appropriate procedures to ensure that data collection
            and access to the Healthcare Integrity and Protection Data Bank
            and the National Practitioner Data Bank are not disrupted.
                (2) Regulations.--The Secretary shall promulgate
            regulations to carry out the amendments made by subsections (a)
            and (b).
                (3) Funding.--
                        (A) Availability of fees.--Fees collected pursuant
                    to section 1128E(d)(2) of the Social Security Act prior
                    to the effective date specified in paragraph (6) for
                    the disclosure of information in the Healthcare
                    Integrity and Protection Data Bank shall be available
                    to the Secretary, without fiscal year limitation, for
                    payment of costs related to the transition process
                    described in paragraph (1). Any such fees remaining
                    after the transition period is complete shall be
                    available to the Secretary, without fiscal year
                    limitation, for payment of the costs of operating the
                    National Practitioner Data Bank.
                        (B) Availability of additional funds.--In addition
                    to the fees described in subparagraph (A), any funds
                    available to the Secretary or to the Inspector General
                    of the Department of Health and Human Services for a
                    purpose related to combating health care fraud, waste,
                    or abuse shall be available to the extent necessary for
                    operating the Healthcare Integrity and Protection Data
                    Bank during the transition period, including systems
                    testing and other activities necessary to ensure that
                    information formerly reported to the Healthcare
                    Integrity and Protection Data Bank will be accessible
                    through the National Practitioner Data Bank after the
                    end of such transition period.
                (4) Special provision for access to the national
            practitioner data bank by the department of veterans affairs.--
                        (A) In general.--Notwithstanding any other
                    provision of law, during the 1-year period that begins
                    on the effective date specified in paragraph (6), the
                    information described in subparagraph (B) shall be
                    available from the National Practitioner Data Bank to
                    the Secretary of Veterans Affairs without charge.
                        (B) Information described.--For purposes of
                    subparagraph (A), the information described in this
                    subparagraph is the information that would, but for the
                    amendments made by this section, have been available to
                    the Secretary of Veterans Affairs from the Healthcare
                    Integrity and Protection Data Bank.
                (5) Transition period defined.--For purposes of this
            subsection, the term ``transition period'' means the period
            that begins on the date of enactment of this Act and ends on
            the later of--
                        (A) the date that is 1 year after such date of
                    enactment; or
                        (B) the effective date of the regulations
                    promulgated under paragraph (2).
                (6) Effective date.--The amendments made by subsections
            (a), (b), and (c) shall take effect on the first day after the
            final day of the transition period.

    SEC. 6404. MAXIMUM PERIOD FOR SUBMISSION OF MEDICARE CLAIMS REDUCED TO
                  NOT MORE THAN 12 MONTHS.

        (a) Reducing Maximum Period for Submission.--
                (1) Part a.--Section 1814(a) of the Social Security Act (42
            U.S.C. 1395f(a)(1)) is amended--
                        (A) in paragraph (1), by striking ``period of 3
                    calendar years'' and all that follows through the
                    semicolon and inserting ``period ending 1 calendar year
                    after the date of service;''; and
                        (B) by adding at the end the following new
                    sentence: ``In applying paragraph (1), the Secretary
                    may specify exceptions to the 1 calendar year period
                    specified in such paragraph.''
                (2) Part b.--
                        (A) Section 1842(b)(3) of such Act (42 U.S.C.
                    1395u(b)(3)(B)) is amended--
                                (i) in subparagraph (B), in the flush
                            language following clause (ii), by striking
                            ``close of the calendar year following the year
                            in which such service is furnished (deeming any
                            service furnished in the last 3 months of any
                            calendar year to have been furnished in the
                            succeeding calendar year)'' and inserting
                            ``period ending 1 calendar year after the date
                            of service''; and
                                (ii) by adding at the end the following new
                            sentence: ``In applying subparagraph (B), the
                            Secretary may specify exceptions to the 1
                            calendar year period specified in such
                            subparagraph.''
                        (B) Section 1835(a) of such Act (42 U.S.C.
                    1395n(a)) is amended--
                                (i) in paragraph (1), by striking ``period
                            of 3 calendar years'' and all that follows
                            through the semicolon and inserting ``period
                            ending 1 calendar year after the date of
                            service;''; and
                                (ii) by adding at the end the following new
                            sentence: ``In applying paragraph (1), the
                            Secretary may specify exceptions to the 1
                            calendar year period specified in such
                            paragraph.''
        (b) Effective Date.--
                (1) In general.--The amendments made by subsection (a)
            shall apply to services furnished on or after January 1, 2010.
                (2) Services furnished before 2010.--In the case of
            services furnished before January 1, 2010, a bill or request
            for payment under section 1814(a)(1), 1842(b)(3)(B), or 1835(a)
            shall be filed not later that December 31, 2010.

    SEC. 6405. PHYSICIANS WHO ORDER ITEMS OR SERVICES REQUIRED TO BE
                  MEDICARE ENROLLED PHYSICIANS OR ELIGIBLE PROFESSIONALS.

        (a) DME.--Section 1834(a)(11)(B) of the Social Security Act (42
    U.S.C. 1395m(a)(11)(B)) is amended by striking ``physician'' and
    inserting ``physician enrolled under section 1866(j) or an eligible
    professional under section 1848(k)(3)(B) that is enrolled under section
    1866(j)''.
        (b) Home Health Services.--
                (1) Part a.--Section 1814(a)(2) of such Act (42 U.S.C.
            1395(a)(2)) is amended in the matter preceding subparagraph (A)
            by inserting ``in the case of services described in
            subparagraph (C), a physician enrolled under section 1866(j) or
            an eligible professional under section 1848(k)(3)(B),'' before
            ``or, in the case of services''.
                (2) Part b.--Section 1835(a)(2) of such Act (42 U.S.C.
            1395n(a)(2)) is amended in the matter preceding subparagraph
            (A) by inserting ``, or in the case of services described in
            subparagraph (A), a physician enrolled under section 1866(j) or
            an eligible professional under section 1848(k)(3)(B),'' after
            ``a physician''.
        (c) Application to Other Items or Services.--The Secretary may
    extend the requirement applied by the amendments made by subsections
    (a) and (b) to durable medical equipment and home health services
    (relating to requiring certifications and written orders to be made by
    enrolled physicians and health professions) to all other categories of
    items or services under title XVIII of the Social Security Act (42
    U.S.C. 1395 et seq.), including covered part D drugs as defined in
    section 1860D-2(e) of such Act (42 U.S.C. 1395w-102), that are ordered,
    prescribed, or referred by a physician enrolled under section 1866(j)
    of such Act (42 U.S.C. 1395cc(j)) or an eligible professional under
    section 1848(k)(3)(B) of such Act (42 U.S.C. 1395w-4(k)(3)(B)).
        (d) Effective Date.--The amendments made by this section shall
    apply to written orders and certifications made on or after July 1,
    2010.

    SEC. 6406. REQUIREMENT FOR PHYSICIANS TO PROVIDE DOCUMENTATION ON
                  REFERRALS TO PROGRAMS AT HIGH RISK OF WASTE AND ABUSE.

        (a) Physicians and Other Suppliers.--Section 1842(h) of the Social
    Security Act (42 U.S.C. 1395u(h)) is amended by adding at the end the
    following new paragraph:
        ``(9) The Secretary may revoke enrollment, for a period of not more
    than one year for each act, for a physician or supplier under section
    1866(j) if such physician or supplier fails to maintain and, upon
    request of the Secretary, provide access to documentation relating to
    written orders or requests for payment for durable medical equipment,
    certifications for home health services, or referrals for other items
    or services written or ordered by such physician or supplier under this
    title, as specified by the Secretary.''.
        (b) Providers of Services.--Section 1866(a)(1) of such Act (42
    U.S.C. 1395cc) is further amended--
                (1) in subparagraph (U), by striking at the end ``and'';
                (2) in subparagraph (V), by striking the period at the end
            and adding ``; and''; and
                (3) by adding at the end the following new subparagraph:
                        ``(W) maintain and, upon request of the Secretary,
                    provide access to documentation relating to written
                    orders or requests for payment for durable medical
                    equipment, certifications for home health services, or
                    referrals for other items or services written or
                    ordered by the provider under this title, as specified
                    by the Secretary.''.
        (c) OIG Permissive Exclusion Authority.--Section 1128(b)(11) of the
    Social Security Act (42 U.S.C. 1320a-7(b)(11)) is amended by inserting
    ``, ordering, referring for furnishing, or certifying the need for''
    after ``furnishing''.
        (d) Effective Date.--The amendments made by this section shall
    apply to orders, certifications, and referrals made on or after January
    1, 2010.

    SEC. 6407. FACE TO FACE ENCOUNTER WITH PATIENT REQUIRED BEFORE
                  PHYSICIANS MAY CERTIFY ELIGIBILITY FOR HOME HEALTH
                  SERVICES OR DURABLE MEDICAL EQUIPMENT UNDER MEDICARE.

        (a) Condition of Payment for Home Health Services.--
                (1) Part a.--Section 1814(a)(2)(C) of such Act is amended--
                        (A) by striking ``and such services'' and inserting
                    ``such services''; and
                        (B) by inserting after ``care of a physician'' the
                    following: ``, and, in the case of a certification made
                    by a physician after January 1, 2010, prior to making
                    such certification the physician must document that the
                    physician himself or herself has had a face-to-face
                    encounter (including through use of telehealth, subject
                    to the requirements in section 1834(m), and other than
                    with respect to encounters that are incident to
                    services involved) with the individual within a
                    reasonable timeframe as determined by the Secretary''.
                (2) Part b.--Section 1835(a)(2)(A) of the Social Security
            Act is amended--
                        (A) by striking ``and'' before ``(iii)''; and
                        (B) by inserting after ``care of a physician'' the
                    following: ``, and (iv) in the case of a certification
                    after January 1, 2010, prior to making such
                    certification the physician must document that the
                    physician has had a face-to-face encounter (including
                    through use of telehealth and other than with respect
                    to encounters that are incident to services involved)
                    with the individual during the 6-month period preceding
                    such certification, or other reasonable timeframe as
                    determined by the Secretary''.
        (b) Condition of Payment for Durable Medical Equipment.--Section
    1834(a)(11)(B) of the Social Security Act (42 U.S.C. 1395m(a)(11)(B))
    is amended--
                (1) by striking ``Order.--The Secretary'' and inserting
            ``Order.--
                                ``(i) In general.--The Secretary''; and
                (2) by adding at the end the following new clause:
                                ``(ii) Requirement for face to face
                            encounter.--The Secretary shall require that
                            such an order be written pursuant to the
                            physician documenting that a physician, a
                            physician assistant, a nurse practitioner, or a
                            clinical nurse specialist (as those terms are
                            defined in section 1861(aa)(5)) has had a face-
                            to-face encounter (including through use of
                            telehealth under subsection (m) and other than
                            with respect to encounters that are incident to
                            services involved) with the individual involved
                            during the 6-month period preceding such
                            written order, or other reasonable timeframe as
                            determined by the Secretary.''.
        (c) Application to Other Areas Under Medicare.--The Secretary may
    apply the face-to-face encounter requirement described in the
    amendments made by subsections (a) and (b) to other items and services
    for which payment is provided under title XVIII of the Social Security
    Act based upon a finding that such an decision would reduce the risk of
    waste, fraud, or abuse.
        (d) Application to Medicaid.--The requirements pursuant to the
    amendments made by subsections (a) and (b) shall apply in the case of
    physicians making certifications for home health services under title
    XIX of the Social Security Act in the same manner and to the same
    extent as such requirements apply in the case of physicians making such
    certifications under title XVIII of such Act.

    SEC. 6408. ENHANCED PENALTIES.

        (a) Civil Monetary Penalties for False Statements or Delaying
    Inspections.--Section 1128A(a) of the Social Security Act (42 U.S.C.
    1320a-7a(a)), as amended by section 5002(d)(2)(A), is amended--
                (1) in paragraph (6), by striking ``or'' at the end; and
                (2) by inserting after paragraph (7) the following new
            paragraphs:
                ``(8) knowingly makes, uses, or causes to be made or used,
            a false record or statement material to a false or fraudulent
            claim for payment for items and services furnished under a
            Federal health care program; or
                ``(9) fails to grant timely access, upon reasonable request
            (as defined by the Secretary in regulations), to the Inspector
            General of the Department of Health and Human Services, for the
            purpose of audits, investigations, evaluations, or other
            statutory functions of the Inspector General of the Department
            of Health and Human Services;''; and
                (3) in the first sentence--
                        (A) by striking ``or in cases under paragraph (7)''
                    and inserting ``in cases under paragraph (7)''; and
                        (B) by striking ``act)'' and inserting ``act, in
                    cases under paragraph (8), $50,000 for each false
                    record or statement, or in cases under paragraph (9),
                    $15,000 for each day of the failure described in such
                    paragraph)''.
        (b) Medicare Advantage and Part D Plans.--
                (1) Ensuring timely inspections relating to contracts with
            ma organizations.--Section 1857(d)(2) of such Act (42 U.S.C.
            1395w-27(d)(2)) is amended--
                        (A) in subparagraph (A), by inserting ``timely''
                    before ``inspect''; and
                        (B) in subparagraph (B), by inserting ``timely''
                    before ``audit and inspect''.
                (2) Marketing violations.--Section 1857(g)(1) of the Social
            Security Act (42 U.S.C. 1395w-27(g)(1)) is amended--
                        (A) in subparagraph (F), by striking ``or'' at the
                    end;
                        (B) by inserting after subparagraph (G) the
                    following new subparagraphs:
                        ``(H) except as provided under subparagraph (C) or
                    (D) of section 1860D-1(b)(1), enrolls an individual in
                    any plan under this part without the prior consent of
                    the individual or the designee of the individual;
                        ``(I) transfers an individual enrolled under this
                    part from one plan to another without the prior consent
                    of the individual or the designee of the individual or
                    solely for the purpose of earning a commission;
                        ``(J) fails to comply with marketing restrictions
                    described in subsections (h) and (j) of section 1851 or
                    applicable implementing regulations or guidance; or
                        ``(K) employs or contracts with any individual or
                    entity who engages in the conduct described in
                    subparagraphs (A) through (J) of this paragraph;''; and
                        (C) by adding at the end the following new
                    sentence: ``The Secretary may provide, in addition to
                    any other remedies authorized by law, for any of the
                    remedies described in paragraph (2), if the Secretary
                    determines that any employee or agent of such
                    organization, or any provider or supplier who contracts
                    with such organization, has engaged in any conduct
                    described in subparagraphs (A) through (K) of this
                    paragraph.''.
                (3) Provision of false information.--Section 1857(g)(2)(A)
            of the Social Security Act (42 U.S.C. 1395w-27(g)(2)(A)) is
            amended by inserting ``except with respect to a determination
            under subparagraph (E), an assessment of not more than the
            amount claimed by such plan or plan sponsor based upon the
            misrepresentation or falsified information involved,'' after
            ``for each such determination,''.
        (c) Obstruction of Program Audits.--Section 1128(b)(2) of the
    Social Security Act (42 U.S.C. 1320a-7(b)(2)) is amended--
                (1) in the heading, by inserting ``or audit'' after
            ``investigation''; and
                (2) by striking ``investigation into'' and all that follows
            through the period and inserting ``investigation or audit
            related to--''
                                ``(i) any offense described in paragraph
                            (1) or in subsection (a); or
                                ``(ii) the use of funds received, directly
                            or indirectly, from any Federal health care
                            program (as defined in section 1128B(f)).''.
        (d) Effective Date.--
                (1) In general.--Except as provided in paragraph (2), the
            amendments made by this section shall apply to acts committed
            on or after January 1, 2010.
                (2) Exception.--The amendments made by subsection (b)(1)
            take effect on the date of enactment of this Act.

    SEC. 6409. MEDICARE SELF-REFERRAL DISCLOSURE PROTOCOL.

        (a) Development of Self-Referral Disclosure Protocol.--
                (1) In general.--The Secretary of Health and Human
            Services, in cooperation with the Inspector General of the
            Department of Health and Human Services, shall establish, not
            later than 6 months after the date of the enactment of this
            Act, a protocol to enable health care providers of services and
            suppliers to disclose an actual or potential violation of
            section 1877 of the Social Security Act (42 U.S.C. 1395nn)
            pursuant to a self-referral disclosure protocol (in this
            section referred to as an ``SRDP''). The SRDP shall include
            direction to health care providers of services and suppliers
            on--
                        (A) a specific person, official, or office to whom
                    such disclosures shall be made; and
                        (B) instruction on the implication of the SRDP on
                    corporate integrity agreements and corporate compliance
                    agreements.
                (2) Publication on internet website of srdp information.--
            The Secretary of Health and Human Services shall post
            information on the public Internet website of the Centers for
            Medicare & Medicaid Services to inform relevant stakeholders of
            how to disclose actual or potential violations pursuant to an
            SRDP.
                (3) Relation to advisory opinions.--The SRDP shall be
            separate from the advisory opinion process set forth in
            regulations implementing section 1877(g) of the Social Security
            Act.
        (b) Reduction in Amounts Owed.--The Secretary of Health and Human
    Services is authorized to reduce the amount due and owing for all
    violations under section 1877 of the Social Security Act to an amount
    less than that specified in subsection (g) of such section. In
    establishing such amount for a violation, the Secretary may consider
    the following factors:
                (1) The nature and extent of the improper or illegal
            practice.
                (2) The timeliness of such self-disclosure.
                (3) The cooperation in providing additional information
            related to the disclosure.
                (4) Such other factors as the Secretary considers
            appropriate.
        (c) Report.--Not later than 18 months after the date on which the
    SRDP protocol is established under subsection (a)(1), the Secretary
    shall submit to Congress a report on the implementation of this
    section. Such report shall include--
                (1) the number of health care providers of services and
            suppliers making disclosures pursuant to the SRDP;
                (2) the amounts collected pursuant to the SRDP;
                (3) the types of violations reported under the SRDP; and
                (4) such other information as may be necessary to evaluate
            the impact of this section.

    SEC. 6410. ADJUSTMENTS TO THE MEDICARE DURABLE MEDICAL EQUIPMENT,
                  PROSTHETICS, ORTHOTICS, AND SUPPLIES COMPETITIVE
                  ACQUISITION PROGRAM.

        (a) Expansion of Round 2 of the DME Competitive Bidding Program.--
    Section 1847(a)(1) of the Social Security Act (42 U.S.C. 1395w-3(a)(1))
    is amended--
                (1) in subparagraph (B)(i)(II), by striking ``70'' and
            inserting ``91''; and
                (2) in subparagraph (D)(ii)--
                        (A) in subclause (I), by striking ``and'' at the
                    end;
                        (B) by redesignating subclause (II) as subclause
                    (III); and
                        (C) by inserting after subclause (I) the following
                    new subclause:
                                        ``(II) the Secretary shall include
                                    the next 21 largest metropolitan
                                    statistical areas by total population
                                    (after those selected under subclause
                                    (I)) for such round; and''.
        (b) Requirement to Either Competitively Bid Areas or Use
    Competitive Bid Prices by 2016.--Section 1834(a)(1)(F) of the Social
    Security Act (42 U.S.C. 1395m(a)(1)(F)) is amended--
                (1) in clause (i), by striking ``and'' at the end;
                (2) in clause (ii)--
                        (A) by inserting ``(and, in the case of covered
                    items furnished on or after January 1, 2016, subject to
                    clause (iii), shall)'' after ``may''; and
                        (B) by striking the period at the end and inserting
                    ``; and''; and
                (3) by adding at the end the following new clause:
                                ``(iii) in the case of covered items
                            furnished on or after January 1, 2016, the
                            Secretary shall continue to make such
                            adjustments described in clause (ii) as, under
                            such competitive acquisition programs,
                            additional covered items are phased in or
                            information is updated as contracts under
                            section 1847 are recompeted in accordance with
                            section 1847(b)(3)(B).''.

    SEC. 6411. EXPANSION OF THE RECOVERY AUDIT CONTRACTOR (RAC) PROGRAM.

        (a) Expansion to Medicaid.--
                (1) State plan amendment.--Section 1902(a)(42) of the
            Social Security Act (42 U.S.C. 1396a(a)(42)) is amended--
                        (A) by striking ``that the records'' and inserting
                    ``that--
                        ``(A) the records'';
                        (B) by inserting ``and'' after the semicolon; and
                        (C) by adding at the end the following:
                        ``(B) not later than December 31, 2010, the State
                    shall--
                                ``(i) establish a program under which the
                            State contracts (consistent with State law and
                            in the same manner as the Secretary enters into
                            contracts with recovery audit contractors under
                            section 1893(h), subject to such exceptions or
                            requirements as the Secretary may require for
                            purposes of this title or a particular State)
                            with 1 or more recovery audit contractors for
                            the purpose of identifying underpayments and
                            overpayments and recouping overpayments under
                            the State plan and under any waiver of the
                            State plan with respect to all services for
                            which payment is made to any entity under such
                            plan or waiver; and
                                ``(ii) provide assurances satisfactory to
                            the Secretary that--
                                        ``(I) under such contracts, payment
                                    shall be made to such a contractor only
                                    from amounts recovered;
                                        ``(II) from such amounts recovered,
                                    payment--
                                                ``(aa) shall be made on a
                                            contingent basis for collecting
                                            overpayments; and
                                                ``(bb) may be made in such
                                            amounts as the State may
                                            specify for identifying
                                            underpayments;
                                        ``(III) the State has an adequate
                                    process for entities to appeal any
                                    adverse determination made by such
                                    contractors; and
                                        ``(IV) such program is carried out
                                    in accordance with such requirements as
                                    the Secretary shall specify,
                                    including--
                                                ``(aa) for purposes of
                                            section 1903(a)(7), that
                                            amounts expended by the State
                                            to carry out the program shall
                                            be considered amounts expended
                                            as necessary for the proper and
                                            efficient administration of the
                                            State plan or a waiver of the
                                            plan;
                                                ``(bb) that section 1903(d)
                                            shall apply to amounts
                                            recovered under the program;
                                            and
                                                ``(cc) that the State and
                                            any such contractors under
                                            contract with the State shall
                                            coordinate such recovery audit
                                            efforts with other contractors
                                            or entities performing audits
                                            of entities receiving payments
                                            under the State plan or waiver
                                            in the State, including efforts
                                            with Federal and State law
                                            enforcement with respect to the
                                            Department of Justice,
                                            including the Federal Bureau of
                                            Investigations, the Inspector
                                            General of the Department of
                                            Health and Human Services, and
                                            the State medicaid fraud
                                            control unit; and''.
                (2) Coordination; regulations.--
                        (A) In general.--The Secretary of Health and Human
                    Services, acting through the Administrator of the
                    Centers for Medicare & Medicaid Services, shall
                    coordinate the expansion of the Recovery Audit
                    Contractor program to Medicaid with States,
                    particularly with respect to each State that enters
                    into a contract with a recovery audit contractor for
                    purposes of the State's Medicaid program prior to
                    December 31, 2010.
                        (B) Regulations.--The Secretary of Health and Human
                    Services shall promulgate regulations to carry out this
                    subsection and the amendments made by this subsection,
                    including with respect to conditions of Federal
                    financial participation, as specified by the Secretary.
        (b) Expansion to Medicare Parts C and D.--Section 1893(h) of the
    Social Security Act (42 U.S.C. 1395ddd(h)) is amended--
                (1) in paragraph (1), in the matter preceding subparagraph
            (A), by striking ``part A or B'' and inserting ``this title'';
                (2) in paragraph (2), by striking ``parts A and B'' and
            inserting ``this title'';
                (3) in paragraph (3), by inserting ``(not later than
            December 31, 2010, in the case of contracts relating to
            payments made under part C or D)'' after ``2010'';
                (4) in paragraph (4), in the matter preceding subparagraph
            (A), by striking ``part A or B'' and inserting ``this title'';
            and
                (5) by adding at the end the following:
                ``(9) Special rules relating to parts c and d.--The
            Secretary shall enter into contracts under paragraph (1) to
            require recovery audit contractors to--
                        ``(A) ensure that each MA plan under part C has an
                    anti-fraud plan in effect and to review the
                    effectiveness of each such anti-fraud plan;
                        ``(B) ensure that each prescription drug plan under
                    part D has an anti-fraud plan in effect and to review
                    the effectiveness of each such anti-fraud plan;
                        ``(C) examine claims for reinsurance payments under
                    section 1860D-15(b) to determine whether prescription
                    drug plans submitting such claims incurred costs in
                    excess of the allowable reinsurance costs permitted
                    under paragraph (2) of that section; and
                        ``(D) review estimates submitted by prescription
                    drug plans by private plans with respect to the
                    enrollment of high cost beneficiaries (as defined by
                    the Secretary) and to compare such estimates with the
                    numbers of such beneficiaries actually enrolled by such
                    plans.''.
        (c) Annual Report.--The Secretary of Health and Human Services,
    acting through the Administrator of the Centers for Medicare & Medicaid
    Services, shall submit an annual report to Congress concerning the
    effectiveness of the Recovery Audit Contractor program under Medicaid
    and Medicare and shall include such reports recommendations for
    expanding or improving the program.

          Subtitle F--Additional Medicaid Program Integrity Provisions

    SEC. 6501. TERMINATION OF PROVIDER PARTICIPATION UNDER MEDICAID IF
                  TERMINATED UNDER MEDICARE OR OTHER STATE PLAN.

        Section 1902(a)(39) of the Social Security Act (42 U.S.C. 42 U.S.C.
    1396a(a)) is amended by inserting after ``1128A,'' the following:
    ``terminate the participation of any individual or entity in such
    program if (subject to such exceptions as are permitted with respect to
    exclusion under sections 1128(c)(3)(B) and 1128(d)(3)(B)) participation
    of such individual or entity is terminated under title XVIII or any
    other State plan under this title,''.

    SEC. 6502. MEDICAID EXCLUSION FROM PARTICIPATION RELATING TO CERTAIN
                  OWNERSHIP, CONTROL, AND MANAGEMENT AFFILIATIONS.

        Section 1902(a) of the Social Security Act (42 U.S.C. 1396a(a)), as
    amended by section 6401(b), is amended by inserting after paragraph
    (77) the following:
                ``(78) provide that the State agency described in paragraph
            (9) exclude, with respect to a period, any individual or entity
            from participation in the program under the State plan if such
            individual or entity owns, controls, or manages an entity that
            (or if such entity is owned, controlled, or managed by an
            individual or entity that)--
                        ``(A) has unpaid overpayments (as defined by the
                    Secretary) under this title during such period
                    determined by the Secretary or the State agency to be
                    delinquent;
                        ``(B) is suspended or excluded from participation
                    under or whose participation is terminated under this
                    title during such period; or
                        ``(C) is affiliated with an individual or entity
                    that has been suspended or excluded from participation
                    under this title or whose participation is terminated
                    under this title during such period;''.

    SEC. 6503. BILLING AGENTS, CLEARINGHOUSES, OR OTHER ALTERNATE PAYEES
                  REQUIRED TO REGISTER UNDER MEDICAID.

        (a) In General.--Section 1902(a) of the Social Security Act (42
    U.S.C. 42 U.S.C. 1396a(a)), as amended by section 6502(a), is amended
    by inserting after paragraph (78), the following:
                ``(79) provide that any agent, clearinghouse, or other
            alternate payee (as defined by the Secretary) that submits
            claims on behalf of a health care provider must register with
            the State and the Secretary in a form and manner specified by
            the Secretary;''.

    SEC. 6504. REQUIREMENT TO REPORT EXPANDED SET OF DATA ELEMENTS UNDER
                  MMIS TO DETECT FRAUD AND ABUSE.

        (a) In General.--Section 1903(r)(1)(F) of the Social Security Act
    (42 U.S.C. 1396b(r)(1)(F)) is amended by inserting after ``necessary''
    the following: ``and including, for data submitted to the Secretary on
    or after January 1, 2010, data elements from the automated data system
    that the Secretary determines to be necessary for program integrity,
    program oversight, and administration, at such frequency as the
    Secretary shall determine''.
        (b) Managed Care Organizations.--
                (1) In general.--Section 1903(m)(2)(A)(xi) of the Social
            Security Act (42 U.S.C. 1396b(m)(2)(A)(xi)) is amended by
            inserting ``and for the provision of such data to the State at
            a frequency and level of detail to be specified by the
            Secretary'' after ``patients''.
                (2) Effective date.--The amendment made by paragraph (1)
            shall apply with respect to contract years beginning on or
            after January 1, 2010.

    SEC. 6505. PROHIBITION ON PAYMENTS TO INSTITUTIONS OR ENTITIES LOCATED
                  OUTSIDE OF THE UNITED STATES.

        Section 1902(a) of the Social Security Act (42 U.S.C. 1396b(a)), as
    amended by section 6503, is amended by inserting after paragraph (79)
    the following new paragraph:
                ``(80) provide that the State shall not provide any
            payments for items or services provided under the State plan or
            under a waiver to any financial institution or entity located
            outside of the United States;''.

    SEC. 6506. OVERPAYMENTS.

        (a) Extension of Period for Collection of Overpayments Due to
    Fraud.--
                (1) In general.--Section 1903(d)(2) of the Social Security
            Act (42 U.S.C. 1396b(d)(2)) is amended--
                        (A) in subparagraph (C)--
                                (i) in the first sentence, by striking ``60
                            days'' and inserting ``1 year''; and
                                (ii) in the second sentence, by striking
                            ``60 days'' and inserting ``1-year period'';
                            and
                        (B) in subparagraph (D)--
                                (i) in inserting ``(i)'' after ``(D)''; and
                                (ii) by adding at the end the following:
        ``(ii) In any case where the State is unable to recover a debt
    which represents an overpayment (or any portion thereof) made to a
    person or other entity due to fraud within 1 year of discovery because
    there is not a final determination of the amount of the overpayment
    under an administrative or judicial process (as applicable), including
    as a result of a judgment being under appeal, no adjustment shall be
    made in the Federal payment to such State on account of such
    overpayment (or portion thereof) before the date that is 30 days after
    the date on which a final judgment (including, if applicable, a final
    determination on an appeal) is made.''.
                (2) Effective date.--The amendments made by this subsection
            take effect on the date of enactment of this Act and apply to
            overpayments discovered on or after that date.
        (b) Corrective Action.--The Secretary shall promulgate regulations
    that require States to correct Federally identified claims
    overpayments, of an ongoing or recurring nature, with new Medicaid
    Management Information System (MMIS) edits, audits, or other
    appropriate corrective action.

    SEC. 6507. MANDATORY STATE USE OF NATIONAL CORRECT CODING INITIATIVE.

        Section 1903(r) of the Social Security Act (42 U.S.C. 1396b(r)) is
    amended--
                (1) in paragraph (1)(B)--
                        (A) in clause (ii), by striking ``and'' at the end;
                        (B) in clause (iii), by adding ``and'' after the
                    semi-colon; and
                        (C) by adding at the end the following new clause:
                                ``(iv) effective for claims filed on or
                            after October 1, 2010, incorporate compatible
                            methodologies of the National Correct Coding
                            Initiative administered by the Secretary (or
                            any successor initiative to promote correct
                            coding and to control improper coding leading
                            to inappropriate payment) and such other
                            methodologies of that Initiative (or such other
                            national correct coding methodologies) as the
                            Secretary identifies in accordance with
                            paragraph (4);''; and
                (2) by adding at the end the following new paragraph:
        ``(4) For purposes of paragraph (1)(B)(iv), the Secretary shall do
    the following:
                ``(A) Not later than September 1, 2010:
                        ``(i) Identify those methodologies of the National
                    Correct Coding Initiative administered by the Secretary
                    (or any successor initiative to promote correct coding
                    and to control improper coding leading to inappropriate
                    payment) which are compatible to claims filed under
                    this title.
                        ``(ii) Identify those methodologies of such
                    Initiative (or such other national correct coding
                    methodologies) that should be incorporated into claims
                    filed under this title with respect to items or
                    services for which States provide medical assistance
                    under this title and no national correct coding
                    methodologies have been established under such
                    Initiative with respect to title XVIII.
                        ``(iii) Notify States of--
                                ``(I) the methodologies identified under
                            subparagraphs (A) and (B) (and of any other
                            national correct coding methodologies
                            identified under subparagraph (B)); and
                                ``(II) how States are to incorporate such
                            methodologies into claims filed under this
                            title.
                ``(B) Not later than March 1, 2011, submit a report to
            Congress that includes the notice to States under clause (iii)
            of subparagraph (A) and an analysis supporting the
            identification of the methodologies made under clauses (i) and
            (ii) of subparagraph (A).''.

    SEC. 6508. GENERAL EFFECTIVE DATE.

        (a) In General.--Except as otherwise provided in this subtitle,
    this subtitle and the amendments made by this subtitle take effect on
    January 1, 2011, without regard to whether final regulations to carry
    out such amendments and subtitle have been promulgated by that date.
        (b) Delay if State Legislation Required.--In the case of a State
    plan for medical assistance under title XIX of the Social Security Act
    or a child health plan under title XXI of such Act which the Secretary
    of Health and Human Services determines requires State legislation
    (other than legislation appropriating funds) in order for the plan to
    meet the additional requirement imposed by the amendments made by this
    subtitle, the State plan or child health plan shall not be regarded as
    failing to comply with the requirements of such title solely on the
    basis of its failure to meet this additional requirement before the
    first day of the first calendar quarter beginning after the close of
    the first regular session of the State legislature that begins after
    the date of the enactment of this Act. For purposes of the previous
    sentence, in the case of a State that has a 2-year legislative session,
    each year of such session shall be deemed to be a separate regular
    session of the State legislature.

              Subtitle G--Additional Program Integrity Provisions

    SEC. 6601. PROHIBITION ON FALSE STATEMENTS AND REPRESENTATIONS.

        (a) Prohibition.--Part 5 of subtitle B of title I of the Employee
    Retirement Income Security Act of 1974 (29 U.S.C. 1131 et seq.) is
    amended by adding at the end the following:

    ``SEC. 519. PROHIBITION ON FALSE STATEMENTS AND REPRESENTATIONS.

        ``No person, in connection with a plan or other arrangement that is
    multiple employer welfare arrangement described in section 3(40), shall
    make a false statement or false representation of fact, knowing it to
    be false, in connection with the marketing or sale of such plan or
    arrangement, to any employee, any member of an employee organization,
    any beneficiary, any employer, any employee organization, the
    Secretary, or any State, or the representative or agent of any such
    person, State, or the Secretary, concerning--
                ``(1) the financial condition or solvency of such plan or
            arrangement;
                ``(2) the benefits provided by such plan or arrangement;
                ``(3) the regulatory status of such plan or other
            arrangement under any Federal or State law governing collective
            bargaining, labor management relations, or intern union
            affairs; or
                ``(4) the regulatory status of such plan or other
            arrangement regarding exemption from state regulatory authority
            under this Act.
    This section shall not apply to any plan or arrangement that does not
    fall within the meaning of the term `multiple employer welfare
    arrangement' under section 3(40)(A).''.
        (b) Criminal Penalties.--Section 501 of the Employee Retirement
    Income Security Act of 1974 (29 U.S.C. 1131) is amended--
                (1) by inserting ``(a)'' before ``Any person''; and
                (2) by adding at the end the following:
        ``(b) Any person that violates section 519 shall upon conviction be
    imprisoned not more than 10 years or fined under title 18, United
    States Code, or both.''.
        (c) Conforming Amendment.--The table of sections for part 5 of
    subtitle B of title I of the Employee Retirement Income Security Act of
    1974 is amended by adding at the end the following:

    ``Sec. 519. Prohibition on false statement and representations.''.

    SEC. 6602. CLARIFYING DEFINITION.

        Section 24(a)(2) of title 18, United States Code, is amended by
    inserting ``or section 411, 518, or 511 of the Employee Retirement
    Income Security Act of 1974,'' after ``1954 of this title''.

    SEC. 6603. DEVELOPMENT OF MODEL UNIFORM REPORT FORM.

        Part C of title XXVII of the Public Health Service Act (42 U.S.C.
    300gg-91 et seq.) is amended by adding at the end the following:

    ``SEC. 2794. UNIFORM FRAUD AND ABUSE REFERRAL FORMAT.

        ``The Secretary shall request the National Association of Insurance
    Commissioners to develop a model uniform report form for private health
    insurance issuer seeking to refer suspected fraud and abuse to State
    insurance departments or other responsible State agencies for
    investigation. The Secretary shall request that the National
    Association of Insurance Commissioners develop recommendations for
    uniform reporting standards for such referrals.''.

    SEC. 6604. APPLICABILITY OF STATE LAW TO COMBAT FRAUD AND ABUSE.

        (a) In General.--Part 5 of subtitle B of title I of the Employee
    Retirement Income Security Act of 1974 (29 U.S.C. 1131 et seq.), as
    amended by section 6601, is further amended by adding at the end the
    following:

    ``SEC. 520. APPLICABILITY OF STATE LAW TO COMBAT FRAUD AND ABUSE.

        ``The Secretary may, for the purpose of identifying, preventing, or
    prosecuting fraud and abuse, adopt regulatory standards establishing,
    or issue an order relating to a specific person establishing, that a
    person engaged in the business of providing insurance through a
    multiple employer welfare arrangement described in section 3(40) is
    subject to the laws of the States in which such person operates which
    regulate insurance in such State, notwithstanding section 514(b)(6) of
    this Act or the Liability Risk Retention Act of 1986, and regardless of
    whether the law of the State is otherwise preempted under any of such
    provisions. This section shall not apply to any plan or arrangement
    that does not fall within the meaning of the term `multiple employer
    welfare arrangement' under section 3(40)(A).''.
        (b) Conforming Amendment.--The table of sections for part 5 of
    subtitle B of title I of the Employee Retirement Income Security Act of
    1974, as amended by section 6601, is further amended by adding at the
    end the following:

    ``Sec. 520. Applicability of State law to combat fraud and abuse.''.

    SEC. 6605. ENABLING THE DEPARTMENT OF LABOR TO ISSUE ADMINISTRATIVE
                  SUMMARY CEASE AND DESIST ORDERS AND SUMMARY SEIZURES
                  ORDERS AGAINST PLANS THAT ARE IN FINANCIALLY HAZARDOUS
                  CONDITION.

        (a) In General.--Part 5 of subtitle B of title I of the Employee
    Retirement Income Security Act of 1974 (29 U.S.C. 1131 et seq.), as
    amended by section 6604, is further amended by adding at the end the
    following:

    ``SEC. 521. ADMINISTRATIVE SUMMARY CEASE AND DESIST ORDERS AND SUMMARY
                  SEIZURE ORDERS AGAINST MULTIPLE EMPLOYER WELFARE
                  ARRANGEMENTS IN FINANCIALLY HAZARDOUS CONDITION.

        ``(a) In General.--The Secretary may issue a cease and desist (ex
    parte) order under this title if it appears to the Secretary that the
    alleged conduct of a multiple employer welfare arrangement described in
    section 3(40), other than a plan or arrangement described in subsection
    (g), is fraudulent, or creates an immediate danger to the public safety
    or welfare, or is causing or can be reasonably expected to cause
    significant, imminent, and irreparable public injury.
        ``(b) Hearing.--A person that is adversely affected by the issuance
    of a cease and desist order under subsection (a) may request a hearing
    by the Secretary regarding such order. The Secretary may require that a
    proceeding under this section, including all related information and
    evidence, be conducted in a confidential manner.
        ``(c) Burden of Proof.--The burden of proof in any hearing
    conducted under subsection (b) shall be on the party requesting the
    hearing to show cause why the cease and desist order should be set
    aside.
        ``(d) Determination.--Based upon the evidence presented at a
    hearing under subsection (b), the cease and desist order involved may
    be affirmed, modified, or set aside by the Secretary in whole or in
    part.
        ``(e) Seizure.--The Secretary may issue a summary seizure order
    under this title if it appears that a multiple employer welfare
    arrangement is in a financially hazardous condition.
        ``(f) Regulations.--The Secretary may promulgate such regulations
    or other guidance as may be necessary or appropriate to carry out this
    section.
        ``(g) Exception.--This section shall not apply to any plan or
    arrangement that does not fall within the meaning of the term `multiple
    employer welfare arrangement' under section 3(40)(A).''.
        (b) Conforming Amendment.--The table of sections for part 5 of
    subtitle B of title I of the Employee Retirement Income Security Act of
    1974, as amended by section 6604, is further amended by adding at the
    end the following:

    ``Sec. 521. Administrative summary cease and desist orders and summary
                                seizure orders against health plans in
                                financially hazardous condition.''.

    SEC. 6606. MEWA PLAN REGISTRATION WITH DEPARTMENT OF LABOR.

        Section 101(g) of the Employee Retirement Income Security Act of
    1974 (29 U.S.C. 1021(g)) is amended--
                (1) by striking ``Secretary may'' and inserting ``Secretary
            shall''; and
                (2) by inserting ``to register with the Secretary prior to
            operating in a State and may, by regulation, require such
            multiple employer welfare arrangements'' after ``not group
            health plans''.

    SEC. 6607. PERMITTING EVIDENTIARY PRIVILEGE AND CONFIDENTIAL
                  COMMUNICATIONS.

        Section 504 of the Employee Retirement Income Security Act of 1974
    (29 U.S.C. 1134) is amended by adding at the end the following:
        ``(d) The Secretary may promulgate a regulation that provides an
    evidentiary privilege for, and provides for the confidentiality of
    communications between or among, any of the following entities or their
    agents, consultants, or employees:
                ``(1) A State insurance department.
                ``(2) A State attorney general.
                ``(3) The National Association of Insurance Commissioners.
                ``(4) The Department of Labor.
                ``(5) The Department of the Treasury.
                ``(6) The Department of Justice.
                ``(7) The Department of Health and Human Services.
                ``(8) Any other Federal or State authority that the
            Secretary determines is appropriate for the purposes of
            enforcing the provisions of this title.
        ``(e) The privilege established under subsection (d) shall apply to
    communications related to any investigation, audit, examination, or
    inquiry conducted or coordinated by any of the agencies. A
    communication that is privileged under subsection (d) shall not waive
    any privilege otherwise available to the communicating agency or to any
    person who provided the information that is communicated.''.

                         Subtitle H--Elder Justice Act

    SEC. 6701. SHORT TITLE OF SUBTITLE.

        This subtitle may be cited as the ``Elder Justice Act of 2009''.

    SEC. 6702. DEFINITIONS.

        Except as otherwise specifically provided, any term that is defined
    in section 2011 of the Social Security Act (as added by section
    6703(a)) and is used in this subtitle has the meaning given such term
    by such section.

    SEC. 6703. ELDER JUSTICE.

        (a) Elder Justice.--
                (1) In general.--Title XX of the Social Security Act (42
            U.S.C. 1397 et seq.) is amended--
                        (A) in the heading, by inserting ``AND ELDER
                    JUSTICE'' after ``SOCIAL SERVICES'';
                        (B) by inserting before section 2001 the following:

          ``Subtitle A--Block Grants to States for Social Services'';

                    and
                        (C) by adding at the end the following:

                          ``Subtitle B--Elder Justice

    ``SEC. 2011. DEFINITIONS.

        ``In this subtitle:
                ``(1) Abuse.--The term `abuse' means the knowing infliction
            of physical or psychological harm or the knowing deprivation of
            goods or services that are necessary to meet essential needs or
            to avoid physical or psychological harm.
                ``(2) Adult protective services.--The term `adult
            protective services' means such services provided to adults as
            the Secretary may specify and includes services such as--
                        ``(A) receiving reports of adult abuse, neglect, or
                    exploitation;
                        ``(B) investigating the reports described in
                    subparagraph (A);
                        ``(C) case planning, monitoring, evaluation, and
                    other case work and services; and
                        ``(D) providing, arranging for, or facilitating the
                    provision of medical, social service, economic, legal,
                    housing, law enforcement, or other protective,
                    emergency, or support services.
                ``(3) Caregiver.--The term `caregiver' means an individual
            who has the responsibility for the care of an elder, either
            voluntarily, by contract, by receipt of payment for care, or as
            a result of the operation of law, and means a family member or
            other individual who provides (on behalf of such individual or
            of a public or private agency, organization, or institution)
            compensated or uncompensated care to an elder who needs
            supportive services in any setting.
                ``(4) Direct care.--The term `direct care' means care by an
            employee or contractor who provides assistance or long-term
            care services to a recipient.
                ``(5) Elder.--The term `elder' means an individual age 60
            or older.
                ``(6) Elder justice.--The term `elder justice' means--
                        ``(A) from a societal perspective, efforts to--
                                ``(i) prevent, detect, treat, intervene in,
                            and prosecute elder abuse, neglect, and
                            exploitation; and
                                ``(ii) protect elders with diminished
                            capacity while maximizing their autonomy; and
                        ``(B) from an individual perspective, the
                    recognition of an elder's rights, including the right
                    to be free of abuse, neglect, and exploitation.
                ``(7) Eligible entity.--The term `eligible entity' means a
            State or local government agency, Indian tribe or tribal
            organization, or any other public or private entity that is
            engaged in and has expertise in issues relating to elder
            justice or in a field necessary to promote elder justice
            efforts.
                ``(8) Exploitation.--The term `exploitation' means the
            fraudulent or otherwise illegal, unauthorized, or improper act
            or process of an individual, including a caregiver or
            fiduciary, that uses the resources of an elder for monetary or
            personal benefit, profit, or gain, or that results in depriving
            an elder of rightful access to, or use of, benefits, resources,
            belongings, or assets.
                ``(9) Fiduciary.--The term `fiduciary'--
                        ``(A) means a person or entity with the legal
                    responsibility--
                                ``(i) to make decisions on behalf of and
                            for the benefit of another person; and
                                ``(ii) to act in good faith and with
                            fairness; and
                        ``(B) includes a trustee, a guardian, a
                    conservator, an executor, an agent under a financial
                    power of attorney or health care power of attorney, or
                    a representative payee.
                ``(10) Grant.--The term `grant' includes a contract,
            cooperative agreement, or other mechanism for providing
            financial assistance.
                ``(11) Guardianship.--The term `guardianship' means--
                        ``(A) the process by which a State court determines
                    that an adult individual lacks capacity to make
                    decisions about self-care or property, and appoints
                    another individual or entity known as a guardian, as a
                    conservator, or by a similar term, as a surrogate
                    decisionmaker;
                        ``(B) the manner in which the court-appointed
                    surrogate decisionmaker carries out duties to the
                    individual and the court; or
                        ``(C) the manner in which the court exercises
                    oversight of the surrogate decisionmaker.
                ``(12) Indian tribe.--
                        ``(A) In general.--The term `Indian tribe' has the
                    meaning given such term in section 4 of the Indian
                    Self-Determination and Education Assistance Act (25
                    U.S.C. 450b).
                        ``(B) Inclusion of pueblo and rancheria.--The term
                    `Indian tribe' includes any Pueblo or Rancheria.
                ``(13) Law enforcement.--The term `law enforcement' means
            the full range of potential responders to elder abuse, neglect,
            and exploitation including--
                        ``(A) police, sheriffs, detectives, public safety
                    officers, and corrections personnel;
                        ``(B) prosecutors;
                        ``(C) medical examiners;
                        ``(D) investigators; and
                        ``(E) coroners.
                ``(14) Long-term care.--
                        ``(A) In general.--The term `long-term care' means
                    supportive and health services specified by the
                    Secretary for individuals who need assistance because
                    the individuals have a loss of capacity for self-care
                    due to illness, disability, or vulnerability.
                        ``(B) Loss of capacity for self-care.--For purposes
                    of subparagraph (A), the term `loss of capacity for
                    self-care' means an inability to engage in 1 or more
                    activities of daily living, including eating, dressing,
                    bathing, management of one's financial affairs, and
                    other activities the Secretary determines appropriate.
                ``(15) Long-term care facility.--The term `long-term care
            facility' means a residential care provider that arranges for,
            or directly provides, long-term care.
                ``(16) Neglect.--The term `neglect' means--
                        ``(A) the failure of a caregiver or fiduciary to
                    provide the goods or services that are necessary to
                    maintain the health or safety of an elder; or
                        ``(B) self-neglect.
                ``(17) Nursing facility.--
                        ``(A) In general.--The term `nursing facility' has
                    the meaning given such term under section 1919(a).
                        ``(B) Inclusion of skilled nursing facility.--The
                    term `nursing facility' includes a skilled nursing
                    facility (as defined in section 1819(a)).
                ``(18) Self-neglect.--The term `self-neglect' means an
            adult's inability, due to physical or mental impairment or
            diminished capacity, to perform essential self-care tasks
            including--
                        ``(A) obtaining essential food, clothing, shelter,
                    and medical care;
                        ``(B) obtaining goods and services necessary to
                    maintain physical health, mental health, or general
                    safety; or
                        ``(C) managing one's own financial affairs.
                ``(19) Serious bodily injury.--
                        ``(A) In general.--The term `serious bodily injury'
                    means an injury--
                                ``(i) involving extreme physical pain;
                                ``(ii) involving substantial risk of death;
                                ``(iii) involving protracted loss or
                            impairment of the function of a bodily member,
                            organ, or mental faculty; or
                                ``(iv) requiring medical intervention such
                            as surgery, hospitalization, or physical
                            rehabilitation.
                        ``(B) Criminal sexual abuse.--Serious bodily injury
                    shall be considered to have occurred if the conduct
                    causing the injury is conduct described in section 2241
                    (relating to aggravated sexual abuse) or 2242 (relating
                    to sexual abuse) of title 18, United States Code, or
                    any similar offense under State law.
                ``(20) Social.--The term `social', when used with respect
            to a service, includes adult protective services.
                ``(21) State legal assistance developer.--The term `State
            legal assistance developer' means an individual described in
            section 731 of the Older Americans Act of 1965.
                ``(22) State long-term care ombudsman.--The term `State
            Long-Term Care Ombudsman' means the State Long-Term Care
            Ombudsman described in section 712(a)(2) of the Older Americans
            Act of 1965.

    ``SEC. 2012. GENERAL PROVISIONS.

        ``(a) Protection of Privacy.--In pursuing activities under this
    subtitle, the Secretary shall ensure the protection of individual
    health privacy consistent with the regulations promulgated under
    section 264(c) of the Health Insurance Portability and Accountability
    Act of 1996 and applicable State and local privacy regulations.
        ``(b) Rule of Construction.--Nothing in this subtitle shall be
    construed to interfere with or abridge an elder's right to practice his
    or her religion through reliance on prayer alone for healing when this
    choice--
                ``(1) is contemporaneously expressed, either orally or in
            writing, with respect to a specific illness or injury which the
            elder has at the time of the decision by an elder who is
            competent at the time of the decision;
                ``(2) is previously set forth in a living will, health care
            proxy, or other advance directive document that is validly
            executed and applied under State law; or
                ``(3) may be unambiguously deduced from the elder's life
            history.

        ``PART I--NATIONAL COORDINATION OF ELDER JUSTICE ACTIVITIES AND
                                    RESEARCH

     ``Subpart A--Elder Justice Coordinating Council and Advisory Board on
                     Elder Abuse, Neglect, and Exploitation

    ``SEC. 2021. ELDER JUSTICE COORDINATING COUNCIL.

        ``(a) Establishment.--There is established within the Office of the
    Secretary an Elder Justice Coordinating Council (in this section
    referred to as the `Council').
        ``(b) Membership.--
                ``(1) In general.--The Council shall be composed of the
            following members:
                        ``(A) The Secretary (or the Secretary's designee).
                        ``(B) The Attorney General (or the Attorney
                    General's designee).
                        ``(C) The head of each Federal department or agency
                    or other governmental entity identified by the Chair
                    referred to in subsection (d) as having
                    responsibilities, or administering programs, relating
                    to elder abuse, neglect, and exploitation.
                ``(2) Requirement.--Each member of the Council shall be an
            officer or employee of the Federal Government.
        ``(c) Vacancies.--Any vacancy in the Council shall not affect its
    powers, but shall be filled in the same manner as the original
    appointment was made.
        ``(d) Chair.--The member described in subsection (b)(1)(A) shall be
    Chair of the Council.
        ``(e) Meetings.--The Council shall meet at least 2 times per year,
    as determined by the Chair.
        ``(f) Duties.--
                ``(1) In general.--The Council shall make recommendations
            to the Secretary for the coordination of activities of the
            Department of Health and Human Services, the Department of
            Justice, and other relevant Federal, State, local, and private
            agencies and entities, relating to elder abuse, neglect, and
            exploitation and other crimes against elders.
                ``(2) Report.--Not later than the date that is 2 years
            after the date of enactment of the Elder Justice Act of 2009
            and every 2 years thereafter, the Council shall submit to the
            Committee on Finance of the Senate and the Committee on Ways
            and Means and the Committee on Energy and Commerce of the House
            of Representatives a report that--
                        ``(A) describes the activities and accomplishments
                    of, and challenges faced by--
                                ``(i) the Council; and
                                ``(ii) the entities represented on the
                            Council; and
                        ``(B) makes such recommendations for legislation,
                    model laws, or other action as the Council determines
                    to be appropriate.
        ``(g) Powers of the Council.--
                ``(1) Information from federal agencies.--Subject to the
            requirements of section 2012(a), the Council may secure
            directly from any Federal department or agency such information
            as the Council considers necessary to carry out this section.
            Upon request of the Chair of the Council, the head of such
            department or agency shall furnish such information to the
            Council.
                ``(2) Postal services.--The Council may use the United
            States mails in the same manner and under the same conditions
            as other departments and agencies of the Federal Government.
        ``(h) Travel Expenses.--The members of the Council shall not
    receive compensation for the performance of services for the Council.
    The members shall be allowed travel expenses, including per diem in
    lieu of subsistence, at rates authorized for employees of agencies
    under subchapter I of chapter 57 of title 5, United States Code, while
    away from their homes or regular places of business in the performance
    of services for the Council. Notwithstanding section 1342 of title 31,
    United States Code, the Secretary may accept the voluntary and
    uncompensated services of the members of the Council.
        ``(i) Detail of Government Employees.--Any Federal Government
    employee may be detailed to the Council without reimbursement, and such
    detail shall be without interruption or loss of civil service status or
    privilege.
        ``(j) Status as Permanent Council.--Section 14 of the Federal
    Advisory Committee Act (5 U.S.C. App.) shall not apply to the Council.
        ``(k) Authorization of Appropriations.--There are authorized to be
    appropriated such sums as are necessary to carry out this section.

    ``SEC. 2022. ADVISORY BOARD ON ELDER ABUSE, NEGLECT, AND EXPLOITATION.

        ``(a) Establishment.--There is established a board to be known as
    the `Advisory Board on Elder Abuse, Neglect, and Exploitation' (in this
    section referred to as the `Advisory Board') to create short- and long-
    term multidisciplinary strategic plans for the development of the field
    of elder justice and to make recommendations to the Elder Justice
    Coordinating Council established under section 2021.
        ``(b) Composition.--The Advisory Board shall be composed of 27
    members appointed by the Secretary from among members of the general
    public who are individuals with experience and expertise in elder
    abuse, neglect, and exploitation prevention, detection, treatment,
    intervention, or prosecution.
        ``(c) Solicitation of Nominations.--The Secretary shall publish a
    notice in the Federal Register soliciting nominations for the
    appointment of members of the Advisory Board under subsection (b).
        ``(d) Terms.--
                ``(1) In general.--Each member of the Advisory Board shall
            be appointed for a term of 3 years, except that, of the members
            first appointed--
                        ``(A) 9 shall be appointed for a term of 3 years;
                        ``(B) 9 shall be appointed for a term of 2 years;
                    and
                        ``(C) 9 shall be appointed for a term of 1 year.
                ``(2) Vacancies.--
                        ``(A) In general.--Any vacancy on the Advisory
                    Board shall not affect its powers, but shall be filled
                    in the same manner as the original appointment was
                    made.
                        ``(B) Filling unexpired term.--An individual chosen
                    to fill a vacancy shall be appointed for the unexpired
                    term of the member replaced.
                ``(3) Expiration of terms.--The term of any member shall
            not expire before the date on which the member's successor
            takes office.
        ``(e) Election of Officers.--The Advisory Board shall elect a Chair
    and Vice Chair from among its members. The Advisory Board shall elect
    its initial Chair and Vice Chair at its initial meeting.
        ``(f) Duties.--
                ``(1) Enhance communication on promoting quality of, and
            preventing abuse, neglect, and exploitation in, long-term
            care.--The Advisory Board shall develop collaborative and
            innovative approaches to improve the quality of, including
            preventing abuse, neglect, and exploitation in, long-term care.
                ``(2) Collaborative efforts to develop consensus around the
            management of certain quality-related factors.--
                        ``(A) In general.--The Advisory Board shall
                    establish multidisciplinary panels to address, and
                    develop consensus on, subjects relating to improving
                    the quality of long-term care. At least 1 such panel
                    shall address, and develop consensus on, methods for
                    managing resident-to-resident abuse in long-term care.
                        ``(B) Activities conducted.--The multidisciplinary
                    panels established under subparagraph (A) shall examine
                    relevant research and data, identify best practices
                    with respect to the subject of the panel, determine the
                    best way to carry out those best practices in a
                    practical and feasible manner, and determine an
                    effective manner of distributing information on such
                    subject.
                ``(3) Report.--Not later than the date that is 18 months
            after the date of enactment of the Elder Justice Act of 2009,
            and annually thereafter, the Advisory Board shall prepare and
            submit to the Elder Justice Coordinating Council, the Committee
            on Finance of the Senate, and the Committee on Ways and Means
            and the Committee on Energy and Commerce of the House of
            Representatives a report containing--
                        ``(A) information on the status of Federal, State,
                    and local public and private elder justice activities;
                        ``(B) recommendations (including recommended
                    priorities) regarding--
                                ``(i) elder justice programs, research,
                            training, services, practice, enforcement, and
                            coordination;
                                ``(ii) coordination between entities
                            pursuing elder justice efforts and those
                            involved in related areas that may inform or
                            overlap with elder justice efforts, such as
                            activities to combat violence against women and
                            child abuse and neglect; and
                                ``(iii) activities relating to adult
                            fiduciary systems, including guardianship and
                            other fiduciary arrangements;
                        ``(C) recommendations for specific modifications
                    needed in Federal and State laws (including
                    regulations) or for programs, research, and training to
                    enhance prevention, detection, and treatment (including
                    diagnosis) of, intervention in (including investigation
                    of), and prosecution of elder abuse, neglect, and
                    exploitation;
                        ``(D) recommendations on methods for the most
                    effective coordinated national data collection with
                    respect to elder justice, and elder abuse, neglect, and
                    exploitation; and
                        ``(E) recommendations for a multidisciplinary
                    strategic plan to guide the effective and efficient
                    development of the field of elder justice.
        ``(g) Powers of the Advisory Board.--
                ``(1) Information from federal agencies.--Subject to the
            requirements of section 2012(a), the Advisory Board may secure
            directly from any Federal department or agency such information
            as the Advisory Board considers necessary to carry out this
            section. Upon request of the Chair of the Advisory Board, the
            head of such department or agency shall furnish such
            information to the Advisory Board.
                ``(2) Sharing of data and reports.--The Advisory Board may
            request from any entity pursuing elder justice activities under
            the Elder Justice Act of 2009 or an amendment made by that Act,
            any data, reports, or recommendations generated in connection
            with such activities.
                ``(3) Postal services.--The Advisory Board may use the
            United States mails in the same manner and under the same
            conditions as other departments and agencies of the Federal
            Government.
        ``(h) Travel Expenses.--The members of the Advisory Board shall not
    receive compensation for the performance of services for the Advisory
    Board. The members shall be allowed travel expenses for up to 4
    meetings per year, including per diem in lieu of subsistence, at rates
    authorized for employees of agencies under subchapter I of chapter 57
    of title 5, United States Code, while away from their homes or regular
    places of business in the performance of services for the Advisory
    Board. Notwithstanding section 1342 of title 31, United States Code,
    the Secretary may accept the voluntary and uncompensated services of
    the members of the Advisory Board.
        ``(i) Detail of Government Employees.--Any Federal Government
    employee may be detailed to the Advisory Board without reimbursement,
    and such detail shall be without interruption or loss of civil service
    status or privilege.
        ``(j) Status as Permanent Advisory Committee.--Section 14 of the
    Federal Advisory Committee Act (5 U.S.C. App.) shall not apply to the
    advisory board.
        ``(k) Authorization of Appropriations.--There are authorized to be
    appropriated such sums as are necessary to carry out this section.

    ``SEC. 2023. RESEARCH PROTECTIONS.

        ``(a) Guidelines.--The Secretary shall promulgate guidelines to
    assist researchers working in the area of elder abuse, neglect, and
    exploitation, with issues relating to human subject protections.
        ``(b) Definition of Legally Authorized Representative for
    Application of Regulations.--For purposes of the application of subpart
    A of part 46 of title 45, Code of Federal Regulations, to research
    conducted under this subpart, the term `legally authorized
    representative' means, unless otherwise provided by law, the individual
    or judicial or other body authorized under the applicable law to
    consent to medical treatment on behalf of another person.

    ``SEC. 2024. AUTHORIZATION OF APPROPRIATIONS.

        ``There are authorized to be appropriated to carry out this
    subpart--
                ``(1) for fiscal year 2011, $6,500,000; and
                ``(2) for each of fiscal years 2012 through 2014,
            $7,000,000.

      ``Subpart B--Elder Abuse, Neglect, and Exploitation Forensic Centers

    ``SEC. 2031. ESTABLISHMENT AND SUPPORT OF ELDER ABUSE, NEGLECT, AND
                  EXPLOITATION FORENSIC CENTERS.

        ``(a) In General.--The Secretary, in consultation with the Attorney
    General, shall make grants to eligible entities to establish and
    operate stationary and mobile forensic centers, to develop forensic
    expertise regarding, and provide services relating to, elder abuse,
    neglect, and exploitation.
        ``(b) Stationary Forensic Centers.--The Secretary shall make 4 of
    the grants described in subsection (a) to institutions of higher
    education with demonstrated expertise in forensics or commitment to
    preventing or treating elder abuse, neglect, or exploitation, to
    establish and operate stationary forensic centers.
        ``(c) Mobile Centers.--The Secretary shall make 6 of the grants
    described in subsection (a) to appropriate entities to establish and
    operate mobile forensic centers.
        ``(d) Authorized Activities.--
                ``(1) Development of forensic markers and methodologies.--
            An eligible entity that receives a grant under this section
            shall use funds made available through the grant to assist in
            determining whether abuse, neglect, or exploitation occurred
            and whether a crime was committed and to conduct research to
            describe and disseminate information on--
                        ``(A) forensic markers that indicate a case in
                    which elder abuse, neglect, or exploitation may have
                    occurred; and
                        ``(B) methodologies for determining, in such a
                    case, when and how health care, emergency service,
                    social and protective services, and legal service
                    providers should intervene and when the providers
                    should report the case to law enforcement authorities.
                ``(2) Development of forensic expertise.--An eligible
            entity that receives a grant under this section shall use funds
            made available through the grant to develop forensic expertise
            regarding elder abuse, neglect, and exploitation in order to
            provide medical and forensic evaluation, therapeutic
            intervention, victim support and advocacy, case review, and
            case tracking.
                ``(3) Collection of evidence.--The Secretary, in
            coordination with the Attorney General, shall use data made
            available by grant recipients under this section to develop the
            capacity of geriatric health care professionals and law
            enforcement to collect forensic evidence, including collecting
            forensic evidence relating to a potential determination of
            elder abuse, neglect, or exploitation.
        ``(e) Application.--To be eligible to receive a grant under this
    section, an entity shall submit an application to the Secretary at such
    time, in such manner, and containing such information as the Secretary
    may require.
        ``(f) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this section--
                ``(1) for fiscal year 2011, $4,000,000;
                ``(2) for fiscal year 2012, $6,000,000; and
                ``(3) for each of fiscal years 2013 and 2014, $8,000,000.

                  ``PART II--PROGRAMS TO PROMOTE ELDER JUSTICE

    ``SEC. 2041. ENHANCEMENT OF LONG-TERM CARE.

        ``(a) Grants and Incentives for Long-Term Care Staffing.--
                ``(1) In general.--The Secretary shall carry out
            activities, including activities described in paragraphs (2)
            and (3), to provide incentives for individuals to train for,
            seek, and maintain employment providing direct care in long-
            term care.
                ``(2) Specific programs to enhance training, recruitment,
            and retention of staff.--
                        ``(A) Coordination with secretary of labor to
                    recruit and train long-term care staff.--The Secretary
                    shall coordinate activities under this subsection with
                    the Secretary of Labor in order to provide incentives
                    for individuals to train for and seek employment
                    providing direct care in long-term care.
                        ``(B) Career ladders and wage or benefit increases
                    to increase staffing in long-term care.--
                                ``(i) In general.--The Secretary shall make
                            grants to eligible entities to carry out
                            programs through which the entities--
                                        ``(I) offer, to employees who
                                    provide direct care to residents of an
                                    eligible entity or individuals
                                    receiving community-based long-term
                                    care from an eligible entity,
                                    continuing training and varying levels
                                    of certification, based on observed
                                    clinical care practices and the amount
                                    of time the employees spend providing
                                    direct care; and
                                        ``(II) provide, or make
                                    arrangements to provide, bonuses or
                                    other increased compensation or
                                    benefits to employees who achieve
                                    certification under such a program.
                                ``(ii) Application.--To be eligible to
                            receive a grant under this subparagraph, an
                            eligible entity shall submit an application to
                            the Secretary at such time, in such manner, and
                            containing such information as the Secretary
                            may require (which may include evidence of
                            consultation with the State in which the
                            eligible entity is located with respect to
                            carrying out activities funded under the
                            grant).
                                ``(iii) Authority to limit number of
                            applicants.--Nothing in this subparagraph shall
                            be construed as prohibiting the Secretary from
                            limiting the number of applicants for a grant
                            under this subparagraph.
                ``(3) Specific programs to improve management practices.--
                        ``(A) In general.--The Secretary shall make grants
                    to eligible entities to enable the entities to provide
                    training and technical assistance.
                        ``(B) Authorized activities.--An eligible entity
                    that receives a grant under subparagraph (A) shall use
                    funds made available through the grant to provide
                    training and technical assistance regarding management
                    practices using methods that are demonstrated to
                    promote retention of individuals who provide direct
                    care, such as--
                                ``(i) the establishment of standard human
                            resource policies that reward high performance,
                            including policies that provide for improved
                            wages and benefits on the basis of job reviews;
                                ``(ii) the establishment of motivational
                            and thoughtful work organization practices;
                                ``(iii) the creation of a workplace culture
                            that respects and values caregivers and their
                            needs;
                                ``(iv) the promotion of a workplace culture
                            that respects the rights of residents of an
                            eligible entity or individuals receiving
                            community-based long-term care from an eligible
                            entity and results in improved care for the
                            residents or the individuals; and
                                ``(v) the establishment of other programs
                            that promote the provision of high quality
                            care, such as a continuing education program
                            that provides additional hours of training,
                            including on-the-job training, for employees
                            who are certified nurse aides.
                        ``(C) Application.--To be eligible to receive a
                    grant under this paragraph, an eligible entity shall
                    submit an application to the Secretary at such time, in
                    such manner, and containing such information as the
                    Secretary may require (which may include evidence of
                    consultation with the State in which the eligible
                    entity is located with respect to carrying out
                    activities funded under the grant).
                        ``(D) Authority to limit number of applicants.--
                    Nothing in this paragraph shall be construed as
                    prohibiting the Secretary from limiting the number of
                    applicants for a grant under this paragraph.
                ``(4) Accountability measures.--The Secretary shall develop
            accountability measures to ensure that the activities conducted
            using funds made available under this subsection benefit
            individuals who provide direct care and increase the stability
            of the long-term care workforce.
                ``(5) Definitions.--In this subsection:
                        ``(A) Community-based long-term care.--The term
                    `community-based long-term care' has the meaning given
                    such term by the Secretary.
                        ``(B) Eligible entity.--The term `eligible entity'
                    means the following:
                                ``(i) A long-term care facility.
                                ``(ii) A community-based long-term care
                            entity (as defined by the Secretary).
        ``(b) Certified EHR Technology Grant Program.--
                ``(1) Grants authorized.--The Secretary is authorized to
            make grants to long-term care facilities for the purpose of
            assisting such entities in offsetting the costs related to
            purchasing, leasing, developing, and implementing certified EHR
            technology (as defined in section 1848(o)(4)) designed to
            improve patient safety and reduce adverse events and health
            care complications resulting from medication errors.
                ``(2) Use of grant funds.--Funds provided under grants
            under this subsection may be used for any of the following:
                        ``(A) Purchasing, leasing, and installing computer
                    software and hardware, including handheld computer
                    technologies.
                        ``(B) Making improvements to existing computer
                    software and hardware.
                        ``(C) Making upgrades and other improvements to
                    existing computer software and hardware to enable e-
                    prescribing.
                        ``(D) Providing education and training to eligible
                    long-term care facility staff on the use of such
                    technology to implement the electronic transmission of
                    prescription and patient information.
                ``(3) Application.--
                        ``(A) In general.--To be eligible to receive a
                    grant under this subsection, a long-term care facility
                    shall submit an application to the Secretary at such
                    time, in such manner, and containing such information
                    as the Secretary may require (which may include
                    evidence of consultation with the State in which the
                    long-term care facility is located with respect to
                    carrying out activities funded under the grant).
                        ``(B) Authority to limit number of applicants.--
                    Nothing in this subsection shall be construed as
                    prohibiting the Secretary from limiting the number of
                    applicants for a grant under this subsection.
                ``(4) Participation in state health exchanges.--A long-term
            care facility that receives a grant under this subsection
            shall, where available, participate in activities conducted by
            a State or a qualified State-designated entity (as defined in
            section 3013(f) of the Public Health Service Act) under a grant
            under section 3013 of the Public Health Service Act to
            coordinate care and for other purposes determined appropriate
            by the Secretary.
                ``(5) Accountability measures.--The Secretary shall develop
            accountability measures to ensure that the activities conducted
            using funds made available under this subsection help improve
            patient safety and reduce adverse events and health care
            complications resulting from medication errors.
        ``(c) Adoption of Standards for Transactions Involving Clinical
    Data by Long-Term Care Facilities.--
                ``(1) Standards and compatibility.--The Secretary shall
            adopt electronic standards for the exchange of clinical data by
            long-term care facilities, including, where available,
            standards for messaging and nomenclature. Standards adopted by
            the Secretary under the preceding sentence shall be compatible
            with standards established under part C of title XI, standards
            established under subsections (b)(2)(B)(i) and (e)(4) of
            section 1860D-4, standards adopted under section 3004 of the
            Public Health Service Act, and general health information
            technology standards.
                ``(2) Electronic submission of data to the secretary.--
                        ``(A) In general.--Not later than 10 years after
                    the date of enactment of the Elder Justice Act of 2009,
                    the Secretary shall have procedures in place to accept
                    the optional electronic submission of clinical data by
                    long-term care facilities pursuant to the standards
                    adopted under paragraph (1).
                        ``(B) Rule of construction.--Nothing in this
                    subsection shall be construed to require a long-term
                    care facility to submit clinical data electronically to
                    the Secretary.
                ``(3) Regulations.--The Secretary shall promulgate
            regulations to carry out this subsection. Such regulations
            shall require a State, as a condition of the receipt of funds
            under this part, to conduct such data collection and reporting
            as the Secretary determines are necessary to satisfy the
            requirements of this subsection.
        ``(d) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this section--
                ``(1) for fiscal year 2011, $20,000,000;
                ``(2) for fiscal year 2012, $17,500,000; and
                ``(3) for each of fiscal years 2013 and 2014, $15,000,000.

    ``SEC. 2042. ADULT PROTECTIVE SERVICES FUNCTIONS AND GRANT PROGRAMS.

        ``(a) Secretarial Responsibilities.--
                ``(1) In general.--The Secretary shall ensure that the
            Department of Health and Human Services--
                        ``(A) provides funding authorized by this part to
                    State and local adult protective services offices that
                    investigate reports of the abuse, neglect, and
                    exploitation of elders;
                        ``(B) collects and disseminates data annually
                    relating to the abuse, exploitation, and neglect of
                    elders in coordination with the Department of Justice;
                        ``(C) develops and disseminates information on best
                    practices regarding, and provides training on, carrying
                    out adult protective services;
                        ``(D) conducts research related to the provision of
                    adult protective services; and
                        ``(E) provides technical assistance to States and
                    other entities that provide or fund the provision of
                    adult protective services, including through grants
                    made under subsections (b) and (c).
                ``(2) Authorization of appropriations.--There are
            authorized to be appropriated to carry out this subsection,
            $3,000,000 for fiscal year 2011 and $4,000,000 for each of
            fiscal years 2012 through 2014.
        ``(b) Grants To Enhance the Provision of Adult Protective
    Services.--
                ``(1) Establishment.--There is established an adult
            protective services grant program under which the Secretary
            shall annually award grants to States in the amounts calculated
            under paragraph (2) for the purposes of enhancing adult
            protective services provided by States and local units of
            government.
                ``(2) Amount of payment.--
                        ``(A) In general.--Subject to the availability of
                    appropriations and subparagraphs (B) and (C), the
                    amount paid to a State for a fiscal year under the
                    program under this subsection shall equal the amount
                    appropriated for that year to carry out this subsection
                    multiplied by the percentage of the total number of
                    elders who reside in the United States who reside in
                    that State.
                        ``(B) Guaranteed minimum payment amount.--
                                ``(i) 50 states.--Subject to clause (ii),
                            if the amount determined under subparagraph (A)
                            for a State for a fiscal year is less than 0.75
                            percent of the amount appropriated for such
                            year, the Secretary shall increase such
                            determined amount so that the total amount paid
                            under this subsection to the State for the year
                            is equal to 0.75 percent of the amount so
                            appropriated.
                                ``(ii) Territories.--In the case of a State
                            other than 1 of the 50 States, clause (i) shall
                            be applied as if each reference to `0.75' were
                            a reference to `0.1'.
                        ``(C) Pro rata reductions.--The Secretary shall
                    make such pro rata reductions to the amounts described
                    in subparagraph (A) as are necessary to comply with the
                    requirements of subparagraph (B).
                ``(3) Authorized activities.--
                        ``(A) Adult protective services.--Funds made
                    available pursuant to this subsection may only be used
                    by States and local units of government to provide
                    adult protective services and may not be used for any
                    other purpose.
                        ``(B) Use by agency.--Each State receiving funds
                    pursuant to this subsection shall provide such funds to
                    the agency or unit of State government having legal
                    responsibility for providing adult protective services
                    within the State.
                        ``(C) Supplement not supplant.--Each State or local
                    unit of government shall use funds made available
                    pursuant to this subsection to supplement and not
                    supplant other Federal, State, and local public funds
                    expended to provide adult protective services in the
                    State.
                ``(4) State reports.--Each State receiving funds under this
            subsection shall submit to the Secretary, at such time and in
            such manner as the Secretary may require, a report on the
            number of elders served by the grants awarded under this
            subsection.
                ``(5) Authorization of appropriations.--There are
            authorized to be appropriated to carry out this subsection,
            $100,000,000 for each of fiscal years 2011 through 2014.
        ``(c) State Demonstration Programs.--
                ``(1) Establishment.--The Secretary shall award grants to
            States for the purposes of conducting demonstration programs in
            accordance with paragraph (2).
                ``(2) Demonstration programs.--Funds made available
            pursuant to this subsection may be used by States and local
            units of government to conduct demonstration programs that
            test--
                        ``(A) training modules developed for the purpose of
                    detecting or preventing elder abuse;
                        ``(B) methods to detect or prevent financial
                    exploitation of elders;
                        ``(C) methods to detect elder abuse;
                        ``(D) whether training on elder abuse forensics
                    enhances the detection of elder abuse by employees of
                    the State or local unit of government; or
                        ``(E) other matters relating to the detection or
                    prevention of elder abuse.
                ``(3) Application.--To be eligible to receive a grant under
            this subsection, a State shall submit an application to the
            Secretary at such time, in such manner, and containing such
            information as the Secretary may require.
                ``(4) State reports.--Each State that receives funds under
            this subsection shall submit to the Secretary a report at such
            time, in such manner, and containing such information as the
            Secretary may require on the results of the demonstration
            program conducted by the State using funds made available under
            this subsection.
                ``(5) Authorization of appropriations.--There are
            authorized to be appropriated to carry out this subsection,
            $25,000,000 for each of fiscal years 2011 through 2014.

    ``SEC. 2043. LONG-TERM CARE OMBUDSMAN PROGRAM GRANTS AND TRAINING.

        ``(a) Grants To Support the Long-Term Care Ombudsman Program.--
                ``(1) In general.--The Secretary shall make grants to
            eligible entities with relevant expertise and experience in
            abuse and neglect in long-term care facilities or long-term
            care ombudsman programs and responsibilities, for the purpose
            of--
                        ``(A) improving the capacity of State long-term
                    care ombudsman programs to respond to and resolve
                    complaints about abuse and neglect;
                        ``(B) conducting pilot programs with State long-
                    term care ombudsman offices or local ombudsman
                    entities; and
                        ``(C) providing support for such State long-term
                    care ombudsman programs and such pilot programs (such
                    as through the establishment of a national long-term
                    care ombudsman resource center).
                ``(2) Authorization of appropriations.--There are
            authorized to be appropriated to carry out this subsection--
                        ``(A) for fiscal year 2011, $5,000,000;
                        ``(B) for fiscal year 2012, $7,500,000; and
                        ``(C) for each of fiscal years 2013 and 2014,
                    $10,000,000.
        ``(b) Ombudsman Training Programs.--
                ``(1) In general.--The Secretary shall establish programs
            to provide and improve ombudsman training with respect to elder
            abuse, neglect, and exploitation for national organizations and
            State long-term care ombudsman programs.
                ``(2) Authorization of appropriations.--There are
            authorized to be appropriated to carry out this subsection, for
            each of fiscal years 2011 through 2014, $10,000,000.

    ``SEC. 2044. PROVISION OF INFORMATION REGARDING, AND EVALUATIONS OF,
                  ELDER JUSTICE PROGRAMS.

        ``(a) Provision of Information.--To be eligible to receive a grant
    under this part, an applicant shall agree--
                ``(1) except as provided in paragraph (2), to provide the
            eligible entity conducting an evaluation under subsection (b)
            of the activities funded through the grant with such
            information as the eligible entity may require in order to
            conduct such evaluation; or
                ``(2) in the case of an applicant for a grant under section
            2041(b), to provide the Secretary with such information as the
            Secretary may require to conduct an evaluation or audit under
            subsection (c).
        ``(b) Use of Eligible Entities To Conduct Evaluations.--
                ``(1) Evaluations required.--Except as provided in
            paragraph (2), the Secretary shall--
                        ``(A) reserve a portion (not less than 2 percent)
                    of the funds appropriated with respect to each program
                    carried out under this part; and
                        ``(B) use the funds reserved under subparagraph (A)
                    to provide assistance to eligible entities to conduct
                    evaluations of the activities funded under each program
                    carried out under this part.
                ``(2) Certified ehr technology grant program not
            included.--The provisions of this subsection shall not apply to
            the certified EHR technology grant program under section
            2041(b).
                ``(3) Authorized activities.--A recipient of assistance
            described in paragraph (1)(B) shall use the funds made
            available through the assistance to conduct a validated
            evaluation of the effectiveness of the activities funded under
            a program carried out under this part.
                ``(4) Applications.--To be eligible to receive assistance
            under paragraph (1)(B), an entity shall submit an application
            to the Secretary at such time, in such manner, and containing
            such information as the Secretary may require, including a
            proposal for the evaluation.
                ``(5) Reports.--Not later than a date specified by the
            Secretary, an eligible entity receiving assistance under
            paragraph (1)(B) shall submit to the Secretary, the Committee
            on Ways and Means and the Committee on Energy and Commerce of
            the House of Representatives, and the Committee on Finance of
            the Senate a report containing the results of the evaluation
            conducted using such assistance together with such
            recommendations as the entity determines to be appropriate.
        ``(c) Evaluations and Audits of Certified EHR Technology Grant
    Program by the Secretary.--
                ``(1) Evaluations.--The Secretary shall conduct an
            evaluation of the activities funded under the certified EHR
            technology grant program under section 2041(b). Such evaluation
            shall include an evaluation of whether the funding provided
            under the grant is expended only for the purposes for which it
            is made.
                ``(2) Audits.--The Secretary shall conduct appropriate
            audits of grants made under section 2041(b).

    ``SEC. 2045. REPORT.

        ``Not later than October 1, 2014, the Secretary shall submit to the
    Elder Justice Coordinating Council established under section 2021, the
    Committee on Ways and Means and the Committee on Energy and Commerce of
    the House of Representatives, and the Committee on Finance of the
    Senate a report--
                ``(1) compiling, summarizing, and analyzing the information
            contained in the State reports submitted under subsections
            (b)(4) and (c)(4) of section 2042; and
                ``(2) containing such recommendations for legislative or
            administrative action as the Secretary determines to be
            appropriate.

    ``SEC. 2046. RULE OF CONSTRUCTION.

        ``Nothing in this subtitle shall be construed as--
                ``(1) limiting any cause of action or other relief related
            to obligations under this subtitle that is available under the
            law of any State, or political subdivision thereof; or
                ``(2) creating a private cause of action for a violation of
            this subtitle.''.
                (2) Option for state plan under program for temporary
            assistance for needy families.--
                        (A) In general.--Section 402(a)(1)(B) of the Social
                    Security Act (42 U.S.C. 602(a)(1)(B)) is amended by
                    adding at the end the following new clause:
                                ``(v) The document shall indicate whether
                            the State intends to assist individuals to
                            train for, seek, and maintain employment--
                                        ``(I) providing direct care in a
                                    long-term care facility (as such terms
                                    are defined under section 2011); or
                                        ``(II) in other occupations related
                                    to elder care determined appropriate by
                                    the State for which the State
                                    identifies an unmet need for service
                                    personnel,
                            and, if so, shall include an overview of such
                            assistance.''.
                        (B) Effective date.--The amendment made by
                    subparagraph (A) shall take effect on January 1, 2011.
        (b) Protecting Residents of Long-Term Care Facilities.--
                (1) National training institute for surveyors.--
                        (A) In general.--The Secretary of Health and Human
                    Services shall enter into a contract with an entity for
                    the purpose of establishing and operating a National
                    Training Institute for Federal and State surveyors.
                    Such Institute shall provide and improve the training
                    of surveyors with respect to investigating allegations
                    of abuse, neglect, and misappropriation of property in
                    programs and long-term care facilities that receive
                    payments under title XVIII or XIX of the Social
                    Security Act.
                        (B) Activities carried out by the institute.--The
                    contract entered into under subparagraph (A) shall
                    require the Institute established and operated under
                    such contract to carry out the following activities:
                                (i) Assess the extent to which State
                            agencies use specialized surveyors for the
                            investigation of reported allegations of abuse,
                            neglect, and misappropriation of property in
                            such programs and long-term care facilities.
                                (ii) Evaluate how the competencies of
                            surveyors may be improved to more effectively
                            investigate reported allegations of such abuse,
                            neglect, and misappropriation of property, and
                            provide feedback to Federal and State agencies
                            on the evaluations conducted.
                                (iii) Provide a national program of
                            training, tools, and technical assistance to
                            Federal and State surveyors on investigating
                            reports of such abuse, neglect, and
                            misappropriation of property.
                                (iv) Develop and disseminate information on
                            best practices for the investigation of such
                            abuse, neglect, and misappropriation of
                            property.
                                (v) Assess the performance of State
                            complaint intake systems, in order to ensure
                            that the intake of complaints occurs 24 hours
                            per day, 7 days a week (including holidays).
                                (vi) To the extent approved by the
                            Secretary of Health and Human Services, provide
                            a national 24 hours per day, 7 days a week
                            (including holidays), back-up system to State
                            complaint intake systems in order to ensure
                            optimum national responsiveness to complaints
                            of such abuse, neglect, and misappropriation of
                            property.
                                (vii) Analyze and report annually on the
                            following:
                                        (I) The total number and sources of
                                    complaints of such abuse, neglect, and
                                    misappropriation of property.
                                        (II) The extent to which such
                                    complaints are referred to law
                                    enforcement agencies.
                                        (III) General results of Federal
                                    and State investigations of such
                                    complaints.
                                (viii) Conduct a national study of the cost
                            to State agencies of conducting complaint
                            investigations of skilled nursing facilities
                            and nursing facilities under sections 1819 and
                            1919, respectively, of the Social Security Act
                            (42 U.S.C. 1395i-3; 1396r), and making
                            recommendations to the Secretary of Health and
                            Human Services with respect to options to
                            increase the efficiency and cost-effectiveness
                            of such investigations.
                        (C) Authorization.--There are authorized to be
                    appropriated to carry out this paragraph, for the
                    period of fiscal years 2011 through 2014, $12,000,000.
                (2) Grants to state survey agencies.--
                        (A) In general.--The Secretary of Health and Human
                    Services shall make grants to State agencies that
                    perform surveys of skilled nursing facilities or
                    nursing facilities under sections 1819 or 1919,
                    respectively, of the Social Security Act (42 U.S.C.
                    1395i-3; 1395r).
                        (B) Use of funds.--A grant awarded under
                    subparagraph (A) shall be used for the purpose of
                    designing and implementing complaint investigations
                    systems that--
                                (i) promptly prioritize complaints in order
                            to ensure a rapid response to the most serious
                            and urgent complaints;
                                (ii) respond to complaints with optimum
                            effectiveness and timeliness; and
                                (iii) optimize the collaboration between
                            local authorities, consumers, and providers,
                            including--
                                        (I) such State agency;
                                        (II) the State Long-Term Care
                                    Ombudsman;
                                        (III) local law enforcement
                                    agencies;
                                        (IV) advocacy and consumer
                                    organizations;
                                        (V) State aging units;
                                        (VI) Area Agencies on Aging; and
                                        (VII) other appropriate entities.
                        (C) Authorization.--There are authorized to be
                    appropriated to carry out this paragraph, for each of
                    fiscal years 2011 through 2014, $5,000,000.
                (3) Reporting of crimes in federally funded long-term care
            facilities.--Part A of title XI of the Social Security Act (42
            U.S.C. 1301 et seq.), as amended by section 6005, is amended by
            inserting after section 1150A the following new section:

    ``reporting to law enforcement of crimes occurring in federally funded
                           long-term care facilities

        ``Sec. 1150B.  (a) Determination and Notification.--
                ``(1) Determination.--The owner or operator of each long-
            term care facility that receives Federal funds under this Act
            shall annually determine whether the facility received at least
            $10,000 in such Federal funds during the preceding year.
                ``(2) Notification.--If the owner or operator determines
            under paragraph (1) that the facility received at least $10,000
            in such Federal funds during the preceding year, such owner or
            operator shall annually notify each covered individual (as
            defined in paragraph (3)) of that individual's obligation to
            comply with the reporting requirements described in subsection
            (b).
                ``(3) Covered individual defined.--In this section, the
            term `covered individual' means each individual who is an
            owner, operator, employee, manager, agent, or contractor of a
            long-term care facility that is the subject of a determination
            described in paragraph (1).
        ``(b) Reporting Requirements.--
                ``(1) In general.--Each covered individual shall report to
            the Secretary and 1 or more law enforcement entities for the
            political subdivision in which the facility is located any
            reasonable suspicion of a crime (as defined by the law of the
            applicable political subdivision) against any individual who is
            a resident of, or is receiving care from, the facility.
                ``(2) Timing.--If the events that cause the suspicion--
                        ``(A) result in serious bodily injury, the
                    individual shall report the suspicion immediately, but
                    not later than 2 hours after forming the suspicion; and
                        ``(B) do not result in serious bodily injury, the
                    individual shall report the suspicion not later than 24
                    hours after forming the suspicion.
        ``(c) Penalties.--
                ``(1) In general.--If a covered individual violates
            subsection (b)--
                        ``(A) the covered individual shall be subject to a
                    civil money penalty of not more than $200,000; and
                        ``(B) the Secretary may make a determination in the
                    same proceeding to exclude the covered individual from
                    participation in any Federal health care program (as
                    defined in section 1128B(f)).
                ``(2) Increased harm.--If a covered individual violates
            subsection (b) and the violation exacerbates the harm to the
            victim of the crime or results in harm to another individual--
                        ``(A) the covered individual shall be subject to a
                    civil money penalty of not more than $300,000; and
                        ``(B) the Secretary may make a determination in the
                    same proceeding to exclude the covered individual from
                    participation in any Federal health care program (as
                    defined in section 1128B(f)).
                ``(3) Excluded individual.--During any period for which a
            covered individual is classified as an excluded individual
            under paragraph (1)(B) or (2)(B), a long-term care facility
            that employs such individual shall be ineligible to receive
            Federal funds under this Act.
                ``(4) Extenuating circumstances.--
                        ``(A) In general.--The Secretary may take into
                    account the financial burden on providers with
                    underserved populations in determining any penalty to
                    be imposed under this subsection.
                        ``(B) Underserved population defined.--In this
                    paragraph, the term `underserved population' means the
                    population of an area designated by the Secretary as an
                    area with a shortage of elder justice programs or a
                    population group designated by the Secretary as having
                    a shortage of such programs. Such areas or groups
                    designated by the Secretary may include--
                                ``(i) areas or groups that are
                            geographically isolated (such as isolated in a
                            rural area);
                                ``(ii) racial and ethnic minority
                            populations; and
                                ``(iii) populations underserved because of
                            special needs (such as language barriers,
                            disabilities, alien status, or age).
        ``(d) Additional Penalties for Retaliation.--
                ``(1) In general.--A long-term care facility may not--
                        ``(A) discharge, demote, suspend, threaten, harass,
                    or deny a promotion or other employment-related benefit
                    to an employee, or in any other manner discriminate
                    against an employee in the terms and conditions of
                    employment because of lawful acts done by the employee;
                    or
                        ``(B) file a complaint or a report against a nurse
                    or other employee with the appropriate State
                    professional disciplinary agency because of lawful acts
                    done by the nurse or employee,
            for making a report, causing a report to be made, or for taking
            steps in furtherance of making a report pursuant to subsection
            (b)(1).
                ``(2) Penalties for retaliation.--If a long-term care
            facility violates subparagraph (A) or (B) of paragraph (1) the
            facility shall be subject to a civil money penalty of not more
            than $200,000 or the Secretary may classify the entity as an
            excluded entity for a period of 2 years pursuant to section
            1128(b), or both.
                ``(3) Requirement to post notice.--Each long-term care
            facility shall post conspicuously in an appropriate location a
            sign (in a form specified by the Secretary) specifying the
            rights of employees under this section. Such sign shall include
            a statement that an employee may file a complaint with the
            Secretary against a long-term care facility that violates the
            provisions of this subsection and information with respect to
            the manner of filing such a complaint.
        ``(e) Procedure.--The provisions of section 1128A (other than
    subsections (a) and (b) and the second sentence of subsection (f))
    shall apply to a civil money penalty or exclusion under this section in
    the same manner as such provisions apply to a penalty or proceeding
    under section 1128A(a).
        ``(f) Definitions.--In this section, the terms `elder justice',
    `long-term care facility', and `law enforcement' have the meanings
    given those terms in section 2011.''.
        (c) National Nurse Aide Registry.--
                (1) Definition of nurse aide.--In this subsection, the term
            ``nurse aide'' has the meaning given that term in sections
            1819(b)(5)(F) and 1919(b)(5)(F) of the Social Security Act (42
            U.S.C. 1395i-3(b)(5)(F); 1396r(b)(5)(F)).
                (2) Study and report.--
                        (A) In general.--The Secretary, in consultation
                    with appropriate government agencies and private sector
                    organizations, shall conduct a study on establishing a
                    national nurse aide registry.
                        (B) Areas evaluated.--The study conducted under
                    this subsection shall include an evaluation of--
                                (i) who should be included in the registry;
                                (ii) how such a registry would comply with
                            Federal and State privacy laws and regulations;
                                (iii) how data would be collected for the
                            registry;
                                (iv) what entities and individuals would
                            have access to the data collected;
                                (v) how the registry would provide
                            appropriate information regarding violations of
                            Federal and State law by individuals included
                            in the registry;
                                (vi) how the functions of a national nurse
                            aide registry would be coordinated with the
                            nationwide program for national and State
                            background checks on direct patient access
                            employees of long-term care facilities and
                            providers under section 4301; and
                                (vii) how the information included in State
                            nurse aide registries developed and maintained
                            under sections 1819(e)(2) and 1919(e)(2) of the
                            Social Security Act (42 U.S.C. 1395i-3(e)(2);
                            1396r(e)(2)(2)) would be provided as part of a
                            national nurse aide registry.
                        (C) Considerations.--In conducting the study and
                    preparing the report required under this subsection,
                    the Secretary shall take into consideration the
                    findings and conclusions of relevant reports and other
                    relevant resources, including the following:
                                (i) The Department of Health and Human
                            Services Office of Inspector General Report,
                            Nurse Aide Registries: State Compliance and
                            Practices (February 2005).
                                (ii) The General Accounting Office (now
                            known as the Government Accountability Office)
                            Report, Nursing Homes: More Can Be Done to
                            Protect Residents from Abuse (March 2002).
                                (iii) The Department of Health and Human
                            Services Office of the Inspector General
                            Report, Nurse Aide Registries: Long-Term Care
                            Facility Compliance and Practices (July 2005).
                                (iv) The Department of Health and Human
                            Services Health Resources and Services
                            Administration Report, Nursing Aides, Home
                            Health Aides, and Related Health Care
                            Occupations--National and Local Workforce
                            Shortages and Associated Data Needs (2004) (in
                            particular with respect to chapter 7 and
                            appendix F).
                                (v) The 2001 Report to CMS from the School
                            of Rural Public Health, Texas A&M University,
                            Preventing Abuse and Neglect in Nursing Homes:
                            The Role of Nurse Aide Registries.
                                (vi) Information included in State nurse
                            aide registries developed and maintained under
                            sections 1819(e)(2) and 1919(e)(2) of the
                            Social Security Act (42 U.S.C. 1395i-3(e)(2);
                            1396r(e)(2)(2)).
                        (D) Report.--Not later than 18 months after the
                    date of enactment of this Act, the Secretary shall
                    submit to the Elder Justice Coordinating Council
                    established under section 2021 of the Social Security
                    Act, as added by section 1805(a), the Committee on
                    Finance of the Senate, and the Committee on Ways and
                    Means and the Committee on Energy and Commerce of the
                    House of Representatives a report containing the
                    findings and recommendations of the study conducted
                    under this paragraph.
                        (E) Funding limitation.--Funding for the study
                    conducted under this subsection shall not exceed
                    $500,000.
                (3) Congressional action.--After receiving the report
            submitted by the Secretary under paragraph (2)(D), the
            Committee on Finance of the Senate and the Committee on Ways
            and Means and the Committee on Energy and Commerce of the House
            of Representatives shall, as they deem appropriate, take action
            based on the recommendations contained in the report.
                (4) Authorization of appropriations.--There are authorized
            to be appropriated such sums as are necessary for the purpose
            of carrying out this subsection.
        (d) Conforming Amendments.--
                (1) Title xx.--Title XX of the Social Security Act (42
            U.S.C. 1397 et seq.), as amended by section 6703(a), is
            amended--
                        (A) in the heading of section 2001, by striking
                    ``title'' and inserting ``subtitle''; and
                        (B) in subtitle 1, by striking ``this title'' each
                    place it appears and inserting ``this subtitle''.
                (2) Title iv.--Title IV of the Social Security Act (42
            U.S.C. 601 et seq.) is amended--
                        (A) in section 404(d)--
                                (i) in paragraphs (1)(A), (2)(A), and
                            (3)(B), by inserting ``subtitle 1 of'' before
                            ``title XX'' each place it appears;
                                (ii) in the heading of paragraph (2), by
                            inserting ``subtitle 1 of'' before ``title
                            xx''; and
                                (iii) in the heading of paragraph (3)(B),
                            by inserting ``subtitle 1 of'' before ``title
                            xx''; and
                        (B) in sections 422(b), 471(a)(4), 472(h)(1), and
                    473(b)(2), by inserting ``subtitle 1 of'' before
                    ``title XX'' each place it appears.
                (3) Title xi.--Title XI of the Social Security Act (42
            U.S.C. 1301 et seq.) is amended--
                        (A) in section 1128(h)(3)--
                                (i) by inserting ``subtitle 1 of'' before
                            ``title XX''; and
                                (ii) by striking ``such title'' and
                            inserting ``such subtitle''; and
                        (B) in section 1128A(i)(1), by inserting ``subtitle
                    1 of'' before ``title XX''.

         Subtitle I--Sense of the Senate Regarding Medical Malpractice

    SEC. 6801. SENSE OF THE SENATE REGARDING MEDICAL MALPRACTICE.

        It is the sense of the Senate that--
                (1) health care reform presents an opportunity to address
            issues related to medical malpractice and medical liability
            insurance;
                (2) States should be encouraged to develop and test
            alternatives to the existing civil litigation system as a way
            of improving patient safety, reducing medical errors,
            encouraging the efficient resolution of disputes, increasing
            the availability of prompt and fair resolution of disputes, and
            improving access to liability insurance, while preserving an
            individual's right to seek redress in court; and
                (3) Congress should consider establishing a State
            demonstration program to evaluate alternatives to the existing
            civil litigation system with respect to the resolution of
            medical malpractice claims.

          TITLE VII--IMPROVING ACCESS TO INNOVATIVE MEDICAL THERAPIES

             Subtitle A--Biologics Price Competition and Innovation

    SEC. 7001. SHORT TITLE.

        (a) In General.--This subtitle may be cited as the ``Biologics
    Price Competition and Innovation Act of 2009''.
        (b) Sense of the Senate.--It is the sense of the Senate that a
    biosimilars pathway balancing innovation and consumer interests should
    be established.

    SEC. 7002. APPROVAL PATHWAY FOR BIOSIMILAR BIOLOGICAL PRODUCTS.

        (a) Licensure of Biological Products as Biosimilar or
    Interchangeable.--Section 351 of the Public Health Service Act (42
    U.S.C. 262) is amended--
                (1) in subsection (a)(1)(A), by inserting ``under this
            subsection or subsection (k)'' after ``biologics license''; and
                (2) by adding at the end the following:
        ``(k) Licensure of Biological Products as Biosimilar or
    Interchangeable.--
                ``(1) In general.--Any person may submit an application for
            licensure of a biological product under this subsection.
                ``(2) Content.--
                        ``(A) In general.--
                                ``(i) Required information.--An application
                            submitted under this subsection shall include
                            information demonstrating that--
                                        ``(I) the biological product is
                                    biosimilar to a reference product based
                                    upon data derived from--
                                                ``(aa) analytical studies
                                            that demonstrate that the
                                            biological product is highly
                                            similar to the reference
                                            product notwithstanding minor
                                            differences in clinically
                                            inactive components;
                                                ``(bb) animal studies
                                            (including the assessment of
                                            toxicity); and
                                                ``(cc) a clinical study or
                                            studies (including the
                                            assessment of immunogenicity
                                            and pharmacokinetics or
                                            pharmacodynamics) that are
                                            sufficient to demonstrate
                                            safety, purity, and potency in
                                            1 or more appropriate
                                            conditions of use for which the
                                            reference product is licensed
                                            and intended to be used and for
                                            which licensure is sought for
                                            the biological product;
                                        ``(II) the biological product and
                                    reference product utilize the same
                                    mechanism or mechanisms of action for
                                    the condition or conditions of use
                                    prescribed, recommended, or suggested
                                    in the proposed labeling, but only to
                                    the extent the mechanism or mechanisms
                                    of action are known for the reference
                                    product;
                                        ``(III) the condition or conditions
                                    of use prescribed, recommended, or
                                    suggested in the labeling proposed for
                                    the biological product have been
                                    previously approved for the reference
                                    product;
                                        ``(IV) the route of administration,
                                    the dosage form, and the strength of
                                    the biological product are the same as
                                    those of the reference product; and
                                        ``(V) the facility in which the
                                    biological product is manufactured,
                                    processed, packed, or held meets
                                    standards designed to assure that the
                                    biological product continues to be
                                    safe, pure, and potent.
                                ``(ii) Determination by secretary.--The
                            Secretary may determine, in the Secretary's
                            discretion, that an element described in clause
                            (i)(I) is unnecessary in an application
                            submitted under this subsection.
                                ``(iii) Additional information.--An
                            application submitted under this subsection--
                                        ``(I) shall include publicly-
                                    available information regarding the
                                    Secretary's previous determination that
                                    the reference product is safe, pure,
                                    and potent; and
                                        ``(II) may include any additional
                                    information in support of the
                                    application, including publicly-
                                    available information with respect to
                                    the reference product or another
                                    biological product.
                        ``(B) Interchangeability.--An application (or a
                    supplement to an application) submitted under this
                    subsection may include information demonstrating that
                    the biological product meets the standards described in
                    paragraph (4).
                ``(3) Evaluation by secretary.--Upon review of an
            application (or a supplement to an application) submitted under
            this subsection, the Secretary shall license the biological
            product under this subsection if--
                        ``(A) the Secretary determines that the information
                    submitted in the application (or the supplement) is
                    sufficient to show that the biological product--
                                ``(i) is biosimilar to the reference
                            product; or
                                ``(ii) meets the standards described in
                            paragraph (4), and therefore is interchangeable
                            with the reference product; and
                        ``(B) the applicant (or other appropriate person)
                    consents to the inspection of the facility that is the
                    subject of the application, in accordance with
                    subsection (c).
                ``(4) Safety standards for determining
            interchangeability.--Upon review of an application submitted
            under this subsection or any supplement to such application,
            the Secretary shall determine the biological product to be
            interchangeable with the reference product if the Secretary
            determines that the information submitted in the application
            (or a supplement to such application) is sufficient to show
            that--
                        ``(A) the biological product--
                                ``(i) is biosimilar to the reference
                            product; and
                                ``(ii) can be expected to produce the same
                            clinical result as the reference product in any
                            given patient; and
                        ``(B) for a biological product that is administered
                    more than once to an individual, the risk in terms of
                    safety or diminished efficacy of alternating or
                    switching between use of the biological product and the
                    reference product is not greater than the risk of using
                    the reference product without such alternation or
                    switch.
                ``(5) General rules.--
                        ``(A) One reference product per application.--A
                    biological product, in an application submitted under
                    this subsection, may not be evaluated against more than
                    1 reference product.
                        ``(B) Review.--An application submitted under this
                    subsection shall be reviewed by the division within the
                    Food and Drug Administration that is responsible for
                    the review and approval of the application under which
                    the reference product is licensed.
                        ``(C) Risk evaluation and mitigation strategies.--
                    The authority of the Secretary with respect to risk
                    evaluation and mitigation strategies under the Federal
                    Food, Drug, and Cosmetic Act shall apply to biological
                    products licensed under this subsection in the same
                    manner as such authority applies to biological products
                    licensed under subsection (a).
                ``(6) Exclusivity for first interchangeable biological
            product.--Upon review of an application submitted under this
            subsection relying on the same reference product for which a
            prior biological product has received a determination of
            interchangeability for any condition of use, the Secretary
            shall not make a determination under paragraph (4) that the
            second or subsequent biological product is interchangeable for
            any condition of use until the earlier of--
                        ``(A) 1 year after the first commercial marketing
                    of the first interchangeable biosimilar biological
                    product to be approved as interchangeable for that
                    reference product;
                        ``(B) 18 months after--
                                ``(i) a final court decision on all patents
                            in suit in an action instituted under
                            subsection (l)(6) against the applicant that
                            submitted the application for the first
                            approved interchangeable biosimilar biological
                            product; or
                                ``(ii) the dismissal with or without
                            prejudice of an action instituted under
                            subsection (l)(6) against the applicant that
                            submitted the application for the first
                            approved interchangeable biosimilar biological
                            product; or
                        ``(C)(i) 42 months after approval of the first
                    interchangeable biosimilar biological product if the
                    applicant that submitted such application has been sued
                    under subsection (l)(6) and such litigation is still
                    ongoing within such 42-month period; or
                        ``(ii) 18 months after approval of the first
                    interchangeable biosimilar biological product if the
                    applicant that submitted such application has not been
                    sued under subsection (l)(6).
            For purposes of this paragraph, the term `final court decision'
            means a final decision of a court from which no appeal (other
            than a petition to the United States Supreme Court for a writ
            of certiorari) has been or can be taken.
                ``(7) Exclusivity for reference product.--
                        ``(A) Effective date of biosimilar application
                    approval.--Approval of an application under this
                    subsection may not be made effective by the Secretary
                    until the date that is 12 years after the date on which
                    the reference product was first licensed under
                    subsection (a).
                        ``(B) Filing period.--An application under this
                    subsection may not be submitted to the Secretary until
                    the date that is 4 years after the date on which the
                    reference product was first licensed under subsection
                    (a).
                        ``(C) First licensure.--Subparagraphs (A) and (B)
                    shall not apply to a license for or approval of--
                                ``(i) a supplement for the biological
                            product that is the reference product; or
                                ``(ii) a subsequent application filed by
                            the same sponsor or manufacturer of the
                            biological product that is the reference
                            product (or a licensor, predecessor in
                            interest, or other related entity) for--
                                        ``(I) a change (not including a
                                    modification to the structure of the
                                    biological product) that results in a
                                    new indication, route of
                                    administration, dosing schedule, dosage
                                    form, delivery system, delivery device,
                                    or strength; or
                                        ``(II) a modification to the
                                    structure of the biological product
                                    that does not result in a change in
                                    safety, purity, or potency.
                ``(8) Guidance documents.--
                        ``(A) In general.--The Secretary may, after
                    opportunity for public comment, issue guidance in
                    accordance, except as provided in subparagraph (B)(i),
                    with section 701(h) of the Federal Food, Drug, and
                    Cosmetic Act with respect to the licensure of a
                    biological product under this subsection. Any such
                    guidance may be general or specific.
                        ``(B) Public comment.--
                                ``(i) In general.--The Secretary shall
                            provide the public an opportunity to comment on
                            any proposed guidance issued under subparagraph
                            (A) before issuing final guidance.
                                ``(ii) Input regarding most valuable
                            guidance.--The Secretary shall establish a
                            process through which the public may provide
                            the Secretary with input regarding priorities
                            for issuing guidance.
                        ``(C) No requirement for application
                    consideration.--The issuance (or non-issuance) of
                    guidance under subparagraph (A) shall not preclude the
                    review of, or action on, an application submitted under
                    this subsection.
                        ``(D) Requirement for product class-specific
                    guidance.--If the Secretary issues product class-
                    specific guidance under subparagraph (A), such guidance
                    shall include a description of--
                                ``(i) the criteria that the Secretary will
                            use to determine whether a biological product
                            is highly similar to a reference product in
                            such product class; and
                                ``(ii) the criteria, if available, that the
                            Secretary will use to determine whether a
                            biological product meets the standards
                            described in paragraph (4).
                        ``(E) Certain product classes.--
                                ``(i) Guidance.--The Secretary may indicate
                            in a guidance document that the science and
                            experience, as of the date of such guidance,
                            with respect to a product or product class (not
                            including any recombinant protein) does not
                            allow approval of an application for a license
                            as provided under this subsection for such
                            product or product class.
                                ``(ii) Modification or reversal.--The
                            Secretary may issue a subsequent guidance
                            document under subparagraph (A) to modify or
                            reverse a guidance document under clause (i).
                                ``(iii) No effect on ability to deny
                            license.--Clause (i) shall not be construed to
                            require the Secretary to approve a product with
                            respect to which the Secretary has not
                            indicated in a guidance document that the
                            science and experience, as described in clause
                            (i), does not allow approval of such an
                            application.
        ``(l) Patents.--
                ``(1) Confidential access to subsection (k) application.--
                        ``(A) Application of paragraph.--Unless otherwise
                    agreed to by a person that submits an application under
                    subsection (k) (referred to in this subsection as the
                    `subsection (k) applicant') and the sponsor of the
                    application for the reference product (referred to in
                    this subsection as the `reference product sponsor'),
                    the provisions of this paragraph shall apply to the
                    exchange of information described in this subsection.
                        ``(B) In general.--
                                ``(i) Provision of confidential
                            information.--When a subsection (k) applicant
                            submits an application under subsection (k),
                            such applicant shall provide to the persons
                            described in clause (ii), subject to the terms
                            of this paragraph, confidential access to the
                            information required to be produced pursuant to
                            paragraph (2) and any other information that
                            the subsection (k) applicant determines, in its
                            sole discretion, to be appropriate (referred to
                            in this subsection as the `confidential
                            information').
                                ``(ii) Recipients of information.--The
                            persons described in this clause are the
                            following:
                                        ``(I) Outside counsel.--One or more
                                    attorneys designated by the reference
                                    product sponsor who are employees of an
                                    entity other than the reference product
                                    sponsor (referred to in this paragraph
                                    as the `outside counsel'), provided
                                    that such attorneys do not engage,
                                    formally or informally, in patent
                                    prosecution relevant or related to the
                                    reference product.
                                        ``(II) In-house counsel.--One
                                    attorney that represents the reference
                                    product sponsor who is an employee of
                                    the reference product sponsor, provided
                                    that such attorney does not engage,
                                    formally or informally, in patent
                                    prosecution relevant or related to the
                                    reference product.
                                ``(iii) Patent owner access.--A
                            representative of the owner of a patent
                            exclusively licensed to a reference product
                            sponsor with respect to the reference product
                            and who has retained a right to assert the
                            patent or participate in litigation concerning
                            the patent may be provided the confidential
                            information, provided that the representative
                            informs the reference product sponsor and the
                            subsection (k) applicant of his or her
                            agreement to be subject to the confidentiality
                            provisions set forth in this paragraph,
                            including those under clause (ii).
                        ``(C) Limitation on disclosure.--No person that
                    receives confidential information pursuant to
                    subparagraph (B) shall disclose any confidential
                    information to any other person or entity, including
                    the reference product sponsor employees, outside
                    scientific consultants, or other outside counsel
                    retained by the reference product sponsor, without the
                    prior written consent of the subsection (k) applicant,
                    which shall not be unreasonably withheld.
                        ``(D) Use of confidential information.--
                    Confidential information shall be used for the sole and
                    exclusive purpose of determining, with respect to each
                    patent assigned to or exclusively licensed by the
                    reference product sponsor, whether a claim of patent
                    infringement could reasonably be asserted if the
                    subsection (k) applicant engaged in the manufacture,
                    use, offering for sale, sale, or importation into the
                    United States of the biological product that is the
                    subject of the application under subsection (k).
                        ``(E) Ownership of confidential information.--The
                    confidential information disclosed under this paragraph
                    is, and shall remain, the property of the subsection
                    (k) applicant. By providing the confidential
                    information pursuant to this paragraph, the subsection
                    (k) applicant does not provide the reference product
                    sponsor or the outside counsel any interest in or
                    license to use the confidential information, for
                    purposes other than those specified in subparagraph
                    (D).
                        ``(F) Effect of infringement action.--In the event
                    that the reference product sponsor files a patent
                    infringement suit, the use of confidential information
                    shall continue to be governed by the terms of this
                    paragraph until such time as a court enters a
                    protective order regarding the information. Upon entry
                    of such order, the subsection (k) applicant may
                    redesignate confidential information in accordance with
                    the terms of that order. No confidential information
                    shall be included in any publicly-available complaint
                    or other pleading. In the event that the reference
                    product sponsor does not file an infringement action by
                    the date specified in paragraph (6), the reference
                    product sponsor shall return or destroy all
                    confidential information received under this paragraph,
                    provided that if the reference product sponsor opts to
                    destroy such information, it will confirm destruction
                    in writing to the subsection (k) applicant.
                        ``(G) Rule of construction.--Nothing in this
                    paragraph shall be construed--
                                ``(i) as an admission by the subsection (k)
                            applicant regarding the validity,
                            enforceability, or infringement of any patent;
                            or
                                ``(ii) as an agreement or admission by the
                            subsection (k) applicant with respect to the
                            competency, relevance, or materiality of any
                            confidential information.
                        ``(H) Effect of violation.--The disclosure of any
                    confidential information in violation of this paragraph
                    shall be deemed to cause the subsection (k) applicant
                    to suffer irreparable harm for which there is no
                    adequate legal remedy and the court shall consider
                    immediate injunctive relief to be an appropriate and
                    necessary remedy for any violation or threatened
                    violation of this paragraph.
                ``(2) Subsection (k) application information.--Not later
            than 20 days after the Secretary notifies the subsection (k)
            applicant that the application has been accepted for review,
            the subsection (k) applicant--
                        ``(A) shall provide to the reference product
                    sponsor a copy of the application submitted to the
                    Secretary under subsection (k), and such other
                    information that describes the process or processes
                    used to manufacture the biological product that is the
                    subject of such application; and
                        ``(B) may provide to the reference product sponsor
                    additional information requested by or on behalf of the
                    reference product sponsor.
                ``(3) List and description of patents.--
                        ``(A) List by reference product sponsor.--Not later
                    than 60 days after the receipt of the application and
                    information under paragraph (2), the reference product
                    sponsor shall provide to the subsection (k) applicant--
                                ``(i) a list of patents for which the
                            reference product sponsor believes a claim of
                            patent infringement could reasonably be
                            asserted by the reference product sponsor, or
                            by a patent owner that has granted an exclusive
                            license to the reference product sponsor with
                            respect to the reference product, if a person
                            not licensed by the reference product sponsor
                            engaged in the making, using, offering to sell,
                            selling, or importing into the United States of
                            the biological product that is the subject of
                            the subsection (k) application; and
                                ``(ii) an identification of the patents on
                            such list that the reference product sponsor
                            would be prepared to license to the subsection
                            (k) applicant.
                        ``(B) List and description by subsection (k)
                    applicant.--Not later than 60 days after receipt of the
                    list under subparagraph (A), the subsection (k)
                    applicant--
                                ``(i) may provide to the reference product
                            sponsor a list of patents to which the
                            subsection (k) applicant believes a claim of
                            patent infringement could reasonably be
                            asserted by the reference product sponsor if a
                            person not licensed by the reference product
                            sponsor engaged in the making, using, offering
                            to sell, selling, or importing into the United
                            States of the biological product that is the
                            subject of the subsection (k) application;
                                ``(ii) shall provide to the reference
                            product sponsor, with respect to each patent
                            listed by the reference product sponsor under
                            subparagraph (A) or listed by the subsection
                            (k) applicant under clause (i)--
                                        ``(I) a detailed statement that
                                    describes, on a claim by claim basis,
                                    the factual and legal basis of the
                                    opinion of the subsection (k) applicant
                                    that such patent is invalid,
                                    unenforceable, or will not be infringed
                                    by the commercial marketing of the
                                    biological product that is the subject
                                    of the subsection (k) application; or
                                        ``(II) a statement that the
                                    subsection (k) applicant does not
                                    intend to begin commercial marketing of
                                    the biological product before the date
                                    that such patent expires; and
                                ``(iii) shall provide to the reference
                            product sponsor a response regarding each
                            patent identified by the reference product
                            sponsor under subparagraph (A)(ii).
                        ``(C) Description by reference product sponsor.--
                    Not later than 60 days after receipt of the list and
                    statement under subparagraph (B), the reference product
                    sponsor shall provide to the subsection (k) applicant a
                    detailed statement that describes, with respect to each
                    patent described in subparagraph (B)(ii)(I), on a claim
                    by claim basis, the factual and legal basis of the
                    opinion of the reference product sponsor that such
                    patent will be infringed by the commercial marketing of
                    the biological product that is the subject of the
                    subsection (k) application and a response to the
                    statement concerning validity and enforceability
                    provided under subparagraph (B)(ii)(I).
                ``(4) Patent resolution negotiations.--
                        ``(A) In general.--After receipt by the subsection
                    (k) applicant of the statement under paragraph (3)(C),
                    the reference product sponsor and the subsection (k)
                    applicant shall engage in good faith negotiations to
                    agree on which, if any, patents listed under paragraph
                    (3) by the subsection (k) applicant or the reference
                    product sponsor shall be the subject of an action for
                    patent infringement under paragraph (6).
                        ``(B) Failure to reach agreement.--If, within 15
                    days of beginning negotiations under subparagraph (A),
                    the subsection (k) applicant and the reference product
                    sponsor fail to agree on a final and complete list of
                    which, if any, patents listed under paragraph (3) by
                    the subsection (k) applicant or the reference product
                    sponsor shall be the subject of an action for patent
                    infringement under paragraph (6), the provisions of
                    paragraph (5) shall apply to the parties.
                ``(5) Patent resolution if no agreement.--
                        ``(A) Number of patents.--The subsection (k)
                    applicant shall notify the reference product sponsor of
                    the number of patents that such applicant will provide
                    to the reference product sponsor under subparagraph
                    (B)(i)(I).
                        ``(B) Exchange of patent lists.--
                                ``(i) In general.--On a date agreed to by
                            the subsection (k) applicant and the reference
                            product sponsor, but in no case later than 5
                            days after the subsection (k) applicant
                            notifies the reference product sponsor under
                            subparagraph (A), the subsection (k) applicant
                            and the reference product sponsor shall
                            simultaneously exchange--
                                        ``(I) the list of patents that the
                                    subsection (k) applicant believes
                                    should be the subject of an action for
                                    patent infringement under paragraph
                                    (6); and
                                        ``(II) the list of patents, in
                                    accordance with clause (ii), that the
                                    reference product sponsor believes
                                    should be the subject of an action for
                                    patent infringement under paragraph
                                    (6).
                                ``(ii) Number of patents listed by
                            reference product sponsor.--
                                        ``(I) In general.--Subject to
                                    subclause (II), the number of patents
                                    listed by the reference product sponsor
                                    under clause (i)(II) may not exceed the
                                    number of patents listed by the
                                    subsection (k) applicant under clause
                                    (i)(I).
                                        ``(II) Exception.--If a subsection
                                    (k) applicant does not list any patent
                                    under clause (i)(I), the reference
                                    product sponsor may list 1 patent under
                                    clause (i)(II).
                ``(6) Immediate patent infringement action.--
                        ``(A) Action if agreement on patent list.--If the
                    subsection (k) applicant and the reference product
                    sponsor agree on patents as described in paragraph (4),
                    not later than 30 days after such agreement, the
                    reference product sponsor shall bring an action for
                    patent infringement with respect to each such patent.
                        ``(B) Action if no agreement on patent list.--If
                    the provisions of paragraph (5) apply to the parties as
                    described in paragraph (4)(B), not later than 30 days
                    after the exchange of lists under paragraph (5)(B), the
                    reference product sponsor shall bring an action for
                    patent infringement with respect to each patent that is
                    included on such lists.
                        ``(C) Notification and publication of complaint.--
                                ``(i) Notification to secretary.--Not later
                            than 30 days after a complaint is served to a
                            subsection (k) applicant in an action for
                            patent infringement described under this
                            paragraph, the subsection (k) applicant shall
                            provide the Secretary with notice and a copy of
                            such complaint.
                                ``(ii) Publication by secretary.--The
                            Secretary shall publish in the Federal Register
                            notice of a complaint received under clause
                            (i).
                ``(7) Newly issued or licensed patents.--In the case of a
            patent that--
                        ``(A) is issued to, or exclusively licensed by, the
                    reference product sponsor after the date that the
                    reference product sponsor provided the list to the
                    subsection (k) applicant under paragraph (3)(A); and
                        ``(B) the reference product sponsor reasonably
                    believes that, due to the issuance of such patent, a
                    claim of patent infringement could reasonably be
                    asserted by the reference product sponsor if a person
                    not licensed by the reference product sponsor engaged
                    in the making, using, offering to sell, selling, or
                    importing into the United States of the biological
                    product that is the subject of the subsection (k)
                    application,
            not later than 30 days after such issuance or licensing, the
            reference product sponsor shall provide to the subsection (k)
            applicant a supplement to the list provided by the reference
            product sponsor under paragraph (3)(A) that includes such
            patent, not later than 30 days after such supplement is
            provided, the subsection (k) applicant shall provide a
            statement to the reference product sponsor in accordance with
            paragraph (3)(B), and such patent shall be subject to paragraph
            (8).
                ``(8) Notice of commercial marketing and preliminary
            injunction.--
                        ``(A) Notice of commercial marketing.--The
                    subsection (k) applicant shall provide notice to the
                    reference product sponsor not later than 180 days
                    before the date of the first commercial marketing of
                    the biological product licensed under subsection (k).
                        ``(B) Preliminary injunction.--After receiving the
                    notice under subparagraph (A) and before such date of
                    the first commercial marketing of such biological
                    product, the reference product sponsor may seek a
                    preliminary injunction prohibiting the subsection (k)
                    applicant from engaging in the commercial manufacture
                    or sale of such biological product until the court
                    decides the issue of patent validity, enforcement, and
                    infringement with respect to any patent that is--
                                ``(i) included in the list provided by the
                            reference product sponsor under paragraph
                            (3)(A) or in the list provided by the
                            subsection (k) applicant under paragraph
                            (3)(B); and
                                ``(ii) not included, as applicable, on--
                                        ``(I) the list of patents described
                                    in paragraph (4); or
                                        ``(II) the lists of patents
                                    described in paragraph (5)(B).
                        ``(C) Reasonable cooperation.--If the reference
                    product sponsor has sought a preliminary injunction
                    under subparagraph (B), the reference product sponsor
                    and the subsection (k) applicant shall reasonably
                    cooperate to expedite such further discovery as is
                    needed in connection with the preliminary injunction
                    motion.
                ``(9) Limitation on declaratory judgment action.--
                        ``(A) Subsection (k) application provided.--If a
                    subsection (k) applicant provides the application and
                    information required under paragraph (2)(A), neither
                    the reference product sponsor nor the subsection (k)
                    applicant may, prior to the date notice is received
                    under paragraph (8)(A), bring any action under section
                    2201 of title 28, United States Code, for a declaration
                    of infringement, validity, or enforceability of any
                    patent that is described in clauses (i) and (ii) of
                    paragraph (8)(B).
                        ``(B) Subsequent failure to act by subsection (k)
                    applicant.--If a subsection (k) applicant fails to
                    complete an action required of the subsection (k)
                    applicant under paragraph (3)(B)(ii), paragraph (5),
                    paragraph (6)(C)(i), paragraph (7), or paragraph
                    (8)(A), the reference product sponsor, but not the
                    subsection (k) applicant, may bring an action under
                    section 2201 of title 28, United States Code, for a
                    declaration of infringement, validity, or
                    enforceability of any patent included in the list
                    described in paragraph (3)(A), including as provided
                    under paragraph (7).
                        ``(C) Subsection (k) application not provided.--If
                    a subsection (k) applicant fails to provide the
                    application and information required under paragraph
                    (2)(A), the reference product sponsor, but not the
                    subsection (k) applicant, may bring an action under
                    section 2201 of title 28, United States Code, for a
                    declaration of infringement, validity, or
                    enforceability of any patent that claims the biological
                    product or a use of the biological product.''.
        (b) Definitions.--Section 351(i) of the Public Health Service Act
    (42 U.S.C. 262(i)) is amended--
                (1) by striking ``In this section, the term `biological
            product' means'' and inserting the following: ``In this
            section:
                ``(1) The term `biological product' means'';
                (2) in paragraph (1), as so designated, by inserting
            ``protein (except any chemically synthesized polypeptide),''
            after ``allergenic product,''; and
                (3) by adding at the end the following:
                ``(2) The term `biosimilar' or `biosimilarity', in
            reference to a biological product that is the subject of an
            application under subsection (k), means--
                        ``(A) that the biological product is highly similar
                    to the reference product notwithstanding minor
                    differences in clinically inactive components; and
                        ``(B) there are no clinically meaningful
                    differences between the biological product and the
                    reference product in terms of the safety, purity, and
                    potency of the product.
                ``(3) The term `interchangeable' or `interchangeability',
            in reference to a biological product that is shown to meet the
            standards described in subsection (k)(4), means that the
            biological product may be substituted for the reference product
            without the intervention of the health care provider who
            prescribed the reference product.
                ``(4) The term `reference product' means the single
            biological product licensed under subsection (a) against which
            a biological product is evaluated in an application submitted
            under subsection (k).''.
        (c) Conforming Amendments Relating to Patents.--
                (1) Patents.--Section 271(e) of title 35, United States
            Code, is amended--
                        (A) in paragraph (2)--
                                (i) in subparagraph (A), by striking ``or''
                            at the end;
                                (ii) in subparagraph (B), by adding ``or''
                            at the end; and
                                (iii) by inserting after subparagraph (B)
                            the following:
                ``(C)(i) with respect to a patent that is identified in the
            list of patents described in section 351(l)(3) of the Public
            Health Service Act (including as provided under section
            351(l)(7) of such Act), an application seeking approval of a
            biological product, or
                ``(ii) if the applicant for the application fails to
            provide the application and information required under section
            351(l)(2)(A) of such Act, an application seeking approval of a
            biological product for a patent that could be identified
            pursuant to section 351(l)(3)(A)(i) of such Act,''; and
                                (iv) in the matter following subparagraph
                            (C) (as added by clause (iii)), by striking
                            ``or veterinary biological product'' and
                            inserting ``, veterinary biological product, or
                            biological product'';
                        (B) in paragraph (4)--
                                (i) in subparagraph (B), by--
                                        (I) striking ``or veterinary
                                    biological product'' and inserting ``,
                                    veterinary biological product, or
                                    biological product''; and
                                        (II) striking ``and'' at the end;
                                (ii) in subparagraph (C), by--
                                        (I) striking ``or veterinary
                                    biological product'' and inserting ``,
                                    veterinary biological product, or
                                    biological product''; and
                                        (II) striking the period and
                                    inserting ``, and'';
                                (iii) by inserting after subparagraph (C)
                            the following:
                ``(D) the court shall order a permanent injunction
            prohibiting any infringement of the patent by the biological
            product involved in the infringement until a date which is not
            earlier than the date of the expiration of the patent that has
            been infringed under paragraph (2)(C), provided the patent is
            the subject of a final court decision, as defined in section
            351(k)(6) of the Public Health Service Act, in an action for
            infringement of the patent under section 351(l)(6) of such Act,
            and the biological product has not yet been approved because of
            section 351(k)(7) of such Act.''; and
                                (iv) in the matter following subparagraph
                            (D) (as added by clause (iii)), by striking
                            ``and (C)'' and inserting ``(C), and (D)''; and
                        (C) by adding at the end the following:
        ``(6)(A) Subparagraph (B) applies, in lieu of paragraph (4), in the
    case of a patent--
                ``(i) that is identified, as applicable, in the list of
            patents described in section 351(l)(4) of the Public Health
            Service Act or the lists of patents described in section
            351(l)(5)(B) of such Act with respect to a biological product;
            and
                ``(ii) for which an action for infringement of the patent
            with respect to the biological product--
                        ``(I) was brought after the expiration of the 30-
                    day period described in subparagraph (A) or (B), as
                    applicable, of section 351(l)(6) of such Act; or
                        ``(II) was brought before the expiration of the 30-
                    day period described in subclause (I), but which was
                    dismissed without prejudice or was not prosecuted to
                    judgment in good faith.
        ``(B) In an action for infringement of a patent described in
    subparagraph (A), the sole and exclusive remedy that may be granted by
    a court, upon a finding that the making, using, offering to sell,
    selling, or importation into the United States of the biological
    product that is the subject of the action infringed the patent, shall
    be a reasonable royalty.
        ``(C) The owner of a patent that should have been included in the
    list described in section 351(l)(3)(A) of the Public Health Service
    Act, including as provided under section 351(l)(7) of such Act for a
    biological product, but was not timely included in such list, may not
    bring an action under this section for infringement of the patent with
    respect to the biological product.''.
                (2) Conforming amendment under title 28.--Section 2201(b)
            of title 28, United States Code, is amended by inserting before
            the period the following: ``, or section 351 of the Public
            Health Service Act''.
        (d) Conforming Amendments Under the Federal Food, Drug, and
    Cosmetic Act.--
                (1) Content and review of applications.--Section
            505(b)(5)(B) of the Federal Food, Drug, and Cosmetic Act (21
            U.S.C. 355(b)(5)(B)) is amended by inserting before the period
            at the end of the first sentence the following: ``or, with
            respect to an applicant for approval of a biological product
            under section 351(k) of the Public Health Service Act, any
            necessary clinical study or studies''.
                (2) New active ingredient.--Section 505B of the Federal
            Food, Drug, and Cosmetic Act (21 U.S.C. 355c) is amended by
            adding at the end the following:
        ``(n) New Active Ingredient.--
                ``(1) Non-interchangeable biosimilar biological product.--A
            biological product that is biosimilar to a reference product
            under section 351 of the Public Health Service Act, and that
            the Secretary has not determined to meet the standards
            described in subsection (k)(4) of such section for
            interchangeability with the reference product, shall be
            considered to have a new active ingredient under this section.
                ``(2) Interchangeable biosimilar biological product.--A
            biological product that is interchangeable with a reference
            product under section 351 of the Public Health Service Act
            shall not be considered to have a new active ingredient under
            this section.''.
        (e) Products Previously Approved Under Section 505.--
                (1) Requirement to follow section 351.--Except as provided
            in paragraph (2), an application for a biological product shall
            be submitted under section 351 of the Public Health Service Act
            (42 U.S.C. 262) (as amended by this Act).
                (2) Exception.--An application for a biological product may
            be submitted under section 505 of the Federal Food, Drug, and
            Cosmetic Act (21 U.S.C. 355) if--
                        (A) such biological product is in a product class
                    for which a biological product in such product class is
                    the subject of an application approved under such
                    section 505 not later than the date of enactment of
                    this Act; and
                        (B) such application--
                                (i) has been submitted to the Secretary of
                            Health and Human Services (referred to in this
                            subtitle as the ``Secretary'') before the date
                            of enactment of this Act; or
                                (ii) is submitted to the Secretary not
                            later than the date that is 10 years after the
                            date of enactment of this Act.
                (3) Limitation.--Notwithstanding paragraph (2), an
            application for a biological product may not be submitted under
            section 505 of the Federal Food, Drug, and Cosmetic Act (21
            U.S.C. 355) if there is another biological product approved
            under subsection (a) of section 351 of the Public Health
            Service Act that could be a reference product with respect to
            such application (within the meaning of such section 351) if
            such application were submitted under subsection (k) of such
            section 351.
                (4) Deemed approved under section 351.--An approved
            application for a biological product under section 505 of the
            Federal Food, Drug, and Cosmetic Act (21 U.S.C. 355) shall be
            deemed to be a license for the biological product under such
            section 351 on the date that is 10 years after the date of
            enactment of this Act.
                (5) Definitions.--For purposes of this subsection, the term
            ``biological product'' has the meaning given such term under
            section 351 of the Public Health Service Act (42 U.S.C. 262)
            (as amended by this Act).
        (f) Follow-on Biologics User Fees.--
                (1) Development of user fees for biosimilar biological
            products.--
                        (A) In general.--Beginning not later than October
                    1, 2010, the Secretary shall develop recommendations to
                    present to Congress with respect to the goals, and
                    plans for meeting the goals, for the process for the
                    review of biosimilar biological product applications
                    submitted under section 351(k) of the Public Health
                    Service Act (as added by this Act) for the first 5
                    fiscal years after fiscal year 2012. In developing such
                    recommendations, the Secretary shall consult with--
                                (i) the Committee on Health, Education,
                            Labor, and Pensions of the Senate;
                                (ii) the Committee on Energy and Commerce
                            of the House of Representatives;
                                (iii) scientific and academic experts;
                                (iv) health care professionals;
                                (v) representatives of patient and consumer
                            advocacy groups; and
                                (vi) the regulated industry.
                        (B) Public review of recommendations.--After
                    negotiations with the regulated industry, the Secretary
                    shall--
                                (i) present the recommendations developed
                            under subparagraph (A) to the Congressional
                            committees specified in such subparagraph;
                                (ii) publish such recommendations in the
                            Federal Register;
                                (iii) provide for a period of 30 days for
                            the public to provide written comments on such
                            recommendations;
                                (iv) hold a meeting at which the public may
                            present its views on such recommendations; and
                                (v) after consideration of such public
                            views and comments, revise such recommendations
                            as necessary.
                        (C) Transmittal of recommendations.--Not later than
                    January 15, 2012, the Secretary shall transmit to
                    Congress the revised recommendations under subparagraph
                    (B), a summary of the views and comments received under
                    such subparagraph, and any changes made to the
                    recommendations in response to such views and comments.
                (2) Establishment of user fee program.--It is the sense of
            the Senate that, based on the recommendations transmitted to
            Congress by the Secretary pursuant to paragraph (1)(C),
            Congress should authorize a program, effective on October 1,
            2012, for the collection of user fees relating to the
            submission of biosimilar biological product applications under
            section 351(k) of the Public Health Service Act (as added by
            this Act).
                (3) Transitional provisions for user fees for biosimilar
            biological products.--
                        (A) Application of the prescription drug user fee
                    provisions.--Section 735(1)(B) of the Federal Food,
                    Drug, and Cosmetic Act (21 U.S.C. 379g(1)(B)) is
                    amended by striking ``section 351'' and inserting
                    ``subsection (a) or (k) of section 351''.
                        (B) Evaluation of costs of reviewing biosimilar
                    biological product applications.--During the period
                    beginning on the date of enactment of this Act and
                    ending on October 1, 2010, the Secretary shall collect
                    and evaluate data regarding the costs of reviewing
                    applications for biological products submitted under
                    section 351(k) of the Public Health Service Act (as
                    added by this Act) during such period.
                        (C) Audit.--
                                (i) In general.--On the date that is 2
                            years after first receiving a user fee
                            applicable to an application for a biological
                            product under section 351(k) of the Public
                            Health Service Act (as added by this Act), and
                            on a biennial basis thereafter until October 1,
                            2013, the Secretary shall perform an audit of
                            the costs of reviewing such applications under
                            such section 351(k). Such an audit shall
                            compare--
                                        (I) the costs of reviewing such
                                    applications under such section 351(k)
                                    to the amount of the user fee
                                    applicable to such applications; and
                                        (II)(aa) such ratio determined
                                    under subclause (I); to
                                        (bb) the ratio of the costs of
                                    reviewing applications for biological
                                    products under section 351(a) of such
                                    Act (as amended by this Act) to the
                                    amount of the user fee applicable to
                                    such applications under such section
                                    351(a).
                                (ii) Alteration of user fee.--If the audit
                            performed under clause (i) indicates that the
                            ratios compared under subclause (II) of such
                            clause differ by more than 5 percent, then the
                            Secretary shall alter the user fee applicable
                            to applications submitted under such section
                            351(k) to more appropriately account for the
                            costs of reviewing such applications.
                                (iii) Accounting standards.--The Secretary
                            shall perform an audit under clause (i) in
                            conformance with the accounting principles,
                            standards, and requirements prescribed by the
                            Comptroller General of the United States under
                            section 3511 of title 31, United State Code, to
                            ensure the validity of any potential
                            variability.
                (4) Authorization of appropriations.--There is authorized
            to be appropriated to carry out this subsection such sums as
            may be necessary for each of fiscal years 2010 through 2012.
        (g) Pediatric Studies of Biological Products.--
                (1) In general.--Section 351 of the Public Health Service
            Act (42 U.S.C. 262) is amended by adding at the end the
            following:
        ``(m) Pediatric Studies.--
                ``(1) Application of certain provisions.--The provisions of
            subsections (a), (d), (e), (f), (i), (j), (k), (l), (p), and
            (q) of section 505A of the Federal Food, Drug, and Cosmetic Act
            shall apply with respect to the extension of a period under
            paragraphs (2) and (3) to the same extent and in the same
            manner as such provisions apply with respect to the extension
            of a period under subsection (b) or (c) of section 505A of the
            Federal Food, Drug, and Cosmetic Act.
                ``(2) Market exclusivity for new biological products.--If,
            prior to approval of an application that is submitted under
            subsection (a), the Secretary determines that information
            relating to the use of a new biological product in the
            pediatric population may produce health benefits in that
            population, the Secretary makes a written request for pediatric
            studies (which shall include a timeframe for completing such
            studies), the applicant agrees to the request, such studies are
            completed using appropriate formulations for each age group for
            which the study is requested within any such timeframe, and the
            reports thereof are submitted and accepted in accordance with
            section 505A(d)(3) of the Federal Food, Drug, and Cosmetic
            Act--
                        ``(A) the periods for such biological product
                    referred to in subsection (k)(7) are deemed to be 4
                    years and 6 months rather than 4 years and 12 years and
                    6 months rather than 12 years; and
                        ``(B) if the biological product is designated under
                    section 526 for a rare disease or condition, the period
                    for such biological product referred to in section
                    527(a) is deemed to be 7 years and 6 months rather than
                    7 years.
                ``(3) Market exclusivity for already-marketed biological
            products.--If the Secretary determines that information
            relating to the use of a licensed biological product in the
            pediatric population may produce health benefits in that
            population and makes a written request to the holder of an
            approved application under subsection (a) for pediatric studies
            (which shall include a timeframe for completing such studies),
            the holder agrees to the request, such studies are completed
            using appropriate formulations for each age group for which the
            study is requested within any such timeframe, and the reports
            thereof are submitted and accepted in accordance with section
            505A(d)(3) of the Federal Food, Drug, and Cosmetic Act--
                        ``(A) the periods for such biological product
                    referred to in subsection (k)(7) are deemed to be 4
                    years and 6 months rather than 4 years and 12 years and
                    6 months rather than 12 years; and
                        ``(B) if the biological product is designated under
                    section 526 for a rare disease or condition, the period
                    for such biological product referred to in section
                    527(a) is deemed to be 7 years and 6 months rather than
                    7 years.
                ``(4) Exception.--The Secretary shall not extend a period
            referred to in paragraph (2)(A), (2)(B), (3)(A), or (3)(B) if
            the determination under section 505A(d)(3) is made later than 9
            months prior to the expiration of such period.''.
                (2) Studies regarding pediatric research.--
                        (A) Program for pediatric study of drugs.--
                    Subsection (a)(1) of section 409I of the Public Health
                    Service Act (42 U.S.C. 284m) is amended by inserting
                    ``, biological products,'' after ``including drugs''.
                        (B) Institute of medicine study.--Section 505A(p)
                    of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
                    355b(p)) is amended by striking paragraphs (4) and (5)
                    and inserting the following:
                ``(4) review and assess the number and importance of
            biological products for children that are being tested as a
            result of the amendments made by the Biologics Price
            Competition and Innovation Act of 2009 and the importance for
            children, health care providers, parents, and others of
            labeling changes made as a result of such testing;
                ``(5) review and assess the number, importance, and
            prioritization of any biological products that are not being
            tested for pediatric use; and
                ``(6) offer recommendations for ensuring pediatric testing
            of biological products, including consideration of any
            incentives, such as those provided under this section or
            section 351(m) of the Public Health Service Act.''.
        (h) Orphan Products.--If a reference product, as defined in section
    351 of the Public Health Service Act (42 U.S.C. 262) (as amended by
    this Act) has been designated under section 526 of the Federal Food,
    Drug, and Cosmetic Act (21 U.S.C. 360bb) for a rare disease or
    condition, a biological product seeking approval for such disease or
    condition under subsection (k) of such section 351 as biosimilar to, or
    interchangeable with, such reference product may be licensed by the
    Secretary only after the expiration for such reference product of the
    later of--
                (1) the 7-year period described in section 527(a) of the
            Federal Food, Drug, and Cosmetic Act (21 U.S.C. 360cc(a)); and
                (2) the 12-year period described in subsection (k)(7) of
            such section 351.

    SEC. 7003. SAVINGS.

        (a) Determination.--The Secretary of the Treasury, in consultation
    with the Secretary of Health and Human Services, shall for each fiscal
    year determine the amount of savings to the Federal Government as a
    result of the enactment of this subtitle.
        (b) Use.--Notwithstanding any other provision of this subtitle (or
    an amendment made by this subtitle), the savings to the Federal
    Government generated as a result of the enactment of this subtitle
    shall be used for deficit reduction.

      Subtitle B--More Affordable Medicines for Children and Underserved
                                  Communities

    SEC. 7101. EXPANDED PARTICIPATION IN 340B PROGRAM.

        (a) Expansion of Covered Entities Receiving Discounted Prices.--
    Section 340B(a)(4) of the Public Health Service Act (42 U.S.C.
    256b(a)(4)) is amended by adding at the end the following:
                        ``(M) A children's hospital excluded from the
                    Medicare prospective payment system pursuant to section
                    1886(d)(1)(B)(iii) of the Social Security Act, or a
                    free-standing cancer hospital excluded from the
                    Medicare prospective payment system pursuant to section
                    1886(d)(1)(B)(v) of the Social Security Act, that would
                    meet the requirements of subparagraph (L), including
                    the disproportionate share adjustment percentage
                    requirement under clause (ii) of such subparagraph, if
                    the hospital were a subsection (d) hospital as defined
                    by section 1886(d)(1)(B) of the Social Security Act.
                        ``(N) An entity that is a critical access hospital
                    (as determined under section 1820(c)(2) of the Social
                    Security Act), and that meets the requirements of
                    subparagraph (L)(i).
                        ``(O) An entity that is a rural referral center, as
                    defined by section 1886(d)(5)(C)(i) of the Social
                    Security Act, or a sole community hospital, as defined
                    by section 1886(d)(5)(C)(iii) of such Act, and that
                    both meets the requirements of subparagraph (L)(i) and
                    has a disproportionate share adjustment percentage
                    equal to or greater than 8 percent.''.
        (b) Extension of Discount to Inpatient Drugs.--Section 340B of the
    Public Health Service Act (42 U.S.C. 256b) is amended--
                (1) in paragraphs (2), (5), (7), and (9) of subsection (a),
            by striking ``outpatient'' each place it appears; and
                (2) in subsection (b)--
                        (A) by striking ``Other Definition'' and all that
                    follows through ``In this section'' and inserting the
                    following: ``Other Definitions.--
                ``(1) In general.--In this section''; and
                        (B) by adding at the end the following new
                    paragraph:
                ``(2) Covered drug.--In this section, the term `covered
            drug'--
                        ``(A) means a covered outpatient drug (as defined
                    in section 1927(k)(2) of the Social Security Act); and
                        ``(B) includes, notwithstanding paragraph (3)(A) of
                    section 1927(k) of such Act, a drug used in connection
                    with an inpatient or outpatient service provided by a
                    hospital described in subparagraph (L), (M), (N), or
                    (O) of subsection (a)(4) that is enrolled to
                    participate in the drug discount program under this
                    section.''.
        (c) Prohibition on Group Purchasing Arrangements.--Section 340B(a)
    of the Public Health Service Act (42 U.S.C. 256b(a)) is amended--
                (1) in paragraph (4)(L)--
                        (A) in clause (i), by adding ``and'' at the end;
                        (B) in clause (ii), by striking ``; and'' and
                    inserting a period; and
                        (C) by striking clause (iii); and
                (2) in paragraph (5), as amended by subsection (b)--
                        (A) by redesignating subparagraphs (C) and (D) as
                    subparagraphs (D) and (E); respectively; and
                        (B) by inserting after subparagraph (B), the
                    following:
                        ``(C) Prohibition on group purchasing
                    arrangements.--
                                ``(i) In general.--A hospital described in
                            subparagraph (L), (M), (N), or (O) of paragraph
                            (4) shall not obtain covered outpatient drugs
                            through a group purchasing organization or
                            other group purchasing arrangement, except as
                            permitted or provided for pursuant to clauses
                            (ii) or (iii).
                                ``(ii) Inpatient drugs.--Clause (i) shall
                            not apply to drugs purchased for inpatient use.
                                ``(iii) Exceptions.--The Secretary shall
                            establish reasonable exceptions to clause (i)--
                                        ``(I) with respect to a covered
                                    outpatient drug that is unavailable to
                                    be purchased through the program under
                                    this section due to a drug shortage
                                    problem, manufacturer noncompliance, or
                                    any other circumstance beyond the
                                    hospital's control;
                                        ``(II) to facilitate generic
                                    substitution when a generic covered
                                    outpatient drug is available at a lower
                                    price; or
                                        ``(III) to reduce in other ways the
                                    administrative burdens of managing both
                                    inventories of drugs subject to this
                                    section and inventories of drugs that
                                    are not subject to this section, so
                                    long as the exceptions do not create a
                                    duplicate discount problem in violation
                                    of subparagraph (A) or a diversion
                                    problem in violation of subparagraph
                                    (B).
                                ``(iv) Purchasing arrangements for
                            inpatient drugs.--The Secretary shall ensure
                            that a hospital described in subparagraph (L),
                            (M), (N), or (O) of subsection (a)(4) that is
                            enrolled to participate in the drug discount
                            program under this section shall have multiple
                            options for purchasing covered drugs for
                            inpatients, including by utilizing a group
                            purchasing organization or other group
                            purchasing arrangement, establishing and
                            utilizing its own group purchasing program,
                            purchasing directly from a manufacturer, and
                            any other purchasing arrangements that the
                            Secretary determines is appropriate to ensure
                            access to drug discount pricing under this
                            section for inpatient drugs taking into account
                            the particular needs of small and rural
                            hospitals.''.
        (d) Medicaid Credits on Inpatient Drugs.--Section 340B of the
    Public Health Service Act (42 U.S.C. 256b) is amended by striking
    subsection (c) and inserting the following:
        ``(c) Medicaid Credit.--Not later than 90 days after the date of
    filing of the hospital's most recently filed Medicare cost report, the
    hospital shall issue a credit as determined by the Secretary to the
    State Medicaid program for inpatient covered drugs provided to Medicaid
    recipients.''.
        (e) Effective Dates.--
                (1) In general.--The amendments made by this section and
            section 7102 shall take effect on January 1, 2010, and shall
            apply to drugs purchased on or after January 1, 2010.
                (2) Effectiveness.--The amendments made by this section and
            section 7102 shall be effective and shall be taken into account
            in determining whether a manufacturer is deemed to meet the
            requirements of section 340B(a) of the Public Health Service
            Act (42 U.S.C. 256b(a)), notwithstanding any other provision of
            law.

    SEC. 7102. IMPROVEMENTS TO 340B PROGRAM INTEGRITY.

        (a) Integrity Improvements.--Subsection (d) of section 340B of the
    Public Health Service Act (42 U.S.C. 256b) is amended to read as
    follows:
        ``(d) Improvements in Program Integrity.--
                ``(1) Manufacturer compliance.--
                        ``(A) In general.--From amounts appropriated under
                    paragraph (4), the Secretary shall provide for
                    improvements in compliance by manufacturers with the
                    requirements of this section in order to prevent
                    overcharges and other violations of the discounted
                    pricing requirements specified in this section.
                        ``(B) Improvements.--The improvements described in
                    subparagraph (A) shall include the following:
                                ``(i) The development of a system to enable
                            the Secretary to verify the accuracy of ceiling
                            prices calculated by manufacturers under
                            subsection (a)(1) and charged to covered
                            entities, which shall include the following:
                                        ``(I) Developing and publishing
                                    through an appropriate policy or
                                    regulatory issuance, precisely defined
                                    standards and methodology for the
                                    calculation of ceiling prices under
                                    such subsection.
                                        ``(II) Comparing regularly the
                                    ceiling prices calculated by the
                                    Secretary with the quarterly pricing
                                    data that is reported by manufacturers
                                    to the Secretary.
                                        ``(III) Performing spot checks of
                                    sales transactions by covered entities.
                                        ``(IV) Inquiring into the cause of
                                    any pricing discrepancies that may be
                                    identified and either taking, or
                                    requiring manufacturers to take, such
                                    corrective action as is appropriate in
                                    response to such price discrepancies.
                                ``(ii) The establishment of procedures for
                            manufacturers to issue refunds to covered
                            entities in the event that there is an
                            overcharge by the manufacturers, including the
                            following:
                                        ``(I) Providing the Secretary with
                                    an explanation of why and how the
                                    overcharge occurred, how the refunds
                                    will be calculated, and to whom the
                                    refunds will be issued.
                                        ``(II) Oversight by the Secretary
                                    to ensure that the refunds are issued
                                    accurately and within a reasonable
                                    period of time, both in routine
                                    instances of retroactive adjustment to
                                    relevant pricing data and exceptional
                                    circumstances such as erroneous or
                                    intentional overcharging for covered
                                    drugs.
                                ``(iii) The provision of access through the
                            Internet website of the Department of Health
                            and Human Services to the applicable ceiling
                            prices for covered drugs as calculated and
                            verified by the Secretary in accordance with
                            this section, in a manner (such as through the
                            use of password protection) that limits such
                            access to covered entities and adequately
                            assures security and protection of privileged
                            pricing data from unauthorized re-disclosure.
                                ``(iv) The development of a mechanism by
                            which--
                                        ``(I) rebates and other discounts
                                    provided by manufacturers to other
                                    purchasers subsequent to the sale of
                                    covered drugs to covered entities are
                                    reported to the Secretary; and
                                        ``(II) appropriate credits and
                                    refunds are issued to covered entities
                                    if such discounts or rebates have the
                                    effect of lowering the applicable
                                    ceiling price for the relevant quarter
                                    for the drugs involved.
                                ``(v) Selective auditing of manufacturers
                            and wholesalers to ensure the integrity of the
                            drug discount program under this section.
                                ``(vi) The imposition of sanctions in the
                            form of civil monetary penalties, which--
                                        ``(I) shall be assessed according
                                    to standards established in regulations
                                    to be promulgated by the Secretary not
                                    later than 180 days after the date of
                                    enactment of the Patient Protection and
                                    Affordable Care Act;
                                        ``(II) shall not exceed $5,000 for
                                    each instance of overcharging a covered
                                    entity that may have occurred; and
                                        ``(III) shall apply to any
                                    manufacturer with an agreement under
                                    this section that knowingly and
                                    intentionally charges a covered entity
                                    a price for purchase of a drug that
                                    exceeds the maximum applicable price
                                    under subsection (a)(1).
                ``(2) Covered entity compliance.--
                        ``(A) In general.--From amounts appropriated under
                    paragraph (4), the Secretary shall provide for
                    improvements in compliance by covered entities with the
                    requirements of this section in order to prevent
                    diversion and violations of the duplicate discount
                    provision and other requirements specified under
                    subsection (a)(5).
                        ``(B) Improvements.--The improvements described in
                    subparagraph (A) shall include the following:
                                ``(i) The development of procedures to
                            enable and require covered entities to
                            regularly update (at least annually) the
                            information on the Internet website of the
                            Department of Health and Human Services
                            relating to this section.
                                ``(ii) The development of a system for the
                            Secretary to verify the accuracy of information
                            regarding covered entities that is listed on
                            the website described in clause (i).
                                ``(iii) The development of more detailed
                            guidance describing methodologies and options
                            available to covered entities for billing
                            covered drugs to State Medicaid agencies in a
                            manner that avoids duplicate discounts pursuant
                            to subsection (a)(5)(A).
                                ``(iv) The establishment of a single,
                            universal, and standardized identification
                            system by which each covered entity site can be
                            identified by manufacturers, distributors,
                            covered entities, and the Secretary for
                            purposes of facilitating the ordering,
                            purchasing, and delivery of covered drugs under
                            this section, including the processing of
                            chargebacks for such drugs.
                                ``(v) The imposition of sanctions, in
                            appropriate cases as determined by the
                            Secretary, additional to those to which covered
                            entities are subject under subsection
                            (a)(5)(E), through one or more of the following
                            actions:
                                        ``(I) Where a covered entity
                                    knowingly and intentionally violates
                                    subsection (a)(5)(B), the covered
                                    entity shall be required to pay a
                                    monetary penalty to a manufacturer or
                                    manufacturers in the form of interest
                                    on sums for which the covered entity is
                                    found liable under subsection
                                    (a)(5)(E), such interest to be
                                    compounded monthly and equal to the
                                    current short term interest rate as
                                    determined by the Federal Reserve for
                                    the time period for which the covered
                                    entity is liable.
                                        ``(II) Where the Secretary
                                    determines a violation of subsection
                                    (a)(5)(B) was systematic and egregious
                                    as well as knowing and intentional,
                                    removing the covered entity from the
                                    drug discount program under this
                                    section and disqualifying the entity
                                    from re-entry into such program for a
                                    reasonable period of time to be
                                    determined by the Secretary.
                                        ``(III) Referring matters to
                                    appropriate Federal authorities within
                                    the Food and Drug Administration, the
                                    Office of Inspector General of
                                    Department of Health and Human
                                    Services, or other Federal agencies for
                                    consideration of appropriate action
                                    under other Federal statutes, such as
                                    the Prescription Drug Marketing Act (21
                                    U.S.C. 353).
                ``(3) Administrative dispute resolution process.--
                        ``(A) In general.--Not later than 180 days after
                    the date of enactment of the Patient Protection and
                    Affordable Care Act, the Secretary shall promulgate
                    regulations to establish and implement an
                    administrative process for the resolution of claims by
                    covered entities that they have been overcharged for
                    drugs purchased under this section, and claims by
                    manufacturers, after the conduct of audits as
                    authorized by subsection (a)(5)(D), of violations of
                    subsections (a)(5)(A) or (a)(5)(B), including
                    appropriate procedures for the provision of remedies
                    and enforcement of determinations made pursuant to such
                    process through mechanisms and sanctions described in
                    paragraphs (1)(B) and (2)(B).
                        ``(B) Deadlines and procedures.--Regulations
                    promulgated by the Secretary under subparagraph (A)
                    shall--
                                ``(i) designate or establish a decision-
                            making official or decision-making body within
                            the Department of Health and Human Services to
                            be responsible for reviewing and finally
                            resolving claims by covered entities that they
                            have been charged prices for covered drugs in
                            excess of the ceiling price described in
                            subsection (a)(1), and claims by manufacturers
                            that violations of subsection (a)(5)(A) or
                            (a)(5)(B) have occurred;
                                ``(ii) establish such deadlines and
                            procedures as may be necessary to ensure that
                            claims shall be resolved fairly, efficiently,
                            and expeditiously;
                                ``(iii) establish procedures by which a
                            covered entity may discover and obtain such
                            information and documents from manufacturers
                            and third parties as may be relevant to
                            demonstrate the merits of a claim that charges
                            for a manufacturer's product have exceeded the
                            applicable ceiling price under this section,
                            and may submit such documents and information
                            to the administrative official or body
                            responsible for adjudicating such claim;
                                ``(iv) require that a manufacturer conduct
                            an audit of a covered entity pursuant to
                            subsection (a)(5)(D) as a prerequisite to
                            initiating administrative dispute resolution
                            proceedings against a covered entity;
                                ``(v) permit the official or body
                            designated under clause (i), at the request of
                            a manufacturer or manufacturers, to consolidate
                            claims brought by more than one manufacturer
                            against the same covered entity where, in the
                            judgment of such official or body,
                            consolidation is appropriate and consistent
                            with the goals of fairness and economy of
                            resources; and
                                ``(vi) include provisions and procedures to
                            permit multiple covered entities to jointly
                            assert claims of overcharges by the same
                            manufacturer for the same drug or drugs in one
                            administrative proceeding, and permit such
                            claims to be asserted on behalf of covered
                            entities by associations or organizations
                            representing the interests of such covered
                            entities and of which the covered entities are
                            members.
                        ``(C) Finality of administrative resolution.--The
                    administrative resolution of a claim or claims under
                    the regulations promulgated under subparagraph (A)
                    shall be a final agency decision and shall be binding
                    upon the parties involved, unless invalidated by an
                    order of a court of competent jurisdiction.
                ``(4) Authorization of appropriations.--There are
            authorized to be appropriated to carry out this subsection,
            such sums as may be necessary for fiscal year 2010 and each
            succeeding fiscal year.''.
        (b) Conforming Amendments.--Section 340B(a) of the Public Health
    Service Act (42 U.S.C. 256b(a)) is amended--
                (1) in subsection (a)(1), by adding at the end the
            following: ``Each such agreement shall require that the
            manufacturer furnish the Secretary with reports, on a quarterly
            basis, of the price for each covered drug subject to the
            agreement that, according to the manufacturer, represents the
            maximum price that covered entities may permissibly be required
            to pay for the drug (referred to in this section as the
            `ceiling price'), and shall require that the manufacturer offer
            each covered entity covered drugs for purchase at or below the
            applicable ceiling price if such drug is made available to any
            other purchaser at any price.''; and
                (2) in the first sentence of subsection (a)(5)(E), as
            redesignated by section 7101(c), by inserting ``after audit as
            described in subparagraph (D) and'' after ``finds,''.

    SEC. 7103. GAO STUDY TO MAKE RECOMMENDATIONS ON IMPROVING THE 340B
                  PROGRAM.

        (a) Report.--Not later than 18 months after the date of enactment
    of this Act, the Comptroller General of the United States shall submit
    to Congress a report that examines whether those individuals served by
    the covered entities under the program under section 340B of the Public
    Health Service Act (42 U.S.C. 256b) (referred to in this section as the
    ``340B program'') are receiving optimal health care services.
        (b) Recommendations.--The report under subsection (a) shall include
    recommendations on the following:
                (1) Whether the 340B program should be expanded since it is
            anticipated that the 47,000,000 individuals who are uninsured
            as of the date of enactment of this Act will have health care
            coverage once this Act is implemented.
                (2) Whether mandatory sales of certain products by the 340B
            program could hinder patients access to those therapies through
            any provider.
                (3) Whether income from the 340B program is being used by
            the covered entities under the program to further the program
            objectives.

                             TITLE VIII--CLASS ACT

    SEC. 8001. SHORT TITLE OF TITLE.

        This title may be cited as the ``Community Living Assistance
    Services and Supports Act'' or the ``CLASS Act''.

    SEC. 8002. ESTABLISHMENT OF NATIONAL VOLUNTARY INSURANCE PROGRAM FOR
                  PURCHASING COMMUNITY LIVING ASSISTANCE SERVICES AND
                  SUPPORT.

        (a) Establishment of CLASS Program.--
                (1) In general.--The Public Health Service Act (42 U.S.C.
            201 et seq.), as amended by section 4302(a), is amended by
            adding at the end the following:

        ``TITLE XXXII--COMMUNITY LIVING ASSISTANCE SERVICES AND SUPPORTS

    ``SEC. 3201. PURPOSE.

        ``The purpose of this title is to establish a national voluntary
    insurance program for purchasing community living assistance services
    and supports in order to--
                ``(1) provide individuals with functional limitations with
            tools that will allow them to maintain their personal and
            financial independence and live in the community through a new
            financing strategy for community living assistance services and
            supports;
                ``(2) establish an infrastructure that will help address
            the Nation's community living assistance services and supports
            needs;
                ``(3) alleviate burdens on family caregivers; and
                ``(4) address institutional bias by providing a financing
            mechanism that supports personal choice and independence to
            live in the community.

    ``SEC. 3202. DEFINITIONS.

        ``In this title:
                ``(1) Active enrollee.--The term `active enrollee' means an
            individual who is enrolled in the CLASS program in accordance
            with section 3204 and who has paid any premiums due to maintain
            such enrollment.
                ``(2) Actively employed.--The term `actively employed'
            means an individual who--
                        ``(A) is reporting for work at the individual's
                    usual place of employment or at another location to
                    which the individual is required to travel because of
                    the individual's employment (or in the case of an
                    individual who is a member of the uniformed services,
                    is on active duty and is physically able to perform the
                    duties of the individual's position); and
                        ``(B) is able to perform all the usual and
                    customary duties of the individual's employment on the
                    individual's regular work schedule.
                ``(3) Activities of daily living.--The term `activities of
            daily living' means each of the following activities specified
            in section 7702B(c)(2)(B) of the Internal Revenue Code of 1986:
                        ``(A) Eating.
                        ``(B) Toileting.
                        ``(C) Transferring.
                        ``(D) Bathing.
                        ``(E) Dressing.
                        ``(F) Continence.
                ``(4) CLASS program.--The term `CLASS program' means the
            program established under this title.
                ``(5) Eligibility assessment system.--The term `Eligibility
            Assessment System' means the entity established by the
            Secretary under section 3205(a)(2) to make functional
            eligibility determinations for the CLASS program.
                ``(6) Eligible beneficiary.--
                        ``(A) In general.--The term `eligible beneficiary'
                    means any individual who is an active enrollee in the
                    CLASS program and, as of the date described in
                    subparagraph (B)--
                                ``(i) has paid premiums for enrollment in
                            such program for at least 60 months;
                                ``(ii) has earned, with respect to at least
                            3 calendar years that occur during the first 60
                            months for which the individual has paid
                            premiums for enrollment in the program, at
                            least an amount equal to the amount of wages
                            and self-employment income which an individual
                            must have in order to be credited with a
                            quarter of coverage under section 213(d) of the
                            Social Security Act for the year; and
                                ``(iii) has paid premiums for enrollment in
                            such program for at least 24 consecutive
                            months, if a lapse in premium payments of more
                            than 3 months has occurred during the period
                            that begins on the date of the individual's
                            enrollment and ends on the date of such
                            determination.
                        ``(B) Date described.--For purposes of subparagraph
                    (A), the date described in this subparagraph is the
                    date on which the individual is determined to have a
                    functional limitation described in section
                    3203(a)(1)(C) that is expected to last for a continuous
                    period of more than 90 days.
                        ``(C) Regulations.--The Secretary shall promulgate
                    regulations specifying exceptions to the minimum
                    earnings requirements under subparagraph (A)(ii) for
                    purposes of being considered an eligible beneficiary
                    for certain populations.
                ``(7) Hospital; nursing facility; intermediate care
            facility for the mentally retarded; institution for mental
            diseases.--The terms `hospital', `nursing facility',
            `intermediate care facility for the mentally retarded', and
            `institution for mental diseases' have the meanings given such
            terms for purposes of Medicaid.
                ``(8) CLASS independence advisory council.--The term `CLASS
            Independence Advisory Council' or `Council' means the Advisory
            Council established under section 3207 to advise the Secretary.
                ``(9) CLASS independence benefit plan.--The term `CLASS
            Independence Benefit Plan' means the benefit plan developed and
            designated by the Secretary in accordance with section 3203.
                ``(10) CLASS independence fund.--The term `CLASS
            Independence Fund' or `Fund' means the fund established under
            section 3206.
                ``(11) Medicaid.--The term `Medicaid' means the program
            established under title XIX of the Social Security Act (42
            U.S.C. 1396 et seq.).
                ``(12) Poverty line.--The term `poverty line' has the
            meaning given that term in section 2110(c)(5) of the Social
            Security Act (42 U.S.C. 1397jj(c)(5)).
                ``(13) Protection and advocacy system.--The term
            `Protection and Advocacy System' means the system for each
            State established under section 143 of the Developmental
            Disabilities Assistance and Bill of Rights Act of 2000 (42
            U.S.C. 15043).

    ``SEC. 3203. CLASS INDEPENDENCE BENEFIT PLAN.

        ``(a) Process for Development.--
                ``(1) In general.--The Secretary, in consultation with
            appropriate actuaries and other experts, shall develop at least
            3 actuarially sound benefit plans as alternatives for
            consideration for designation by the Secretary as the CLASS
            Independence Benefit Plan under which eligible beneficiaries
            shall receive benefits under this title. Each of the plan
            alternatives developed shall be designed to provide eligible
            beneficiaries with the benefits described in section 3205
            consistent with the following requirements:
                        ``(A) Premiums.--
                                ``(i) In general.--Beginning with the first
                            year of the CLASS program, and for each year
                            thereafter, subject to clauses (ii) and (iii),
                            the Secretary shall establish all premiums to
                            be paid by enrollees for the year based on an
                            actuarial analysis of the 75-year costs of the
                            program that ensures solvency throughout such
                            75-year period.
                                ``(ii) Nominal premium for poorest
                            individuals and full-time students.--
                                        ``(I) In general.--The monthly
                                    premium for enrollment in the CLASS
                                    program shall not exceed the applicable
                                    dollar amount per month determined
                                    under subclause (II) for--
                                                ``(aa) any individual whose
                                            income does not exceed the
                                            poverty line; and
                                                ``(bb) any individual who
                                            has not attained age 22, and is
                                            actively employed during any
                                            period in which the individual
                                            is a full-time student (as
                                            determined by the Secretary).
                                        ``(II) Applicable dollar amount.--
                                    The applicable dollar amount described
                                    in this subclause is the amount equal
                                    to $5, increased by the percentage
                                    increase in the consumer price index
                                    for all urban consumers (U.S. city
                                    average) for each year occurring after
                                    2009 and before such year.
                                ``(iii) Class independence fund reserves.--
                            At such time as the CLASS program has been in
                            operation for 10 years, the Secretary shall
                            establish all premiums to be paid by enrollees
                            for the year based on an actuarial analysis
                            that accumulated reserves in the CLASS
                            Independence Fund would not decrease in that
                            year. At such time as the Secretary determines
                            the CLASS program demonstrates a sustained
                            ability to finance expected yearly expenses
                            with expected yearly premiums and interest
                            credited to the CLASS Independence Fund, the
                            Secretary may decrease the required amount of
                            CLASS Independence Fund reserves.
                        ``(B) Vesting period.--A 5-year vesting period for
                    eligibility for benefits.
                        ``(C) Benefit triggers.--A benefit trigger for
                    provision of benefits that requires a determination
                    that an individual has a functional limitation, as
                    certified by a licensed health care practitioner,
                    described in any of the following clauses that is
                    expected to last for a continuous period of more than
                    90 days:
                                ``(i) The individual is determined to be
                            unable to perform at least the minimum number
                            (which may be 2 or 3) of activities of daily
                            living as are required under the plan for the
                            provision of benefits without substantial
                            assistance (as defined by the Secretary) from
                            another individual.
                                ``(ii) The individual requires substantial
                            supervision to protect the individual from
                            threats to health and safety due to substantial
                            cognitive impairment.
                                ``(iii) The individual has a level of
                            functional limitation similar (as determined
                            under regulations prescribed by the Secretary)
                            to the level of functional limitation described
                            in clause (i) or (ii).
                        ``(D) Cash benefit.--Payment of a cash benefit that
                    satisfies the following requirements:
                                ``(i) Minimum required amount.--The benefit
                            amount provides an eligible beneficiary with
                            not less than an average of $50 per day (as
                            determined based on the reasonably expected
                            distribution of beneficiaries receiving
                            benefits at various benefit levels).
                                ``(ii) Amount scaled to functional
                            ability.--The benefit amount is varied based on
                            a scale of functional ability, with not less
                            than 2, and not more than 6, benefit level
                            amounts.
                                ``(iii) Daily or weekly.--The benefit is
                            paid on a daily or weekly basis.
                                ``(iv) No lifetime or aggregate limit.--The
                            benefit is not subject to any lifetime or
                            aggregate limit.
                        ``(E) Coordination with supplemental coverage
                    obtained through the exchange.--The benefits allow for
                    coordination with any supplemental coverage purchased
                    through an Exchange established under section 1311 of
                    the Patient Protection and Affordable Care Act.
                ``(2) Review and recommendation by the class independence
            advisory council.--The CLASS Independence Advisory Council
            shall--
                        ``(A) evaluate the alternative benefit plans
                    developed under paragraph (1); and
                        ``(B) recommend for designation as the CLASS
                    Independence Benefit Plan for offering to the public
                    the plan that the Council determines best balances
                    price and benefits to meet enrollees' needs in an
                    actuarially sound manner, while optimizing the
                    probability of the long-term sustainability of the
                    CLASS program.
                ``(3) Designation by the secretary.--Not later than October
            1, 2012, the Secretary, taking into consideration the
            recommendation of the CLASS Independence Advisory Council under
            paragraph (2)(B), shall designate a benefit plan as the CLASS
            Independence Benefit Plan. The Secretary shall publish such
            designation, along with details of the plan and the reasons for
            the selection by the Secretary, in a final rule that allows for
            a period of public comment.
        ``(b) Additional Premium Requirements.--
                ``(1) Adjustment of premiums.--
                        ``(A) In general.--Except as provided in
                    subparagraphs (B), (C), (D), and (E), the amount of the
                    monthly premium determined for an individual upon such
                    individual's enrollment in the CLASS program shall
                    remain the same for as long as the individual is an
                    active enrollee in the program.
                        ``(B) Recalculated premium if required for program
                    solvency.--
                                ``(i) In general.--Subject to clause (ii),
                            if the Secretary determines, based on the most
                            recent report of the Board of Trustees of the
                            CLASS Independence Fund, the advice of the
                            CLASS Independence Advisory Council, and the
                            annual report of the Inspector General of the
                            Department of Health and Human Services, and
                            waste, fraud, and abuse, or such other
                            information as the Secretary determines
                            appropriate, that the monthly premiums and
                            income to the CLASS Independence Fund for a
                            year are projected to be insufficient with
                            respect to the 20-year period that begins with
                            that year, the Secretary shall adjust the
                            monthly premiums for individuals enrolled in
                            the CLASS program as necessary (but maintaining
                            a nominal premium for enrollees whose income is
                            below the poverty line or who are full-time
                            students actively employed).
                                ``(ii) Exemption from increase.--Any
                            increase in a monthly premium imposed as result
                            of a determination described in clause (i)
                            shall not apply with respect to the monthly
                            premium of any active enrollee who--
                                        ``(I) has attained age 65;
                                        ``(II) has paid premiums for
                                    enrollment in the program for at least
                                    20 years; and
                                        ``(III) is not actively employed.
                        ``(C) Recalculated premium if reenrollment after
                    more than a 3-month lapse.--
                                ``(i) In general.--The reenrollment of an
                            individual after a 90-day period during which
                            the individual failed to pay the monthly
                            premium required to maintain the individual's
                            enrollment in the CLASS program shall be
                            treated as an initial enrollment for purposes
                            of age-adjusting the premium for enrollment in
                            the program.
                                ``(ii) Credit for prior months if
                            reenrolled within 5 years.--An individual who
                            reenrolls in the CLASS program after such a 90-
                            day period and before the end of the 5-year
                            period that begins with the first month for
                            which the individual failed to pay the monthly
                            premium required to maintain the individual's
                            enrollment in the program shall be--
                                        ``(I) credited with any months of
                                    paid premiums that accrued prior to the
                                    individual's lapse in enrollment; and
                                        ``(II) notwithstanding the total
                                    amount of any such credited months,
                                    required to satisfy section
                                    3202(6)(A)(ii) before being eligible to
                                    receive benefits.
                        ``(D) No longer status as a full-time student.--An
                    individual subject to a nominal premium on the basis of
                    being described in subsection (a)(1)(A)(ii)(I)(bb) who
                    ceases to be described in that subsection, beginning
                    with the first month following the month in which the
                    individual ceases to be so described, shall be subject
                    to the same monthly premium as the monthly premium that
                    applies to an individual of the same age who first
                    enrolls in the program under the most similar
                    circumstances as the individual (such as the first year
                    of eligibility for enrollment in the program or in a
                    subsequent year).
                        ``(E) Penalty for reenollment after 5-year lapse.--
                    In the case of an individual who reenrolls in the CLASS
                    program after the end of the 5-year period described in
                    subparagraph (C)(ii), the monthly premium required for
                    the individual shall be the age-adjusted premium that
                    would be applicable to an initially enrolling
                    individual who is the same age as the reenrolling
                    individual, increased by the greater of--
                                ``(i) an amount that the Secretary
                            determines is actuarially sound for each month
                            that occurs during the period that begins with
                            the first month for which the individual failed
                            to pay the monthly premium required to maintain
                            the individual's enrollment in the CLASS
                            program and ends with the month preceding the
                            month in which the reenollment is effective; or
                                ``(ii) 1 percent of the applicable age-
                            adjusted premium for each such month occurring
                            in such period.
                ``(2) Administrative expenses.--In determining the monthly
            premiums for the CLASS program the Secretary may factor in
            costs for administering the program, not to exceed for any year
            in which the program is in effect under this title, an amount
            equal to 3 percent of all premiums paid during the year.
                ``(3) No underwriting requirements.--No underwriting (other
            than on the basis of age in accordance with subparagraphs (D)
            and (E) of paragraph (1)) shall be used to--
                        ``(A) determine the monthly premium for enrollment
                    in the CLASS program; or
                        ``(B) prevent an individual from enrolling in the
                    program.
        ``(c) Self-attestation and Verification of Income.--The Secretary
    shall establish procedures to--
                ``(1) permit an individual who is eligible for the nominal
            premium required under subsection (a)(1)(A)(ii), as part of
            their automatic enrollment in the CLASS program, to self-attest
            that their income does not exceed the poverty line or that
            their status as a full-time student who is actively employed;
                ``(2) verify, using procedures similar to the procedures
            used by the Commissioner of Social Security under section
            1631(e)(1)(B)(ii) of the Social Security Act and consistent
            with the requirements applicable to the conveyance of data and
            information under section 1942 of such Act, the validity of
            such self-attestation; and
                ``(3) require an individual to confirm, on at least an
            annual basis, that their income does not exceed the poverty
            line or that they continue to maintain such status.

    ``SEC. 3204. ENROLLMENT AND DISENROLLMENT REQUIREMENTS.

        ``(a) Automatic Enrollment.--
                ``(1) In general.--Subject to paragraph (2), the Secretary,
            in coordination with the Secretary of the Treasury, shall
            establish procedures under which each individual described in
            subsection (c) may be automatically enrolled in the CLASS
            program by an employer of such individual in the same manner as
            an employer may elect to automatically enroll employees in a
            plan under section 401(k), 403(b), or 457 of the Internal
            Revenue Code of 1986.
                ``(2) Alternative enrollment procedures.--The procedures
            established under paragraph (1) shall provide for an
            alternative enrollment process for an individual described in
            subsection (c) in the case of such an individual--
                        ``(A) who is self-employed;
                        ``(B) who has more than 1 employer; or
                        ``(C) whose employer does not elect to participate
                    in the automatic enrollment process established by the
                    Secretary.
                ``(3) Administration.--
                        ``(A) In general.--The Secretary and the Secretary
                    of the Treasury shall, by regulation, establish
                    procedures to ensure that an individual is not
                    automatically enrolled in the CLASS program by more
                    than 1 employer.
                        ``(B) Form.--Enrollment in the CLASS program shall
                    be made in such manner as the Secretary may prescribe
                    in order to ensure ease of administration.
        ``(b) Election to Opt-Out.--An individual described in subsection
    (c) may elect to waive enrollment in the CLASS program at any time in
    such form and manner as the Secretary and the Secretary of the Treasury
    shall prescribe.
        ``(c) Individual Described.--For purposes of enrolling in the CLASS
    program, an individual described in this paragraph is an individual--
                ``(1) who has attained age 18;
                ``(2) who--
                        ``(A) receives wages on which there is imposed a
                    tax under section 3201(a) of the Internal Revenue Code
                    of 1986; or
                        ``(B) derives self-employment income on which there
                    is imposed a tax under section 1401(a) of the Internal
                    Revenue Code of 1986;
                ``(3) who is actively employed; and
                ``(4) who is not--
                        ``(A) a patient in a hospital or nursing facility,
                    an intermediate care facility for the mentally
                    retarded, or an institution for mental diseases and
                    receiving medical assistance under Medicaid; or
                        ``(B) confined in a jail, prison, other penal
                    institution or correctional facility, or by court order
                    pursuant to conviction of a criminal offense or in
                    connection with a verdict or finding described in
                    section 202(x)(1)(A)(ii) of the Social Security Act (42
                    U.S.C. 402(x)(1)(A)(ii)).
        ``(d) Rule of Construction.--Nothing in this title shall be
    construed as requiring an active enrollee to continue to satisfy
    subparagraph (B) or (C) of subsection (c)(1) in order to maintain
    enrollment in the CLASS program.
        ``(e) Payment.--
                ``(1) Payroll deduction.--An amount equal to the monthly
            premium for the enrollment in the CLASS program of an
            individual shall be deducted from the wages or self-employment
            income of such individual in accordance with such procedures as
            the Secretary, in coordination with the Secretary of the
            Treasury, shall establish for employers who elect to deduct and
            withhold such premiums on behalf of enrolled employees.
                ``(2) Alternative payment mechanism.--The Secretary, in
            coordination with the Secretary of the Treasury, shall
            establish alternative procedures for the payment of monthly
            premiums by an individual enrolled in the CLASS program--
                        ``(A) who does not have an employer who elects to
                    deduct and withhold premiums in accordance with
                    subparagraph (A); or
                        ``(B) who does not earn wages or derive self-
                    employment income.
        ``(f) Transfer of Premiums Collected.--
                ``(1) In general.--During each calendar year the Secretary
            of the Treasury shall deposit into the CLASS Independence Fund
            a total amount equal, in the aggregate, to 100 percent of the
            premiums collected during that year.
                ``(2) Transfers based on estimates.--The amount deposited
            pursuant to paragraph (1) shall be transferred in at least
            monthly payments to the CLASS Independence Fund on the basis of
            estimates by the Secretary and certified to the Secretary of
            the Treasury of the amounts collected in accordance with
            subparagraphs (A) and (B) of paragraph (5). Proper adjustments
            shall be made in amounts subsequently transferred to the Fund
            to the extent prior estimates were in excess of, or were less
            than, actual amounts collected.
        ``(g) Other Enrollment and Disenrollment Opportunities.--The
    Secretary, in coordination with the Secretary of the Treasury, shall
    establish procedures under which--
                ``(1) an individual who, in the year of the individual's
            initial eligibility to enroll in the CLASS program, has elected
            to waive enrollment in the program, is eligible to elect to
            enroll in the program, in such form and manner as the
            Secretaries shall establish, only during an open enrollment
            period established by the Secretaries that is specific to the
            individual and that may not occur more frequently than
            biennially after the date on which the individual first elected
            to waive enrollment in the program; and
                ``(2) an individual shall only be permitted to disenroll
            from the program (other than for nonpayment of premiums) during
            an annual disenrollment period established by the Secretaries
            and in such form and manner as the Secretaries shall establish.

    ``SEC. 3205. BENEFITS.

        ``(a) Determination of Eligibility.--
                ``(1) Application for receipt of benefits.--The Secretary
            shall establish procedures under which an active enrollee shall
            apply for receipt of benefits under the CLASS Independence
            Benefit Plan.
                ``(2) Eligibility assessments.--
                        ``(A) In general.--Not later than January 1, 2012,
                    the Secretary shall--
                                ``(i) establish an Eligibility Assessment
                            System (other than a service with which the
                            Commissioner of Social Security has entered
                            into an agreement, with respect to any State,
                            to make disability determinations for purposes
                            of title II or XVI of the Social Security Act)
                            to provide for eligibility assessments of
                            active enrollees who apply for receipt of
                            benefits;
                                ``(ii) enter into an agreement with the
                            Protection and Advocacy System for each State
                            to provide advocacy services in accordance with
                            subsection (d); and
                                ``(iii) enter into an agreement with public
                            and private entities to provide advice and
                            assistance counseling in accordance with
                            subsection (e).
                        ``(B) Regulations.--The Secretary shall promulgate
                    regulations to develop an expedited nationally
                    equitable eligibility determination process, as
                    certified by a licensed health care practitioner, an
                    appeals process, and a redetermination process, as
                    certified by a licensed health care practitioner,
                    including whether an active enrollee is eligible for a
                    cash benefit under the program and if so, the amount of
                    the cash benefit (in accordance the sliding scale
                    established under the plan).
                        ``(C) Presumptive eligibility for certain
                    institutionalized enrollees planning to discharge.--An
                    active enrollee shall be deemed presumptively eligible
                    if the enrollee--
                                ``(i) has applied for, and attests is
                            eligible for, the maximum cash benefit
                            available under the sliding scale established
                            under the CLASS Independence Benefit Plan;
                                ``(ii) is a patient in a hospital (but only
                            if the hospitalization is for long-term care),
                            nursing facility, intermediate care facility
                            for the mentally retarded, or an institution
                            for mental diseases; and
                                ``(iii) is in the process of, or about to
                            begin the process of, planning to discharge
                            from the hospital, facility, or institution, or
                            within 60 days from the date of discharge from
                            the hospital, facility, or institution.
                        ``(D) Appeals.--The Secretary shall establish
                    procedures under which an applicant for benefits under
                    the CLASS Independence Benefit Plan shall be guaranteed
                    the right to appeal an adverse determination.
        ``(b) Benefits.--An eligible beneficiary shall receive the
    following benefits under the CLASS Independence Benefit Plan:
                ``(1) Cash benefit.--A cash benefit established by the
            Secretary in accordance with the requirements of section
            3203(a)(1)(D) that--
                        ``(A) the first year in which beneficiaries receive
                    the benefits under the plan, is not less than the
                    average dollar amount specified in clause (i) of such
                    section; and
                        ``(B) for any subsequent year, is not less than the
                    average per day dollar limit applicable under this
                    subparagraph for the preceding year, increased by the
                    percentage increase in the consumer price index for all
                    urban consumers (U.S. city average) over the previous
                    year.
                ``(2) Advocacy services.--Advocacy services in accordance
            with subsection (d).
                ``(3) Advice and assistance counseling.--Advice and
            assistance counseling in accordance with subsection (e).
                ``(4) Administrative expenses.--Advocacy services and
            advise and assistance counseling services under paragraphs (2)
            and (3) of this subsection shall be included as administrative
            expenses under section 3203(b)(3).
        ``(c) Payment of Benefits.--
                ``(1) Life independence account.--
                        ``(A) In general.--The Secretary shall establish
                    procedures for administering the provision of benefits
                    to eligible beneficiaries under the CLASS Independence
                    Benefit Plan, including the payment of the cash benefit
                    for the beneficiary into a Life Independence Account
                    established by the Secretary on behalf of each eligible
                    beneficiary.
                        ``(B) Use of cash benefits.--Cash benefits paid
                    into a Life Independence Account of an eligible
                    beneficiary shall be used to purchase nonmedical
                    services and supports that the beneficiary needs to
                    maintain his or her independence at home or in another
                    residential setting of their choice in the community,
                    including (but not limited to) home modifications,
                    assistive technology, accessible transportation,
                    homemaker services, respite care, personal assistance
                    services, home care aides, and nursing support. Nothing
                    in the preceding sentence shall prevent an eligible
                    beneficiary from using cash benefits paid into a Life
                    Independence Account for obtaining assistance with
                    decision making concerning medical care, including the
                    right to accept or refuse medical or surgical treatment
                    and the right to formulate advance directives or other
                    written instructions recognized under State law, such
                    as a living will or durable power of attorney for
                    health care, in the case that an injury or illness
                    causes the individual to be unable to make health care
                    decisions.
                        ``(C) Electronic management of funds.--The
                    Secretary shall establish procedures for--
                                ``(i) crediting an account established on
                            behalf of a beneficiary with the beneficiary's
                            cash daily benefit;
                                ``(ii) allowing the beneficiary to access
                            such account through debit cards; and
                                ``(iii) accounting for withdrawals by the
                            beneficiary from such account.
                        ``(D) Primary payor rules for beneficiaries who are
                    enrolled in medicaid.--In the case of an eligible
                    beneficiary who is enrolled in Medicaid, the following
                    payment rules shall apply:
                                ``(i) Institutionalized beneficiary.--If
                            the beneficiary is a patient in a hospital,
                            nursing facility, intermediate care facility
                            for the mentally retarded, or an institution
                            for mental diseases, the beneficiary shall
                            retain an amount equal to 5 percent of the
                            beneficiary's daily or weekly cash benefit (as
                            applicable) (which shall be in addition to the
                            amount of the beneficiary's personal needs
                            allowance provided under Medicaid), and the
                            remainder of such benefit shall be applied
                            toward the facility's cost of providing the
                            beneficiary's care, and Medicaid shall provide
                            secondary coverage for such care.
                                ``(ii) Beneficiaries receiving home and
                            community-based services.--
                                        ``(I) 50 percent of benefit
                                    retained by beneficiary.--Subject to
                                    subclause (II), if a beneficiary is
                                    receiving medical assistance under
                                    Medicaid for home and community based
                                    services, the beneficiary shall retain
                                    an amount equal to 50 percent of the
                                    beneficiary's daily or weekly cash
                                    benefit (as applicable), and the
                                    remainder of the daily or weekly cash
                                    benefit shall be applied toward the
                                    cost to the State of providing such
                                    assistance (and shall not be used to
                                    claim Federal matching funds under
                                    Medicaid), and Medicaid shall provide
                                    secondary coverage for the remainder of
                                    any costs incurred in providing such
                                    assistance.
                                        ``(II) Requirement for state
                                    offset.--A State shall be paid the
                                    remainder of a beneficiary's daily or
                                    weekly cash benefit under subclause (I)
                                    only if the State home and community-
                                    based waiver under section 1115 of the
                                    Social Security Act (42 U.S.C. 1315) or
                                    subsection (c) or (d) of section 1915
                                    of such Act (42 U.S.C. 1396n), or the
                                    State plan amendment under subsection
                                    (i) of such section does not include a
                                    waiver of the requirements of section
                                    1902(a)(1) of the Social Security Act
                                    (relating to statewideness) or of
                                    section 1902(a)(10)(B) of such Act
                                    (relating to comparability) and the
                                    State offers at a minimum case
                                    management services, personal care
                                    services, habilitation services, and
                                    respite care under such a waiver or
                                    State plan amendment.
                                        ``(III) Definition of home and
                                    community-based services.--In this
                                    clause, the term `home and community-
                                    based services' means any services
                                    which may be offered under a home and
                                    community-based waiver authorized for a
                                    State under section 1115 of the Social
                                    Security Act (42 U.S.C. 1315) or
                                    subsection (c) or (d) of section 1915
                                    of such Act (42 U.S.C. 1396n) or under
                                    a State plan amendment under subsection
                                    (i) of such section.
                                ``(iii) Beneficiaries enrolled in programs
                            of all-inclusive care for the elderly (pace).--
                                        ``(I) In general.--Subject to
                                    subclause (II), if a beneficiary is
                                    receiving medical assistance under
                                    Medicaid for PACE program services
                                    under section 1934 of the Social
                                    Security Act (42 U.S.C. 1396u-4), the
                                    beneficiary shall retain an amount
                                    equal to 50 percent of the
                                    beneficiary's daily or weekly cash
                                    benefit (as applicable), and the
                                    remainder of the daily or weekly cash
                                    benefit shall be applied toward the
                                    cost to the State of providing such
                                    assistance (and shall not be used to
                                    claim Federal matching funds under
                                    Medicaid), and Medicaid shall provide
                                    secondary coverage for the remainder of
                                    any costs incurred in providing such
                                    assistance.
                                        ``(II) Institutionalized recipients
                                    of pace program services.--If a
                                    beneficiary receiving assistance under
                                    Medicaid for PACE program services is a
                                    patient in a hospital, nursing
                                    facility, intermediate care facility
                                    for the mentally retarded, or an
                                    institution for mental diseases, the
                                    beneficiary shall be treated as in
                                    institutionalized beneficiary under
                                    clause (i).
                ``(2) Authorized representatives.--
                        ``(A) In general.--The Secretary shall establish
                    procedures to allow access to a beneficiary's cash
                    benefits by an authorized representative of the
                    eligible beneficiary on whose behalf such benefits are
                    paid.
                        ``(B) Quality assurance and protection against
                    fraud and abuse.--The procedures established under
                    subparagraph (A) shall ensure that authorized
                    representatives of eligible beneficiaries comply with
                    standards of conduct established by the Secretary,
                    including standards requiring that such representatives
                    provide quality services on behalf of such
                    beneficiaries, do not have conflicts of interest, and
                    do not misuse benefits paid on behalf of such
                    beneficiaries or otherwise engage in fraud or abuse.
                ``(3) Commencement of benefits.--Benefits shall be paid to,
            or on behalf of, an eligible beneficiary beginning with the
            first month in which an application for such benefits is
            approved.
                ``(4) Rollover option for lump-sum payment.--An eligible
            beneficiary may elect to--
                        ``(A) defer payment of their daily or weekly
                    benefit and to rollover any such deferred benefits from
                    month-to-month, but not from year-to-year; and
                        ``(B) receive a lump-sum payment of such deferred
                    benefits in an amount that may not exceed the lesser
                    of--
                                ``(i) the total amount of the accrued
                            deferred benefits; or
                                ``(ii) the applicable annual benefit.
                ``(5) Period for determination of annual benefits.--
                        ``(A) In general.--The applicable period for
                    determining with respect to an eligible beneficiary the
                    applicable annual benefit and the amount of any accrued
                    deferred benefits is the 12-month period that commences
                    with the first month in which the beneficiary began to
                    receive such benefits, and each 12-month period
                    thereafter.
                        ``(B) Inclusion of increased benefits.--The
                    Secretary shall establish procedures under which cash
                    benefits paid to an eligible beneficiary that increase
                    or decrease as a result of a change in the functional
                    status of the beneficiary before the end of a 12-month
                    benefit period shall be included in the determination
                    of the applicable annual benefit paid to the eligible
                    beneficiary.
                        ``(C) Recoupment of unpaid, accrued benefits.--
                                ``(i) In general.--The Secretary, in
                            coordination with the Secretary of the
                            Treasury, shall recoup any accrued benefits in
                            the event of--
                                        ``(I) the death of a beneficiary;
                                    or
                                        ``(II) the failure of a beneficiary
                                    to elect under paragraph (4)(B) to
                                    receive such benefits as a lump-sum
                                    payment before the end of the 12-month
                                    period in which such benefits accrued.
                                ``(ii) Payment into class independence
                            fund.--Any benefits recouped in accordance with
                            clause (i) shall be paid into the CLASS
                            Independence Fund and used in accordance with
                            section 3206.
                ``(6) Requirement to recertify eligibility for receipt of
            benefits.--An eligible beneficiary shall periodically, as
            determined by the Secretary--
                        ``(A) recertify by submission of medical evidence
                    the beneficiary's continued eligibility for receipt of
                    benefits; and
                        ``(B) submit records of expenditures attributable
                    to the aggregate cash benefit received by the
                    beneficiary during the preceding year.
                ``(7) Supplement, not supplant other health care
            benefits.--Subject to the Medicaid payment rules under
            paragraph (1)(D), benefits received by an eligible beneficiary
            shall supplement, but not supplant, other health care benefits
            for which the beneficiary is eligible under Medicaid or any
            other Federally funded program that provides health care
            benefits or assistance.
        ``(d) Advocacy Services.--An agreement entered into under
    subsection (a)(2)(A)(ii) shall require the Protection and Advocacy
    System for the State to--
                ``(1) assign, as needed, an advocacy counselor to each
            eligible beneficiary that is covered by such agreement and who
            shall provide an eligible beneficiary with--
                        ``(A) information regarding how to access the
                    appeals process established for the program;
                        ``(B) assistance with respect to the annual
                    recertification and notification required under
                    subsection (c)(6); and
                        ``(C) such other assistance with obtaining services
                    as the Secretary, by regulation, shall require; and
                ``(2) ensure that the System and such counselors comply
            with the requirements of subsection (h).
        ``(e) Advice and Assistance Counseling.--An agreement entered into
    under subsection (a)(2)(A)(iii) shall require the entity to assign, as
    requested by an eligible beneficiary that is covered by such agreement,
    an advice and assistance counselor who shall provide an eligible
    beneficiary with information regarding--
                ``(1) accessing and coordinating long-term services and
            supports in the most integrated setting;
                ``(2) possible eligibility for other benefits and services;
                ``(3) development of a service and support plan;
                ``(4) information about programs established under the
            Assistive Technology Act of 1998 and the services offered under
            such programs;
                ``(5) available assistance with decision making concerning
            medical care, including the right to accept or refuse medical
            or surgical treatment and the right to formulate advance
            directives or other written instructions recognized under State
            law, such as a living will or durable power of attorney for
            health care, in the case that an injury or illness causes the
            individual to be unable to make health care decisions; and
                ``(6) such other services as the Secretary, by regulation,
            may require.
        ``(f) No Effect on Eligibility for Other Benefits.--Benefits paid
    to an eligible beneficiary under the CLASS program shall be disregarded
    for purposes of determining or continuing the beneficiary's eligibility
    for receipt of benefits under any other Federal, State, or locally
    funded assistance program, including benefits paid under titles II,
    XVI, XVIII, XIX, or XXI of the Social Security Act (42 U.S.C. 401 et
    seq., 1381 et seq., 1395 et seq., 1396 et seq., 1397aa et seq.), under
    the laws administered by the Secretary of Veterans Affairs, under low-
    income housing assistance programs, or under the supplemental nutrition
    assistance program established under the Food and Nutrition Act of 2008
    (7 U.S.C. 2011 et seq.).
        ``(g) Rule of Construction.--Nothing in this title shall be
    construed as prohibiting benefits paid under the CLASS Independence
    Benefit Plan from being used to compensate a family caregiver for
    providing community living assistance services and supports to an
    eligible beneficiary.
        ``(h) Protection Against Conflict of Interests.--The Secretary
    shall establish procedures to ensure that the Eligibility Assessment
    System, the Protection and Advocacy System for a State, advocacy
    counselors for eligible beneficiaries, and any other entities that
    provide services to active enrollees and eligible beneficiaries under
    the CLASS program comply with the following:
                ``(1) If the entity provides counseling or planning
            services, such services are provided in a manner that fosters
            the best interests of the active enrollee or beneficiary.
                ``(2) The entity has established operating procedures that
            are designed to avoid or minimize conflicts of interest between
            the entity and an active enrollee or beneficiary.
                ``(3) The entity provides information about all services
            and options available to the active enrollee or beneficiary, to
            the best of its knowledge, including services available through
            other entities or providers.
                ``(4) The entity assists the active enrollee or beneficiary
            to access desired services, regardless of the provider.
                ``(5) The entity reports the number of active enrollees and
            beneficiaries provided with assistance by age, disability, and
            whether such enrollees and beneficiaries received services from
            the entity or another entity.
                ``(6) If the entity provides counseling or planning
            services, the entity ensures that an active enrollee or
            beneficiary is informed of any financial interest that the
            entity has in a service provider.
                ``(7) The entity provides an active enrollee or beneficiary
            with a list of available service providers that can meet the
            needs of the active enrollee or beneficiary.

    ``SEC. 3206. CLASS INDEPENDENCE FUND.

        ``(a) Establishment of CLASS Independence Fund.--There is
    established in the Treasury of the United States a trust fund to be
    known as the `CLASS Independence Fund'. The Secretary of the Treasury
    shall serve as Managing Trustee of such Fund. The Fund shall consist of
    all amounts derived from payments into the Fund under sections 3204(f)
    and 3205(c)(5)(C)(ii), and remaining after investment of such amounts
    under subsection (b), including additional amounts derived as income
    from such investments. The amounts held in the Fund are appropriated
    and shall remain available without fiscal year limitation--
                ``(1) to be held for investment on behalf of individuals
            enrolled in the CLASS program;
                ``(2) to pay the administrative expenses related to the
            Fund and to investment under subsection (b); and
                ``(3) to pay cash benefits to eligible beneficiaries under
            the CLASS Independence Benefit Plan.
        ``(b) Investment of Fund Balance.--The Secretary of the Treasury
    shall invest and manage the CLASS Independence Fund in the same manner,
    and to the same extent, as the Federal Supplementary Medical Insurance
    Trust Fund may be invested and managed under subsections (c), (d), and
    (e) of section 1841(d) of the Social Security Act (42 U.S.C. 1395t).
        ``(c) Board of Trustees.--
                ``(1) In general.--With respect to the CLASS Independence
            Fund, there is hereby created a body to be known as the Board
            of Trustees of the CLASS Independence Fund (hereinafter in this
            section referred to as the `Board of Trustees') composed of the
            Secretary of the Treasury, the Secretary of Labor, and the
            Secretary of Health and Human Services, all ex officio, and of
            two members of the public (both of whom may not be from the
            same political party), who shall be nominated by the President
            for a term of 4 years and subject to confirmation by the
            Senate. A member of the Board of Trustees serving as a member
            of the public and nominated and confirmed to fill a vacancy
            occurring during a term shall be nominated and confirmed only
            for the remainder of such term. An individual nominated and
            confirmed as a member of the public may serve in such position
            after the expiration of such member's term until the earlier of
            the time at which the member's successor takes office or the
            time at which a report of the Board is first issued under
            paragraph (2) after the expiration of the member's term. The
            Secretary of the Treasury shall be the Managing Trustee of the
            Board of Trustees. The Board of Trustees shall meet not less
            frequently than once each calendar year. A person serving on
            the Board of Trustees shall not be considered to be a fiduciary
            and shall not be personally liable for actions taken in such
            capacity with respect to the Trust Fund.
                ``(2) Duties.--
                        ``(A) In general.--It shall be the duty of the
                    Board of Trustees to do the following:
                                ``(i) Hold the CLASS Independence Fund.
                                ``(ii) Report to the Congress not later
                            than the first day of April of each year on the
                            operation and status of the CLASS Independence
                            Fund during the preceding fiscal year and on
                            its expected operation and status during the
                            current fiscal year and the next 2 fiscal
                            years.
                                ``(iii) Report immediately to the Congress
                            whenever the Board is of the opinion that the
                            amount of the CLASS Independence Fund is not
                            actuarially sound in regards to the projection
                            under section 3203(b)(1)(B)(i).
                                ``(iv) Review the general policies followed
                            in managing the CLASS Independence Fund, and
                            recommend changes in such policies, including
                            necessary changes in the provisions of law
                            which govern the way in which the CLASS
                            Independence Fund is to be managed.
                        ``(B) Report.--The report provided for in
                    subparagraph (A)(ii) shall--
                                ``(i) include--
                                        ``(I) a statement of the assets of,
                                    and the disbursements made from, the
                                    CLASS Independence Fund during the
                                    preceding fiscal year;
                                        ``(II) an estimate of the expected
                                    income to, and disbursements to be made
                                    from, the CLASS Independence Fund
                                    during the current fiscal year and each
                                    of the next 2 fiscal years;
                                        ``(III) a statement of the
                                    actuarial status of the CLASS
                                    Independence Fund for the current
                                    fiscal year, each of the next 2 fiscal
                                    years, and as projected over the 75-
                                    year period beginning with the current
                                    fiscal year; and
                                        ``(IV) an actuarial opinion by the
                                    Chief Actuary of the Centers for
                                    Medicare & Medicaid Services certifying
                                    that the techniques and methodologies
                                    used are generally accepted within the
                                    actuarial profession and that the
                                    assumptions and cost estimates used are
                                    reasonable; and
                                ``(ii) be printed as a House document of
                            the session of the Congress to which the report
                            is made.
                        ``(C) Recommendations.--If the Board of Trustees
                    determines that enrollment trends and expected future
                    benefit claims on the CLASS Independence Fund are not
                    actuarially sound in regards to the projection under
                    section 3203(b)(1)(B)(i) and are unlikely to be
                    resolved with reasonable premium increases or through
                    other means, the Board of Trustees shall include in the
                    report provided for in subparagraph (A)(ii)
                    recommendations for such legislative action as the
                    Board of Trustees determine to be appropriate,
                    including whether to adjust monthly premiums or impose
                    a temporary moratorium on new enrollments.

    ``SEC. 3207. CLASS INDEPENDENCE ADVISORY COUNCIL.

        ``(a) Establishment.--There is hereby created an Advisory Committee
    to be known as the `CLASS Independence Advisory Council'.
        ``(b) Membership.--
                ``(1) In general.--The CLASS Independence Advisory Council
            shall be composed of not more than 15 individuals, not
            otherwise in the employ of the United States--
                        ``(A) who shall be appointed by the President
                    without regard to the civil service laws and
                    regulations; and
                        ``(B) a majority of whom shall be representatives
                    of individuals who participate or are likely to
                    participate in the CLASS program, and shall include
                    representatives of older and younger workers,
                    individuals with disabilities, family caregivers of
                    individuals who require services and supports to
                    maintain their independence at home or in another
                    residential setting of their choice in the community,
                    individuals with expertise in long-term care or
                    disability insurance, actuarial science, economics, and
                    other relevant disciplines, as determined by the
                    Secretary.
                ``(2) Terms.--
                        ``(A) In general.--The members of the CLASS
                    Independence Advisory Council shall serve overlapping
                    terms of 3 years (unless appointed to fill a vacancy
                    occurring prior to the expiration of a term, in which
                    case the individual shall serve for the remainder of
                    the term).
                        ``(B) Limitation.--A member shall not be eligible
                    to serve for more than 2 consecutive terms.
                ``(3) Chair.--The President shall, from time to time,
            appoint one of the members of the CLASS Independence Advisory
            Council to serve as the Chair.
        ``(c) Duties.--The CLASS Independence Advisory Council shall advise
    the Secretary on matters of general policy in the administration of the
    CLASS program established under this title and in the formulation of
    regulations under this title including with respect to--
                ``(1) the development of the CLASS Independence Benefit
            Plan under section 3203;
                ``(2) the determination of monthly premiums under such
            plan; and
                ``(3) the financial solvency of the program.
        ``(d) Application of FACA.--The Federal Advisory Committee Act (5
    U.S.C. App.), other than section 14 of that Act, shall apply to the
    CLASS Independence Advisory Council.
        ``(e) Authorization of Appropriations.--
                ``(1) In general.--There are authorized to be appropriated
            to the CLASS Independence Advisory Council to carry out its
            duties under this section, such sums as may be necessary for
            fiscal year 2011 and for each fiscal year thereafter.
                ``(2) Availability.--Any sums appropriated under the
            authorization contained in this section shall remain available,
            without fiscal year limitation, until expended.

    ``SEC. 3208. SOLVENCY AND FISCAL INDEPENDENCE; REGULATIONS; ANNUAL
                  REPORT.

        ``(a) Solvency.--The Secretary shall regularly consult with the
    Board of Trustees of the CLASS Independence Fund and the CLASS
    Independence Advisory Council, for purposes of ensuring that enrollees
    premiums are adequate to ensure the financial solvency of the CLASS
    program, both with respect to fiscal years occurring in the near-term
    and fiscal years occurring over 20- and 75-year periods, taking into
    account the projections required for such periods under subsections
    (a)(1)(A)(i) and (b)(1)(B)(i) of section 3202.
        ``(b) No Taxpayer Funds Used To Pay Benefits.--No taxpayer funds
    shall be used for payment of benefits under a CLASS Independent Benefit
    Plan. For purposes of this subsection, the term `taxpayer funds' means
    any Federal funds from a source other than premiums deposited by CLASS
    program participants in the CLASS Independence Fund and any associated
    interest earnings.
        ``(c) Regulations.--The Secretary shall promulgate such regulations
    as are necessary to carry out the CLASS program in accordance with this
    title. Such regulations shall include provisions to prevent fraud and
    abuse under the program.
        ``(d) Annual Report.--Beginning January 1, 2014, the Secretary
    shall submit an annual report to Congress on the CLASS program. Each
    report shall include the following:
                ``(1) The total number of enrollees in the program.
                ``(2) The total number of eligible beneficiaries during the
            fiscal year.
                ``(3) The total amount of cash benefits provided during the
            fiscal year.
                ``(4) A description of instances of fraud or abuse
            identified during the fiscal year.
                ``(5) Recommendations for such administrative or
            legislative action as the Secretary determines is necessary to
            improve the program, ensure the solvency of the program, or to
            prevent the occurrence of fraud or abuse.

    ``SEC. 3209. INSPECTOR GENERAL'S REPORT.

        ``The Inspector General of the Department of Health and Human
    Services shall submit an annual report to the Secretary and Congress
    relating to the overall progress of the CLASS program and of the
    existence of waste, fraud, and abuse in the CLASS program. Each such
    report shall include findings in the following areas:
                ``(1) The eligibility determination process.
                ``(2) The provision of cash benefits.
                ``(3) Quality assurance and protection against waste,
            fraud, and abuse.
                ``(4) Recouping of unpaid and accrued benefits.

    ``SEC. 3210. TAX TREATMENT OF PROGRAM.

        ``The CLASS program shall be treated for purposes of the Internal
    Revenue Code of 1986 in the same manner as a qualified long-term care
    insurance contract for qualified long-term care services.''.
                (2) Conforming amendments to medicaid.--Section 1902(a) of
            the Social Security Act (42 U.S.C. 1396a(a)), as amended by
            section 6505, is amended by inserting after paragraph (80) the
            following:
                ``(81) provide that the State will comply with such
            regulations regarding the application of primary and secondary
            payor rules with respect to individuals who are eligible for
            medical assistance under this title and are eligible
            beneficiaries under the CLASS program established under title
            XXXII of the Public Health Service Act as the Secretary shall
            establish; and''.
        (b) Assurance of Adequate Infrastructure for the Provision of
    Personal Care Attendant Workers.--Section 1902(a) of the Social
    Security Act (42 U.S.C. 1396a(a)), as amended by subsection (a)(2), is
    amended by inserting after paragraph (81) the following:
                ``(82) provide that, not later than 2 years after the date
            of enactment of the Community Living Assistance Services and
            Supports Act, each State shall--
                        ``(A) assess the extent to which entities such as
                    providers of home care, home health services, home and
                    community service providers, public authorities created
                    to provide personal care services to individuals
                    eligible for medical assistance under the State plan,
                    and nonprofit organizations, are serving or have the
                    capacity to serve as fiscal agents for, employers of,
                    and providers of employment-related benefits for,
                    personal care attendant workers who provide personal
                    care services to individuals receiving benefits under
                    the CLASS program established under title XXXII of the
                    Public Health Service Act, including in rural and
                    underserved areas;
                        ``(B) designate or create such entities to serve as
                    fiscal agents for, employers of, and providers of
                    employment-related benefits for, such workers to ensure
                    an adequate supply of the workers for individuals
                    receiving benefits under the CLASS program, including
                    in rural and underserved areas; and
                        ``(C) ensure that the designation or creation of
                    such entities will not negatively alter or impede
                    existing programs, models, methods, or administration
                    of service delivery that provide for consumer
                    controlled or self-directed home and community services
                    and further ensure that such entities will not impede
                    the ability of individuals to direct and control their
                    home and community services, including the ability to
                    select, manage, dismiss, co-employ, or employ such
                    workers or inhibit such individuals from relying on
                    family members for the provision of personal care
                    services.''.
        (c) Personal Care Attendants Workforce Advisory Panel.--
                (1) Establishment.--Not later than 90 days after the date
            of enactment of this Act, the Secretary of Health and Human
            Services shall establish a Personal Care Attendants Workforce
            Advisory Panel for the purpose of examining and advising the
            Secretary and Congress on workforce issues related to personal
            care attendant workers, including with respect to the adequacy
            of the number of such workers, the salaries, wages, and
            benefits of such workers, and access to the services provided
            by such workers.
                (2) Membership.--In appointing members to the Personal Care
            Attendants Workforce Advisory Panel, the Secretary shall ensure
            that such members include the following:
                        (A) Individuals with disabilities of all ages.
                        (B) Senior individuals.
                        (C) Representatives of individuals with
                    disabilities.
                        (D) Representatives of senior individuals.
                        (E) Representatives of workforce and labor
                    organizations.
                        (F) Representatives of home and community-based
                    service providers.
                        (G) Representatives of assisted living providers.
        (d) Inclusion of Information on Supplemental Coverage in the
    National Clearinghouse for Long-term Care Information; Extension of
    Funding.--Section 6021(d) of the Deficit Reduction Act of 2005 (42
    U.S.C. 1396p note) is amended--
                (1) in paragraph (2)(A)--
                        (A) in clause (ii), by striking ``and'' at the end;
                        (B) in clause (iii), by striking the period at the
                    end and inserting ``; and''; and
                        (C) by adding at the end the following:
                                ``(iv) include information regarding the
                            CLASS program established under title XXXII of
                            the Public Health Service Act and coverage
                            available for purchase through a Exchange
                            established under section 1311 of the Patient
                            Protection and Affordable Care Act that is
                            supplemental coverage to the benefits provided
                            under a CLASS Independence Benefit Plan under
                            that program, and information regarding how
                            benefits provided under a CLASS Independence
                            Benefit Plan differ from disability insurance
                            benefits.''; and
                (2) in paragraph (3), by striking ``2010'' and inserting
            ``2015''.
        (e) Effective Date.--The amendments made by subsections (a), (b),
    and (d) take effect on January 1, 2011.
        (f) Rule of Construction.--Nothing in this title or the amendments
    made by this title are intended to replace or displace public or
    private disability insurance benefits, including such benefits that are
    for income replacement.

                          TITLE IX--REVENUE PROVISIONS

                     Subtitle A--Revenue Offset Provisions

    SEC. 9001. EXCISE TAX ON HIGH COST EMPLOYER-SPONSORED HEALTH COVERAGE.

        (a) In General.--Chapter 43 of the Internal Revenue Code of 1986,
    as amended by section 1513, is amended by adding at the end the
    following:

    ``SEC. 4980I. EXCISE TAX ON HIGH COST EMPLOYER-SPONSORED HEALTH
                  COVERAGE.

        ``(a) Imposition of Tax.--If--
                ``(1) an employee is covered under any applicable employer-
            sponsored coverage of an employer at any time during a taxable
            period, and
                ``(2) there is any excess benefit with respect to the
            coverage,
    there is hereby imposed a tax equal to 40 percent of the excess
    benefit.
        ``(b) Excess Benefit.--For purposes of this section--
                ``(1) In general.--The term `excess benefit' means, with
            respect to any applicable employer-sponsored coverage made
            available by an employer to an employee during any taxable
            period, the sum of the excess amounts determined under
            paragraph (2) for months during the taxable period.
                ``(2) Monthly excess amount.--The excess amount determined
            under this paragraph for any month is the excess (if any) of--
                        ``(A) the aggregate cost of the applicable
                    employer-sponsored coverage of the employee for the
                    month, over
                        ``(B) an amount equal to \1/12\ of the annual
                    limitation under paragraph (3) for the calendar year in
                    which the month occurs.
                ``(3) Annual limitation.--For purposes of this subsection--
                        ``(A) In general.--The annual limitation under this
                    paragraph for any calendar year is the dollar limit
                    determined under subparagraph (C) for the calendar
                    year.
                        ``(B) Applicable annual limitation.--The annual
                    limitation which applies for any month shall be
                    determined on the basis of the type of coverage (as
                    determined under subsection (f)(1)) provided to the
                    employee by the employer as of the beginning of the
                    month.
                        ``(C) Applicable dollar limit.--Except as provided
                    in subparagraph (D)--
                                ``(i) 2013.--In the case of 2013, the
                            dollar limit under this subparagraph is--
                                        ``(I) in the case of an employee
                                    with self-only coverage, $8,500, and
                                        ``(II) in the case of an employee
                                    with coverage other than self-only
                                    coverage, $23,000.
                                ``(ii) Exception for certain individuals.--
                            In the case of an individual who is a qualified
                            retiree or who participates in a plan sponsored
                            by an employer the majority of whose employees
                            are engaged in a high-risk profession or
                            employed to repair or install electrical or
                            telecommunications lines--
                                        ``(I) the dollar amount in clause
                                    (i)(I) (determined after the
                                    application of subparagraph (D)) shall
                                    be increased by $1,350, and
                                        ``(II) the dollar amount in clause
                                    (i)(II) (determined after the
                                    application of subparagraph (D)) shall
                                    be increased by $3,000.
                                ``(iii) Subsequent years.--In the case of
                            any calendar year after 2013, each of the
                            dollar amounts under clauses (i) and (ii) shall
                            be increased to the amount equal to such amount
                            as in effect for the calendar year preceding
                            such year, increased by an amount equal to the
                            product of--
                                        ``(I) such amount as so in effect,
                                    multiplied by
                                        ``(II) the cost-of-living
                                    adjustment determined under section
                                    1(f)(3) for such year (determined by
                                    substituting the calendar year that is
                                    2 years before such year for `1992' in
                                    subparagraph (B) thereof), increased by
                                    1 percentage point.
                            If any amount determined under this clause is
                            not a multiple of $50, such amount shall be
                            rounded to the nearest multiple of $50.
                        ``(D) Transition rule for states with highest
                    coverage costs.--
                                ``(i) In general.--If an employee is a
                            resident of a high cost State on the first day
                            of any month beginning in 2013, 2014, or 2015,
                            the annual limitation under this paragraph for
                            such month with respect to such employee shall
                            be an amount equal to the applicable percentage
                            of the annual limitation (determined without
                            regard to this subparagraph or subparagraph
                            (C)(ii)).
                                ``(ii) Applicable percentage.--The
                            applicable percentage is 120 percent for 2013,
                            110 percent for 2014, and 105 percent for 2015.
                                ``(iii) High cost state.--The term `high
                            cost State' means each of the 17 States which
                            the Secretary of Health and Human Services, in
                            consultation with the Secretary, estimates had
                            the highest average cost during 2012 for
                            employer-sponsored coverage under health plans.
                            The Secretary's estimate shall be made on the
                            basis of aggregate premiums paid in the State
                            for such health plans, determined using the
                            most recent data available as of August 31,
                            2012.
        ``(c) Liability To Pay Tax.--
                ``(1) In general.--Each coverage provider shall pay the tax
            imposed by subsection (a) on its applicable share of the excess
            benefit with respect to an employee for any taxable period.
                ``(2) Coverage provider.--For purposes of this subsection,
            the term `coverage provider' means each of the following:
                        ``(A) Health insurance coverage.--If the applicable
                    employer-sponsored coverage consists of coverage under
                    a group health plan which provides health insurance
                    coverage, the health insurance issuer.
                        ``(B) HSA and msa contributions.--If the applicable
                    employer-sponsored coverage consists of coverage under
                    an arrangement under which the employer makes
                    contributions described in subsection (b) or (d) of
                    section 106, the employer.
                        ``(C) Other coverage.--In the case of any other
                    applicable employer-sponsored coverage, the person that
                    administers the plan benefits.
                ``(3) Applicable share.--For purposes of this subsection, a
            coverage provider's applicable share of an excess benefit for
            any taxable period is the amount which bears the same ratio to
            the amount of such excess benefit as--
                        ``(A) the cost of the applicable employer-sponsored
                    coverage provided by the provider to the employee
                    during such period, bears to
                        ``(B) the aggregate cost of all applicable
                    employer-sponsored coverage provided to the employee by
                    all coverage providers during such period.
                ``(4) Responsibility to calculate tax and applicable
            shares.--
                        ``(A) In general.--Each employer shall--
                                ``(i) calculate for each taxable period the
                            amount of the excess benefit subject to the tax
                            imposed by subsection (a) and the applicable
                            share of such excess benefit for each coverage
                            provider, and
                                ``(ii) notify, at such time and in such
                            manner as the Secretary may prescribe, the
                            Secretary and each coverage provider of the
                            amount so determined for the provider.
                        ``(B) Special rule for multiemployer plans.--In the
                    case of applicable employer-sponsored coverage made
                    available to employees through a multiemployer plan (as
                    defined in section 414(f)), the plan sponsor shall make
                    the calculations, and provide the notice, required
                    under subparagraph (A).
        ``(d) Applicable Employer-Sponsored Coverage; Cost.--For purposes
    of this section--
                ``(1) Applicable employer-sponsored coverage.--
                        ``(A) In general.--The term `applicable employer-
                    sponsored coverage' means, with respect to any
                    employee, coverage under any group health plan made
                    available to the employee by an employer which is
                    excludable from the employee's gross income under
                    section 106, or would be so excludable if it were
                    employer-provided coverage (within the meaning of such
                    section 106).
                        ``(B) Exceptions.--The term `applicable employer-
                    sponsored coverage' shall not include--
                                ``(i) any coverage (whether through
                            insurance or otherwise) described in section
                            9832(c)(1)(A) or for long-term care, or
                                ``(ii) any coverage described in section
                            9832(c)(3) the payment for which is not
                            excludable from gross income and for which a
                            deduction under section 162(l) is not
                            allowable.
                        ``(C) Coverage includes employee paid portion.--
                    Coverage shall be treated as applicable employer-
                    sponsored coverage without regard to whether the
                    employer or employee pays for the coverage.
                        ``(D) Self-employed individual.--In the case of an
                    individual who is an employee within the meaning of
                    section 401(c)(1), coverage under any group health plan
                    providing health insurance coverage shall be treated as
                    applicable employer-sponsored coverage if a deduction
                    is allowable under section 162(l) with respect to all
                    or any portion of the cost of the coverage.
                        ``(E) Governmental plans included.--Applicable
                    employer-sponsored coverage shall include coverage
                    under any group health plan established and maintained
                    primarily for its civilian employees by the Government
                    of the United States, by the government of any State or
                    political subdivision thereof, or by any agency or
                    instrumentality of any such government.
                ``(2) Determination of cost.--
                        ``(A) In general.--The cost of applicable employer-
                    sponsored coverage shall be determined under rules
                    similar to the rules of section 4980B(f)(4), except
                    that in determining such cost, any portion of the cost
                    of such coverage which is attributable to the tax
                    imposed under this section shall not be taken into
                    account and the amount of such cost shall be calculated
                    separately for self-only coverage and other coverage.
                    In the case of applicable employer-sponsored coverage
                    which provides coverage to retired employees, the plan
                    may elect to treat a retired employee who has not
                    attained the age of 65 and a retired employee who has
                    attained the age of 65 as similarly situated
                    beneficiaries.
                        ``(B) Health fsas.--In the case of applicable
                    employer-sponsored coverage consisting of coverage
                    under a flexible spending arrangement (as defined in
                    section 106(c)(2)), the cost of the coverage shall be
                    equal to the sum of--
                                ``(i) the amount of employer contributions
                            under any salary reduction election under the
                            arrangement, plus
                                ``(ii) the amount determined under
                            subparagraph (A) with respect to any
                            reimbursement under the arrangement in excess
                            of the contributions described in clause (i).
                        ``(C) Archer msas and hsas.--In the case of
                    applicable employer-sponsored coverage consisting of
                    coverage under an arrangement under which the employer
                    makes contributions described in subsection (b) or (d)
                    of section 106, the cost of the coverage shall be equal
                    to the amount of employer contributions under the
                    arrangement.
                        ``(D) Allocation on a monthly basis.--If cost is
                    determined on other than a monthly basis, the cost
                    shall be allocated to months in a taxable period on
                    such basis as the Secretary may prescribe.
        ``(e) Penalty for Failure To Properly Calculate Excess Benefit.--
                ``(1) In general.--If, for any taxable period, the tax
            imposed by subsection (a) exceeds the tax determined under such
            subsection with respect to the total excess benefit calculated
            by the employer or plan sponsor under subsection (c)(4)--
                        ``(A) each coverage provider shall pay the tax on
                    its applicable share (determined in the same manner as
                    under subsection (c)(4)) of the excess, but no penalty
                    shall be imposed on the provider with respect to such
                    amount, and
                        ``(B) the employer or plan sponsor shall, in
                    addition to any tax imposed by subsection (a), pay a
                    penalty in an amount equal to such excess, plus
                    interest at the underpayment rate determined under
                    section 6621 for the period beginning on the due date
                    for the payment of tax imposed by subsection (a) to
                    which the excess relates and ending on the date of
                    payment of the penalty.
                ``(2) Limitations on penalty.--
                        ``(A) Penalty not to apply where failure not
                    discovered exercising reasonable diligence.--No penalty
                    shall be imposed by paragraph (1)(B) on any failure to
                    properly calculate the excess benefit during any period
                    for which it is established to the satisfaction of the
                    Secretary that the employer or plan sponsor neither
                    knew, nor exercising reasonable diligence would have
                    known, that such failure existed.
                        ``(B) Penalty not to apply to failures corrected
                    within 30 days.--No penalty shall be imposed by
                    paragraph (1)(B) on any such failure if--
                                ``(i) such failure was due to reasonable
                            cause and not to willful neglect, and
                                ``(ii) such failure is corrected during the
                            30-day period beginning on the 1st date that
                            the employer knew, or exercising reasonable
                            diligence would have known, that such failure
                            existed.
                        ``(C) Waiver by secretary.--In the case of any such
                    failure which is due to reasonable cause and not to
                    willful neglect, the Secretary may waive part or all of
                    the penalty imposed by paragraph (1), to the extent
                    that the payment of such penalty would be excessive or
                    otherwise inequitable relative to the failure involved.
        ``(f) Other Definitions and Special Rules.--For purposes of this
    section--
                ``(1) Coverage determinations.--
                        ``(A) In general.--Except as provided in
                    subparagraph (B), an employee shall be treated as
                    having self-only coverage with respect to any
                    applicable employer-sponsored coverage of an employer.
                        ``(B) Minimum essential coverage.--An employee
                    shall be treated as having coverage other than self-
                    only coverage only if the employee is enrolled in
                    coverage other than self-only coverage in a group
                    health plan which provides minimum essential coverage
                    (as defined in section 5000A(f)) to the employee and at
                    least one other beneficiary, and the benefits provided
                    under such minimum essential coverage do not vary based
                    on whether any individual covered under such coverage
                    is the employee or another beneficiary.
                ``(2) Qualified retiree.--The term `qualified retiree'
            means any individual who--
                        ``(A) is receiving coverage by reason of being a
                    retiree,
                        ``(B) has attained age 55, and
                        ``(C) is not entitled to benefits or eligible for
                    enrollment under the Medicare program under title XVIII
                    of the Social Security Act.
                ``(3) Employees engaged in high-risk profession.--The term
            `employees engaged in a high-risk profession' means law
            enforcement officers (as such term is defined in section 1204
            of the Omnibus Crime Control and Safe Streets Act of 1968),
            employees in fire protection activities (as such term is
            defined in section 3(y) of the Fair Labor Standards Act of
            1938), individuals who provide out-of-hospital emergency
            medical care (including emergency medical technicians,
            paramedics, and first-responders), and individuals engaged in
            the construction, mining, agriculture (not including food
            processing), forestry, and fishing industries. Such term
            includes an employee who is retired from a high-risk profession
            described in the preceding sentence, if such employee satisfied
            the requirements of such sentence for a period of not less than
            20 years during the employee's employment.
                ``(4) Group health plan.--The term `group health plan' has
            the meaning given such term by section 5000(b)(1).
                ``(5) Health insurance coverage; health insurance issuer.--
                        ``(A) Health insurance coverage.--The term `health
                    insurance coverage' has the meaning given such term by
                    section 9832(b)(1) (applied without regard to
                    subparagraph (B) thereof, except as provided by the
                    Secretary in regulations).
                        ``(B) Health insurance issuer.--The term `health
                    insurance issuer' has the meaning given such term by
                    section 9832(b)(2).
                ``(6) Person that administers the plan benefits.--The term
            `person that administers the plan benefits' shall include the
            plan sponsor if the plan sponsor administers benefits under the
            plan.
                ``(7) Plan sponsor.--The term `plan sponsor' has the
            meaning given such term in section 3(16)(B) of the Employee
            Retirement Income Security Act of 1974.
                ``(8) Taxable period.--The term `taxable period' means the
            calendar year or such shorter period as the Secretary may
            prescribe. The Secretary may have different taxable periods for
            employers of varying sizes.
                ``(9) Aggregation rules.--All employers treated as a single
            employer under subsection (b), (c), (m), or (o) of section 414
            shall be treated as a single employer.
                ``(10) Denial of deduction.--For denial of a deduction for
            the tax imposed by this section, see section 275(a)(6).
        ``(g) Regulations.--The Secretary shall prescribe such regulations
    as may be necessary to carry out this section.''.
        (b) Clerical Amendment.--The table of sections for chapter 43 of
    such Code, as amended by section 1513, is amended by adding at the end
    the following new item:

    ``Sec. 4980I. Excise tax on high cost employer-sponsored health
                                coverage.''.
        (c) Effective Date.--The amendments made by this section shall
    apply to taxable years beginning after December 31, 2012.

    SEC. 9002. INCLUSION OF COST OF EMPLOYER-SPONSORED HEALTH COVERAGE ON
                  W-2.

        (a) In General.--Section 6051(a) of the Internal Revenue Code of
    1986 (relating to receipts for employees) is amended by striking
    ``and'' at the end of paragraph (12), by striking the period at the end
    of paragraph (13) and inserting ``, and'', and by adding after
    paragraph (13) the following new paragraph:
                ``(14) the aggregate cost (determined under rules similar
            to the rules of section 4980B(f)(4)) of applicable employer-
            sponsored coverage (as defined in section 4980I(d)(1)), except
            that this paragraph shall not apply to--
                        ``(A) coverage to which paragraphs (11) and (12)
                    apply, or
                        ``(B) the amount of any salary reduction
                    contributions to a flexible spending arrangement
                    (within the meaning of section 125).''.
        (b) Effective Date.--The amendments made by this section shall
    apply to taxable years beginning after December 31, 2010.

    SEC. 9003. DISTRIBUTIONS FOR MEDICINE QUALIFIED ONLY IF FOR PRESCRIBED
                  DRUG OR INSULIN.

        (a) HSAs.--Subparagraph (A) of section 223(d)(2) of the Internal
    Revenue Code of 1986 is amended by adding at the end the following:
    ``Such term shall include an amount paid for medicine or a drug only if
    such medicine or drug is a prescribed drug (determined without regard
    to whether such drug is available without a prescription) or is
    insulin.''.
        (b) Archer MSAs.--Subparagraph (A) of section 220(d)(2) of the
    Internal Revenue Code of 1986 is amended by adding at the end the
    following: ``Such term shall include an amount paid for medicine or a
    drug only if such medicine or drug is a prescribed drug (determined
    without regard to whether such drug is available without a
    prescription) or is insulin.''.
        (c) Health Flexible Spending Arrangements and Health Reimbursement
    Arrangements.--Section 106 of the Internal Revenue Code of 1986 is
    amended by adding at the end the following new subsection:
        ``(f) Reimbursements for Medicine Restricted to Prescribed Drugs
    and Insulin.--For purposes of this section and section 105,
    reimbursement for expenses incurred for a medicine or a drug shall be
    treated as a reimbursement for medical expenses only if such medicine
    or drug is a prescribed drug (determined without regard to whether such
    drug is available without a prescription) or is insulin.''.
        (d) Effective Dates.--
                (1) Distributions from savings accounts.--The amendments
            made by subsections (a) and (b) shall apply to amounts paid
            with respect to taxable years beginning after December 31,
            2010.
                (2) Reimbursements.--The amendment made by subsection (c)
            shall apply to expenses incurred with respect to taxable years
            beginning after December 31, 2010.

    SEC. 9004. INCREASE IN ADDITIONAL TAX ON DISTRIBUTIONS FROM HSAS AND
                  ARCHER MSAS NOT USED FOR QUALIFIED MEDICAL EXPENSES.

        (a) HSAs.--Section 223(f)(4)(A) of the Internal Revenue Code of
    1986 is amended by striking ``10 percent'' and inserting ``20
    percent''.
        (b) Archer MSAs.--Section 220(f)(4)(A) of the Internal Revenue Code
    of 1986 is amended by striking ``15 percent'' and inserting ``20
    percent''.
        (c) Effective Date.--The amendments made by this section shall
    apply to distributions made after December 31, 2010.

    SEC. 9005. LIMITATION ON HEALTH FLEXIBLE SPENDING ARRANGEMENTS UNDER
                  CAFETERIA PLANS.

        (a) In General.--Section 125 of the Internal Revenue Code of 1986
    is amended--
                (1) by redesignating subsections (i) and (j) as subsections
            (j) and (k), respectively, and
                (2) by inserting after subsection (h) the following new
            subsection:
        ``(i) Limitation on Health Flexible Spending Arrangements.--For
    purposes of this section, if a benefit is provided under a cafeteria
    plan through employer contributions to a health flexible spending
    arrangement, such benefit shall not be treated as a qualified benefit
    unless the cafeteria plan provides that an employee may not elect for
    any taxable year to have salary reduction contributions in excess of
    $2,500 made to such arrangement.''.
        (b) Effective Date.--The amendments made by this section shall
    apply to taxable years beginning after December 31, 2010.

    SEC. 9006. EXPANSION OF INFORMATION REPORTING REQUIREMENTS.

        (a) In General.--Section 6041 of the Internal Revenue Code of 1986
    is amended by adding at the end the following new subsections:
        ``(h) Application to Corporations.--Notwithstanding any regulation
    prescribed by the Secretary before the date of the enactment of this
    subsection, for purposes of this section the term `person' includes any
    corporation that is not an organization exempt from tax under section
    501(a).
        ``(i) Regulations.--The Secretary may prescribe such regulations
    and other guidance as may be appropriate or necessary to carry out the
    purposes of this section, including rules to prevent duplicative
    reporting of transactions.''.
        (b) Payments for Property and Other Gross Proceeds.--Subsection (a)
    of section 6041 of the Internal Revenue Code of 1986 is amended--
                (1) by inserting ``amounts in consideration for property,''
            after ``wages,'',
                (2) by inserting ``gross proceeds,'' after ``emoluments, or
            other'', and
                (3) by inserting ``gross proceeds,'' after ``setting forth
            the amount of such''.
        (c) Effective Date.--The amendments made by this section shall
    apply to payments made after December 31, 2011.

    SEC. 9007. ADDITIONAL REQUIREMENTS FOR CHARITABLE HOSPITALS.

        (a) Requirements To Qualify as Section 501(c)(3) Charitable
    Hospital Organization.--Section 501 of the Internal Revenue Code of
    1986 (relating to exemption from tax on corporations, certain trusts,
    etc.) is amended by redesignating subsection (r) as subsection (s) and
    by inserting after subsection (q) the following new subsection:
        ``(r) Additional Requirements for Certain Hospitals.--
                ``(1) In general.--A hospital organization to which this
            subsection applies shall not be treated as described in
            subsection (c)(3) unless the organization--
                        ``(A) meets the community health needs assessment
                    requirements described in paragraph (3),
                        ``(B) meets the financial assistance policy
                    requirements described in paragraph (4),
                        ``(C) meets the requirements on charges described
                    in paragraph (5), and
                        ``(D) meets the billing and collection requirement
                    described in paragraph (6).
                ``(2) Hospital organizations to which subsection applies.--
                        ``(A) In general.--This subsection shall apply to--
                                ``(i) an organization which operates a
                            facility which is required by a State to be
                            licensed, registered, or similarly recognized
                            as a hospital, and
                                ``(ii) any other organization which the
                            Secretary determines has the provision of
                            hospital care as its principal function or
                            purpose constituting the basis for its
                            exemption under subsection (c)(3) (determined
                            without regard to this subsection).
                        ``(B) Organizations with more than 1 hospital
                    facility.--If a hospital organization operates more
                    than 1 hospital facility--
                                ``(i) the organization shall meet the
                            requirements of this subsection separately with
                            respect to each such facility, and
                                ``(ii) the organization shall not be
                            treated as described in subsection (c)(3) with
                            respect to any such facility for which such
                            requirements are not separately met.
                ``(3) Community health needs assessments.--
                        ``(A) In general.--An organization meets the
                    requirements of this paragraph with respect to any
                    taxable year only if the organization--
                                ``(i) has conducted a community health
                            needs assessment which meets the requirements
                            of subparagraph (B) in such taxable year or in
                            either of the 2 taxable years immediately
                            preceding such taxable year, and
                                ``(ii) has adopted an implementation
                            strategy to meet the community health needs
                            identified through such assessment.
                        ``(B) Community health needs assessment.--A
                    community health needs assessment meets the
                    requirements of this paragraph if such community health
                    needs assessment--
                                ``(i) takes into account input from persons
                            who represent the broad interests of the
                            community served by the hospital facility,
                            including those with special knowledge of or
                            expertise in public health, and
                                ``(ii) is made widely available to the
                            public.
                ``(4) Financial assistance policy.--An organization meets
            the requirements of this paragraph if the organization
            establishes the following policies:
                        ``(A) Financial assistance policy.--A written
                    financial assistance policy which includes--
                                ``(i) eligibility criteria for financial
                            assistance, and whether such assistance
                            includes free or discounted care,
                                ``(ii) the basis for calculating amounts
                            charged to patients,
                                ``(iii) the method for applying for
                            financial assistance,
                                ``(iv) in the case of an organization which
                            does not have a separate billing and
                            collections policy, the actions the
                            organization may take in the event of non-
                            payment, including collections action and
                            reporting to credit agencies, and
                                ``(v) measures to widely publicize the
                            policy within the community to be served by the
                            organization.
                        ``(B) Policy relating to emergency medical care.--A
                    written policy requiring the organization to provide,
                    without discrimination, care for emergency medical
                    conditions (within the meaning of section 1867 of the
                    Social Security Act (42 U.S.C. 1395dd)) to individuals
                    regardless of their eligibility under the financial
                    assistance policy described in subparagraph (A).
                ``(5) Limitation on charges.--An organization meets the
            requirements of this paragraph if the organization--
                        ``(A) limits amounts charged for emergency or other
                    medically necessary care provided to individuals
                    eligible for assistance under the financial assistance
                    policy described in paragraph (4)(A) to not more than
                    the lowest amounts charged to individuals who have
                    insurance covering such care, and
                        ``(B) prohibits the use of gross charges.
                ``(6) Billing and collection requirements.--An organization
            meets the requirement of this paragraph only if the
            organization does not engage in extraordinary collection
            actions before the organization has made reasonable efforts to
            determine whether the individual is eligible for assistance
            under the financial assistance policy described in paragraph
            (4)(A).
                ``(7) Regulatory authority.--The Secretary shall issue such
            regulations and guidance as may be necessary to carry out the
            provisions of this subsection, including guidance relating to
            what constitutes reasonable efforts to determine the
            eligibility of a patient under a financial assistance policy
            for purposes of paragraph (6).''.
        (b) Excise Tax for Failures To Meet Hospital Exemption
    Requirements.--
                (1) In general.--Subchapter D of chapter 42 of the Internal
            Revenue Code of 1986 (relating to failure by certain charitable
            organizations to meet certain qualification requirements) is
            amended by adding at the end the following new section:

    ``SEC. 4959. TAXES ON FAILURES BY HOSPITAL ORGANIZATIONS.

        ``If a hospital organization to which section 501(r) applies fails
    to meet the requirement of section 501(r)(3) for any taxable year,
    there is imposed on the organization a tax equal to $50,000.''.
                (2) Conforming amendment.--The table of sections for
            subchapter D of chapter 42 of such Code is amended by adding at
            the end the following new item:

    ``Sec. 4959. Taxes on failures by hospital organizations.''.
        (c) Mandatory Review of Tax Exemption for Hospitals.--The Secretary
    of the Treasury or the Secretary's delegate shall review at least once
    every 3 years the community benefit activities of each hospital
    organization to which section 501(r) of the Internal Revenue Code of
    1986 (as added by this section) applies.
        (d) Additional Reporting Requirements.--
                (1) Community health needs assessments and audited
            financial statements.--Section 6033(b) of the Internal Revenue
            Code of 1986 (relating to certain organizations described in
            section 501(c)(3)) is amended by striking ``and'' at the end of
            paragraph (14), by redesignating paragraph (15) as paragraph
            (16), and by inserting after paragraph (14) the following new
            paragraph:
                ``(15) in the case of an organization to which the
            requirements of section 501(r) apply for the taxable year--
                        ``(A) a description of how the organization is
                    addressing the needs identified in each community
                    health needs assessment conducted under section
                    501(r)(3) and a description of any such needs that are
                    not being addressed together with the reasons why such
                    needs are not being addressed, and
                        ``(B) the audited financial statements of such
                    organization (or, in the case of an organization the
                    financial statements of which are included in a
                    consolidated financial statement with other
                    organizations, such consolidated financial
                    statement).''.
                (2) Taxes.--Section 6033(b)(10) of such Code is amended by
            striking ``and'' at the end of subparagraph (B), by inserting
            ``and'' at the end of subparagraph (C), and by adding at the
            end the following new subparagraph:
                        ``(D) section 4959 (relating to taxes on failures
                    by hospital organizations),''.
        (e) Reports.--
                (1) Report on levels of charity care.--The Secretary of the
            Treasury, in consultation with the Secretary of Health and
            Human Services, shall submit to the Committees on Ways and
            Means, Education and Labor, and Energy and Commerce of the
            House of Representatives and to the Committees on Finance and
            Health, Education, Labor, and Pensions of the Senate an annual
            report on the following:
                        (A) Information with respect to private tax-exempt,
                    taxable, and government-owned hospitals regarding--
                                (i) levels of charity care provided,
                                (ii) bad debt expenses,
                                (iii) unreimbursed costs for services
                            provided with respect to means-tested
                            government programs, and
                                (iv) unreimbursed costs for services
                            provided with respect to non-means tested
                            government programs.
                        (B) Information with respect to private tax-exempt
                    hospitals regarding costs incurred for community
                    benefit activities.
                (2) Report on trends.--
                        (A) Study.--The Secretary of the Treasury, in
                    consultation with the Secretary of Health and Human
                    Services, shall conduct a study on trends in the
                    information required to be reported under paragraph
                    (1).
                        (B) Report.--Not later than 5 years after the date
                    of the enactment of this Act, the Secretary of the
                    Treasury, in consultation with the Secretary of Health
                    and Human Services, shall submit a report on the study
                    conducted under subparagraph (A) to the Committees on
                    Ways and Means, Education and Labor, and Energy and
                    Commerce of the House of Representatives and to the
                    Committees on Finance and Health, Education, Labor, and
                    Pensions of the Senate.
        (f) Effective Dates.--
                (1) In general.--Except as provided in paragraphs (2) and
            (3), the amendments made by this section shall apply to taxable
            years beginning after the date of the enactment of this Act.
                (2) Community health needs assessment.--The requirements of
            section 501(r)(3) of the Internal Revenue Code of 1986, as
            added by subsection (a), shall apply to taxable years beginning
            after the date which is 2 years after the date of the enactment
            of this Act.
                (3) Excise tax.--The amendments made by subsection (b)
            shall apply to failures occurring after the date of the
            enactment of this Act.

    SEC. 9008. IMPOSITION OF ANNUAL FEE ON BRANDED PRESCRIPTION
                  PHARMACEUTICAL MANUFACTURERS AND IMPORTERS.

        (a) Imposition of Fee.--
                (1) In general.--Each covered entity engaged in the
            business of manufacturing or importing branded prescription
            drugs shall pay to the Secretary of the Treasury not later than
            the annual payment date of each calendar year beginning after
            2009 a fee in an amount determined under subsection (b).
                (2) Annual payment date.--For purposes of this section, the
            term ``annual payment date'' means with respect to any calendar
            year the date determined by the Secretary, but in no event
            later than September 30 of such calendar year.
        (b) Determination of Fee Amount.--
                (1) In general.--With respect to each covered entity, the
            fee under this section for any calendar year shall be equal to
            an amount that bears the same ratio to $2,300,000,000 as--
                        (A) the covered entity's branded prescription drug
                    sales taken into account during the preceding calendar
                    year, bear to
                        (B) the aggregate branded prescription drug sales
                    of all covered entities taken into account during such
                    preceding calendar year.
                (2) Sales taken into account.--For purposes of paragraph
            (1), the branded prescription drug sales taken into account
            during any calendar year with respect to any covered entity
            shall be determined in accordance with the following table:

       With respect to a covered entity's
      aggregate branded prescription drug      The percentage of such sales
      sales during the calendar year that         taken into account is:
                      are:

      Not more than $5,000,000.............  0 percent
      More than $5,000,000 but not more      10 percent
       than $125,000,000.
      More than $125,000,000 but not more    40 percent
       than $225,000,000.
      More than $225,000,000 but not more    75 percent
       than $400,000,000.
      More than $400,000,000...............  100 percent.

                (3) Secretarial determination.--The Secretary of the
            Treasury shall calculate the amount of each covered entity's
            fee for any calendar year under paragraph (1). In calculating
            such amount, the Secretary of the Treasury shall determine such
            covered entity's branded prescription drug sales on the basis
            of reports submitted under subsection (g) and through the use
            of any other source of information available to the Secretary
            of the Treasury.
        (c) Transfer of Fees to Medicare Part B Trust Fund.--There is
    hereby appropriated to the Federal Supplementary Medical Insurance
    Trust Fund established under section 1841 of the Social Security Act an
    amount equal to the fees received by the Secretary of the Treasury
    under subsection (a).
        (d) Covered Entity.--
                (1) In general.--For purposes of this section, the term
            ``covered entity'' means any manufacturer or importer with
            gross receipts from branded prescription drug sales.
                (2) Controlled groups.--
                        (A) In general.--For purposes of this subsection,
                    all persons treated as a single employer under
                    subsection (a) or (b) of section 52 of the Internal
                    Revenue Code of 1986 or subsection (m) or (o) of
                    section 414 of such Code shall be treated as a single
                    covered entity.
                        (B) Inclusion of foreign corporations.--For
                    purposes of subparagraph (A), in applying subsections
                    (a) and (b) of section 52 of such Code to this section,
                    section 1563 of such Code shall be applied without
                    regard to subsection (b)(2)(C) thereof.
        (e) Branded Prescription Drug Sales.--For purposes of this
    section--
                (1) In general.--The term ``branded prescription drug
            sales'' means sales of branded prescription drugs to any
            specified government program or pursuant to coverage under any
            such program.
                (2) Branded prescription drugs.--
                        (A) In general.--The term ``branded prescription
                    drug'' means--
                                (i) any prescription drug the application
                            for which was submitted under section 505(b) of
                            the Federal Food, Drug, and Cosmetic Act (21
                            U.S.C. 355(b)), or
                                (ii) any biological product the license for
                            which was submitted under section 351(a) of the
                            Public Health Service Act (42 U.S.C. 262(a)).
                        (B) Prescription drug.--For purposes of
                    subparagraph (A)(i), the term ``prescription drug''
                    means any drug which is subject to section 503(b) of
                    the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
                    353(b)).
                (3) Exclusion of orphan drug sales.--The term ``branded
            prescription drug sales'' shall not include sales of any drug
            or biological product with respect to which a credit was
            allowed for any taxable year under section 45C of the Internal
            Revenue Code of 1986. The preceding sentence shall not apply
            with respect to any such drug or biological product after the
            date on which such drug or biological product is approved by
            the Food and Drug Administration for marketing for any
            indication other than the treatment of the rare disease or
            condition with respect to which such credit was allowed.
                (4) Specified government program.--The term ``specified
            government program'' means--
                        (A) the Medicare Part D program under part D of
                    title XVIII of the Social Security Act,
                        (B) the Medicare Part B program under part B of
                    title XVIII of the Social Security Act,
                        (C) the Medicaid program under title XIX of the
                    Social Security Act,
                        (D) any program under which branded prescription
                    drugs are procured by the Department of Veterans
                    Affairs,
                        (E) any program under which branded prescription
                    drugs are procured by the Department of Defense, or
                        (F) the TRICARE retail pharmacy program under
                    section 1074g of title 10, United States Code.
        (f) Tax Treatment of Fees.--The fees imposed by this section--
                (1) for purposes of subtitle F of the Internal Revenue Code
            of 1986, shall be treated as excise taxes with respect to which
            only civil actions for refund under procedures of such subtitle
            shall apply, and
                (2) for purposes of section 275 of such Code, shall be
            considered to be a tax described in section 275(a)(6).
        (g) Reporting Requirement.--Not later than the date determined by
    the Secretary of the Treasury following the end of any calendar year,
    the Secretary of Health and Human Services, the Secretary of Veterans
    Affairs, and the Secretary of Defense shall report to the Secretary of
    the Treasury, in such manner as the Secretary of the Treasury
    prescribes, the total branded prescription drug sales for each covered
    entity with respect to each specified government program under such
    Secretary's jurisdiction using the following methodology:
                (1) Medicare part d program.--The Secretary of Health and
            Human Services shall report, for each covered entity and for
            each branded prescription drug of the covered entity covered by
            the Medicare Part D program, the product of--
                        (A) the per-unit ingredient cost, as reported to
                    the Secretary of Health and Human Services by
                    prescription drug plans and Medicare Advantage
                    prescription drug plans, minus any per-unit rebate,
                    discount, or other price concession provided by the
                    covered entity, as reported to the Secretary of Health
                    and Human Services by the prescription drug plans and
                    Medicare Advantage prescription drug plans, and
                        (B) the number of units of the branded prescription
                    drug paid for under the Medicare Part D program.
                (2) Medicare part b program.--The Secretary of Health and
            Human Services shall report, for each covered entity and for
            each branded prescription drug of the covered entity covered by
            the Medicare Part B program under section 1862(a) of the Social
            Security Act, the product of--
                        (A) the per-unit average sales price (as defined in
                    section 1847A(c) of the Social Security Act) or the
                    per-unit Part B payment rate for a separately paid
                    branded prescription drug without a reported average
                    sales price, and
                        (B) the number of units of the branded prescription
                    drug paid for under the Medicare Part B program.
            The Centers for Medicare and Medicaid Services shall establish
            a process for determining the units and the allocated price for
            purposes of this section for those branded prescription drugs
            that are not separately payable or for which National Drug
            Codes are not reported.
                (3) Medicaid program.--The Secretary of Health and Human
            Services shall report, for each covered entity and for each
            branded prescription drug of the covered entity covered under
            the Medicaid program, the product of--
                        (A) the per-unit ingredient cost paid to pharmacies
                    by States for the branded prescription drug dispensed
                    to Medicaid beneficiaries, minus any per-unit rebate
                    paid by the covered entity under section 1927 of the
                    Social Security Act and any State supplemental rebate,
                    and
                        (B) the number of units of the branded prescription
                    drug paid for under the Medicaid program.
                (4) Department of veterans affairs programs.--The Secretary
            of Veterans Affairs shall report, for each covered entity and
            for each branded prescription drug of the covered entity the
            total amount paid for each such branded prescription drug
            procured by the Department of Veterans Affairs for its
            beneficiaries.
                (5) Department of defense programs and tricare.--The
            Secretary of Defense shall report, for each covered entity and
            for each branded prescription drug of the covered entity, the
            sum of--
                        (A) the total amount paid for each such branded
                    prescription drug procured by the Department of Defense
                    for its beneficiaries, and
                        (B) for each such branded prescription drug
                    dispensed under the TRICARE retail pharmacy program,
                    the product of--
                                (i) the per-unit ingredient cost, minus any
                            per-unit rebate paid by the covered entity, and
                                (ii) the number of units of the branded
                            prescription drug dispensed under such program.
        (h) Secretary.--For purposes of this section, the term
    ``Secretary'' includes the Secretary's delegate.
        (i) Guidance.--The Secretary of the Treasury shall publish guidance
    necessary to carry out the purposes of this section.
        (j) Application of Section.--This section shall apply to any
    branded prescription drug sales after December 31, 2008.
        (k) Conforming Amendment.--Section 1841(a) of the Social Security
    Act is amended by inserting ``or section 9008(c) of the Patient
    Protection and Affordable Care Act of 2009'' after ``this part''.

    SEC. 9009. IMPOSITION OF ANNUAL FEE ON MEDICAL DEVICE MANUFACTURERS AND
                  IMPORTERS.

        (a) Imposition of Fee.--
                (1) In general.--Each covered entity engaged in the
            business of manufacturing or importing medical devices shall
            pay to the Secretary not later than the annual payment date of
            each calendar year beginning after 2009 a fee in an amount
            determined under subsection (b).
                (2) Annual payment date.--For purposes of this section, the
            term ``annual payment date'' means with respect to any calendar
            year the date determined by the Secretary, but in no event
            later than September 30 of such calendar year.
        (b) Determination of Fee Amount.--
                (1) In general.--With respect to each covered entity, the
            fee under this section for any calendar year shall be equal to
            an amount that bears the same ratio to $2,000,000,000 as--
                        (A) the covered entity's gross receipts from
                    medical device sales taken into account during the
                    preceding calendar year, bear to
                        (B) the aggregate gross receipts of all covered
                    entities from medical device sales taken into account
                    during such preceding calendar year.
                (2) Gross receipts from sales taken into account.--For
            purposes of paragraph (1), the gross receipts from medical
            device sales taken into account during any calendar year with
            respect to any covered entity shall be determined in accordance
            with the following table:

       With respect to a covered entity's
     aggregate gross receipts from medical       The percentage of gross
     device sales during the calendar year   receipts taken into account is:
                   that are:

      Not more than $5,000,000.............  0 percent
      More than $5,000,000 but not more      50 percent
       than $25,000,000.
      More than $25,000,000................  100 percent.

                (3) Secretarial determination.--The Secretary shall
            calculate the amount of each covered entity's fee for any
            calendar year under paragraph (1). In calculating such amount,
            the Secretary shall determine such covered entity's gross
            receipts from medical device sales on the basis of reports
            submitted by the covered entity under subsection (f) and
            through the use of any other source of information available to
            the Secretary.
        (c) Covered Entity.--
                (1) In general.--For purposes of this section, the term
            ``covered entity'' means any manufacturer or importer with
            gross receipts from medical device sales.
                (2) Controlled groups.--
                        (A) In general.--For purposes of this subsection,
                    all persons treated as a single employer under
                    subsection (a) or (b) of section 52 of the Internal
                    Revenue Code of 1986 or subsection (m) or (o) of
                    section 414 of such Code shall be treated as a single
                    covered entity.
                        (B) Inclusion of foreign corporations.--For
                    purposes of subparagraph (A), in applying subsections
                    (a) and (b) of section 52 of such Code to this section,
                    section 1563 of such Code shall be applied without
                    regard to subsection (b)(2)(C) thereof.
        (d) Medical Device Sales.--For purposes of this section--
                (1) In general.--The term ``medical device sales'' means
            sales for use in the United States of any medical device, other
            than the sales of a medical device that--
                        (A) has been classified in class II under section
                    513 of the Federal Food, Drug, and Cosmetic Act (21
                    U.S.C. 360c) and is primarily sold to consumers at
                    retail for not more than $100 per unit, or
                        (B) has been classified in class I under such
                    section.
                (2) United states.--For purposes of paragraph (1), the term
            ``United States'' means the several States, the District of
            Columbia, the Commonwealth of Puerto Rico, and the possessions
            of the United States.
                (3) Medical device.--For purposes of paragraph (1), the
            term ``medical device'' means any device (as defined in section
            201(h) of the Federal Food, Drug, and Cosmetic Act (21 U.S.C.
            321(h))) intended for humans.
        (e) Tax Treatment of Fees.--The fees imposed by this section--
                (1) for purposes of subtitle F of the Internal Revenue Code
            of 1986, shall be treated as excise taxes with respect to which
            only civil actions for refund under procedures of such subtitle
            shall apply, and
                (2) for purposes of section 275 of such Code, shall be
            considered to be a tax described in section 275(a)(6).
        (f) Reporting Requirement.--
                (1) In general.--Not later than the date determined by the
            Secretary following the end of any calendar year, each covered
            entity shall report to the Secretary, in such manner as the
            Secretary prescribes, the gross receipts from medical device
            sales of such covered entity during such calendar year.
                (2) Penalty for failure to report.--
                        (A) In general.--In the case of any failure to make
                    a report containing the information required by
                    paragraph (1) on the date prescribed therefor
                    (determined with regard to any extension of time for
                    filing), unless it is shown that such failure is due to
                    reasonable cause, there shall be paid by the covered
                    entity failing to file such report, an amount equal
                    to--
                                (i) $10,000, plus
                                (ii) the lesser of--
                                        (I) an amount equal to $1,000,
                                    multiplied by the number of days during
                                    which such failure continues, or
                                        (II) the amount of the fee imposed
                                    by this section for which such report
                                    was required.
                        (B) Treatment of penalty.--The penalty imposed
                    under subparagraph (A)--
                                (i) shall be treated as a penalty for
                            purposes of subtitle F of the Internal Revenue
                            Code of 1986,
                                (ii) shall be paid on notice and demand by
                            the Secretary and in the same manner as tax
                            under such Code, and
                                (iii) with respect to which only civil
                            actions for refund under procedures of such
                            subtitle F shall apply.
        (g) Secretary.--For purposes of this section, the term
    ``Secretary'' means the Secretary of the Treasury or the Secretary's
    delegate.
        (h) Guidance.--The Secretary shall publish guidance necessary to
    carry out the purposes of this section, including identification of
    medical devices described in subsection (d)(1)(A) and with respect to
    the treatment of gross receipts from sales of medical devices to
    another covered entity or to another entity by reason of the
    application of subsection (c)(2).
        (i) Application of Section.--This section shall apply to any
    medical device sales after December 31, 2008.

    SEC. 9010. IMPOSITION OF ANNUAL FEE ON HEALTH INSURANCE PROVIDERS.

        (a) Imposition of Fee.--
                (1) In general.--Each covered entity engaged in the
            business of providing health insurance shall pay to the
            Secretary not later than the annual payment date of each
            calendar year beginning after 2009 a fee in an amount
            determined under subsection (b).
                (2) Annual payment date.--For purposes of this section, the
            term ``annual payment date'' means with respect to any calendar
            year the date determined by the Secretary, but in no event
            later than September 30 of such calendar year.
        (b) Determination of Fee Amount.--
                (1) In general.--With respect to each covered entity, the
            fee under this section for any calendar year shall be equal to
            an amount that bears the same ratio to $6,700,000,000 as--
                        (A) the sum of--
                                (i) the covered entity's net premiums
                            written with respect to health insurance for
                            any United States health risk that are taken
                            into account during the preceding calendar
                            year, plus
                                (ii) 200 percent of the covered entity's
                            third party administration agreement fees that
                            are taken into account during the preceding
                            calendar year, bears to
                        (B) the sum of--
                                (i) the aggregate net premiums written with
                            respect to such health insurance of all covered
                            entities that are taken into account during
                            such preceding calendar year, plus
                                (ii) 200 percent of the aggregate third
                            party administration agreement fees of all
                            covered entities that are taken into account
                            during such preceding calendar year.
                (2) Amounts taken into account.--For purposes of paragraph
            (1)--
                        (A) Net premiums written.--The net premiums written
                    with respect to health insurance for any United States
                    health risk that are taken into account during any
                    calendar year with respect to any covered entity shall
                    be determined in accordance with the following table:

     With respect to a covered entity's net   The percentage of net premiums
      premiums written during the calendar     written that are taken into
                 year that are:                        account is:

      Not more than $25,000,000............  0 percent
      More than $25,000,000 but not more     50 percent
       than $50,000,000.
      More than $50,000,000................  100 percent.

                        (B) Third party administration agreement fees.--The
                    third party administration agreement fees that are
                    taken into account during any calendar year with
                    respect to any covered entity shall be determined in
                    accordance with the following table:

       With respect to a covered entity's     The percentage of third party
      third party administration agreement    administration agreement fees
    fees during the calendar year that are:  that are taken into account is:

      Not more than $5,000,000.............  0 percent
      More than $5,000,000 but not more      50 percent
       than $10,000,000.
      More than $10,000,000................  100 percent.

                (3) Secretarial determination.--The Secretary shall
            calculate the amount of each covered entity's fee for any
            calendar year under paragraph (1). In calculating such amount,
            the Secretary shall determine such covered entity's net
            premiums written with respect to any United States health risk
            and third party administration agreement fees on the basis of
            reports submitted by the covered entity under subsection (g)
            and through the use of any other source of information
            available to the Secretary.
        (c) Covered Entity.--
                (1) In general.--For purposes of this section, the term
            ``covered entity'' means any entity which provides health
            insurance for any United States health risk.
                (2) Exclusion.--Such term does not include--
                        (A) any employer to the extent that such employer
                    self-insures its employees' health risks, or
                        (B) any governmental entity (except to the extent
                    such an entity provides health insurance coverage
                    through the community health insurance option under
                    section 1323).
                (3) Controlled groups.--
                        (A) In general.--For purposes of this subsection,
                    all persons treated as a single employer under
                    subsection (a) or (b) of section 52 of the Internal
                    Revenue Code of 1986 or subsection (m) or (o) of
                    section 414 of such Code shall be treated as a single
                    covered entity (or employer for purposes of paragraph
                    (2)).
                        (B) Inclusion of foreign corporations.--For
                    purposes of subparagraph (A), in applying subsections
                    (a) and (b) of section 52 of such Code to this section,
                    section 1563 of such Code shall be applied without
                    regard to subsection (b)(2)(C) thereof.
        (d) United States Health Risk.--For purposes of this section, the
    term ``United States health risk'' means the health risk of any
    individual who is--
                (1) a United States citizen,
                (2) a resident of the United States (within the meaning of
            section 7701(b)(1)(A) of the Internal Revenue Code of 1986), or
                (3) located in the United States, with respect to the
            period such individual is so located.
        (e) Third Party Administration Agreement Fees.--For purposes of
    this section, the term ``third party administration agreement fees''
    means, with respect to any covered entity, amounts received from an
    employer which are in excess of payments made by such covered entity
    for health benefits under an arrangement under which such employer
    self-insures the United States health risk of its employees.
        (f) Tax Treatment of Fees.--The fees imposed by this section--
                (1) for purposes of subtitle F of the Internal Revenue Code
            of 1986, shall be treated as excise taxes with respect to which
            only civil actions for refund under procedures of such subtitle
            shall apply, and
                (2) for purposes of section 275 of such Code shall be
            considered to be a tax described in section 275(a)(6).
        (g) Reporting Requirement.--
                (1) In general.--Not later than the date determined by the
            Secretary following the end of any calendar year, each covered
            entity shall report to the Secretary, in such manner as the
            Secretary prescribes, the covered entity's net premiums written
            with respect to health insurance for any United States health
            risk and third party administration agreement fees for such
            calendar year.
                (2) Penalty for failure to report.--
                        (A) In general.--In the case of any failure to make
                    a report containing the information required by
                    paragraph (1) on the date prescribed therefor
                    (determined with regard to any extension of time for
                    filing), unless it is shown that such failure is due to
                    reasonable cause, there shall be paid by the covered
                    entity failing to file such report, an amount equal
                    to--
                                (i) $10,000, plus
                                (ii) the lesser of--
                                        (I) an amount equal to $1,000,
                                    multiplied by the number of days during
                                    which such failure continues, or
                                        (II) the amount of the fee imposed
                                    by this section for which such report
                                    was required.
                        (B) Treatment of penalty.--The penalty imposed
                    under subparagraph (A)--
                                (i) shall be treated as a penalty for
                            purposes of subtitle F of the Internal Revenue
                            Code of 1986,
                                (ii) shall be paid on notice and demand by
                            the Secretary and in the same manner as tax
                            under such Code, and
                                (iii) with respect to which only civil
                            actions for refund under procedures of such
                            subtitle F shall apply.
        (h) Additional Definitions.--For purposes of this section--
                (1) Secretary.--The term ``Secretary'' means the Secretary
            of the Treasury or the Secretary's delegate.
                (2) United states.--The term ``United States'' means the
            several States, the District of Columbia, the Commonwealth of
            Puerto Rico, and the possessions of the United States.
                (3) Health insurance.--The term ``health insurance'' shall
            not include insurance for long-term care or disability.
        (i) Guidance.--The Secretary shall publish guidance necessary to
    carry out the purposes of this section.
        (j) Application of Section.--This section shall apply to any net
    premiums written after December 31, 2008, with respect to health
    insurance for any United States health risk, and any third party
    administration agreement fees received after such date.

    SEC. 9011. STUDY AND REPORT OF EFFECT ON VETERANS HEALTH CARE.

        (a) In General.--The Secretary of Veterans Affairs shall conduct a
    study on the effect (if any) of the provisions of sections 9008, 9009,
    and 9010 on--
                (1) the cost of medical care provided to veterans, and
                (2) veterans' access to medical devices and branded
            prescription drugs.
        (b) Report.--The Secretary of Veterans Affairs shall report the
    results of the study under subsection (a) to the Committee on Ways and
    Means of the House of Representatives and to the Committee on Finance
    of the Senate not later than December 31, 2012.

    SEC. 9012. ELIMINATION OF DEDUCTION FOR EXPENSES ALLOCABLE TO MEDICARE
                  PART D SUBSIDY.

        (a) In General.--Section 139A of the Internal Revenue Code of 1986
    is amended by striking the second sentence.
        (b) Effective Date.--The amendment made by this section shall apply
    to taxable years beginning after December 31, 2010.

    SEC. 9013. MODIFICATION OF ITEMIZED DEDUCTION FOR MEDICAL EXPENSES.

        (a) In General.--Subsection (a) of section 213 of the Internal
    Revenue Code of 1986 is amended by striking ``7.5 percent'' and
    inserting ``10 percent''.
        (b) Temporary Waiver of Increase for Certain Seniors.--Section 213
    of the Internal Revenue Code of 1986 is amended by adding at the end
    the following new subsection:
        ``(f) Special Rule for 2013, 2014, 2015, and 2016.--In the case of
    any taxable year beginning after December 31, 2012, and ending before
    January 1, 2017, subsection (a) shall be applied with respect to a
    taxpayer by substituting `7.5 percent' for `10 percent' if such
    taxpayer or such taxpayer's spouse has attained age 65 before the close
    of such taxable year.''.
        (c) Conforming Amendment.--Section 56(b)(1)(B) of the Internal
    Revenue Code of 1986 is amended by striking ``by substituting `10
    percent' for `7.5 percent''' and inserting ``without regard to
    subsection (f) of such section''.
        (d) Effective Date.--The amendments made by this section shall
    apply to taxable years beginning after December 31, 2012.

    SEC. 9014. LIMITATION ON EXCESSIVE REMUNERATION PAID BY CERTAIN HEALTH
                  INSURANCE PROVIDERS.

        (a) In General.--Section 162(m) of the Internal Revenue Code of
    1986 is amended by adding at the end the following new subparagraph:
                ``(6) Special rule for application to certain health
            insurance providers.--
                        ``(A) In general.--No deduction shall be allowed
                    under this chapter--
                                ``(i) in the case of applicable individual
                            remuneration which is for any disqualified
                            taxable year beginning after December 31, 2012,
                            and which is attributable to services performed
                            by an applicable individual during such taxable
                            year, to the extent that the amount of such
                            remuneration exceeds $500,000, or
                                ``(ii) in the case of deferred deduction
                            remuneration for any taxable year beginning
                            after December 31, 2012, which is attributable
                            to services performed by an applicable
                            individual during any disqualified taxable year
                            beginning after December 31, 2009, to the
                            extent that the amount of such remuneration
                            exceeds $500,000 reduced (but not below zero)
                            by the sum of--
                                        ``(I) the applicable individual
                                    remuneration for such disqualified
                                    taxable year, plus
                                        ``(II) the portion of the deferred
                                    deduction remuneration for such
                                    services which was taken into account
                                    under this clause in a preceding
                                    taxable year (or which would have been
                                    taken into account under this clause in
                                    a preceding taxable year if this clause
                                    were applied by substituting `December
                                    31, 2009' for `December 31, 2012' in
                                    the matter preceding subclause (I)).
                        ``(B) Disqualified taxable year.--For purposes of
                    this paragraph, the term `disqualified taxable year'
                    means, with respect to any employer, any taxable year
                    for which such employer is a covered health insurance
                    provider.
                        ``(C) Covered health insurance provider.--For
                    purposes of this paragraph--
                                ``(i) In general.--The term `covered health
                            insurance provider' means--
                                        ``(I) with respect to taxable years
                                    beginning after December 31, 2009, and
                                    before January 1, 2013, any employer
                                    which is a health insurance issuer (as
                                    defined in section 9832(b)(2)) and
                                    which receives premiums from providing
                                    health insurance coverage (as defined
                                    in section 9832(b)(1)), and
                                        ``(II) with respect to taxable
                                    years beginning after December 31,
                                    2012, any employer which is a health
                                    insurance issuer (as defined in section
                                    9832(b)(2)) and with respect to which
                                    not less than 25 percent of the gross
                                    premiums received from providing health
                                    insurance coverage (as defined in
                                    section 9832(b)(1)) is from minimum
                                    essential coverage (as defined in
                                    section 5000A(f)).
                                ``(ii) Aggregation rules.--Two or more
                            persons who are treated as a single employer
                            under subsection (b), (c), (m), or (o) of
                            section 414 shall be treated as a single
                            employer, except that in applying section
                            1563(a) for purposes of any such subsection,
                            paragraphs (2) and (3) thereof shall be
                            disregarded.
                        ``(D) Applicable individual remuneration.--For
                    purposes of this paragraph, the term `applicable
                    individual remuneration' means, with respect to any
                    applicable individual for any disqualified taxable
                    year, the aggregate amount allowable as a deduction
                    under this chapter for such taxable year (determined
                    without regard to this subsection) for remuneration (as
                    defined in paragraph (4) without regard to
                    subparagraphs (B), (C), and (D) thereof) for services
                    performed by such individual (whether or not during the
                    taxable year). Such term shall not include any deferred
                    deduction remuneration with respect to services
                    performed during the disqualified taxable year.
                        ``(E) Deferred deduction remuneration.--For
                    purposes of this paragraph, the term `deferred
                    deduction remuneration' means remuneration which would
                    be applicable individual remuneration for services
                    performed in a disqualified taxable year but for the
                    fact that the deduction under this chapter (determined
                    without regard to this paragraph) for such remuneration
                    is allowable in a subsequent taxable year.
                        ``(F) Applicable individual.--For purposes of this
                    paragraph, the term `applicable individual' means, with
                    respect to any covered health insurance provider for
                    any disqualified taxable year, any individual--
                                ``(i) who is an officer, director, or
                            employee in such taxable year, or
                                ``(ii) who provides services for or on
                            behalf of such covered health insurance
                            provider during such taxable year.
                        ``(G) Coordination.--Rules similar to the rules of
                    subparagraphs (F) and (G) of paragraph (4) shall apply
                    for purposes of this paragraph.
                        ``(H) Regulatory authority.--The Secretary may
                    prescribe such guidance, rules, or regulations as are
                    necessary to carry out the purposes of this
                    paragraph.''.
        (b) Effective Date.--The amendment made by this section shall apply
    to taxable years beginning after December 31, 2009, with respect to
    services performed after such date.

    SEC. 9015. ADDITIONAL HOSPITAL INSURANCE TAX ON HIGH-INCOME TAXPAYERS.

        (a) FICA.--
                (1) In general.--Section 3101(b) of the Internal Revenue
            Code of 1986 is amended--
                        (A) by striking ``In addition'' and inserting the
                    following:
                ``(1) In general.--In addition'',
                        (B) by striking ``the following percentages of
                    the'' and inserting ``1.45 percent of the'',
                        (C) by striking ``(as defined in section 3121(b))--
                    '' and all that follows and inserting ``(as defined in
                    section 3121(b)).'', and
                        (D) by adding at the end the following new
                    paragraph:
                ``(2) Additional tax.--In addition to the tax imposed by
            paragraph (1) and the preceding subsection, there is hereby
            imposed on every taxpayer (other than a corporation, estate, or
            trust) a tax equal to 0.5 percent of wages which are received
            with respect to employment (as defined in section 3121(b))
            during any taxable year beginning after December 31, 2012, and
            which are in excess of--
                        ``(A) in the case of a joint return, $250,000, and
                        ``(B) in any other case, $200,000.''.
                (2) Collection of tax.--Section 3102 of the Internal
            Revenue Code of 1986 is amended by adding at the end the
            following new subsection:
        ``(f) Special Rules for Additional Tax.--
                ``(1) In general.--In the case of any tax imposed by
            section 3101(b)(2), subsection (a) shall only apply to the
            extent to which the taxpayer receives wages from the employer
            in excess of $200,000, and the employer may disregard the
            amount of wages received by such taxpayer's spouse.
                ``(2) Collection of amounts not withheld.--To the extent
            that the amount of any tax imposed by section 3101(b)(2) is not
            collected by the employer, such tax shall be paid by the
            employee.
                ``(3) Tax paid by recipient.--If an employer, in violation
            of this chapter, fails to deduct and withhold the tax imposed
            by section 3101(b)(2) and thereafter the tax is paid by the
            employee, the tax so required to be deducted and withheld shall
            not be collected from the employer, but this paragraph shall in
            no case relieve the employer from liability for any penalties
            or additions to tax otherwise applicable in respect of such
            failure to deduct and withhold.''.
        (b) SECA.--
                (1) In general.--Section 1401(b) of the Internal Revenue
            Code of 1986 is amended--
                        (A) by striking ``In addition'' and inserting the
                    following:
                ``(1) In general.--In addition'', and
                        (B) by adding at the end the following new
                    paragraph:
                ``(2) Additional tax.--
                        ``(A) In general.--In addition to the tax imposed
                    by paragraph (1) and the preceding subsection, there is
                    hereby imposed on every taxpayer (other than a
                    corporation, estate, or trust) for each taxable year
                    beginning after December 31, 2012, a tax equal to 0.5
                    percent of the self-employment income for such taxable
                    year which is in excess of--
                                ``(i) in the case of a joint return,
                            $250,000, and
                                ``(ii) in any other case, $200,000.
                        ``(B) Coordination with fica.--The amounts under
                    clauses (i) and (ii) of subparagraph (A) shall be
                    reduced (but not below zero) by the amount of wages
                    taken into account in determining the tax imposed under
                    section 3121(b)(2) with respect to the taxpayer.''.
                (2) No deduction for additional tax.--
                        (A) In general.--Section 164(f) of such Code is
                    amended by inserting ``(other than the taxes imposed by
                    section 1401(b)(2))'' after ``section 1401)''.
                        (B) Deduction for net earnings from self-
                    employment.--Subparagraph (B) of section 1402(a)(12) is
                    amended by inserting ``(determined without regard to
                    the rate imposed under paragraph (2) of section
                    1401(b))'' after ``for such year''.
        (c) Effective Date.--The amendments made by this section shall
    apply with respect to remuneration received, and taxable years
    beginning, after December 31, 2012.

    SEC. 9016. MODIFICATION OF SECTION 833 TREATMENT OF CERTAIN HEALTH
                  ORGANIZATIONS.

        (a) In General.--Subsection (c) of section 833 of the Internal
    Revenue Code of 1986 is amended by adding at the end the following new
    paragraph:
                ``(5) Nonapplication of section in case of low medical loss
            ratio.--Notwithstanding the preceding paragraphs, this section
            shall not apply to any organization unless such organization's
            percentage of total premium revenue expended on reimbursement
            for clinical services provided to enrollees under its policies
            during such taxable year (as reported under section 2718 of the
            Public Health Service Act) is not less than 85 percent.''.
        (b) Effective Date.--The amendment made by this section shall apply
    to taxable years beginning after December 31, 2009.

    SEC. 9017. EXCISE TAX ON ELECTIVE COSMETIC MEDICAL PROCEDURES.

        (a) In General.--Subtitle D of the Internal Revenue Code of 1986,
    as amended by this Act, is amended by adding at the end the following
    new chapter:

               ``CHAPTER 49--ELECTIVE COSMETIC MEDICAL PROCEDURES

    ``Sec. 5000B. Imposition of tax on elective cosmetic medical
                                procedures.

    ``SEC. 5000B. IMPOSITION OF TAX ON ELECTIVE COSMETIC MEDICAL
                  PROCEDURES.

        ``(a) In General.--There is hereby imposed on any cosmetic surgery
    and medical procedure a tax equal to 5 percent of the amount paid for
    such procedure (determined without regard to this section), whether
    paid by insurance or otherwise.
        ``(b) Cosmetic Surgery and Medical Procedure.--For purposes of this
    section, the term `cosmetic surgery and medical procedure' means any
    cosmetic surgery (as defined in section 213(d)(9)(B)) or other similar
    procedure which--
                ``(1) is performed by a licensed medical professional, and
                ``(2) is not necessary to ameliorate a deformity arising
            from, or directly related to, a congenital abnormality, a
            personal injury resulting from an accident or trauma, or
            disfiguring disease.
        ``(c) Payment of Tax.--
                ``(1) In general.--The tax imposed by this section shall be
            paid by the individual on whom the procedure is performed.
                ``(2) Collection.--Every person receiving a payment for
            procedures on which a tax is imposed under subsection (a) shall
            collect the amount of the tax from the individual on whom the
            procedure is performed and remit such tax quarterly to the
            Secretary at such time and in such manner as provided by the
            Secretary.
                ``(3) Secondary liability.--Where any tax imposed by
            subsection (a) is not paid at the time payments for cosmetic
            surgery and medical procedures are made, then to the extent
            that such tax is not collected, such tax shall be paid by the
            person who performs the procedure.''.
        (b) Clerical Amendment.--The table of chapters for subtitle D of
    the Internal Revenue Code of 1986, as amended by this Act, is amended
    by inserting after the item relating to chapter 48 the following new
    item:

             ``Chapter 49--Elective Cosmetic Medical Procedures''.

        (c) Effective Date.--The amendments made by this section shall
    apply to procedures performed on or after January 1, 2010.

                          Subtitle B--Other Provisions

    SEC. 9021. EXCLUSION OF HEALTH BENEFITS PROVIDED BY INDIAN TRIBAL
                  GOVERNMENTS.

        (a) In General.--Part III of subchapter B of chapter 1 of the
    Internal Revenue Code of 1986 is amended by inserting after section
    139C the following new section:

    ``SEC. 139D. INDIAN HEALTH CARE BENEFITS.

        ``(a) General Rule.--Except as otherwise provided in this section,
    gross income does not include the value of any qualified Indian health
    care benefit.
        ``(b) Qualified Indian Health Care Benefit.--For purposes of this
    section, the term `qualified Indian health care benefit' means--
                ``(1) any health service or benefit provided or purchased,
            directly or indirectly, by the Indian Health Service through a
            grant to or a contract or compact with an Indian tribe or
            tribal organization, or through a third-party program funded by
            the Indian Health Service,
                ``(2) medical care provided or purchased by, or amounts to
            reimburse for such medical care provided by, an Indian tribe or
            tribal organization for, or to, a member of an Indian tribe,
            including a spouse or dependent of such a member,
                ``(3) coverage under accident or health insurance (or an
            arrangement having the effect of accident or health insurance),
            or an accident or health plan, provided by an Indian tribe or
            tribal organization for medical care to a member of an Indian
            tribe, include a spouse or dependent of such a member, and
                ``(4) any other medical care provided by an Indian tribe or
            tribal organization that supplements, replaces, or substitutes
            for a program or service relating to medical care provided by
            the Federal government to Indian tribes or members of such a
            tribe.
        ``(c) Definitions.--For purposes of this section--
                ``(1) Indian tribe.--The term `Indian tribe' has the
            meaning given such term by section 45A(c)(6).
                ``(2) Tribal organization.--The term `tribal organization'
            has the meaning given such term by section 4(l) of the Indian
            Self-Determination and Education Assistance Act.
                ``(3) Medical care.--The term `medical care' has the same
            meaning as when used in section 213.
                ``(4) Accident or health insurance; accident or health
            plan.--The terms `accident or health insurance' and `accident
            or health plan' have the same meaning as when used in section
            105.
                ``(5) Dependent.--The term `dependent' has the meaning
            given such term by section 152, determined without regard to
            subsections (b)(1), (b)(2), and (d)(1)(B) thereof.
        ``(d) Denial of Double Benefit.--Subsection (a) shall not apply to
    the amount of any qualified Indian health care benefit which is not
    includible in gross income of the beneficiary of such benefit under any
    other provision of this chapter, or to the amount of any such benefit
    for which a deduction is allowed to such beneficiary under any other
    provision of this chapter.''.
        (b) Clerical Amendment.--The table of sections for part III of
    subchapter B of chapter 1 of the Internal Revenue Code of 1986 is
    amended by inserting after the item relating to section 139C the
    following new item:

    ``Sec. 139D. Indian health care benefits.''.
        (c) Effective Date.--The amendments made by this section shall
    apply to benefits and coverage provided after the date of the enactment
    of this Act.
        (d) No Inference.--Nothing in the amendments made by this section
    shall be construed to create an inference with respect to the exclusion
    from gross income of--
                (1) benefits provided by an Indian tribe or tribal
            organization that are not within the scope of this section, and
                (2) benefits provided prior to the date of the enactment of
            this Act.

    SEC. 9022. ESTABLISHMENT OF SIMPLE CAFETERIA PLANS FOR SMALL
                  BUSINESSES.

        (a) In General.--Section 125 of the Internal Revenue Code of 1986
    (relating to cafeteria plans), as amended by this Act, is amended by
    redesignating subsections (j) and (k) as subsections (k) and (l),
    respectively, and by inserting after subsection (i) the following new
    subsection:
        ``(j) Simple Cafeteria Plans for Small Businesses.--
                ``(1) In general.--An eligible employer maintaining a
            simple cafeteria plan with respect to which the requirements of
            this subsection are met for any year shall be treated as
            meeting any applicable nondiscrimination requirement during
            such year.
                ``(2) Simple cafeteria plan.--For purposes of this
            subsection, the term `simple cafeteria plan' means a cafeteria
            plan--
                        ``(A) which is established and maintained by an
                    eligible employer, and
                        ``(B) with respect to which the contribution
                    requirements of paragraph (3), and the eligibility and
                    participation requirements of paragraph (4), are met.
                ``(3) Contribution requirements.--
                        ``(A) In general.--The requirements of this
                    paragraph are met if, under the plan the employer is
                    required, without regard to whether a qualified
                    employee makes any salary reduction contribution, to
                    make a contribution to provide qualified benefits under
                    the plan on behalf of each qualified employee in an
                    amount equal to--
                                ``(i) a uniform percentage (not less than 2
                            percent) of the employee's compensation for the
                            plan year, or
                                ``(ii) an amount which is not less than the
                            lesser of--
                                        ``(I) 6 percent of the employee's
                                    compensation for the plan year, or
                                        ``(II) twice the amount of the
                                    salary reduction contributions of each
                                    qualified employee.
                        ``(B) Matching contributions on behalf of highly
                    compensated and key employees.--The requirements of
                    subparagraph (A)(ii) shall not be treated as met if,
                    under the plan, the rate of contributions with respect
                    to any salary reduction contribution of a highly
                    compensated or key employee at any rate of contribution
                    is greater than that with respect to an employee who is
                    not a highly compensated or key employee.
                        ``(C) Additional contributions.--Subject to
                    subparagraph (B), nothing in this paragraph shall be
                    treated as prohibiting an employer from making
                    contributions to provide qualified benefits under the
                    plan in addition to contributions required under
                    subparagraph (A).
                        ``(D) Definitions.--For purposes of this
                    paragraph--
                                ``(i) Salary reduction contribution.--The
                            term `salary reduction contribution' means,
                            with respect to a cafeteria plan, any amount
                            which is contributed to the plan at the
                            election of the employee and which is not
                            includible in gross income by reason of this
                            section.
                                ``(ii) Qualified employee.--The term
                            `qualified employee' means, with respect to a
                            cafeteria plan, any employee who is not a
                            highly compensated or key employee and who is
                            eligible to participate in the plan.
                                ``(iii) Highly compensated employee.--The
                            term `highly compensated employee' has the
                            meaning given such term by section 414(q).
                                ``(iv) Key employee.--The term `key
                            employee' has the meaning given such term by
                            section 416(i).
                ``(4) Minimum eligibility and participation requirements.--
                        ``(A) In general.--The requirements of this
                    paragraph shall be treated as met with respect to any
                    year if, under the plan--
                                ``(i) all employees who had at least 1,000
                            hours of service for the preceding plan year
                            are eligible to participate, and
                                ``(ii) each employee eligible to
                            participate in the plan may, subject to terms
                            and conditions applicable to all participants,
                            elect any benefit available under the plan.
                        ``(B) Certain employees may be excluded.--For
                    purposes of subparagraph (A)(i), an employer may elect
                    to exclude under the plan employees--
                                ``(i) who have not attained the age of 21
                            before the close of a plan year,
                                ``(ii) who have less than 1 year of service
                            with the employer as of any day during the plan
                            year,
                                ``(iii) who are covered under an agreement
                            which the Secretary of Labor finds to be a
                            collective bargaining agreement if there is
                            evidence that the benefits covered under the
                            cafeteria plan were the subject of good faith
                            bargaining between employee representatives and
                            the employer, or
                                ``(iv) who are described in section
                            410(b)(3)(C) (relating to nonresident aliens
                            working outside the United States).
                    A plan may provide a shorter period of service or
                    younger age for purposes of clause (i) or (ii).
                ``(5) Eligible employer.--For purposes of this subsection--
                        ``(A) In general.--The term `eligible employer'
                    means, with respect to any year, any employer if such
                    employer employed an average of 100 or fewer employees
                    on business days during either of the 2 preceding
                    years. For purposes of this subparagraph, a year may
                    only be taken into account if the employer was in
                    existence throughout the year.
                        ``(B) Employers not in existence during preceding
                    year.--If an employer was not in existence throughout
                    the preceding year, the determination under
                    subparagraph (A) shall be based on the average number
                    of employees that it is reasonably expected such
                    employer will employ on business days in the current
                    year.
                        ``(C) Growing employers retain treatment as small
                    employer.--
                                ``(i) In general.--If--
                                        ``(I) an employer was an eligible
                                    employer for any year (a `qualified
                                    year'), and
                                        ``(II) such employer establishes a
                                    simple cafeteria plan for its employees
                                    for such year,
                            then, notwithstanding the fact the employer
                            fails to meet the requirements of subparagraph
                            (A) for any subsequent year, such employer
                            shall be treated as an eligible employer for
                            such subsequent year with respect to employees
                            (whether or not employees during a qualified
                            year) of any trade or business which was
                            covered by the plan during any qualified year.
                                ``(ii) Exception.--This subparagraph shall
                            cease to apply if the employer employs an
                            average of 200 or more employees on business
                            days during any year preceding any such
                            subsequent year.
                        ``(D) Special rules.--
                                ``(i) Predecessors.--Any reference in this
                            paragraph to an employer shall include a
                            reference to any predecessor of such employer.
                                ``(ii) Aggregation rules.--All persons
                            treated as a single employer under subsection
                            (a) or (b) of section 52, or subsection (n) or
                            (o) of section 414, shall be treated as one
                            person.
                ``(6) Applicable nondiscrimination requirement.--For
            purposes of this subsection, the term `applicable
            nondiscrimination requirement' means any requirement under
            subsection (b) of this section, section 79(d), section 105(h),
            or paragraph (2), (3), (4), or (8) of section 129(d).
                ``(7) Compensation.--The term `compensation' has the
            meaning given such term by section 414(s).''.
        (b) Effective Date.--The amendments made by this section shall
    apply to years beginning after December 31, 2010.

    SEC. 9023. QUALIFYING THERAPEUTIC DISCOVERY PROJECT CREDIT.

        (a) In General.--Subpart E of part IV of subchapter A of chapter 1
    of the Internal Revenue Code of 1986 is amended by inserting after
    section 48C the following new section:

    ``SEC. 48D. QUALIFYING THERAPEUTIC DISCOVERY PROJECT CREDIT.

        ``(a) In General.--For purposes of section 46, the qualifying
    therapeutic discovery project credit for any taxable year is an amount
    equal to 50 percent of the qualified investment for such taxable year
    with respect to any qualifying therapeutic discovery project of an
    eligible taxpayer.
        ``(b) Qualified Investment.--
                ``(1) In general.--For purposes of subsection (a), the
            qualified investment for any taxable year is the aggregate
            amount of the costs paid or incurred in such taxable year for
            expenses necessary for and directly related to the conduct of a
            qualifying therapeutic discovery project.
                ``(2) Limitation.--The amount which is treated as qualified
            investment for all taxable years with respect to any qualifying
            therapeutic discovery project shall not exceed the amount
            certified by the Secretary as eligible for the credit under
            this section.
                ``(3) Exclusions.--The qualified investment for any taxable
            year with respect to any qualifying therapeutic discovery
            project shall not take into account any cost--
                        ``(A) for remuneration for an employee described in
                    section 162(m)(3),
                        ``(B) for interest expenses,
                        ``(C) for facility maintenance expenses,
                        ``(D) which is identified as a service cost under
                    section 1.263A-1(e)(4) of title 26, Code of Federal
                    Regulations, or
                        ``(E) for any other expense as determined by the
                    Secretary as appropriate to carry out the purposes of
                    this section.
                ``(4) Certain progress expenditure rules made applicable.--
            In the case of costs described in paragraph (1) that are paid
            for property of a character subject to an allowance for
            depreciation, rules similar to the rules of subsections (c)(4)
            and (d) of section 46 (as in effect on the day before the date
            of the enactment of the Revenue Reconciliation Act of 1990)
            shall apply for purposes of this section.
                ``(5) Application of subsection.--An investment shall be
            considered a qualified investment under this subsection only if
            such investment is made in a taxable year beginning in 2009 or
            2010.
        ``(c) Definitions.--
                ``(1) Qualifying therapeutic discovery project.--The term
            `qualifying therapeutic discovery project' means a project
            which is designed--
                        ``(A) to treat or prevent diseases or conditions by
                    conducting pre-clinical activities, clinical trials,
                    and clinical studies, or carrying out research
                    protocols, for the purpose of securing approval of a
                    product under section 505(b) of the Federal Food, Drug,
                    and Cosmetic Act or section 351(a) of the Public Health
                    Service Act,
                        ``(B) to diagnose diseases or conditions or to
                    determine molecular factors related to diseases or
                    conditions by developing molecular diagnostics to guide
                    therapeutic decisions, or
                        ``(C) to develop a product, process, or technology
                    to further the delivery or administration of
                    therapeutics.
                ``(2) Eligible taxpayer.--
                        ``(A) In general.--The term `eligible taxpayer'
                    means a taxpayer which employs not more than 250
                    employees in all businesses of the taxpayer at the time
                    of the submission of the application under subsection
                    (d)(2).
                        ``(B) Aggregation rules.--All persons treated as a
                    single employer under subsection (a) or (b) of section
                    52, or subsection (m) or (o) of section 414, shall be
                    so treated for purposes of this paragraph.
                ``(3) Facility maintenance expenses.--The term `facility
            maintenance expenses' means costs paid or incurred to maintain
            a facility, including--
                        ``(A) mortgage or rent payments,
                        ``(B) insurance payments,
                        ``(C) utility and maintenance costs, and
                        ``(D) costs of employment of maintenance personnel.
        ``(d) Qualifying Therapeutic Discovery Project Program.--
                ``(1) Establishment.--
                        ``(A) In general.--Not later than 60 days after the
                    date of the enactment of this section, the Secretary,
                    in consultation with the Secretary of Health and Human
                    Services, shall establish a qualifying therapeutic
                    discovery project program to consider and award
                    certifications for qualified investments eligible for
                    credits under this section to qualifying therapeutic
                    discovery project sponsors.
                        ``(B) Limitation.--The total amount of credits that
                    may be allocated under the program shall not exceed
                    $1,000,000,000 for the 2-year period beginning with
                    2009.
                ``(2) Certification.--
                        ``(A) Application period.--Each applicant for
                    certification under this paragraph shall submit an
                    application containing such information as the
                    Secretary may require during the period beginning on
                    the date the Secretary establishes the program under
                    paragraph (1).
                        ``(B) Time for review of applications.--The
                    Secretary shall take action to approve or deny any
                    application under subparagraph (A) within 30 days of
                    the submission of such application.
                        ``(C) Multi-year applications.--An application for
                    certification under subparagraph (A) may include a
                    request for an allocation of credits for more than 1 of
                    the years described in paragraph (1)(B).
                ``(3) Selection criteria.--In determining the qualifying
            therapeutic discovery projects with respect to which qualified
            investments may be certified under this section, the
            Secretary--
                        ``(A) shall take into consideration only those
                    projects that show reasonable potential--
                                ``(i) to result in new therapies--
                                        ``(I) to treat areas of unmet
                                    medical need, or
                                        ``(II) to prevent, detect, or treat
                                    chronic or acute diseases and
                                    conditions,
                                ``(ii) to reduce long-term health care
                            costs in the United States, or
                                ``(iii) to significantly advance the goal
                            of curing cancer within the 30-year period
                            beginning on the date the Secretary establishes
                            the program under paragraph (1), and
                        ``(B) shall take into consideration which projects
                    have the greatest potential--
                                ``(i) to create and sustain (directly or
                            indirectly) high quality, high-paying jobs in
                            the United States, and
                                ``(ii) to advance United States
                            competitiveness in the fields of life,
                            biological, and medical sciences.
                ``(4) Disclosure of allocations.--The Secretary shall, upon
            making a certification under this subsection, publicly disclose
            the identity of the applicant and the amount of the credit with
            respect to such applicant.
        ``(e) Special Rules.--
                ``(1) Basis adjustment.--For purposes of this subtitle, if
            a credit is allowed under this section for an expenditure
            related to property of a character subject to an allowance for
            depreciation, the basis of such property shall be reduced by
            the amount of such credit.
                ``(2) Denial of double benefit.--
                        ``(A) Bonus depreciation.--A credit shall not be
                    allowed under this section for any investment for which
                    bonus depreciation is allowed under section 168(k),
                    1400L(b)(1), or 1400N(d)(1).
                        ``(B) Deductions.--No deduction under this subtitle
                    shall be allowed for the portion of the expenses
                    otherwise allowable as a deduction taken into account
                    in determining the credit under this section for the
                    taxable year which is equal to the amount of the credit
                    determined for such taxable year under subsection (a)
                    attributable to such portion. This subparagraph shall
                    not apply to expenses related to property of a
                    character subject to an allowance for depreciation the
                    basis of which is reduced under paragraph (1), or which
                    are described in section 280C(g).
                        ``(C) Credit for research activities.--
                                ``(i) In general.--Except as provided in
                            clause (ii), any expenses taken into account
                            under this section for a taxable year shall not
                            be taken into account for purposes of
                            determining the credit allowable under section
                            41 or 45C for such taxable year.
                                ``(ii) Expenses included in determining
                            base period research expenses.--Any expenses
                            for any taxable year which are qualified
                            research expenses (within the meaning of
                            section 41(b)) shall be taken into account in
                            determining base period research expenses for
                            purposes of applying section 41 to subsequent
                            taxable years.
        ``(f) Coordination With Department of Treasury Grants.--In the case
    of any investment with respect to which the Secretary makes a grant
    under section 9023(e) of the Patient Protection and Affordable Care Act
    of 2009--
                ``(1) Denial of credit.--No credit shall be determined
            under this section with respect to such investment for the
            taxable year in which such grant is made or any subsequent
            taxable year.
                ``(2) Recapture of credits for progress expenditures made
            before grant.--If a credit was determined under this section
            with respect to such investment for any taxable year ending
            before such grant is made--
                        ``(A) the tax imposed under subtitle A on the
                    taxpayer for the taxable year in which such grant is
                    made shall be increased by so much of such credit as
                    was allowed under section 38,
                        ``(B) the general business carryforwards under
                    section 39 shall be adjusted so as to recapture the
                    portion of such credit which was not so allowed, and
                        ``(C) the amount of such grant shall be determined
                    without regard to any reduction in the basis of any
                    property of a character subject to an allowance for
                    depreciation by reason of such credit.
                ``(3) Treatment of grants.--Any such grant shall not be
            includible in the gross income of the taxpayer.''.
        (b) Inclusion as Part of Investment Credit.--Section 46 of the
    Internal Revenue Code of 1986 is amended--
                (1) by adding a comma at the end of paragraph (2),
                (2) by striking the period at the end of paragraph (5) and
            inserting ``, and'', and
                (3) by adding at the end the following new paragraph:
                ``(6) the qualifying therapeutic discovery project
            credit.''.
        (c) Conforming Amendments.--
                (1) Section 49(a)(1)(C) of the Internal Revenue Code of
            1986 is amended--
                        (A) by striking ``and'' at the end of clause (iv),
                        (B) by striking the period at the end of clause (v)
                    and inserting ``, and'', and
                        (C) by adding at the end the following new clause:
                                ``(vi) the basis of any property to which
                            paragraph (1) of section 48D(e) applies which
                            is part of a qualifying therapeutic discovery
                            project under such section 48D.''.
                (2) Section 280C of such Code is amended by adding at the
            end the following new subsection:
        ``(g) Qualifying Therapeutic Discovery Project Credit.--
                ``(1) In general.--No deduction shall be allowed for that
            portion of the qualified investment (as defined in section
            48D(b)) otherwise allowable as a deduction for the taxable year
            which--
                        ``(A) would be qualified research expenses (as
                    defined in section 41(b)), basic research expenses (as
                    defined in section 41(e)(2)), or qualified clinical
                    testing expenses (as defined in section 45C(b)) if the
                    credit under section 41 or section 45C were allowed
                    with respect to such expenses for such taxable year,
                    and
                        ``(B) is equal to the amount of the credit
                    determined for such taxable year under section 48D(a),
                    reduced by--
                                ``(i) the amount disallowed as a deduction
                            by reason of section 48D(e)(2)(B), and
                                ``(ii) the amount of any basis reduction
                            under section 48D(e)(1).
                ``(2) Similar rule where taxpayer capitalizes rather than
            deducts expenses.--In the case of expenses described in
            paragraph (1)(A) taken into account in determining the credit
            under section 48D for the taxable year, if--
                        ``(A) the amount of the portion of the credit
                    determined under such section with respect to such
                    expenses, exceeds
                        ``(B) the amount allowable as a deduction for such
                    taxable year for such expenses (determined without
                    regard to paragraph (1)),
            the amount chargeable to capital account for the taxable year
            for such expenses shall be reduced by the amount of such
            excess.
                ``(3) Controlled groups.--Paragraph (3) of subsection (b)
            shall apply for purposes of this subsection.''.
        (d) Clerical Amendment.--The table of sections for subpart E of
    part IV of subchapter A of chapter 1 of the Internal Revenue Code of
    1986 is amended by inserting after the item relating to section 48C the
    following new item:

    ``Sec. 48D. Qualifying therapeutic discovery project credit.''.
        (e) Grants for Qualified Investments in Therapeutic Discovery
    Projects in Lieu of Tax Credits.--
                (1) In general.--Upon application, the Secretary of the
            Treasury shall, subject to the requirements of this subsection,
            provide a grant to each person who makes a qualified investment
            in a qualifying therapeutic discovery project in the amount of
            50 percent of such investment. No grant shall be made under
            this subsection with respect to any investment unless such
            investment is made during a taxable year beginning in 2009 or
            2010.
                (2) Application.--
                        (A) In general.--At the stated election of the
                    applicant, an application for certification under
                    section 48D(d)(2) of the Internal Revenue Code of 1986
                    for a credit under such section for the taxable year of
                    the applicant which begins in 2009 shall be considered
                    to be an application for a grant under paragraph (1)
                    for such taxable year.
                        (B) Taxable years beginning in 2010.--An
                    application for a grant under paragraph (1) for a
                    taxable year beginning in 2010 shall be submitted--
                                (i) not earlier than the day after the last
                            day of such taxable year, and
                                (ii) not later than the due date (including
                            extensions) for filing the return of tax for
                            such taxable year.
                        (C) Information to be submitted.--An application
                    for a grant under paragraph (1) shall include such
                    information and be in such form as the Secretary may
                    require to state the amount of the credit allowable
                    (but for the receipt of a grant under this subsection)
                    under section 48D for the taxable year for the
                    qualified investment with respect to which such
                    application is made.
                (3) Time for payment of grant.--
                        (A) In general.--The Secretary of the Treasury
                    shall make payment of the amount of any grant under
                    paragraph (1) during the 30-day period beginning on the
                    later of--
                                (i) the date of the application for such
                            grant, or
                                (ii) the date the qualified investment for
                            which the grant is being made is made.
                        (B) Regulations.--In the case of investments of an
                    ongoing nature, the Secretary shall issue regulations
                    to determine the date on which a qualified investment
                    shall be deemed to have been made for purposes of this
                    paragraph.
                (4) Qualified investment.--For purposes of this subsection,
            the term ``qualified investment'' means a qualified investment
            that is certified under section 48D(d) of the Internal Revenue
            Code of 1986 for purposes of the credit under such section 48D.
                (5) Application of certain rules.--
                        (A) In general.--In making grants under this
                    subsection, the Secretary of the Treasury shall apply
                    rules similar to the rules of section 50 of the
                    Internal Revenue Code of 1986. In applying such rules,
                    any increase in tax under chapter 1 of such Code by
                    reason of an investment ceasing to be a qualified
                    investment shall be imposed on the person to whom the
                    grant was made.
                        (B) Special rules.--
                                (i) Recapture of excessive grant amounts.--
                            If the amount of a grant made under this
                            subsection exceeds the amount allowable as a
                            grant under this subsection, such excess shall
                            be recaptured under subparagraph (A) as if the
                            investment to which such excess portion of the
                            grant relates had ceased to be a qualified
                            investment immediately after such grant was
                            made.
                                (ii) Grant information not treated as
                            return information.--In no event shall the
                            amount of a grant made under paragraph (1), the
                            identity of the person to whom such grant was
                            made, or a description of the investment with
                            respect to which such grant was made be treated
                            as return information for purposes of section
                            6103 of the Internal Revenue Code of 1986.
                (6) Exception for certain non-taxpayers.--The Secretary of
            the Treasury shall not make any grant under this subsection
            to--
                        (A) any Federal, State, or local government (or any
                    political subdivision, agency, or instrumentality
                    thereof),
                        (B) any organization described in section 501(c) of
                    the Internal Revenue Code of 1986 and exempt from tax
                    under section 501(a) of such Code,
                        (C) any entity referred to in paragraph (4) of
                    section 54(j) of such Code, or
                        (D) any partnership or other pass-thru entity any
                    partner (or other holder of an equity or profits
                    interest) of which is described in subparagraph (A),
                    (B) or (C).
            In the case of a partnership or other pass-thru entity
            described in subparagraph (D), partners and other holders of
            any equity or profits interest shall provide to such
            partnership or entity such information as the Secretary of the
            Treasury may require to carry out the purposes of this
            paragraph.
                (7) Secretary.--Any reference in this subsection to the
            Secretary of the Treasury shall be treated as including the
            Secretary's delegate.
                (8) Other terms.--Any term used in this subsection which is
            also used in section 48D of the Internal Revenue Code of 1986
            shall have the same meaning for purposes of this subsection as
            when used in such section.
                (9) Denial of double benefit.--No credit shall be allowed
            under section 46(6) of the Internal Revenue Code of 1986 by
            reason of section 48D of such Code for any investment for which
            a grant is awarded under this subsection.
                (10) Appropriations.--There is hereby appropriated to the
            Secretary of the Treasury such sums as may be necessary to
            carry out this subsection.
                (11) Termination.--The Secretary of the Treasury shall not
            make any grant to any person under this subsection unless the
            application of such person for such grant is received before
            January 1, 2013.
                (12) Protecting middle class families from tax increases.--
            It is the sense of the Senate that the Senate should reject any
            procedural maneuver that would raise taxes on middle class
            families, such as a motion to commit the pending legislation to
            the Committee on Finance, which is designed to kill legislation
            that provides tax cuts for American workers and families,
            including the affordability tax credit and the small business
            tax credit.
        (f) Effective Date.--The amendments made by subsections (a) through
    (d) of this section shall apply to amounts paid or incurred after
    December 31, 2008, in taxable years beginning after such date.

        TITLE X--STRENGTHENING QUALITY, AFFORDABLE HEALTH CARE FOR ALL
                                   AMERICANS

                   Subtitle A--Provisions Relating to Title I

    SEC. 10101. AMENDMENTS TO SUBTITLE A.

        (a) Section 2711 of the Public Health Service Act, as added by
    section 1001(5) of this Act, is amended to read as follows:

    ``SEC. 2711. NO LIFETIME OR ANNUAL LIMITS.

        ``(a) Prohibition.--
                ``(1) In general.--A group health plan and a health
            insurance issuer offering group or individual health insurance
            coverage may not establish--
                        ``(A) lifetime limits on the dollar value of
                    benefits for any participant or beneficiary; or
                        ``(B) except as provided in paragraph (2), annual
                    limits on the dollar value of benefits for any
                    participant or beneficiary.
                ``(2) Annual limits prior to 2014.--With respect to plan
            years beginning prior to January 1, 2014, a group health plan
            and a health insurance issuer offering group or individual
            health insurance coverage may only establish a restricted
            annual limit on the dollar value of benefits for any
            participant or beneficiary with respect to the scope of
            benefits that are essential health benefits under section
            1302(b) of the Patient Protection and Affordable Care Act, as
            determined by the Secretary. In defining the term `restricted
            annual limit' for purposes of the preceding sentence, the
            Secretary shall ensure that access to needed services is made
            available with a minimal impact on premiums.
        ``(b) Per Beneficiary Limits.--Subsection (a) shall not be
    construed to prevent a group health plan or health insurance coverage
    from placing annual or lifetime per beneficiary limits on specific
    covered benefits that are not essential health benefits under section
    1302(b) of the Patient Protection and Affordable Care Act, to the
    extent that such limits are otherwise permitted under Federal or State
    law.''.
        (b) Section 2715(a) of the Public Health Service Act, as added by
    section 1001(5) of this Act, is amended by striking ``and providing to
    enrollees'' and inserting ``and providing to applicants, enrollees, and
    policyholders or certificate holders''.
        (c) Subpart II of part A of title XXVII of the Public Health
    Service Act, as added by section 1001(5), is amended by inserting after
    section 2715, the following:

    ``SEC. 2715A. PROVISION OF ADDITIONAL INFORMATION.

        ``A group health plan and a health insurance issuer offering group
    or individual health insurance coverage shall comply with the
    provisions of section 1311(e)(3) of the Patient Protection and
    Affordable Care Act, except that a plan or coverage that is not offered
    through an Exchange shall only be required to submit the information
    required to the Secretary and the State insurance commissioner, and
    make such information available to the public.''.
        (d) Section 2716 of the Public Health Service Act, as added by
    section 1001(5) of this Act, is amended to read as follows:

    ``SEC. 2716. PROHIBITION ON DISCRIMINATION IN FAVOR OF HIGHLY
                  COMPENSATED INDIVIDUALS.

        ``(a) In General.--A group health plan (other than a self-insured
    plan) shall satisfy the requirements of section 105(h)(2) of the
    Internal Revenue Code of 1986 (relating to prohibition on
    discrimination in favor of highly compensated individuals).
        ``(b) Rules and Definitions.--For purposes of this section--
                ``(1) Certain rules to apply.--Rules similar to the rules
            contained in paragraphs (3), (4), and (8) of section 105(h) of
            such Code shall apply.
                ``(2) Highly compensated individual.--The term `highly
            compensated individual' has the meaning given such term by
            section 105(h)(5) of such Code.''.
        (e) Section 2717 of the Public Health Service Act, as added by
    section 1001(5) of this Act, is amended--
                (1) by redesignating subsections (c) and (d) as subsections
            (d) and (e), respectively; and
                (2) by inserting after subsection (b), the following:
        ``(c) Protection of Second Amendment Gun Rights.--
                ``(1) Wellness and prevention programs.--A wellness and
            health promotion activity implemented under subsection
            (a)(1)(D) may not require the disclosure or collection of any
            information relating to--
                        ``(A) the presence or storage of a lawfully-
                    possessed firearm or ammunition in the residence or on
                    the property of an individual; or
                        ``(B) the lawful use, possession, or storage of a
                    firearm or ammunition by an individual.
                ``(2) Limitation on data collection.--None of the
            authorities provided to the Secretary under the Patient
            Protection and Affordable Care Act or an amendment made by that
            Act shall be construed to authorize or may be used for the
            collection of any information relating to--
                        ``(A) the lawful ownership or possession of a
                    firearm or ammunition;
                        ``(B) the lawful use of a firearm or ammunition; or
                        ``(C) the lawful storage of a firearm or
                    ammunition.
                ``(3) Limitation on databases or data banks.--None of the
            authorities provided to the Secretary under the Patient
            Protection and Affordable Care Act or an amendment made by that
            Act shall be construed to authorize or may be used to maintain
            records of individual ownership or possession of a firearm or
            ammunition.
                ``(4) Limitation on determination of premium rates or
            eligibility for health insurance.--A premium rate may not be
            increased, health insurance coverage may not be denied, and a
            discount, rebate, or reward offered for participation in a
            wellness program may not be reduced or withheld under any
            health benefit plan issued pursuant to or in accordance with
            the Patient Protection and Affordable Care Act or an amendment
            made by that Act on the basis of, or on reliance upon--
                        ``(A) the lawful ownership or possession of a
                    firearm or ammunition; or
                        ``(B) the lawful use or storage of a firearm or
                    ammunition.
                ``(5) Limitation on data collection requirements for
            individuals.--No individual shall be required to disclose any
            information under any data collection activity authorized under
            the Patient Protection and Affordable Care Act or an amendment
            made by that Act relating to--
                        ``(A) the lawful ownership or possession of a
                    firearm or ammunition; or
                        ``(B) the lawful use, possession, or storage of a
                    firearm or ammunition.''.
        (f) Section 2718 of the Public Health Service Act, as added by
    section 1001(5), is amended to read as follows:

    ``SEC. 2718. BRINGING DOWN THE COST OF HEALTH CARE COVERAGE.

        ``(a) Clear Accounting for Costs.--A health insurance issuer
    offering group or individual health insurance coverage (including a
    grandfathered health plan) shall, with respect to each plan year,
    submit to the Secretary a report concerning the ratio of the incurred
    loss (or incurred claims) plus the loss adjustment expense (or change
    in contract reserves) to earned premiums. Such report shall include the
    percentage of total premium revenue, after accounting for collections
    or receipts for risk adjustment and risk corridors and payments of
    reinsurance, that such coverage expends--
                ``(1) on reimbursement for clinical services provided to
            enrollees under such coverage;
                ``(2) for activities that improve health care quality; and
                ``(3) on all other non-claims costs, including an
            explanation of the nature of such costs, and excluding Federal
            and State taxes and licensing or regulatory fees.
    The Secretary shall make reports received under this section available
    to the public on the Internet website of the Department of Health and
    Human Services.
        ``(b) Ensuring That Consumers Receive Value for Their Premium
    Payments.--
                ``(1) Requirement to provide value for premium payments.--
                        ``(A) Requirement.--Beginning not later than
                    January 1, 2011, a health insurance issuer offering
                    group or individual health insurance coverage
                    (including a grandfathered health plan) shall, with
                    respect to each plan year, provide an annual rebate to
                    each enrollee under such coverage, on a pro rata basis,
                    if the ratio of the amount of premium revenue expended
                    by the issuer on costs described in paragraphs (1) and
                    (2) of subsection (a) to the total amount of premium
                    revenue (excluding Federal and State taxes and
                    licensing or regulatory fees and after accounting for
                    payments or receipts for risk adjustment, risk
                    corridors, and reinsurance under sections 1341, 1342,
                    and 1343 of the Patient Protection and Affordable Care
                    Act) for the plan year (except as provided in
                    subparagraph (B)(ii)), is less than--
                                ``(i) with respect to a health insurance
                            issuer offering coverage in the large group
                            market, 85 percent, or such higher percentage
                            as a State may by regulation determine; or
                                ``(ii) with respect to a health insurance
                            issuer offering coverage in the small group
                            market or in the individual market, 80 percent,
                            or such higher percentage as a State may by
                            regulation determine, except that the Secretary
                            may adjust such percentage with respect to a
                            State if the Secretary determines that the
                            application of such 80 percent may destabilize
                            the individual market in such State.
                        ``(B) Rebate amount.--
                                ``(i) Calculation of amount.--The total
                            amount of an annual rebate required under this
                            paragraph shall be in an amount equal to the
                            product of--
                                        ``(I) the amount by which the
                                    percentage described in clause (i) or
                                    (ii) of subparagraph (A) exceeds the
                                    ratio described in such subparagraph;
                                    and
                                        ``(II) the total amount of premium
                                    revenue (excluding Federal and State
                                    taxes and licensing or regulatory fees
                                    and after accounting for payments or
                                    receipts for risk adjustment, risk
                                    corridors, and reinsurance under
                                    sections 1341, 1342, and 1343 of the
                                    Patient Protection and Affordable Care
                                    Act) for such plan year.
                                ``(ii) Calculation based on average
                            ratio.--Beginning on January 1, 2014, the
                            determination made under subparagraph (A) for
                            the year involved shall be based on the
                            averages of the premiums expended on the costs
                            described in such subparagraph and total
                            premium revenue for each of the previous 3
                            years for the plan.
                ``(2) Consideration in setting percentages.--In determining
            the percentages under paragraph (1), a State shall seek to
            ensure adequate participation by health insurance issuers,
            competition in the health insurance market in the State, and
            value for consumers so that premiums are used for clinical
            services and quality improvements.
                ``(3) Enforcement.--The Secretary shall promulgate
            regulations for enforcing the provisions of this section and
            may provide for appropriate penalties.
        ``(c) Definitions.--Not later than December 31, 2010, and subject
    to the certification of the Secretary, the National Association of
    Insurance Commissioners shall establish uniform definitions of the
    activities reported under subsection (a) and standardized methodologies
    for calculating measures of such activities, including definitions of
    which activities, and in what regard such activities, constitute
    activities described in subsection (a)(2). Such methodologies shall be
    designed to take into account the special circumstances of smaller
    plans, different types of plans, and newer plans.
        ``(d) Adjustments.--The Secretary may adjust the rates described in
    subsection (b) if the Secretary determines appropriate on account of
    the volatility of the individual market due to the establishment of
    State Exchanges.
        ``(e) Standard Hospital Charges.--Each hospital operating within
    the United States shall for each year establish (and update) and make
    public (in accordance with guidelines developed by the Secretary) a
    list of the hospital's standard charges for items and services provided
    by the hospital, including for diagnosis-related groups established
    under section 1886(d)(4) of the Social Security Act.''.
        (g) Section 2719 of the Public Health Service Act, as added by
    section 1001(4) of this Act, is amended to read as follows:

    ``SEC. 2719. APPEALS PROCESS.

        ``(a) Internal Claims Appeals.--
                ``(1) In general.--A group health plan and a health
            insurance issuer offering group or individual health insurance
            coverage shall implement an effective appeals process for
            appeals of coverage determinations and claims, under which the
            plan or issuer shall, at a minimum--
                        ``(A) have in effect an internal claims appeal
                    process;
                        ``(B) provide notice to enrollees, in a culturally
                    and linguistically appropriate manner, of available
                    internal and external appeals processes, and the
                    availability of any applicable office of health
                    insurance consumer assistance or ombudsman established
                    under section 2793 to assist such enrollees with the
                    appeals processes; and
                        ``(C) allow an enrollee to review their file, to
                    present evidence and testimony as part of the appeals
                    process, and to receive continued coverage pending the
                    outcome of the appeals process.
                ``(2) Established processes.--To comply with paragraph
            (1)--
                        ``(A) a group health plan and a health insurance
                    issuer offering group health coverage shall provide an
                    internal claims and appeals process that initially
                    incorporates the claims and appeals procedures
                    (including urgent claims) set forth at section
                    2560.503-1 of title 29, Code of Federal Regulations, as
                    published on November 21, 2000 (65 Fed. Reg. 70256),
                    and shall update such process in accordance with any
                    standards established by the Secretary of Labor for
                    such plans and issuers; and
                        ``(B) a health insurance issuer offering individual
                    health coverage, and any other issuer not subject to
                    subparagraph (A), shall provide an internal claims and
                    appeals process that initially incorporates the claims
                    and appeals procedures set forth under applicable law
                    (as in existence on the date of enactment of this
                    section), and shall update such process in accordance
                    with any standards established by the Secretary of
                    Health and Human Services for such issuers.
        ``(b) External Review.--A group health plan and a health insurance
    issuer offering group or individual health insurance coverage--
                ``(1) shall comply with the applicable State external
            review process for such plans and issuers that, at a minimum,
            includes the consumer protections set forth in the Uniform
            External Review Model Act promulgated by the National
            Association of Insurance Commissioners and is binding on such
            plans; or
                ``(2) shall implement an effective external review process
            that meets minimum standards established by the Secretary
            through guidance and that is similar to the process described
            under paragraph (1)--
                        ``(A) if the applicable State has not established
                    an external review process that meets the requirements
                    of paragraph (1); or
                        ``(B) if the plan is a self-insured plan that is
                    not subject to State insurance regulation (including a
                    State law that establishes an external review process
                    described in paragraph (1)).
        ``(c) Secretary Authority.--The Secretary may deem the external
    review process of a group health plan or health insurance issuer, in
    operation as of the date of enactment of this section, to be in
    compliance with the applicable process established under subsection
    (b), as determined appropriate by the Secretary.''.
        (h) Subpart II of part A of title XVIII of the Public Health
    Service Act, as added by section 1001(5) of this Act, is amended by
    inserting after section 2719 the following:

    ``SEC. 2719A. PATIENT PROTECTIONS.

        ``(a) Choice of Health Care Professional.--If a group health plan,
    or a health insurance issuer offering group or individual health
    insurance coverage, requires or provides for designation by a
    participant, beneficiary, or enrollee of a participating primary care
    provider, then the plan or issuer shall permit each participant,
    beneficiary, and enrollee to designate any participating primary care
    provider who is available to accept such individual.
        ``(b) Coverage of Emergency Services.--
                ``(1) In general.--If a group health plan, or a health
            insurance issuer offering group or individual health insurance
            issuer, provides or covers any benefits with respect to
            services in an emergency department of a hospital, the plan or
            issuer shall cover emergency services (as defined in paragraph
            (2)(B))--
                        ``(A) without the need for any prior authorization
                    determination;
                        ``(B) whether the health care provider furnishing
                    such services is a participating provider with respect
                    to such services;
                        ``(C) in a manner so that, if such services are
                    provided to a participant, beneficiary, or enrollee--
                                ``(i) by a nonparticipating health care
                            provider with or without prior authorization;
                            or
                                ``(ii)(I) such services will be provided
                            without imposing any requirement under the plan
                            for prior authorization of services or any
                            limitation on coverage where the provider of
                            services does not have a contractual
                            relationship with the plan for the providing of
                            services that is more restrictive than the
                            requirements or limitations that apply to
                            emergency department services received from
                            providers who do have such a contractual
                            relationship with the plan; and
                                ``(II) if such services are provided out-
                            of-network, the cost-sharing requirement
                            (expressed as a copayment amount or coinsurance
                            rate) is the same requirement that would apply
                            if such services were provided in-network;
                        ``(D) without regard to any other term or condition
                    of such coverage (other than exclusion or coordination
                    of benefits, or an affiliation or waiting period,
                    permitted under section 2701 of this Act, section 701
                    of the Employee Retirement Income Security Act of 1974,
                    or section 9801 of the Internal Revenue Code of 1986,
                    and other than applicable cost-sharing).
                ``(2) Definitions.--In this subsection:
                        ``(A) Emergency medical condition.--The term
                    `emergency medical condition' means a medical condition
                    manifesting itself by acute symptoms of sufficient
                    severity (including severe pain) such that a prudent
                    layperson, who possesses an average knowledge of health
                    and medicine, could reasonably expect the absence of
                    immediate medical attention to result in a condition
                    described in clause (i), (ii), or (iii) of section
                    1867(e)(1)(A) of the Social Security Act.
                        ``(B) Emergency services.--The term `emergency
                    services' means, with respect to an emergency medical
                    condition--
                                ``(i) a medical screening examination (as
                            required under section 1867 of the Social
                            Security Act) that is within the capability of
                            the emergency department of a hospital,
                            including ancillary services routinely
                            available to the emergency department to
                            evaluate such emergency medical condition, and
                                ``(ii) within the capabilities of the staff
                            and facilities available at the hospital, such
                            further medical examination and treatment as
                            are required under section 1867 of such Act to
                            stabilize the patient.
                        ``(C) Stabilize.--The term `to stabilize', with
                    respect to an emergency medical condition (as defined
                    in subparagraph (A)), has the meaning give in section
                    1867(e)(3) of the Social Security Act (42 U.S.C.
                    1395dd(e)(3)).
        ``(c) Access to Pediatric Care.--
                ``(1) Pediatric care.--In the case of a person who has a
            child who is a participant, beneficiary, or enrollee under a
            group health plan, or health insurance coverage offered by a
            health insurance issuer in the group or individual market, if
            the plan or issuer requires or provides for the designation of
            a participating primary care provider for the child, the plan
            or issuer shall permit such person to designate a physician
            (allopathic or osteopathic) who specializes in pediatrics as
            the child's primary care provider if such provider participates
            in the network of the plan or issuer.
                ``(2) Construction.--Nothing in paragraph (1) shall be
            construed to waive any exclusions of coverage under the terms
            and conditions of the plan or health insurance coverage with
            respect to coverage of pediatric care.
        ``(d) Patient Access to Obstetrical and Gynecological Care.--
                ``(1) General rights.--
                        ``(A) Direct access.--A group health plan, or
                    health insurance issuer offering group or individual
                    health insurance coverage, described in paragraph (2)
                    may not require authorization or referral by the plan,
                    issuer, or any person (including a primary care
                    provider described in paragraph (2)(B)) in the case of
                    a female participant, beneficiary, or enrollee who
                    seeks coverage for obstetrical or gynecological care
                    provided by a participating health care professional
                    who specializes in obstetrics or gynecology. Such
                    professional shall agree to otherwise adhere to such
                    plan's or issuer's policies and procedures, including
                    procedures regarding referrals and obtaining prior
                    authorization and providing services pursuant to a
                    treatment plan (if any) approved by the plan or issuer.
                        ``(B) Obstetrical and gynecological care.--A group
                    health plan or health insurance issuer described in
                    paragraph (2) shall treat the provision of obstetrical
                    and gynecological care, and the ordering of related
                    obstetrical and gynecological items and services,
                    pursuant to the direct access described under
                    subparagraph (A), by a participating health care
                    professional who specializes in obstetrics or
                    gynecology as the authorization of the primary care
                    provider.
                ``(2) Application of paragraph.--A group health plan, or
            health insurance issuer offering group or individual health
            insurance coverage, described in this paragraph is a group
            health plan or coverage that--
                        ``(A) provides coverage for obstetric or
                    gynecologic care; and
                        ``(B) requires the designation by a participant,
                    beneficiary, or enrollee of a participating primary
                    care provider.
                ``(3) Construction.--Nothing in paragraph (1) shall be
            construed to--
                        ``(A) waive any exclusions of coverage under the
                    terms and conditions of the plan or health insurance
                    coverage with respect to coverage of obstetrical or
                    gynecological care; or
                        ``(B) preclude the group health plan or health
                    insurance issuer involved from requiring that the
                    obstetrical or gynecological provider notify the
                    primary care health care professional or the plan or
                    issuer of treatment decisions.''.
        (i) Section 2794 of the Public Health Service Act, as added by
    section 1003 of this Act, is amended--
                (1) in subsection (c)(1)--
                        (A) in subparagraph (A), by striking ``and'' at the
                    end;
                        (B) in subparagraph (B), by striking the period and
                    inserting ``; and''; and
                        (C) by adding at the end the following:
                        ``(C) in establishing centers (consistent with
                    subsection (d)) at academic or other nonprofit
                    institutions to collect medical reimbursement
                    information from health insurance issuers, to analyze
                    and organize such information, and to make such
                    information available to such issuers, health care
                    providers, health researchers, health care policy
                    makers, and the general public.''; and
                (2) by adding at the end the following:
        ``(d) Medical Reimbursement Data Centers.--
                ``(1) Functions.--A center established under subsection
            (c)(1)(C) shall--
                        ``(A) develop fee schedules and other database
                    tools that fairly and accurately reflect market rates
                    for medical services and the geographic differences in
                    those rates;
                        ``(B) use the best available statistical methods
                    and data processing technology to develop such fee
                    schedules and other database tools;
                        ``(C) regularly update such fee schedules and other
                    database tools to reflect changes in charges for
                    medical services;
                        ``(D) make health care cost information readily
                    available to the public through an Internet website
                    that allows consumers to understand the amounts that
                    health care providers in their area charge for
                    particular medical services; and
                        ``(E) regularly publish information concerning the
                    statistical methodologies used by the center to analyze
                    health charge data and make such data available to
                    researchers and policy makers.
                ``(2) Conflicts of interest.--A center established under
            subsection (c)(1)(C) shall adopt by-laws that ensures that the
            center (and all members of the governing board of the center)
            is independent and free from all conflicts of interest. Such
            by-laws shall ensure that the center is not controlled or
            influenced by, and does not have any corporate relation to, any
            individual or entity that may make or receive payments for
            health care services based on the center's analysis of health
            care costs.
                ``(3) Rule of construction.--Nothing in this subsection
            shall be construed to permit a center established under
            subsection (c)(1)(C) to compel health insurance issuers to
            provide data to the center.''.

    SEC. 10102. AMENDMENTS TO SUBTITLE B.

        (a) Section 1102(a)(2)(B) of this Act is amended--
                (1) in the matter preceding clause (i), by striking ``group
            health benefits plan'' and inserting ``group benefits plan
            providing health benefits''; and
                (2) in clause (i)(I), by inserting ``or any agency or
            instrumentality of any of the foregoing'' before the closed
            parenthetical.
        (b) Section 1103(a) of this Act is amended--
                (1) in paragraph (1), by inserting ``, or small business
            in,'' after ``residents of any''; and
                (2) by striking paragraph (2) and inserting the following:
                ``(2) Connecting to affordable coverage.--An Internet
            website established under paragraph (1) shall, to the extent
            practicable, provide ways for residents of, and small
            businesses in, any State to receive information on at least the
            following coverage options:
                        ``(A) Health insurance coverage offered by health
                    insurance issuers, other than coverage that provides
                    reimbursement only for the treatment or mitigation of--
                                ``(i) a single disease or condition; or
                                ``(ii) an unreasonably limited set of
                            diseases or conditions (as determined by the
                            Secretary).
                        ``(B) Medicaid coverage under title XIX of the
                    Social Security Act.
                        ``(C) Coverage under title XXI of the Social
                    Security Act.
                        ``(D) A State health benefits high risk pool, to
                    the extent that such high risk pool is offered in such
                    State; and
                        ``(E) Coverage under a high risk pool under section
                    1101.
                        ``(F) Coverage within the small group market for
                    small businesses and their employees, including
                    reinsurance for early retirees under section 1102, tax
                    credits available under section 45R of the Internal
                    Revenue Code of 1986 (as added by section 1421), and
                    other information specifically for small businesses
                    regarding affordable health care options.''.

    SEC. 10103. AMENDMENTS TO SUBTITLE C.

        (a) Section 2701(a)(5) of the Public Health Service Act, as added
    by section 1201(4) of this Act, is amended by inserting ``(other than
    self-insured group health plans offered in such market)'' after ``such
    market''.
        (b) Section 2708 of the Public Health Service Act, as added by
    section 1201(4) of this Act, is amended by striking ``or individual''.
        (c) Subpart I of part A of title XXVII of the Public Health Service
    Act, as added by section 1201(4) of this Act, is amended by inserting
    after section 2708, the following:

    ``SEC. 2709. COVERAGE FOR INDIVIDUALS PARTICIPATING IN APPROVED
                  CLINICAL TRIALS.

        ``(a) Coverage.--
                ``(1) In general.--If a group health plan or a health
            insurance issuer offering group or individual health insurance
            coverage provides coverage to a qualified individual, then such
            plan or issuer--
                        ``(A) may not deny the individual participation in
                    the clinical trial referred to in subsection (b)(2);
                        ``(B) subject to subsection (c), may not deny (or
                    limit or impose additional conditions on) the coverage
                    of routine patient costs for items and services
                    furnished in connection with participation in the
                    trial; and
                        ``(C) may not discriminate against the individual
                    on the basis of the individual's participation in such
                    trial.
                ``(2) Routine patient costs.--
                        ``(A) Inclusion.--For purposes of paragraph (1)(B),
                    subject to subparagraph (B), routine patient costs
                    include all items and services consistent with the
                    coverage provided in the plan (or coverage) that is
                    typically covered for a qualified individual who is not
                    enrolled in a clinical trial.
                        ``(B) Exclusion.--For purposes of paragraph (1)(B),
                    routine patient costs does not include--
                                ``(i) the investigational item, device, or
                            service, itself;
                                ``(ii) items and services that are provided
                            solely to satisfy data collection and analysis
                            needs and that are not used in the direct
                            clinical management of the patient; or
                                ``(iii) a service that is clearly
                            inconsistent with widely accepted and
                            established standards of care for a particular
                            diagnosis.
                ``(3) Use of in-network providers.--If one or more
            participating providers is participating in a clinical trial,
            nothing in paragraph (1) shall be construed as preventing a
            plan or issuer from requiring that a qualified individual
            participate in the trial through such a participating provider
            if the provider will accept the individual as a participant in
            the trial.
                ``(4) Use of out-of-network.--Notwithstanding paragraph
            (3), paragraph (1) shall apply to a qualified individual
            participating in an approved clinical trial that is conducted
            outside the State in which the qualified individual resides.
        ``(b) Qualified Individual Defined.--For purposes of subsection
    (a), the term `qualified individual' means an individual who is a
    participant or beneficiary in a health plan or with coverage described
    in subsection (a)(1) and who meets the following conditions:
                ``(1) The individual is eligible to participate in an
            approved clinical trial according to the trial protocol with
            respect to treatment of cancer or other life-threatening
            disease or condition.
                ``(2) Either--
                        ``(A) the referring health care professional is a
                    participating health care provider and has concluded
                    that the individual's participation in such trial would
                    be appropriate based upon the individual meeting the
                    conditions described in paragraph (1); or
                        ``(B) the participant or beneficiary provides
                    medical and scientific information establishing that
                    the individual's participation in such trial would be
                    appropriate based upon the individual meeting the
                    conditions described in paragraph (1).
        ``(c) Limitations on Coverage.--This section shall not be construed
    to require a group health plan, or a health insurance issuer offering
    group or individual health insurance coverage, to provide benefits for
    routine patient care services provided outside of the plan's (or
    coverage's) health care provider network unless out-of-network benefits
    are otherwise provided under the plan (or coverage).
        ``(d) Approved Clinical Trial Defined.--
                ``(1) In general.--In this section, the term `approved
            clinical trial' means a phase I, phase II, phase III, or phase
            IV clinical trial that is conducted in relation to the
            prevention, detection, or treatment of cancer or other life-
            threatening disease or condition and is described in any of the
            following subparagraphs:
                        ``(A) Federally funded trials.--The study or
                    investigation is approved or funded (which may include
                    funding through in-kind contributions) by one or more
                    of the following:
                                ``(i) The National Institutes of Health.
                                ``(ii) The Centers for Disease Control and
                            Prevention.
                                ``(iii) The Agency for Health Care Research
                            and Quality.
                                ``(iv) The Centers for Medicare & Medicaid
                            Services.
                                ``(v) cooperative group or center of any of
                            the entities described in clauses (i) through
                            (iv) or the Department of Defense or the
                            Department of Veterans Affairs.
                                ``(vi) A qualified non-governmental
                            research entity identified in the guidelines
                            issued by the National Institutes of Health for
                            center support grants.
                                ``(vii) Any of the following if the
                            conditions described in paragraph (2) are met:
                                        ``(I) The Department of Veterans
                                    Affairs.
                                        ``(II) The Department of Defense.
                                        ``(III) The Department of Energy.
                        ``(B) The study or investigation is conducted under
                    an investigational new drug application reviewed by the
                    Food and Drug Administration.
                        ``(C) The study or investigation is a drug trial
                    that is exempt from having such an investigational new
                    drug application.
                ``(2) Conditions for departments.--The conditions described
            in this paragraph, for a study or investigation conducted by a
            Department, are that the study or investigation has been
            reviewed and approved through a system of peer review that the
            Secretary determines--
                        ``(A) to be comparable to the system of peer review
                    of studies and investigations used by the National
                    Institutes of Health, and
                        ``(B) assures unbiased review of the highest
                    scientific standards by qualified individuals who have
                    no interest in the outcome of the review.
        ``(e) Life-threatening Condition Defined.--In this section, the
    term `life-threatening condition' means any disease or condition from
    which the likelihood of death is probable unless the course of the
    disease or condition is interrupted.
        ``(f) Construction.--Nothing in this section shall be construed to
    limit a plan's or issuer's coverage with respect to clinical trials.
        ``(g) Application to FEHBP.--Notwithstanding any provision of
    chapter 89 of title 5, United States Code, this section shall apply to
    health plans offered under the program under such chapter.
        ``(h) Preemption.--Notwithstanding any other provision of this Act,
    nothing in this section shall preempt State laws that require a
    clinical trials policy for State regulated health insurance plans that
    is in addition to the policy required under this section.''.
        (d) Section 1251(a) of this Act is amended--
                (1) in paragraph (2), by striking ``With'' and inserting
            ``Except as provided in paragraph (3), with''; and
                (2) by adding at the end the following:
                ``(3) Application of certain provisions.--The provisions of
            sections 2715 and 2718 of the Public Health Service Act (as
            added by subtitle A) shall apply to grandfathered health plans
            for plan years beginning on or after the date of enactment of
            this Act.''.
        (e) Section 1253 of this Act is amended insert before the period
    the following: ``, except that--
                ``(1) section 1251 shall take effect on the date of
            enactment of this Act; and
                ``(2) the provisions of section 2704 of the Public Health
            Service Act (as amended by section 1201), as they apply to
            enrollees who are under 19 years of age, shall become effective
            for plan years beginning on or after the date that is 6 months
            after the date of enactment of this Act.''.
        (f) Subtitle C of title I of this Act is amended--
                (1) by redesignating section 1253 as section 1255; and
                (2) by inserting after section 1252, the following:

    ``SEC. 1253. ANNUAL REPORT ON SELF-INSURED PLANS.

        ``Not later than 1 year after the date of enactment of this Act,
    and annually thereafter, the Secretary of Labor shall prepare an
    aggregate annual report, using data collected from the Annual Return/
    Report of Employee Benefit Plan (Department of Labor Form 5500), that
    shall include general information on self-insured group health plans
    (including plan type, number of participants, benefits offered, funding
    arrangements, and benefit arrangements) as well as data from the
    financial filings of self-insured employers (including information on
    assets, liabilities, contributions, investments, and expenses). The
    Secretary shall submit such reports to the appropriate committees of
    Congress.

    ``SEC. 1254. STUDY OF LARGE GROUP MARKET.

        ``(a) In General.--The Secretary of Health and Human Services shall
    conduct a study of the fully-insured and self-insured group health plan
    markets to--
                ``(1) compare the characteristics of employers (including
            industry, size, and other characteristics as determined
            appropriate by the Secretary), health plan benefits, financial
            solvency, capital reserve levels, and the risks of becoming
            insolvent; and
                ``(2) determine the extent to which new insurance market
            reforms are likely to cause adverse selection in the large
            group market or to encourage small and midsize employers to
            self-insure.
        ``(b) Collection of Information.--In conducting the study under
    subsection (a), the Secretary, in coordination with the Secretary of
    Labor, shall collect information and analyze--
                ``(1) the extent to which self-insured group health plans
            can offer less costly coverage and, if so, whether lower costs
            are due to more efficient plan administration and lower
            overhead or to the denial of claims and the offering very
            limited benefit packages;
                ``(2) claim denial rates, plan benefit fluctuations (to
            evaluate the extent that plans scale back health benefits
            during economic downturns), and the impact of the limited
            recourse options on consumers; and
                ``(3) any potential conflict of interest as it relates to
            the health care needs of self-insured enrollees and self-
            insured employer's financial contribution or profit margin, and
            the impact of such conflict on administration of the health
            plan.
        ``(c) Report.--Not later than 1 year after the date of enactment of
    this Act, the Secretary shall submit to the appropriate committees of
    Congress a report concerning the results of the study conducted under
    subsection (a).''.

    SEC. 10104. AMENDMENTS TO SUBTITLE D.

        (a) Section 1301(a) of this Act is amended by striking paragraph
    (2) and inserting the following:
                ``(2) Inclusion of co-op plans and multi-state qualified
            health plans.--Any reference in this title to a qualified
            health plan shall be deemed to include a qualified health plan
            offered through the CO-OP program under section 1322, and a
            multi-State plan under section 1334, unless specifically
            provided for otherwise.
                ``(3) Treatment of qualified direct primary care medical
            home plans.--The Secretary of Health and Human Services shall
            permit a qualified health plan to provide coverage through a
            qualified direct primary care medical home plan that meets
            criteria established by the Secretary, so long as the qualified
            health plan meets all requirements that are otherwise
            applicable and the services covered by the medical home plan
            are coordinated with the entity offering the qualified health
            plan.
                ``(4) Variation based on rating area.--A qualified health
            plan, including a multi-State qualified health plan, may as
            appropriate vary premiums by rating area (as defined in section
            2701(a)(2) of the Public Health Service Act).''.
        (b) Section 1302 of this Act is amended--
                (1) in subsection (d)(2)(B), by striking ``may issue'' and
            inserting ``shall issue''; and
                (2) by adding at the end the following:
        ``(g) Payments to Federally-qualified Health Centers.--If any item
    or service covered by a qualified health plan is provided by a
    Federally-qualified health center (as defined in section 1905(l)(2)(B)
    of the Social Security Act (42 U.S.C. 1396d(l)(2)(B)) to an enrollee of
    the plan, the offeror of the plan shall pay to the center for the item
    or service an amount that is not less than the amount of payment that
    would have been paid to the center under section 1902(bb) of such Act
    (42 U.S.C. 1396a(bb)) for such item or service.''.
        (c) Section 1303 of this Act is amended to read as follows:

    ``SEC. 1303. SPECIAL RULES.

        ``(a) State Opt-out of Abortion Coverage.--
                ``(1) In general.--A State may elect to prohibit abortion
            coverage in qualified health plans offered through an Exchange
            in such State if such State enacts a law to provide for such
            prohibition.
                ``(2) Termination of opt out.--A State may repeal a law
            described in paragraph (1) and provide for the offering of such
            services through the Exchange.
        ``(b) Special Rules Relating to Coverage of Abortion Services.--
                ``(1) Voluntary choice of coverage of abortion services.--
                        ``(A) In general.--Notwithstanding any other
                    provision of this title (or any amendment made by this
                    title)--
                                ``(i) nothing in this title (or any
                            amendment made by this title), shall be
                            construed to require a qualified health plan to
                            provide coverage of services described in
                            subparagraph (B)(i) or (B)(ii) as part of its
                            essential health benefits for any plan year;
                            and
                                ``(ii) subject to subsection (a), the
                            issuer of a qualified health plan shall
                            determine whether or not the plan provides
                            coverage of services described in subparagraph
                            (B)(i) or (B)(ii) as part of such benefits for
                            the plan year.
                        ``(B) Abortion services.--
                                ``(i) Abortions for which public funding is
                            prohibited.--The services described in this
                            clause are abortions for which the expenditure
                            of Federal funds appropriated for the
                            Department of Health and Human Services is not
                            permitted, based on the law as in effect as of
                            the date that is 6 months before the beginning
                            of the plan year involved.
                                ``(ii) Abortions for which public funding
                            is allowed.--The services described in this
                            clause are abortions for which the expenditure
                            of Federal funds appropriated for the
                            Department of Health and Human Services is
                            permitted, based on the law as in effect as of
                            the date that is 6 months before the beginning
                            of the plan year involved.
                ``(2) Prohibition on the use of federal funds.--
                        ``(A) In general.--If a qualified health plan
                    provides coverage of services described in paragraph
                    (1)(B)(i), the issuer of the plan shall not use any
                    amount attributable to any of the following for
                    purposes of paying for such services:
                                ``(i) The credit under section 36B of the
                            Internal Revenue Code of 1986 (and the amount
                            (if any) of the advance payment of the credit
                            under section 1412 of the Patient Protection
                            and Affordable Care Act).
                                ``(ii) Any cost-sharing reduction under
                            section 1402 of the Patient Protection and
                            Affordable Care Act (and the amount (if any) of
                            the advance payment of the reduction under
                            section 1412 of the Patient Protection and
                            Affordable Care Act).
                        ``(B) Establishment of allocation accounts.--In the
                    case of a plan to which subparagraph (A) applies, the
                    issuer of the plan shall--
                                ``(i) collect from each enrollee in the
                            plan (without regard to the enrollee's age,
                            sex, or family status) a separate payment for
                            each of the following:
                                        ``(I) an amount equal to the
                                    portion of the premium to be paid
                                    directly by the enrollee for coverage
                                    under the plan of services other than
                                    services described in paragraph
                                    (1)(B)(i) (after reduction for credits
                                    and cost-sharing reductions described
                                    in subparagraph (A)); and
                                        ``(II) an amount equal to the
                                    actuarial value of the coverage of
                                    services described in paragraph
                                    (1)(B)(i), and
                                ``(ii) shall deposit all such separate
                            payments into separate allocation accounts as
                            provided in subparagraph (C).
                    In the case of an enrollee whose premium for coverage
                    under the plan is paid through employee payroll
                    deposit, the separate payments required under this
                    subparagraph shall each be paid by a separate deposit.
                        ``(C) Segregation of funds.--
                                ``(i) In general.--The issuer of a plan to
                            which subparagraph (A) applies shall establish
                            allocation accounts described in clause (ii)
                            for enrollees receiving amounts described in
                            subparagraph (A).
                                ``(ii) Allocation accounts.--The issuer of
                            a plan to which subparagraph (A) applies shall
                            deposit--
                                        ``(I) all payments described in
                                    subparagraph (B)(i)(I) into a separate
                                    account that consists solely of such
                                    payments and that is used exclusively
                                    to pay for services other than services
                                    described in paragraph (1)(B)(i); and
                                        ``(II) all payments described in
                                    subparagraph (B)(i)(II) into a separate
                                    account that consists solely of such
                                    payments and that is used exclusively
                                    to pay for services described in
                                    paragraph (1)(B)(i).
                        ``(D) Actuarial value.--
                                ``(i) In general.--The issuer of a
                            qualified health plan shall estimate the basic
                            per enrollee, per month cost, determined on an
                            average actuarial basis, for including coverage
                            under the qualified health plan of the services
                            described in paragraph (1)(B)(i).
                                ``(ii) Considerations.--In making such
                            estimate, the issuer--
                                        ``(I) may take into account the
                                    impact on overall costs of the
                                    inclusion of such coverage, but may not
                                    take into account any cost reduction
                                    estimated to result from such services,
                                    including prenatal care, delivery, or
                                    postnatal care;
                                        ``(II) shall estimate such costs as
                                    if such coverage were included for the
                                    entire population covered; and
                                        ``(III) may not estimate such a
                                    cost at less than $1 per enrollee, per
                                    month.
                        ``(E) Ensuring compliance with segregation
                    requirements.--
                                ``(i) In general.--Subject to clause (ii),
                            State health insurance commissioners shall
                            ensure that health plans comply with the
                            segregation requirements in this subsection
                            through the segregation of plan funds in
                            accordance with applicable provisions of
                            generally accepted accounting requirements,
                            circulars on funds management of the Office of
                            Management and Budget, and guidance on
                            accounting of the Government Accountability
                            Office.
                                ``(ii) Clarification.--Nothing in clause
                            (i) shall prohibit the right of an individual
                            or health plan to appeal such action in courts
                            of competent jurisdiction.
                ``(3) Rules relating to notice.--
                        ``(A) Notice.--A qualified health plan that
                    provides for coverage of the services described in
                    paragraph (1)(B)(i) shall provide a notice to
                    enrollees, only as part of the summary of benefits and
                    coverage explanation, at the time of enrollment, of
                    such coverage.
                        ``(B) Rules relating to payments.--The notice
                    described in subparagraph (A), any advertising used by
                    the issuer with respect to the plan, any information
                    provided by the Exchange, and any other information
                    specified by the Secretary shall provide information
                    only with respect to the total amount of the combined
                    payments for services described in paragraph (1)(B)(i)
                    and other services covered by the plan.
                ``(4) No discrimination on basis of provision of
            abortion.--No qualified health plan offered through an Exchange
            may discriminate against any individual health care provider or
            health care facility because of its unwillingness to provide,
            pay for, provide coverage of, or refer for abortions
        ``(c) Application of State and Federal Laws Regarding Abortion.--
                ``(1) No preemption of state laws regarding abortion.--
            Nothing in this Act shall be construed to preempt or otherwise
            have any effect on State laws regarding the prohibition of (or
            requirement of) coverage, funding, or procedural requirements
            on abortions, including parental notification or consent for
            the performance of an abortion on a minor.
                ``(2) No effect on federal laws regarding abortion.--
                        ``(A) In general.--Nothing in this Act shall be
                    construed to have any effect on Federal laws
                    regarding--
                                ``(i) conscience protection;
                                ``(ii) willingness or refusal to provide
                            abortion; and
                                ``(iii) discrimination on the basis of the
                            willingness or refusal to provide, pay for,
                            cover, or refer for abortion or to provide or
                            participate in training to provide abortion.
                ``(3) No effect on federal civil rights law.--Nothing in
            this subsection shall alter the rights and obligations of
            employees and employers under title VII of the Civil Rights Act
            of 1964.
        ``(d) Application of Emergency Services Laws.--Nothing in this Act
    shall be construed to relieve any health care provider from providing
    emergency services as required by State or Federal law, including
    section 1867 of the Social Security Act (popularly known as
    `EMTALA').''.
        (d) Section 1304 of this Act is amended by adding at the end the
    following:
        ``(e) Educated Health Care Consumers.--The term `educated health
    care consumer' means an individual who is knowledgeable about the
    health care system, and has background or experience in making informed
    decisions regarding health, medical, and scientific matters.''.
        (e) Section 1311(d) of this Act is amended--
                (1) in paragraph (3)(B), by striking clause (ii) and
            inserting the following:
                                ``(ii) State must assume cost.--A State
                            shall make payments--
                                        ``(I) to an individual enrolled in
                                    a qualified health plan offered in such
                                    State; or
                                        ``(II) on behalf of an individual
                                    described in subclause (I) directly to
                                    the qualified health plan in which such
                                    individual is enrolled;
                            to defray the cost of any additional benefits
                            described in clause (i).''; and
                (2) in paragraph (6)(A), by inserting ``educated'' before
            ``health care''.
        (f) Section 1311(e) of this Act is amended--
                (1) in paragraph (2), by striking ``may'' in the second
            sentence and inserting ``shall''; and
                (2) by adding at the end the following:
                ``(3) Transparency in coverage.--
                        ``(A) In general.--The Exchange shall require
                    health plans seeking certification as qualified health
                    plans to submit to the Exchange, the Secretary, the
                    State insurance commissioner, and make available to the
                    public, accurate and timely disclosure of the following
                    information:
                                ``(i) Claims payment policies and
                            practices.
                                ``(ii) Periodic financial disclosures.
                                ``(iii) Data on enrollment.
                                ``(iv) Data on disenrollment.
                                ``(v) Data on the number of claims that are
                            denied.
                                ``(vi) Data on rating practices.
                                ``(vii) Information on cost-sharing and
                            payments with respect to any out-of-network
                            coverage.
                                ``(viii) Information on enrollee and
                            participant rights under this title.
                                ``(ix) Other information as determined
                            appropriate by the Secretary.
                        ``(B) Use of plain language.--The information
                    required to be submitted under subparagraph (A) shall
                    be provided in plain language. The term `plain
                    language' means language that the intended audience,
                    including individuals with limited English proficiency,
                    can readily understand and use because that language is
                    concise, well-organized, and follows other best
                    practices of plain language writing. The Secretary and
                    the Secretary of Labor shall jointly develop and issue
                    guidance on best practices of plain language writing.
                        ``(C) Cost sharing transparency.--The Exchange
                    shall require health plans seeking certification as
                    qualified health plans to permit individuals to learn
                    the amount of cost-sharing (including deductibles,
                    copayments, and coinsurance) under the individual's
                    plan or coverage that the individual would be
                    responsible for paying with respect to the furnishing
                    of a specific item or service by a participating
                    provider in a timely manner upon the request of the
                    individual. At a minimum, such information shall be
                    made available to such individual through an Internet
                    website and such other means for individuals without
                    access to the Internet.
                        ``(D) Group health plans.--The Secretary of Labor
                    shall update and harmonize the Secretary's rules
                    concerning the accurate and timely disclosure to
                    participants by group health plans of plan disclosure,
                    plan terms and conditions, and periodic financial
                    disclosure with the standards established by the
                    Secretary under subparagraph (A).''.
        (g) Section 1311(g)(1) of this Act is amended--
                (1) in subparagraph (C), by striking ``; and'' and
            inserting a semicolon;
                (2) in subparagraph (D), by striking the period and
            inserting ``; and''; and
                (3) by adding at the end the following:
                        ``(E) the implementation of activities to reduce
                    health and health care disparities, including through
                    the use of language services, community outreach, and
                    cultural competency trainings.''.
        (h) Section 1311(i)(2)((B) of this Act is amended by striking
    ``small business development centers'' and inserting ``resource
    partners of the Small Business Administration''.
        (i) Section 1312 of this Act is amended--
                (1) in subsection (a)(1), by inserting ``and for which such
            individual is eligible'' before the period;
                (2) in subsection (e)--
                        (A) in paragraph (1), by inserting ``and
                    employers'' after ``enroll individuals''; and
                        (B) by striking the flush sentence at the end; and
                (3) in subsection (f)(1)(A)(ii), by striking the
            parenthetical.
        (j)(1) Subparagraph (B) of section 1313(a)(6) of this Act is hereby
    deemed null, void, and of no effect.
        (2) Section 3730(e) of title 31, United States Code, is amended by
    striking paragraph (4) and inserting the following:
                ``(4)(A) The court shall dismiss an action or claim under
            this section, unless opposed by the Government, if
            substantially the same allegations or transactions as alleged
            in the action or claim were publicly disclosed--
                        ``(i) in a Federal criminal, civil, or
                    administrative hearing in which the Government or its
                    agent is a party;
                        ``(ii) in a congressional, Government
                    Accountability Office, or other Federal report,
                    hearing, audit, or investigation; or
                        ``(iii) from the news media,
            unless the action is brought by the Attorney General or the
            person bringing the action is an original source of the
            information.
                ``(B) For purposes of this paragraph, ``original source''
            means an individual who either (i) prior to a public disclosure
            under subsection (e)(4)(a), has voluntarily disclosed to the
            Government the information on which allegations or transactions
            in a claim are based, or (2) who has knowledge that is
            independent of and materially adds to the publicly disclosed
            allegations or transactions, and who has voluntarily provided
            the information to the Government before filing an action under
            this section.''.
        (k) Section 1313(b) of this Act is amended--
                (1) in paragraph (3), by striking ``and'' at the end;
                (2) by redesignating paragraph (4) as paragraph (5); and
                (3) by inserting after paragraph (3) the following:
                ``(4) a survey of the cost and affordability of health care
            insurance provided under the Exchanges for owners and employees
            of small business concerns (as defined under section 3 of the
            Small Business Act (15 U.S.C. 632)), including data on
            enrollees in Exchanges and individuals purchasing health
            insurance coverage outside of Exchanges; and''.
        (l) Section 1322(b) of this Act is amended--
                (1) by redesignating paragraph (3) as paragraph (4); and
                (2) by inserting after paragraph (2), the following:
                ``(3) Repayment of loans and grants.--Not later than July
            1, 2013, and prior to awarding loans and grants under the CO-OP
            program, the Secretary shall promulgate regulations with
            respect to the repayment of such loans and grants in a manner
            that is consistent with State solvency regulations and other
            similar State laws that may apply. In promulgating such
            regulations, the Secretary shall provide that such loans shall
            be repaid within 5 years and such grants shall be repaid within
            15 years, taking into consideration any appropriate State
            reserve requirements, solvency regulations, and requisite
            surplus note arrangements that must be constructed in a State
            to provide for such repayment prior to awarding such loans and
            grants.''.
        (m) Part III of subtitle D of title I of this Act is amended by
    striking section 1323.
        (n) Section 1324(a) of this Act is amended by striking ``, a
    community health'' and all that follows through ``1333(b)'' and
    inserting ``, or a multi-State qualified health plan under section
    1334''.
        (o) Section 1331 of this Act is amended--
                (1) in subsection (d)(3)(A)(i), by striking ``85'' and
            inserting ``95''; and
                (2) in subsection (e)(1)(B), by inserting before the
            semicolon the following: ``, or, in the case of an alien
            lawfully present in the United States, whose income is not
            greater than 133 percent of the poverty line for the size of
            the family involved but who is not eligible for the Medicaid
            program under title XIX of the Social Security Act by reason of
            such alien status''.
        (p) Section 1333 of this Act is amended by striking subsection (b).
        (q) Part IV of subtitle D of title I of this Act is amended by
    adding at the end the following:

    ``SEC. 1334. MULTI-STATE PLANS.

        ``(a) Oversight by the Office of Personnel Management.--
                ``(1) In general.--The Director of the Office of Personnel
            Management (referred to in this section as the `Director')
            shall enter into contracts with health insurance issuers (which
            may include a group of health insurance issuers affiliated
            either by common ownership and control or by the common use of
            a nationally licensed service mark), without regard to section
            5 of title 41, United States Code, or other statutes requiring
            competitive bidding, to offer at least 2 multi-State qualified
            health plans through each Exchange in each State. Such plans
            shall provide individual, or in the case of small employers,
            group coverage.
                ``(2) Terms.--Each contract entered into under paragraph
            (1) shall be for a uniform term of at least 1 year, but may be
            made automatically renewable from term to term in the absence
            of notice of termination by either party. In entering into such
            contracts, the Director shall ensure that health benefits
            coverage is provided in accordance with the types of coverage
            provided for under section 2701(a)(1)(A)(i) of the Public
            Health Service Act.
                ``(3) Non-profit entities.--In entering into contracts
            under paragraph (1), the Director shall ensure that at least
            one contract is entered into with a non-profit entity.
                ``(4) Administration.--The Director shall implement this
            subsection in a manner similar to the manner in which the
            Director implements the contracting provisions with respect to
            carriers under the Federal employees health benefit program
            under chapter 89 of title 5, United States Code, including
            (through negotiating with each multi-state plan)--
                        ``(A) a medical loss ratio;
                        ``(B) a profit margin;
                        ``(C) the premiums to be charged; and
                        ``(D) such other terms and conditions of coverage
                    as are in the interests of enrollees in such plans.
                ``(5) Authority to protect consumers.--The Director may
            prohibit the offering of any multi-State health plan that does
            not meet the terms and conditions defined by the Director with
            respect to the elements described in subparagraphs (A) through
            (D) of paragraph (4).
                ``(6) Assured availability of varied coverage.--In entering
            into contracts under this subsection, the Director shall ensure
            that with respect to multi-State qualified health plans offered
            in an Exchange, there is at least one such plan that does not
            provide coverage of services described in section
            1303(b)(1)(B)(i).
                ``(7) Withdrawal.--Approval of a contract under this
            subsection may be withdrawn by the Director only after notice
            and opportunity for hearing to the issuer concerned without
            regard to subchapter II of chapter 5 and chapter 7 of title 5,
            United States Code.
        ``(b) Eligibility.--A health insurance issuer shall be eligible to
    enter into a contract under subsection (a)(1) if such issuer--
                ``(1) agrees to offer a multi-State qualified health plan
            that meets the requirements of subsection (c) in each Exchange
            in each State;
                ``(2) is licensed in each State and is subject to all
            requirements of State law not inconsistent with this section,
            including the standards and requirements that a State imposes
            that do not prevent the application of a requirement of part A
            of title XXVII of the Public Health Service Act or a
            requirement of this title;
                ``(3) otherwise complies with the minimum standards
            prescribed for carriers offering health benefits plans under
            section 8902(e) of title 5, United States Code, to the extent
            that such standards do not conflict with a provision of this
            title; and
                ``(4) meets such other requirements as determined
            appropriate by the Director, in consultation with the
            Secretary.
        ``(c) Requirements for Multi-State Qualified Health Plan.--
                ``(1) In general.--A multi-State qualified health plan
            meets the requirements of this subsection if, in the
            determination of the Director--
                        ``(A) the plan offers a benefits package that is
                    uniform in each State and consists of the essential
                    benefits described in section 1302;
                        ``(B) the plan meets all requirements of this title
                    with respect to a qualified health plan, including
                    requirements relating to the offering of the bronze,
                    silver, and gold levels of coverage and catastrophic
                    coverage in each State Exchange;
                        ``(C) except as provided in paragraph (5), the
                    issuer provides for determinations of premiums for
                    coverage under the plan on the basis of the rating
                    requirements of part A of title XXVII of the Public
                    Health Service Act; and
                        ``(D) the issuer offers the plan in all geographic
                    regions, and in all States that have adopted adjusted
                    community rating before the date of enactment of this
                    Act.
                ``(2) States may offer additional benefits.--Nothing in
            paragraph (1)(A) shall preclude a State from requiring that
            benefits in addition to the essential health benefits required
            under such paragraph be provided to enrollees of a multi-State
            qualified health plan offered in such State.
                ``(3) Credits.--
                        ``(A) In general.--An individual enrolled in a
                    multi-State qualified health plan under this section
                    shall be eligible for credits under section 36B of the
                    Internal Revenue Code of 1986 and cost sharing
                    assistance under section 1402 in the same manner as an
                    individual who is enrolled in a qualified health plan.
                        ``(B) No additional federal cost.--A requirement by
                    a State under paragraph (2) that benefits in addition
                    to the essential health benefits required under
                    paragraph (1)(A) be provided to enrollees of a multi-
                    State qualified health plan shall not affect the amount
                    of a premium tax credit provided under section 36B of
                    the Internal Revenue Code of 1986 with respect to such
                    plan.
                ``(4) State must assume cost.--A State shall make
            payments--
                        ``(A) to an individual enrolled in a multi-State
                    qualified health plan offered in such State; or
                        ``(B) on behalf of an individual described in
                    subparagraph (A) directly to the multi-State qualified
                    health plan in which such individual is enrolled;
            to defray the cost of any additional benefits described in
            paragraph (2).
                ``(5) Application of certain state rating requirements.--
            With respect to a multi-State qualified health plan that is
            offered in a State with age rating requirements that are lower
            than 3:1, the State may require that Exchanges operating in
            such State only permit the offering of such multi-State
            qualified health plans if such plans comply with the State's
            more protective age rating requirements.
        ``(d) Plans Deemed To Be Certified.--A multi-State qualified health
    plan that is offered under a contract under subsection (a) shall be
    deemed to be certified by an Exchange for purposes of section
    1311(d)(4)(A).
        ``(e) Phase-in.--Notwithstanding paragraphs (1) and (2) of
    subsection (b), the Director shall enter into a contract with a health
    insurance issuer for the offering of a multi-State qualified health
    plan under subsection (a) if--
                ``(1) with respect to the first year for which the issuer
            offers such plan, such issuer offers the plan in at least 60
            percent of the States;
                ``(2) with respect to the second such year, such issuer
            offers the plan in at least 70 percent of the States;
                ``(3) with respect to the third such year, such issuer
            offers the plan in at least 85 percent of the States; and
                ``(4) with respect to each subsequent year, such issuer
            offers the plan in all States.
        ``(f) Applicability.--The requirements under chapter 89 of title 5,
    United States Code, applicable to health benefits plans under such
    chapter shall apply to multi-State qualified health plans provided for
    under this section to the extent that such requirements do not conflict
    with a provision of this title.
        ``(g) Continued Support for FEHBP.--
                ``(1) Maintenance of effort.--Nothing in this section shall
            be construed to permit the Director to allocate fewer financial
            or personnel resources to the functions of the Office of
            Personnel Management related to the administration of the
            Federal Employees Health Benefit Program under chapter 89 of
            title 5, United States Code.
                ``(2) Separate risk pool.--Enrollees in multi-State
            qualified health plans under this section shall be treated as a
            separate risk pool apart from enrollees in the Federal
            Employees Health Benefit Program under chapter 89 of title 5,
            United States Code.
                ``(3) Authority to establish separate entities.--The
            Director may establish such separate units or offices within
            the Office of Personnel Management as the Director determines
            to be appropriate to ensure that the administration of multi-
            State qualified health plans under this section does not
            interfere with the effective administration of the Federal
            Employees Health Benefit Program under chapter 89 of title 5,
            United States Code.
                ``(4) Effective oversight.--The Director may appoint such
            additional personnel as may be necessary to enable the Director
            to carry out activities under this section.
                ``(5) Assurance of separate program.--In carrying out this
            section, the Director shall ensure that the program under this
            section is separate from the Federal Employees Health Benefit
            Program under chapter 89 of title 5, United States Code.
            Premiums paid for coverage under a multi-State qualified health
            plan under this section shall not be considered to be Federal
            funds for any purposes.
                ``(6) FEHBP plans not required to participate.--Nothing in
            this section shall require that a carrier offering coverage
            under the Federal Employees Health Benefit Program under
            chapter 89 of title 5, United States Code, also offer a multi-
            State qualified health plan under this section.
        ``(h) Advisory Board.--The Director shall establish an advisory
    board to provide recommendations on the activities described in this
    section. A significant percentage of the members of such board shall be
    comprised of enrollees in a multi-State qualified health plan, or
    representatives of such enrollees.
        ``(i) Authorization of Appropriations.--There is authorized to be
    appropriated, such sums as may be necessary to carry out this
    section.''.
        (r) Section 1341 of this Act is amended--
                (1) in the section heading, by striking ``and small group
            markets'' and inserting ``market'';
                (2) in subsection (b)(2)(B), by striking ``paragraph
            (1)(A)'' and inserting ``paragraph (1)(B)''; and
                (3) in subsection (c)(1)(A), by striking ``and small group
            markets'' and inserting ``market''.

    SEC. 10105. AMENDMENTS TO SUBTITLE E.

        (a) Section 36B(b)(3)(A)(ii) of the Internal Revenue Code of 1986,
    as added by section 1401(a) of this Act, is amended by striking ``is in
    excess of'' and inserting ``equals or exceeds''.
        (b) Section 36B(c)(1)(A) of the Internal Revenue Code of 1986, as
    added by section 1401(a) of this Act, is amended by inserting ``equals
    or'' before ``exceeds''.
        (c) Section 36B(c)(2)(C)(iv) of the Internal Revenue Code of 1986,
    as added by section 1401(a) of this Act, is amended by striking
    ``subsection (b)(3)(A)(ii)'' and inserting ``subsection
    (b)(3)(A)(iii)''.
        (d) Section 1401(d) of this Act is amended by adding at the end the
    following:
                ``(3) Section 6211(b)(4)(A) of the Internal Revenue Code of
            1986 is amended by inserting `36B,' after `36A,'.''.
        (e)(1) Subparagraph (B) of section 45R(d)(3) of the Internal
    Revenue Code of 1986, as added by section 1421(a) of this Act, is
    amended to read as follows:
                        ``(B) Dollar amount.--For purposes of paragraph
                    (1)(B) and subsection (c)(2)--
                                ``(i) 2010, 2011, 2012, and 2013.--The
                            dollar amount in effect under this paragraph
                            for taxable years beginning in 2010, 2011,
                            2012, or 2013 is $25,000.
                                ``(ii) Subsequent years.--In the case of a
                            taxable year beginning in a calendar year after
                            2013, the dollar amount in effect under this
                            paragraph shall be equal to $25,000, multiplied
                            by the cost-of-living adjustment under section
                            1(f)(3) for the calendar year, determined by
                            substituting `calendar year 2012' for `calendar
                            year 1992' in subparagraph (B) thereof.''.
        (2) Subsection (g) of section 45R of the Internal Revenue Code of
    1986, as added by section 1421(a) of this Act, is amended by striking
    ``2011'' both places it appears and inserting ``2010, 2011''.
        (3) Section 280C(h) of the Internal Revenue Code of 1986, as added
    by section 1421(d)(1) of this Act, is amended by striking ``2011'' and
    inserting ``2010, 2011''.
        (4) Section 1421(f) of this Act is amended by striking ``2010''
    both places it appears and inserting ``2009''.
        (5) The amendments made by this subsection shall take effect as if
    included in the enactment of section 1421 of this Act.
        (f) Part I of subtitle E of title I of this Act is amended by
    adding at the end of subpart B, the following:

    ``SEC. 1416. STUDY OF GEOGRAPHIC VARIATION IN APPLICATION OF FPL.

        ``(a) In General.--The Secretary shall conduct a study to examine
    the feasibility and implication of adjusting the application of the
    Federal poverty level under this subtitle (and the amendments made by
    this subtitle) for different geographic areas so as to reflect the
    variations in cost-of-living among different areas within the United
    States. If the Secretary determines that an adjustment is feasible, the
    study should include a methodology to make such an adjustment. Not
    later than January 1, 2013, the Secretary shall submit to Congress a
    report on such study and shall include such recommendations as the
    Secretary determines appropriate.
        ``(b) Inclusion of Territories.--
                ``(1) In general.--The Secretary shall ensure that the
            study under subsection (a) covers the territories of the United
            States and that special attention is paid to the disparity that
            exists among poverty levels and the cost of living in such
            territories and to the impact of such disparity on efforts to
            expand health coverage and ensure health care.
                ``(2) Territories defined.--In this subsection, the term
            `territories of the United States' includes the Commonwealth of
            Puerto Rico, the United States Virgin Islands, Guam, the
            Northern Mariana Islands, and any other territory or possession
            of the United States.''.

    SEC. 10106. AMENDMENTS TO SUBTITLE F.

        (a) Section 1501(a)(2) of this Act is amended to read as follows:
                ``(2) Effects on the national economy and interstate
            commerce.--The effects described in this paragraph are the
            following:
                        ``(A) The requirement regulates activity that is
                    commercial and economic in nature: economic and
                    financial decisions about how and when health care is
                    paid for, and when health insurance is purchased. In
                    the absence of the requirement, some individuals would
                    make an economic and financial decision to forego
                    health insurance coverage and attempt to self-insure,
                    which increases financial risks to households and
                    medical providers.
                        ``(B) Health insurance and health care services are
                    a significant part of the national economy. National
                    health spending is projected to increase from
                    $2,500,000,000,000, or 17.6 percent of the economy, in
                    2009 to $4,700,000,000,000 in 2019. Private health
                    insurance spending is projected to be $854,000,000,000
                    in 2009, and pays for medical supplies, drugs, and
                    equipment that are shipped in interstate commerce.
                    Since most health insurance is sold by national or
                    regional health insurance companies, health insurance
                    is sold in interstate commerce and claims payments flow
                    through interstate commerce.
                        ``(C) The requirement, together with the other
                    provisions of this Act, will add millions of new
                    consumers to the health insurance market, increasing
                    the supply of, and demand for, health care services,
                    and will increase the number and share of Americans who
                    are insured.
                        ``(D) The requirement achieves near-universal
                    coverage by building upon and strengthening the private
                    employer-based health insurance system, which covers
                    176,000,000 Americans nationwide. In Massachusetts, a
                    similar requirement has strengthened private employer-
                    based coverage: despite the economic downturn, the
                    number of workers offered employer-based coverage has
                    actually increased.
                        ``(E) The economy loses up to $207,000,000,000 a
                    year because of the poorer health and shorter lifespan
                    of the uninsured. By significantly reducing the number
                    of the uninsured, the requirement, together with the
                    other provisions of this Act, will significantly reduce
                    this economic cost.
                        ``(F) The cost of providing uncompensated care to
                    the uninsured was $43,000,000,000 in 2008. To pay for
                    this cost, health care providers pass on the cost to
                    private insurers, which pass on the cost to families.
                    This cost-shifting increases family premiums by on
                    average over $1,000 a year. By significantly reducing
                    the number of the uninsured, the requirement, together
                    with the other provisions of this Act, will lower
                    health insurance premiums.
                        ``(G) 62 percent of all personal bankruptcies are
                    caused in part by medical expenses. By significantly
                    increasing health insurance coverage, the requirement,
                    together with the other provisions of this Act, will
                    improve financial security for families.
                        ``(H) Under the Employee Retirement Income Security
                    Act of 1974 (29 U.S.C. 1001 et seq.), the Public Health
                    Service Act (42 U.S.C. 201 et seq.), and this Act, the
                    Federal Government has a significant role in regulating
                    health insurance. The requirement is an essential part
                    of this larger regulation of economic activity, and the
                    absence of the requirement would undercut Federal
                    regulation of the health insurance market.
                        ``(I) Under sections 2704 and 2705 of the Public
                    Health Service Act (as added by section 1201 of this
                    Act), if there were no requirement, many individuals
                    would wait to purchase health insurance until they
                    needed care. By significantly increasing health
                    insurance coverage, the requirement, together with the
                    other provisions of this Act, will minimize this
                    adverse selection and broaden the health insurance risk
                    pool to include healthy individuals, which will lower
                    health insurance premiums. The requirement is essential
                    to creating effective health insurance markets in which
                    improved health insurance products that are guaranteed
                    issue and do not exclude coverage of pre-existing
                    conditions can be sold.
                        ``(J) Administrative costs for private health
                    insurance, which were $90,000,000,000 in 2006, are 26
                    to 30 percent of premiums in the current individual and
                    small group markets. By significantly increasing health
                    insurance coverage and the size of purchasing pools,
                    which will increase economies of scale, the
                    requirement, together with the other provisions of this
                    Act, will significantly reduce administrative costs and
                    lower health insurance premiums. The requirement is
                    essential to creating effective health insurance
                    markets that do not require underwriting and eliminate
                    its associated administrative costs.''.
        (b)(1) Section 5000A(b)(1) of the Internal Revenue Code of 1986, as
    added by section 1501(b) of this Act, is amended to read as follows:
                ``(1) In general.--If a taxpayer who is an applicable
            individual, or an applicable individual for whom the taxpayer
            is liable under paragraph (3), fails to meet the requirement of
            subsection (a) for 1 or more months, then, except as provided
            in subsection (e), there is hereby imposed on the taxpayer a
            penalty with respect to such failures in the amount determined
            under subsection (c).''.
                (2) Paragraphs (1) and (2) of section 5000A(c) of the
            Internal Revenue Code of 1986, as so added, are amended to read
            as follows:
                ``(1) In general.--The amount of the penalty imposed by
            this section on any taxpayer for any taxable year with respect
            to failures described in subsection (b)(1) shall be equal to
            the lesser of--
                        ``(A) the sum of the monthly penalty amounts
                    determined under paragraph (2) for months in the
                    taxable year during which 1 or more such failures
                    occurred, or
                        ``(B) an amount equal to the national average
                    premium for qualified health plans which have a bronze
                    level of coverage, provide coverage for the applicable
                    family size involved, and are offered through Exchanges
                    for plan years beginning in the calendar year with or
                    within which the taxable year ends.
                ``(2) Monthly penalty amounts.--For purposes of paragraph
            (1)(A), the monthly penalty amount with respect to any taxpayer
            for any month during which any failure described in subsection
            (b)(1) occurred is an amount equal to \1/12\ of the greater of
            the following amounts:
                        ``(A) Flat dollar amount.--An amount equal to the
                    lesser of--
                                ``(i) the sum of the applicable dollar
                            amounts for all individuals with respect to
                            whom such failure occurred during such month,
                            or
                                ``(ii) 300 percent of the applicable dollar
                            amount (determined without regard to paragraph
                            (3)(C)) for the calendar year with or within
                            which the taxable year ends.
                        ``(B) Percentage of income.--An amount equal to the
                    following percentage of the taxpayer's household income
                    for the taxable year:
                                ``(i) 0.5 percent for taxable years
                            beginning in 2014.
                                ``(ii) 1.0 percent for taxable years
                            beginning in 2015.
                                ``(iii) 2.0 percent for taxable years
                            beginning after 2015.''.
        (3) Section 5000A(c)(3) of the Internal Revenue Code of 1986, as
    added by section 1501(b) of this Act, is amended by striking ``$350''
    and inserting ``$495''.
        (c) Section 5000A(d)(2)(A) of the Internal Revenue Code of 1986, as
    added by section 1501(b) of this Act, is amended to read as follows:
                        ``(A) Religious conscience exemption.--Such term
                    shall not include any individual for any month if such
                    individual has in effect an exemption under section
                    1311(d)(4)(H) of the Patient Protection and Affordable
                    Care Act which certifies that such individual is--
                                ``(i) a member of a recognized religious
                            sect or division thereof which is described in
                            section 1402(g)(1), and
                                ``(ii) an adherent of established tenets or
                            teachings of such sect or division as described
                            in such section.''.
        (d) Section 5000A(e)(1)(C) of the Internal Revenue Code of 1986, as
    added by section 1501(b) of this Act, is amended to read as follows:
                        ``(C) Special rules for individuals related to
                    employees.--For purposes of subparagraph (B)(i), if an
                    applicable individual is eligible for minimum essential
                    coverage through an employer by reason of a
                    relationship to an employee, the determination under
                    subparagraph (A) shall be made by reference to required
                    contribution of the employee.''.
        (e) Section 4980H(b) of the Internal Revenue Code of 1986, as added
    by section 1513(a) of this Act, is amended to read as follows:
        ``(b) Large Employers With Waiting Periods Exceeding 60 Days.--
                ``(1) In general.--In the case of any applicable large
            employer which requires an extended waiting period to enroll in
            any minimum essential coverage under an employer-sponsored plan
            (as defined in section 5000A(f)(2)), there is hereby imposed on
            the employer an assessable payment of $600 for each full-time
            employee of the employer to whom the extended waiting period
            applies.
                ``(2) Extended waiting period.--The term `extended waiting
            period' means any waiting period (as defined in section
            2701(b)(4) of the Public Health Service Act) which exceeds 60
            days.''.
        (f)(1) Subparagraph (A) of section 4980H(d)(4) of the Internal
    Revenue Code of 1986, as added by section 1513(a) of this Act, is
    amended by inserting ``, with respect to any month,'' after ``means''.
        (2) Section 4980H(d)(2) of the Internal Revenue Code of 1986, as
    added by section 1513(a) of this Act, is amended by adding at the end
    the following:
                        ``(D) Application to construction industry
                    employers.--In the case of any employer the substantial
                    annual gross receipts of which are attributable to the
                    construction industry--
                                ``(i) subparagraph (A) shall be applied by
                            substituting `who employed an average of at
                            least 5 full-time employees on business days
                            during the preceding calendar year and whose
                            annual payroll expenses exceed $250,000 for
                            such preceding calendar year' for `who employed
                            an average of at least 50 full-time employees
                            on business days during the preceding calendar
                            year', and
                                ``(ii) subparagraph (B) shall be applied by
                            substituting `5' for `50'.''.
        (3) The amendment made by paragraph (2) shall apply to months
    beginning after December 31, 2013.
        (g) Section 6056(b) of the Internal Revenue Code of 1986, as added
    by section 1514(a) of the Act, is amended by adding at the end the
    following new flush sentence:
    ``The Secretary shall have the authority to review the accuracy of the
    information provided under this subsection, including the applicable
    large employer's share under paragraph (2)(C)(iv).''.

    SEC. 10107. AMENDMENTS TO SUBTITLE G.

        (a) Section 1562 of this Act is amended, in the amendment made by
    subsection (a)(2)(B)(iii), by striking ``subpart 1'' and inserting
    ``subparts I and II''; and
        (b) Subtitle G of title I of this Act is amended--
                (1) by redesignating section 1562 (as amended) as section
            1563; and
                (2) by inserting after section 1561 the following:

    ``SEC. 1562. GAO STUDY REGARDING THE RATE OF DENIAL OF COVERAGE AND
                  ENROLLMENT BY HEALTH INSURANCE ISSUERS AND GROUP HEALTH
                  PLANS.

        ``(a) In General.--The Comptroller General of the United States
    (referred to in this section as the `Comptroller General') shall
    conduct a study of the incidence of denials of coverage for medical
    services and denials of applications to enroll in health insurance
    plans, as described in subsection (b), by group health plans and health
    insurance issuers.
        ``(b) Data.--
                ``(1) In general.--In conducting the study described in
            subsection (a), the Comptroller General shall consider samples
            of data concerning the following:
                        ``(A)(i) denials of coverage for medical services
                    to a plan enrollees, by the types of services for which
                    such coverage was denied; and
                        ``(ii) the reasons such coverage was denied; and
                        ``(B)(i) incidents in which group health plans and
                    health insurance issuers deny the application of an
                    individual to enroll in a health insurance plan offered
                    by such group health plan or issuer; and
                        ``(ii) the reasons such applications are denied.
                ``(2) Scope of data.--
                        ``(A) Favorably resolved disputes.--The data that
                    the Comptroller General considers under paragraph (1)
                    shall include data concerning denials of coverage for
                    medical services and denials of applications for
                    enrollment in a plan by a group health plan or health
                    insurance issuer, where such group health plan or
                    health insurance issuer later approves such coverage or
                    application.
                        ``(B) All health plans.--The study under this
                    section shall consider data from varied group health
                    plans and health insurance plans offered by health
                    insurance issuers, including qualified health plans and
                    health plans that are not qualified health plans.
        ``(c) Report.--Not later than one year after the date of enactment
    of this Act, the Comptroller General shall submit to the Secretaries of
    Health and Human Services and Labor a report describing the results of
    the study conducted under this section.
        ``(d) Publication of Report.--The Secretaries of Health and Human
    Services and Labor shall make the report described in subsection (c)
    available to the public on an Internet website.

    ``SEC. 1563. SMALL BUSINESS PROCUREMENT.

        ``Part 19 of the Federal Acquisition Regulation, section 15 of the
    Small Business Act (15 U.S.C. 644), and any other applicable laws or
    regulations establishing procurement requirements relating to small
    business concerns (as defined in section 3 of the Small Business Act
    (15 U.S.C. 632)) may not be waived with respect to any contract awarded
    under any program or other authority under this Act or an amendment
    made by this Act.''.

    SEC. 10108. FREE CHOICE VOUCHERS.

        (a) In General.--An offering employer shall provide free choice
    vouchers to each qualified employee of such employer.
        (b) Offering Employer.--For purposes of this section, the term
    ``offering employer'' means any employer who--
                (1) offers minimum essential coverage to its employees
            consisting of coverage through an eligible employer-sponsored
            plan; and
                (2) pays any portion of the costs of such plan.
        (c) Qualified Employee.--For purposes of this section--
                (1) In general.--The term ``qualified employee'' means,
            with respect to any plan year of an offering employer, any
            employee--
                        (A) whose required contribution (as determined
                    under section 5000A(e)(1)(B)) for minimum essential
                    coverage through an eligible employer-sponsored plan--
                                (i) exceeds 8 percent of such employee's
                            household income for the taxable year described
                            in section 1412(b)(1)(B) which ends with or
                            within in the plan year; and
                                (ii) does not exceed 9.8 percent of such
                            employee's household income for such taxable
                            year;
                        (B) whose household income for such taxable year is
                    not greater than 400 percent of the poverty line for a
                    family of the size involved; and
                        (C) who does not participate in a health plan
                    offered by the offering employer.
                (2) Indexing.--In the case of any calendar year beginning
            after 2014, the Secretary shall adjust the 8 percent under
            paragraph (1)(A)(i) and 9.8 percent under paragraph (1)(A)(ii)
            for the calendar year to reflect the rate of premium growth
            between the preceding calendar year and 2013 over the rate of
            income growth for such period.
        (d) Free Choice Voucher.--
                (1) Amount.--
                        (A) In general.--The amount of any free choice
                    voucher provided under subsection (a) shall be equal to
                    the monthly portion of the cost of the eligible
                    employer-sponsored plan which would have been paid by
                    the employer if the employee were covered under the
                    plan with respect to which the employer pays the
                    largest portion of the cost of the plan. Such amount
                    shall be equal to the amount the employer would pay for
                    an employee with self-only coverage unless such
                    employee elects family coverage (in which case such
                    amount shall be the amount the employer would pay for
                    family coverage).
                        (B) Determination of cost.--The cost of any health
                    plan shall be determined under the rules similar to the
                    rules of section 2204 of the Public Health Service Act,
                    except that such amount shall be adjusted for age and
                    category of enrollment in accordance with regulations
                    established by the Secretary.
                (2) Use of vouchers.--An Exchange shall credit the amount
            of any free choice voucher provided under subsection (a) to the
            monthly premium of any qualified health plan in the Exchange in
            which the qualified employee is enrolled and the offering
            employer shall pay any amounts so credited to the Exchange.
                (3) Payment of excess amounts.--If the amount of the free
            choice voucher exceeds the amount of the premium of the
            qualified health plan in which the qualified employee is
            enrolled for such month, such excess shall be paid to the
            employee.
        (e) Other Definitions.--Any term used in this section which is also
    used in section 5000A of the Internal Revenue Code of 1986 shall have
    the meaning given such term under such section 5000A.
        (f) Exclusion From Income for Employee.--
                (1) In general.--Part III of subchapter B of chapter 1 of
            the Internal Revenue Code of 1986 is amended by inserting after
            section 139C the following new section:

    ``SEC. 139D. FREE CHOICE VOUCHERS.

        ``Gross income shall not include the amount of any free choice
    voucher provided by an employer under section 10108 of the Patient
    Protection and Affordable Care Act to the extent that the amount of
    such voucher does not exceed the amount paid for a qualified health
    plan (as defined in section 1301 of such Act) by the taxpayer.''.
                (2) Clerical amendment.--The table of sections for part III
            of subchapter B of chapter 1 of such Code is amended by
            inserting after the item relating to section 139C the following
            new item:

    ``Sec. 139D. Free choice vouchers.''.
                (3) Effective date.--The amendments made by this subsection
            shall apply to vouchers provided after December 31, 2013.
        (g) Deduction Allowed to Employer.--
                (1) In general.--Section 162(a) of the Internal Revenue
            Code of 1986 is amended by adding at the end the following new
            sentence: ``For purposes of paragraph (1), the amount of a free
            choice voucher provided under section 10108 of the Patient
            Protection and Affordable Care Act shall be treated as an
            amount for compensation for personal services actually
            rendered.''.
                (2) Effective date.--The amendments made by this subsection
            shall apply to vouchers provided after December 31, 2013.
        (h) Voucher Taken Into Account in Determining Premium Credit.--
                (1) In general.--Subsection (c)(2) of section 36B of the
            Internal Revenue Code of 1986, as added by section 1401, is
            amended by adding at the end the following new subparagraph:
                        ``(D) Exception for individual receiving free
                    choice vouchers.--The term `coverage month' shall not
                    include any month in which such individual has a free
                    choice voucher provided under section 10108 of the
                    Patient Protection and Affordable Care Act.''.
                (2) Effective date.--The amendment made by this subsection
            shall apply to taxable years beginning after December 31, 2013.
        (i) Coordination With Employer Responsibilities.--
                (1) Shared responsibility penalty.--
                        (A) In general.--Subsection (c) of section 4980H of
                    the Internal Revenue Code of 1986, as added by section
                    1513, is amended by adding at the end the following new
                    paragraph:
                ``(3) Special rules for employers providing free choice
            vouchers.--No assessable payment shall be imposed under
            paragraph (1) for any month with respect to any employee to
            whom the employer provides a free choice voucher under section
            10108 of the Patient Protection and Affordable Care Act for
            such month.''.
                        (B) Effective date.--The amendment made by this
                    paragraph shall apply to months beginning after
                    December 31, 2013.
                (2) Notification requirement.--Section 18B(a)(3) of the
            Fair Labor Standards Act of 1938, as added by section 1512, is
            amended--
                        (A) by inserting ``and the employer does not offer
                    a free choice voucher'' after ``Exchange''; and
                        (B) by striking ``will lose'' and inserting ``may
                    lose''.
        (j) Employer Reporting.--
                (1) In general.--Subsection (a) of section 6056 of the
            Internal Revenue Code of 1986, as added by section 1514, is
            amended by inserting ``and every offering employer'' before
            ``shall''.
                (2) Offering employers.--Subsection (f) of section 6056 of
            such Code, as added by section 1514, is amended to read as
            follows:
        ``(f) Definitions.--For purposes of this section--
                ``(1) Offering employer.--
                        ``(A) In general.--The term `offering employer'
                    means any offering employer (as defined in section
                    10108(b) of the Patient Protection and Affordable Care
                    Act) if the required contribution (within the meaning
                    of section 5000A(e)(1)(B)(i)) of any employee exceeds 8
                    percent of the wages (as defined in section 3121(a))
                    paid to such employee by such employer.
                        ``(B) Indexing.--In the case of any calendar year
                    beginning after 2014, the 8 percent under subparagraph
                    (A) shall be adjusted for the calendar year to reflect
                    the rate of premium growth between the preceding
                    calendar year and 2013 over the rate of income growth
                    for such period.
                ``(2) Other definitions.--Any term used in this section
            which is also used in section 4980H shall have the meaning
            given such term by section 4980H.''.
                (3) Conforming amendments.--
                        (A) The heading of section 6056 of such Code, as
                    added by section 1514, is amended by striking ``large''
                    and inserting ``certain''.
                        (B) Section 6056(b)(2)(C) of such Code is amended--
                                (i) by inserting ``in the case of an
                            applicable large employer,'' before ``the
                            length'' in clause (i);
                                (ii) by striking ``and'' at the end of
                            clause (iii);
                                (iii) by striking ``applicable large
                            employer'' in clause (iv) and inserting
                            ``employer'';
                                (iv) by inserting ``and'' at the end of
                            clause (iv); and
                                (v) by inserting at the end the following
                            new clause:
                                ``(v) in the case of an offering employer,
                            the option for which the employer pays the
                            largest portion of the cost of the plan and the
                            portion of the cost paid by the employer in
                            each of the enrollment categories under such
                            option,''.
                        (C) Section 6056(d)(2) of such Code is amended by
                    inserting ``or offering employer'' after ``applicable
                    large employer''.
                        (D) Section 6056(e) of such Code is amended by
                    inserting ``or offering employer'' after ``applicable
                    large employer''.
                        (E) Section 6724(d)(1)(B)(xxv) of such Code, as
                    added by section 1514, is amended by striking ``large''
                    and inserting ``certain''.
                        (F) Section 6724(d)(2)(HH) of such Code, as added
                    by section 1514, is amended by striking ``large'' and
                    inserting ``certain''.
                        (G) The table of sections for subpart D of part III
                    of subchapter A of chapter 1 of such Code, as amended
                    by section 1514, is amended by striking ``Large
                    employers'' in the item relating to section 6056 and
                    inserting ``Certain employers''.
                (4) Effective date.--The amendments made by this subsection
            shall apply to periods beginning after December 31, 2013.

    SEC. 10109. DEVELOPMENT OF STANDARDS FOR FINANCIAL AND ADMINISTRATIVE
                  TRANSACTIONS.

        (a) Additional Transaction Standards and Operating Rules.--
                (1) Development of additional transaction standards and
            operating rules.--Section 1173(a) of the Social Security Act
            (42 U.S.C. 1320d-2(a)), as amended by section 1104(b)(2), is
            amended--
                        (A) in paragraph (1)(B), by inserting before the
                    period the following: ``, and subject to the
                    requirements under paragraph (5)''; and
                        (B) by adding at the end the following new
                    paragraph:
                ``(5) Consideration of standardization of activities and
            items.--
                        ``(A) In general.--For purposes of carrying out
                    paragraph (1)(B), the Secretary shall solicit, not
                    later than January 1, 2012, and not less than every 3
                    years thereafter, input from entities described in
                    subparagraph (B) on--
                                ``(i) whether there could be greater
                            uniformity in financial and administrative
                            activities and items, as determined appropriate
                            by the Secretary; and
                                ``(ii) whether such activities should be
                            considered financial and administrative
                            transactions (as described in paragraph (1)(B))
                            for which the adoption of standards and
                            operating rules would improve the operation of
                            the health care system and reduce
                            administrative costs.
                        ``(B) Solicitation of input.--For purposes of
                    subparagraph (A), the Secretary shall seek input from--
                                ``(i) the National Committee on Vital and
                            Health Statistics, the Health Information
                            Technology Policy Committee, and the Health
                            Information Technology Standards Committee; and
                                ``(ii) standard setting organizations and
                            stakeholders, as determined appropriate by the
                            Secretary.''.
        (b) Activities and Items for Initial Consideration.--For purposes
    of section 1173(a)(5) of the Social Security Act, as added by
    subsection (a), the Secretary of Health and Human Services (in this
    section referred to as the ``Secretary'') shall, not later than January
    1, 2012, seek input on activities and items relating to the following
    areas:
                (1) Whether the application process, including the use of a
            uniform application form, for enrollment of health care
            providers by health plans could be made electronic and
            standardized.
                (2) Whether standards and operating rules described in
            section 1173 of the Social Security Act should apply to the
            health care transactions of automobile insurance, worker's
            compensation, and other programs or persons not described in
            section 1172(a) of such Act (42 U.S.C. 1320d-1(a)).
                (3) Whether standardized forms could apply to financial
            audits required by health plans, Federal and State agencies
            (including State auditors, the Office of the Inspector General
            of the Department of Health and Human Services, and the Centers
            for Medicare & Medicaid Services), and other relevant entities
            as determined appropriate by the Secretary.
                (4) Whether there could be greater transparency and
            consistency of methodologies and processes used to establish
            claim edits used by health plans (as described in section
            1171(5) of the Social Security Act (42 U.S.C. 1320d(5))).
                (5) Whether health plans should be required to publish
            their timeliness of payment rules.
        (c) ICD Coding Crosswalks.--
                (1) ICD-9 to icd-10 crosswalk.--The Secretary shall task
            the ICD-9-CM Coordination and Maintenance Committee to convene
            a meeting, not later than January 1, 2011, to receive input
            from appropriate stakeholders (including health plans, health
            care providers, and clinicians) regarding the crosswalk between
            the Ninth and Tenth Revisions of the International
            Classification of Diseases (ICD-9 and ICD-10, respectively)
            that is posted on the website of the Centers for Medicare &
            Medicaid Services, and make recommendations about appropriate
            revisions to such crosswalk.
                (2) Revision of crosswalk.--For purposes of the crosswalk
            described in paragraph (1), the Secretary shall make
            appropriate revisions and post any such revised crosswalk on
            the website of the Centers for Medicare & Medicaid Services.
                (3) Use of revised crosswalk.--For purposes of paragraph
            (2), any revised crosswalk shall be treated as a code set for
            which a standard has been adopted by the Secretary for purposes
            of section 1173(c)(1)(B) of the Social Security Act (42 U.S.C.
            1320d-2(c)(1)(B)).
                (4) Subsequent crosswalks.--For subsequent revisions of the
            International Classification of Diseases that are adopted by
            the Secretary as a standard code set under section 1173(c) of
            the Social Security Act (42 U.S.C. 1320d-2(c)), the Secretary
            shall, after consultation with the appropriate stakeholders,
            post on the website of the Centers for Medicare & Medicaid
            Services a crosswalk between the previous and subsequent
            version of the International Classification of Diseases not
            later than the date of implementation of such subsequent
            revision.

                  Subtitle B--Provisions Relating to Title II

                           PART I--MEDICAID AND CHIP

    SEC. 10201. AMENDMENTS TO THE SOCIAL SECURITY ACT AND TITLE II OF THIS
                  ACT.

        (a)(1) Section 1902(a)(10)(A)(i)(IX) of the Social Security Act (42
    U.S.C. 1396a(a)(10)(A)(i)(IX)), as added by section 2004(a), is amended
    to read as follows:
                                        ``(IX) who--
                                                ``(aa) are under 26 years
                                            of age;
                                                ``(bb) are not described in
                                            or enrolled under any of
                                            subclauses (I) through (VII) of
                                            this clause or are described in
                                            any of such subclauses but have
                                            income that exceeds the level
                                            of income applicable under the
                                            State plan for eligibility to
                                            enroll for medical assistance
                                            under such subclause;
                                                ``(cc) were in foster care
                                            under the responsibility of the
                                            State on the date of attaining
                                            18 years of age or such higher
                                            age as the State has elected
                                            under section 475(8)(B)(iii);
                                            and
                                                ``(dd) were enrolled in the
                                            State plan under this title or
                                            under a waiver of the plan
                                            while in such foster care;''.
        (2) Section 1902(a)(10) of the Social Security Act (42 U.S.C.
    1396a(a)(10), as amended by section 2001(a)(5)(A), is amended in the
    matter following subparagraph (G), by striking ``and (XV)'' and
    inserting ``(XV)'', and by inserting ``and (XVI) if an individual is
    described in subclause (IX) of subparagraph (A)(i) and is also
    described in subclause (VIII) of that subparagraph, the medical
    assistance shall be made available to the individual through subclause
    (IX) instead of through subclause (VIII)'' before the semicolon.
        (3) Section 2004(d) of this Act is amended by striking ``2019'' and
    inserting ``2014''.
        (b) Section 1902(k)(2) of the Social Security Act (42 U.S.C.
    1396a(k)(2)), as added by section 2001(a)(4)(A), is amended by striking
    ``January 1, 2011'' and inserting ``April 1, 2010''.
        (c) Section 1905 of the Social Security Act (42 U.S.C. 1396d), as
    amended by sections 2001(a)(3), 2001(a)(5)(C), 2006, and 4107(a)(2), is
    amended--
                (1) in subsection (a), in the matter preceding paragraph
            (1), by inserting in clause (xiv), ``or 1902(a)(10)(A)(i)(IX)''
            before the comma;
                (2) in subsection (b), in the first sentence, by inserting
            ``, (z),'' before ``and (aa)'';
                (3) in subsection (y)--
                        (A) in paragraph (1)(B)(ii)(II), in the first
                    sentence, by inserting ``includes inpatient hospital
                    services,'' after ``100 percent of the poverty line,
                    that''; and
                        (B) in paragraph (2)(A), by striking ``on the date
                    of enactment of the Patient Protection and Affordable
                    Care Act'' and inserting ``as of December 1, 2009'';
                (4) by inserting after subsection (y) the following:
        ``(z) Equitable Support for Certain States.--
                ``(1)(A) During the period that begins on January 1, 2014,
            and ends on September 30, 2019, notwithstanding subsection (b),
            the Federal medical assistance percentage otherwise determined
            under subsection (b) with respect to a fiscal year occurring
            during that period shall be increased by 2.2 percentage points
            for any State described in subparagraph (B) for amounts
            expended for medical assistance for individuals who are not
            newly eligible (as defined in subsection (y)(2)) individuals
            described in subclause (VIII) of section 1902(a)(10)(A)(i).
                ``(B) For purposes of subparagraph (A), a State described
            in this subparagraph is a State that--
                        ``(i) is an expansion State described in subsection
                    (y)(1)(B)(ii)(II);
                        ``(ii) the Secretary determines will not receive
                    any payments under this title on the basis of an
                    increased Federal medical assistance percentage under
                    subsection (y) for expenditures for medical assistance
                    for newly eligible individuals (as so defined); and
                        ``(iii) has not been approved by the Secretary to
                    divert a portion of the DSH allotment for a State to
                    the costs of providing medical assistance or other
                    health benefits coverage under a waiver that is in
                    effect on July 2009.
        ``(2)(A) During the period that begins on January 1, 2014, and ends
    on December 31, 2016, notwithstanding subsection (b), the Federal
    medical assistance percentage otherwise determined under subsection (b)
    with respect to all or any portion of a fiscal year occurring during
    that period shall be increased by .5 percentage point for a State
    described in subparagraph (B) for amounts expended for medical
    assistance under the State plan under this title or under a waiver of
    that plan during that period.
        ``(B) For purposes of subparagraph (A), a State described in this
    subparagraph is a State that--
                ``(i) is described in clauses (i) and (ii) of paragraph
            (1)(B); and
                ``(ii) is the State with the highest percentage of its
            population insured during 2008, based on the Current Population
            Survey.
        ``(3) Notwithstanding subsection (b) and paragraphs (1) and (2) of
    this subsection, the Federal medical assistance percentage otherwise
    determined under subsection (b) with respect to all or any portion of a
    fiscal year that begins on or after January 1, 2017, for the State of
    Nebraska, with respect to amounts expended for newly eligible
    individuals described in subclause (VIII) of section 1902(a)(10)(A)(i),
    shall be determined as provided for under subsection (y)(1)(A)
    (notwithstanding the period provided for in such paragraph).
        ``(4) The increase in the Federal medical assistance percentage for
    a State under paragraphs (1), (2), or (3) shall apply only for purposes
    of this title and shall not apply with respect to--
                ``(A) disproportionate share hospital payments described in
            section 1923;
                ``(B) payments under title IV;
                ``(C) payments under title XXI; and
                ``(D) payments under this title that are based on the
            enhanced FMAP described in section 2105(b).'';
                (5) in subsection (aa), is amended by striking ``without
            regard to this subsection and subsection (y)'' and inserting
            ``without regard to this subsection, subsection (y), subsection
            (z), and section 10202 of the Patient Protection and Affordable
            Care Act'' each place it appears;
                (6) by adding after subsection (bb), the following:
        ``(cc) Requirement for Certain States.--Notwithstanding subsections
    (y), (z), and (aa), in the case of a State that requires political
    subdivisions within the State to contribute toward the non-Federal
    share of expenditures required under the State plan under section
    1902(a)(2), the State shall not be eligible for an increase in its
    Federal medical assistance percentage under such subsections if it
    requires that political subdivisions pay a greater percentage of the
    non-Federal share of such expenditures, or a greater percentage of the
    non-Federal share of payments under section 1923, than the respective
    percentages that would have been required by the State under the State
    plan under this title, State law, or both, as in effect on December 31,
    2009, and without regard to any such increase. Voluntary contributions
    by a political subdivision to the non-Federal share of expenditures
    under the State plan under this title or to the non-Federal share of
    payments under section 1923, shall not be considered to be required
    contributions for purposes of this subsection. The treatment of
    voluntary contributions, and the treatment of contributions required by
    a State under the State plan under this title, or State law, as
    provided by this subsection, shall also apply to the increases in the
    Federal medical assistance percentage under section 5001 of the
    American Recovery and Reinvestment Act of 2009.''.
        (d) Section 1108(g)(4)(B) of the Social Security Act (42 U.S.C.
    1308(g)(4)(B)), as added by section 2005(b), is amended by striking
    ``income eligibility level in effect for that population under title
    XIX or under a waiver'' and inserting ``the highest income eligibility
    level in effect for parents under the commonwealth's or territory's
    State plan under title XIX or under a waiver of the plan''.
        (e)(1) Section 1923(f) of the Social Security Act (42 U.S.C. 1396r-
    4(f)), as amended by section 2551, is amended--
                (A) in paragraph (6)--
                        (i) by striking the paragraph heading and inserting
                    the following: ``Allotment adjustments''; and
                        (ii) in subparagraph (B), by adding at the end the
                    following:
                                ``(iii) Allotment for 2d, 3rd, and 4th
                            quarter of fiscal year 2012, fiscal year 2013,
                            and succeeding fiscal years.--Notwithstanding
                            the table set forth in paragraph (2) or
                            paragraph (7):
                                        ``(I) 2d, 3rd, and 4th quarter of
                                    fiscal year 2012.--The DSH allotment
                                    for Hawaii for the 2d, 3rd, and 4th
                                    quarters of fiscal year 2012 shall be
                                    $7,500,000.
                                        ``(II) Treatment as a low-dsh state
                                    for fiscal year 2013 and succeeding
                                    fiscal years.--With respect to fiscal
                                    year 2013, and each fiscal year
                                    thereafter, the DSH allotment for
                                    Hawaii shall be increased in the same
                                    manner as allotments for low DSH States
                                    are increased for such fiscal year
                                    under clause (iii) of paragraph (5)(B).
                                        ``(III) Certain hospital
                                    payments.--The Secretary may not impose
                                    a limitation on the total amount of
                                    payments made to hospitals under the
                                    QUEST section 1115 Demonstration
                                    Project except to the extent that such
                                    limitation is necessary to ensure that
                                    a hospital does not receive payments in
                                    excess of the amounts described in
                                    subsection (g), or as necessary to
                                    ensure that such payments under the
                                    waiver and such payments pursuant to
                                    the allotment provided in this clause
                                    do not, in the aggregate in any year,
                                    exceed the amount that the Secretary
                                    determines is equal to the Federal
                                    medical assistance percentage component
                                    attributable to disproportionate share
                                    hospital payment adjustments for such
                                    year that is reflected in the budget
                                    neutrality provision of the QUEST
                                    Demonstration Project.''; and
                (B) in paragraph (7)--
                        (i) in subparagraph (A), in the matter preceding
                    clause (i), by striking ``subparagraph (E)'' and
                    inserting ``subparagraphs (E) and (G)'';
                        (ii) in subparagraph (B)--
                                (I) in clause (i), by striking subclauses
                            (I) and (II), and inserting the following:
                                        ``(I) if the State is a low DSH
                                    State described in paragraph (5)(B) and
                                    has spent not more than 99.90 percent
                                    of the DSH allotments for the State on
                                    average for the period of fiscal years
                                    2004 through 2008, as of September 30,
                                    2009, the applicable percentage is
                                    equal to 25 percent;
                                        ``(II) if the State is a low DSH
                                    State described in paragraph (5)(B) and
                                    has spent more than 99.90 percent of
                                    the DSH allotments for the State on
                                    average for the period of fiscal years
                                    2004 through 2008, as of September 30,
                                    2009, the applicable percentage is
                                    equal to 17.5 percent;
                                        ``(III) if the State is not a low
                                    DSH State described in paragraph (5)(B)
                                    and has spent not more than 99.90
                                    percent of the DSH allotments for the
                                    State on average for the period of
                                    fiscal years 2004 through 2008, as of
                                    September 30, 2009, the applicable
                                    percentage is equal to 50 percent; and
                                        ``(IV) if the State is not a low
                                    DSH State described in paragraph (5)(B)
                                    and has spent more than 99.90 percent
                                    of the DSH allotments for the State on
                                    average for the period of fiscal years
                                    2004 through 2008, as of September 30,
                                    2009, the applicable percentage is
                                    equal to 35 percent.'';
                                (II) in clause (ii), by striking subclauses
                            (I) and (II), and inserting the following:
                                        ``(I) if the State is a low DSH
                                    State described in paragraph (5)(B) and
                                    has spent not more than 99.90 percent
                                    of the DSH allotments for the State on
                                    average for the period of fiscal years
                                    2004 through 2008, as of September 30,
                                    2009, the applicable percentage is
                                    equal to the product of the percentage
                                    reduction in uncovered individuals for
                                    the fiscal year from the preceding
                                    fiscal year and 27.5 percent;
                                        ``(II) if the State is a low DSH
                                    State described in paragraph (5)(B) and
                                    has spent more than 99.90 percent of
                                    the DSH allotments for the State on
                                    average for the period of fiscal years
                                    2004 through 2008, as of September 30,
                                    2009, the applicable percentage is
                                    equal to the product of the percentage
                                    reduction in uncovered individuals for
                                    the fiscal year from the preceding
                                    fiscal year and 20 percent;
                                        ``(III) if the State is not a low
                                    DSH State described in paragraph (5)(B)
                                    and has spent not more than 99.90
                                    percent of the DSH allotments for the
                                    State on average for the period of
                                    fiscal years 2004 through 2008, as of
                                    September 30, 2009, the applicable
                                    percentage is equal to the product of
                                    the percentage reduction in uncovered
                                    individuals for the fiscal year from
                                    the preceding fiscal year and 55
                                    percent; and
                                        ``(IV) if the State is not a low
                                    DSH State described in paragraph (5)(B)
                                    and has spent more than 99.90 percent
                                    of the DSH allotments for the State on
                                    average for the period of fiscal years
                                    2004 through 2008, as of September 30,
                                    2009, the applicable percentage is
                                    equal to the product of the percentage
                                    reduction in uncovered individuals for
                                    the fiscal year from the preceding
                                    fiscal year and 40 percent.'';
                                (III) in subparagraph (E), by striking ``35
                            percent'' and inserting ``50 percent''; and
                                (IV) by adding at the end the following:
                        ``(G) Nonapplication.--The preceding provisions of
                    this paragraph shall not apply to the DSH allotment
                    determined for the State of Hawaii for a fiscal year
                    under paragraph (6).''.
        (f) Section 2551 of this Act is amended by striking subsection (b).
        (g) Section 2105(d)(3)(B) of the Social Security Act (42 U.S.C.
    1397ee(d)(3)(B)), as added by section 2101(b)(1), is amended by adding
    at the end the following: ``For purposes of eligibility for premium
    assistance for the purchase of a qualified health plan under section
    36B of the Internal Revenue Code of 1986 and reduced cost-sharing under
    section 1402 of the Patient Protection and Affordable Care Act,
    children described in the preceding sentence shall be deemed to be
    ineligible for coverage under the State child health plan.''.
        (h) Clause (i) of subparagraph (C) of section 513(b)(2) of the
    Social Security Act, as added by section 2953 of this Act, is amended
    to read as follows:
                                ``(i) Healthy relationships, including
                            marriage and family interactions.''.
        (i) Section 1115 of the Social Security Act (42 U.S.C. 1315) is
    amended by inserting after subsection (c) the following:
        ``(d)(1) An application or renewal of any experimental, pilot, or
    demonstration project undertaken under subsection (a) to promote the
    objectives of title XIX or XXI in a State that would result in an
    impact on eligibility, enrollment, benefits, cost-sharing, or financing
    with respect to a State program under title XIX or XXI (in this
    subsection referred to as a `demonstration project') shall be
    considered by the Secretary in accordance with the regulations required
    to be promulgated under paragraph (2).
        ``(2) Not later than 180 days after the date of enactment of this
    subsection, the Secretary shall promulgate regulations relating to
    applications for, and renewals of, a demonstration project that provide
    for--
                ``(A) a process for public notice and comment at the State
            level, including public hearings, sufficient to ensure a
            meaningful level of public input;
                ``(B) requirements relating to--
                        ``(i) the goals of the program to be implemented or
                    renewed under the demonstration project;
                        ``(ii) the expected State and Federal costs and
                    coverage projections of the demonstration project; and
                        ``(iii) the specific plans of the State to ensure
                    that the demonstration project will be in compliance
                    with title XIX or XXI;
                ``(C) a process for providing public notice and comment
            after the application is received by the Secretary, that is
            sufficient to ensure a meaningful level of public input;
                ``(D) a process for the submission to the Secretary of
            periodic reports by the State concerning the implementation of
            the demonstration project; and
                ``(E) a process for the periodic evaluation by the
            Secretary of the demonstration project.
        ``(3) The Secretary shall annually report to Congress concerning
    actions taken by the Secretary with respect to applications for
    demonstration projects under this section.''.
        (j) Subtitle F of title III of this Act is amended by adding at the
    end the following:

    ``SEC. 3512. GAO STUDY AND REPORT ON CAUSES OF ACTION.

        ``(a) Study.--
                ``(1) In general.--The Comptroller General of the United
            States shall conduct a study of whether the development,
            recognition, or implementation of any guideline or other
            standards under a provision described in paragraph (2) would
            result in the establishment of a new cause of action or claim.
                ``(2) Provisions described.--The provisions described in
            this paragraph include the following:
                        ``(A) Section 2701 (adult health quality measures).
                        ``(B) Section 2702 (payment adjustments for health
                    care acquired conditions).
                        ``(C) Section 3001 (Hospital Value-Based Purchase
                    Program).
                        ``(D) Section 3002 (improvements to the Physician
                    Quality Reporting Initiative).
                        ``(E) Section 3003 (improvements to the Physician
                    Feedback Program).
                        ``(F) Section 3007 (value based payment modifier
                    under physician fee schedule).
                        ``(G) Section 3008 (payment adjustment for
                    conditions acquired in hospitals).
                        ``(H) Section 3013 (quality measure development).
                        ``(I) Section 3014 (quality measurement).
                        ``(J) Section 3021 (Establishment of Center for
                    Medicare and Medicaid Innovation).
                        ``(K) Section 3025 (hospital readmission reduction
                    program).
                        ``(L) Section 3501 (health care delivery system
                    research, quality improvement).
                        ``(M) Section 4003 (Task Force on Clinical and
                    Preventive Services).
                        ``(N) Section 4301 (research to optimize deliver of
                    public health services).
        ``(b) Report.--Not later than 2 years after the date of enactment
    of this Act, the Comptroller General of the United States shall submit
    to the appropriate committees of Congress, a report containing the
    findings made by the Comptroller General under the study under
    subsection (a).''.

    SEC. 10202. INCENTIVES FOR STATES TO OFFER HOME AND COMMUNITY-BASED
                  SERVICES AS A LONG-TERM CARE ALTERNATIVE TO NURSING
                  HOMES.

        (a) State Balancing Incentive Payments Program.--Notwithstanding
    section 1905(b) of the Social Security Act (42 U.S.C. 1396d(b)), in the
    case of a balancing incentive payment State, as defined in subsection
    (b), that meets the conditions described in subsection (c), during the
    balancing incentive period, the Federal medical assistance percentage
    determined for the State under section 1905(b) of such Act and, if
    applicable, increased under subsection (z) or (aa) shall be increased
    by the applicable percentage points determined under subsection (d)
    with respect to eligible medical assistance expenditures described in
    subsection (e).
        (b) Balancing Incentive Payment State.--A balancing incentive
    payment State is a State--
                (1) in which less than 50 percent of the total expenditures
            for medical assistance under the State Medicaid program for a
            fiscal year for long-term services and supports (as defined by
            the Secretary under subsection (f))(1)) are for non-
            institutionally-based long-term services and supports described
            in subsection (f)(1)(B);
                (2) that submits an application and meets the conditions
            described in subsection (c); and
                (3) that is selected by the Secretary to participate in the
            State balancing incentive payment program established under
            this section.
        (c) Conditions.--The conditions described in this subsection are
    the following:
                (1) Application.--The State submits an application to the
            Secretary that includes, in addition to such other information
            as the Secretary shall require--
                        (A) a proposed budget that details the State's plan
                    to expand and diversify medical assistance for non-
                    institutionally-based long-term services and supports
                    described in subsection (f)(1)(B) under the State
                    Medicaid program during the balancing incentive period
                    and achieve the target spending percentage applicable
                    to the State under paragraph (2), including through
                    structural changes to how the State furnishes such
                    assistance, such as through the establishment of a ``no
                    wrong door--single entry point system'', optional
                    presumptive eligibility, case management services, and
                    the use of core standardized assessment instruments,
                    and that includes a description of the new or expanded
                    offerings of such services that the State will provide
                    and the projected costs of such services; and
                        (B) in the case of a State that proposes to expand
                    the provision of home and community-based services
                    under its State Medicaid program through a State plan
                    amendment under section 1915(i) of the Social Security
                    Act, at the option of the State, an election to
                    increase the income eligibility for such services from
                    150 percent of the poverty line to such higher
                    percentage as the State may establish for such purpose,
                    not to exceed 300 percent of the supplemental security
                    income benefit rate established by section 1611(b)(1)
                    of the Social Security Act (42 U.S.C. 1382(b)(1)).
                (2) Target spending percentages.--
                        (A) In the case of a balancing incentive payment
                    State in which less than 25 percent of the total
                    expenditures for long-term services and supports under
                    the State Medicaid program for fiscal year 2009 are for
                    home and community-based services, the target spending
                    percentage for the State to achieve by not later than
                    October 1, 2015, is that 25 percent of the total
                    expenditures for long-term services and supports under
                    the State Medicaid program are for home and community-
                    based services.
                        (B) In the case of any other balancing incentive
                    payment State, the target spending percentage for the
                    State to achieve by not later than October 1, 2015, is
                    that 50 percent of the total expenditures for long-term
                    services and supports under the State Medicaid program
                    are for home and community-based services.
                (3) Maintenance of eligibility requirements.--The State
            does not apply eligibility standards, methodologies, or
            procedures for determining eligibility for medical assistance
            for non-institutionally-based long-term services and supports
            described in subsection (f)(1)(B) under the State Medicaid
            program that are more restrictive than the eligibility
            standards, methodologies, or procedures in effect for such
            purposes on December 31, 2010.
                (4) Use of additional funds.--The State agrees to use the
            additional Federal funds paid to the State as a result of this
            section only for purposes of providing new or expanded
            offerings of non-institutionally-based long-term services and
            supports described in subsection (f)(1)(B) under the State
            Medicaid program.
                (5) Structural changes.--The State agrees to make, not
            later than the end of the 6-month period that begins on the
            date the State submits an application under this section, the
            following changes:
                        (A) ``No wrong door--single entry point system''.--
                    Development of a statewide system to enable consumers
                    to access all long-term services and supports through
                    an agency, organization, coordinated network, or
                    portal, in accordance with such standards as the State
                    shall establish and that shall provide information
                    regarding the availability of such services, how to
                    apply for such services, referral services for services
                    and supports otherwise available in the community, and
                    determinations of financial and functional eligibility
                    for such services and supports, or assistance with
                    assessment processes for financial and functional
                    eligibility.
                        (B) Conflict-free case management services.--
                    Conflict-free case management services to develop a
                    service plan, arrange for services and supports,
                    support the beneficiary (and, if appropriate, the
                    beneficiary's caregivers) in directing the provision of
                    services and supports for the beneficiary, and conduct
                    ongoing monitoring to assure that services and supports
                    are delivered to meet the beneficiary's needs and
                    achieve intended outcomes.
                        (C) Core standardized assessment instruments.--
                    Development of core standardized assessment instruments
                    for determining eligibility for non-institutionally-
                    based long-term services and supports described in
                    subsection (f)(1)(B), which shall be used in a uniform
                    manner throughout the State, to determine a
                    beneficiary's needs for training, support services,
                    medical care, transportation, and other services, and
                    develop an individual service plan to address such
                    needs.
                (6) Data collection.--The State agrees to collect from
            providers of services and through such other means as the State
            determines appropriate the following data:
                        (A) Services data.--Services data from providers of
                    non-institutionally-based long-term services and
                    supports described in subsection (f)(1)(B) on a per-
                    beneficiary basis and in accordance with such
                    standardized coding procedures as the State shall
                    establish in consultation with the Secretary.
                        (B) Quality data.--Quality data on a selected set
                    of core quality measures agreed upon by the Secretary
                    and the State that are linked to population-specific
                    outcomes measures and accessible to providers.
                        (C) Outcomes measures.--Outcomes measures data on a
                    selected set of core population-specific outcomes
                    measures agreed upon by the Secretary and the State
                    that are accessible to providers and include--
                                (i) measures of beneficiary and family
                            caregiver experience with providers;
                                (ii) measures of beneficiary and family
                            caregiver satisfaction with services; and
                                (iii) measures for achieving desired
                            outcomes appropriate to a specific beneficiary,
                            including employment, participation in
                            community life, health stability, and
                            prevention of loss in function.
        (d) Applicable Percentage Points Increase in FMAP.--The applicable
    percentage points increase is--
                (1) in the case of a balancing incentive payment State
            subject to the target spending percentage described in
            subsection (c)(2)(A), 5 percentage points; and
                (2) in the case of any other balancing incentive payment
            State, 2 percentage points.
        (e) Eligible Medical Assistance Expenditures.--
                (1) In general.--Subject to paragraph (2), medical
            assistance described in this subsection is medical assistance
            for non-institutionally-based long-term services and supports
            described in subsection (f)(1)(B) that is provided by a
            balancing incentive payment State under its State Medicaid
            program during the balancing incentive payment period.
                (2) Limitation on payments.--In no case may the aggregate
            amount of payments made by the Secretary to balancing incentive
            payment States under this section during the balancing
            incentive period exceed $3,000,000,000.
        (f) Definitions.--In this section:
                (1) Long-term services and supports defined.--The term
            ``long-term services and supports'' has the meaning given that
            term by Secretary and may include any of the following (as
            defined for purposes of State Medicaid programs):
                        (A) Institutionally-based long-term services and
                    supports.--Services provided in an institution,
                    including the following:
                                (i) Nursing facility services.
                                (ii) Services in an intermediate care
                            facility for the mentally retarded described in
                            subsection (a)(15) of section 1905 of such Act.
                        (B) Non-institutionally-based long-term services
                    and supports.--Services not provided in an institution,
                    including the following:
                                (i) Home and community-based services
                            provided under subsection (c), (d), or (i) of
                            section 1915 of such Act or under a waiver
                            under section 1115 of such Act.
                                (ii) Home health care services.
                                (iii) Personal care services.
                                (iv) Services described in subsection
                            (a)(26) of section 1905 of such Act (relating
                            to PACE program services).
                                (v) Self-directed personal assistance
                            services described in section 1915(j) of such
                            Act.
                (2) Balancing incentive period.--The term ``balancing
            incentive period'' means the period that begins on October 1,
            2011, and ends on September 30, 2015.
                (3) Poverty line.--The term ``poverty line'' has the
            meaning given that term in section 2110(c)(5) of the Social
            Security Act (42 U.S.C. 1397jj(c)(5)).
                (4) State medicaid program.--The term ``State Medicaid
            program'' means the State program for medical assistance
            provided under a State plan under title XIX of the Social
            Security Act and under any waiver approved with respect to such
            State plan.

    SEC. 10203. EXTENSION OF FUNDING FOR CHIP THROUGH FISCAL YEAR 2015 AND
                  OTHER CHIP-RELATED PROVISIONS.

        (a) Section 1311(c)(1) of this Act is amended by striking ``and''
    at the end of subparagraph (G), by striking the period at the end of
    subparagraph (H) and inserting ``; and'', and by adding at the end the
    following:
                        ``(I) report to the Secretary at least annually and
                    in such manner as the Secretary shall require,
                    pediatric quality reporting measures consistent with
                    the pediatric quality reporting measures established
                    under section 1139A of the Social Security Act.''.
        (b) Effective as if included in the enactment of the Children's
    Health Insurance Program Reauthorization Act of 2009 (Public Law 111-
    3):
                (1) Section 1906(e)(2) of the Social Security Act (42
            U.S.C. 1396e(e)(2)) is amended by striking ``means'' and all
            that follows through the period and inserting ``has the meaning
            given that term in section 2105(c)(3)(A).''.
                (2)(A) Section 1906A(a) of the Social Security Act (42
            U.S.C. 1396e-1(a)), is amended by inserting before the period
            the following: ``and the offering of such a subsidy is cost-
            effective, as defined for purposes of section 2105(c)(3)(A)''.
                (B) This Act shall be applied without regard to
            subparagraph (A) of section 2003(a)(1) of this Act and that
            subparagraph and the amendment made by that subparagraph are
            hereby deemed null, void, and of no effect.
                (3) Section 2105(c)(10) of the Social Security Act (42
            U.S.C. 1397ee(c)(10)) is amended--
                        (A) in subparagraph (A), in the first sentence, by
                    inserting before the period the following: ``if the
                    offering of such a subsidy is cost-effective, as
                    defined for purposes of paragraph (3)(A)'';
                        (B) by striking subparagraph (M); and
                        (C) by redesignating subparagraph (N) as
                    subparagraph (M).
                (4) Section 2105(c)(3)(A) of the Social Security Act (42
            U.S.C. 1397ee(c)(3)(A)) is amended--
                        (A) in the matter preceding clause (i), by striking
                    ``to'' and inserting ``to--''; and
                        (B) in clause (ii), by striking the period and
                    inserting a semicolon.
        (c) Section 2105 of the Social Security Act (42 U.S.C. 1397ee), as
    amended by section 2101, is amended--
                (1) in subsection (b), in the second sentence, by striking
            ``2013'' and inserting ``2015''; and
                (2) in subsection (d)(3)--
                        (A) in subparagraph (A)--
                                (i) in the first sentence, by inserting
                            ``as a condition of receiving payments under
                            section 1903(a),'' after ``2019,'';
                                (ii) in clause (i), by striking ``or'' at
                            the end;
                                (iii) by redesignating clause (ii) as
                            clause (iii); and
                                (iv) by inserting after clause (i), the
                            following:
                                ``(ii) after September 30, 2015, enrolling
                            children eligible to be targeted low-income
                            children under the State child health plan in a
                            qualified health plan that has been certified
                            by the Secretary under subparagraph (C); or'';
                        (B) in subparagraph (B), by striking ``provided
                    coverage'' and inserting ``screened for eligibility for
                    medical assistance under the State plan under title XIX
                    or a waiver of that plan and, if found eligible,
                    enrolled in such plan or a waiver. In the case of such
                    children who, as a result of such screening, are
                    determined to not be eligible for medical assistance
                    under the State plan or a waiver under title XIX, the
                    State shall establish procedures to ensure that the
                    children are enrolled in a qualified health plan that
                    has been certified by the Secretary under subparagraph
                    (C) and is offered''; and
                        (C) by adding at the end the following:
                        ``(C) Certification of comparability of pediatric
                    coverage offered by qualified health plans.--With
                    respect to each State, the Secretary, not later than
                    April 1, 2015, shall review the benefits offered for
                    children and the cost-sharing imposed with respect to
                    such benefits by qualified health plans offered through
                    an Exchange established by the State under section 1311
                    of the Patient Protection and Affordable Care Act and
                    shall certify those plans that offer benefits for
                    children and impose cost-sharing with respect to such
                    benefits that the Secretary determines are at least
                    comparable to the benefits offered and cost-sharing
                    protections provided under the State child health
                    plan.''.
        (d)(1) Section 2104(a) of such Act (42 U.S.C. 1397dd(a)) is
    amended--
                (A) in paragraph (15), by striking ``and'' at the end; and
                (B) by striking paragraph (16) and inserting the following:
                ``(16) for fiscal year 2013, $17,406,000,000;
                ``(17) for fiscal year 2014, $19,147,000,000; and
                ``(18) for fiscal year 2015, for purposes of making 2 semi-
            annual allotments--
                        ``(A) $2,850,000,000 for the period beginning on
                    October 1, 2014, and ending on March 31, 2015, and
                        ``(B) $2,850,000,000 for the period beginning on
                    April 1, 2015, and ending on September 30, 2015.''.
        (2)(A) Section 2104(m) of such Act (42 U.S.C. 1397dd(m)), as
    amended by section 2102(a)(1), is amended--
                (i) in the subsection heading, by striking ``2013'' and
            inserting ``2015'';
                (ii) in paragraph (2)--
                        (I) in the paragraph heading, by striking ``2012''
                    and inserting ``2014''; and
                        (II) by adding at the end the following:
                        ``(B) Fiscal years 2013 and 2014.--Subject to
                    paragraphs (4) and (6), from the amount made available
                    under paragraphs (16) and (17) of subsection (a) for
                    fiscal years 2013 and 2014, respectively, the Secretary
                    shall compute a State allotment for each State
                    (including the District of Columbia and each
                    commonwealth and territory) for each such fiscal year
                    as follows:
                                ``(i) Rebasing in fiscal year 2013.--For
                            fiscal year 2013, the allotment of the State is
                            equal to the Federal payments to the State that
                            are attributable to (and countable towards) the
                            total amount of allotments available under this
                            section to the State in fiscal year 2012
                            (including payments made to the State under
                            subsection (n) for fiscal year 2012 as well as
                            amounts redistributed to the State in fiscal
                            year 2012), multiplied by the allotment
                            increase factor under paragraph (5) for fiscal
                            year 2013.
                                ``(ii) Growth factor update for fiscal year
                            2014.--For fiscal year 2014, the allotment of
                            the State is equal to the sum of--
                                        ``(I) the amount of the State
                                    allotment under clause (i) for fiscal
                                    year 2013; and
                                        ``(II) the amount of any payments
                                    made to the State under subsection (n)
                                    for fiscal year 2013,
                            multiplied by the allotment increase factor
                            under paragraph (5) for fiscal year 2014.'';
                        (iii) in paragraph (3)--
                                (I) in the paragraph heading, by striking
                            ``2013'' and inserting ``2015'';
                                (II) in subparagraphs (A) and (B), by
                            striking ``paragraph (16)'' each place it
                            appears and inserting ``paragraph (18)'';
                                (III) in subparagraph (C)--
                                        (aa) by striking ``2012'' each
                                    place it appears and inserting
                                    ``2014''; and
                                        (bb) by striking ``2013'' and
                                    inserting ``2015''; and
                                (IV) in subparagraph (D)--
                                        (aa) in clause (i)(I), by striking
                                    ``subsection (a)(16)(A)'' and inserting
                                    ``subsection (a)(18)(A)''; and
                                        (bb) in clause (ii)(II), by
                                    striking ``subsection (a)(16)(B)'' and
                                    inserting ``subsection (a)(18)(B)'';
                        (iv) in paragraph (4), by striking ``2013'' and
                    inserting ``2015'';
                        (v) in paragraph (6)--
                                (I) in subparagraph (A), by striking
                            ``2013'' and inserting ``2015''; and
                                (II) in the flush language after and below
                            subparagraph (B)(ii), by striking ``or fiscal
                            year 2012'' and inserting ``, fiscal year 2012,
                            or fiscal year 2014''; and
                        (vi) in paragraph (8)--
                                (I) in the paragraph heading, by striking
                            ``2013'' and inserting ``2015''; and
                                (II) by striking ``2013'' and inserting
                            ``2015''.
        (B) Section 2104(n) of such Act (42 U.S.C. 1397dd(n)) is amended--
                (i) in paragraph (2)--
                        (I) in subparagraph (A)(ii)--
                                (aa) by striking ``2012'' and inserting
                            ``2014''; and
                                (bb) by striking ``2013'' and inserting
                            ``2015'';
                        (II) in subparagraph (B)--
                                (aa) by striking ``2012'' and inserting
                            ``2014''; and
                                (bb) by striking ``2013'' and inserting
                            ``2015''; and
                (ii) in paragraph (3)(A), by striking ``or a semi-annual
            allotment period for fiscal year 2013'' and inserting ``fiscal
            year 2013, fiscal year 2014, or a semi-annual allotment period
            for fiscal year 2015''.
        (C) Section 2105(g)(4) of such Act (42 U.S.C. 1397ee(g)(4)) is
    amended--
                (i) in the paragraph heading, by striking ``2013'' and
            inserting ``2015''; and
                (ii) in subparagraph (A), by striking ``2013'' and
            inserting ``2015''.
        (D) Section 2110(b) of such Act (42 U.S.C. 1397jj(b)) is amended--
                (i) in paragraph (2)(B), by inserting ``except as provided
            in paragraph (6),'' before ``a child''; and
                (ii) by adding at the end the following new paragraph:
                ``(6) Exceptions to exclusion of children of employees of a
            public agency in the state.--
                        ``(A) In general.--A child shall not be considered
                    to be described in paragraph (2)(B) if--
                                ``(i) the public agency that employs a
                            member of the child's family to which such
                            paragraph applies satisfies subparagraph (B);
                            or
                                ``(ii) subparagraph (C) applies to such
                            child.
                        ``(B) Maintenance of effort with respect to per
                    person agency contribution for family coverage.--For
                    purposes of subparagraph (A)(i), a public agency
                    satisfies this subparagraph if the amount of annual
                    agency expenditures made on behalf of each employee
                    enrolled in health coverage paid for by the agency that
                    includes dependent coverage for the most recent State
                    fiscal year is not less than the amount of such
                    expenditures made by the agency for the 1997 State
                    fiscal year, increased by the percentage increase in
                    the medical care expenditure category of the Consumer
                    Price Index for All-Urban Consumers (all items: U.S.
                    City Average) for such preceding fiscal year.
                        ``(C) Hardship exception.--For purposes of
                    subparagraph (A)(ii), this subparagraph applies to a
                    child if the State determines, on a case-by-case basis,
                    that the annual aggregate amount of premiums and cost-
                    sharing imposed for coverage of the family of the child
                    would exceed 5 percent of such family's income for the
                    year involved.''.
        (E) Section 2113 of such Act (42 U.S.C. 1397mm) is amended--
                (i) in subsection (a)(1), by striking ``2013'' and
            inserting ``2015''; and
                (ii) in subsection (g), by striking ``$100,000,000 for the
            period of fiscal years 2009 through 2013'' and inserting
            ``$140,000,000 for the period of fiscal years 2009 through
            2015''.
        (F) Section 108 of Public Law 111-3 is amended by striking
    ``$11,706,000,000'' and all that follows through the second sentence
    and inserting ``$15,361,000,000 to accompany the allotment made for the
    period beginning on October 1, 2014, and ending on March 31, 2015,
    under section 2104(a)(18)(A) of the Social Security Act (42 U.S.C.
    1397dd(a)(18)(A)), to remain available until expended. Such amount
    shall be used to provide allotments to States under paragraph (3) of
    section 2104(m) of the Social Security Act (42 U.S.C. 1397dd(m)) for
    the first 6 months of fiscal year 2015 in the same manner as allotments
    are provided under subsection (a)(18)(A) of such section 2104 and
    subject to the same terms and conditions as apply to the allotments
    provided from such subsection (a)(18)(A).''.

          PART II--SUPPORT FOR PREGNANT AND PARENTING TEENS AND WOMEN

    SEC. 10211. DEFINITIONS.

        In this part:
                (1) Accompaniment.--The term ``accompaniment'' means
            assisting, representing, and accompanying a woman in seeking
            judicial relief for child support, child custody, restraining
            orders, and restitution for harm to persons and property, and
            in filing criminal charges, and may include the payment of
            court costs and reasonable attorney and witness fees associated
            therewith.
                (2) Eligible institution of higher education.--The term
            ``eligible institution of higher education'' means an
            institution of higher education (as such term is defined in
            section 101 of the Higher Education Act of 1965 (20 U.S.C.
            1001)) that has established and operates, or agrees to
            establish and operate upon the receipt of a grant under this
            part, a pregnant and parenting student services office.
                (3) Community service center.--The term ``community service
            center'' means a non-profit organization that provides social
            services to residents of a specific geographical area via
            direct service or by contract with a local governmental agency.
                (4) High school.--The term ``high school'' means any public
            or private school that operates grades 10 through 12,
            inclusive, grades 9 through 12, inclusive or grades 7 through
            12, inclusive.
                (5) Intervention services.--The term ``intervention
            services'' means, with respect to domestic violence, sexual
            violence, sexual assault, or stalking, 24-hour telephone
            hotline services for police protection and referral to
            shelters.
                (6) Secretary.--The term ``Secretary'' means the Secretary
            of Health and Human Services.
                (7) State.--The term ``State'' includes the District of
            Columbia, any commonwealth, possession, or other territory of
            the United States, and any Indian tribe or reservation.
                (8) Supportive social services.--The term ``supportive
            social services'' means transitional and permanent housing,
            vocational counseling, and individual and group counseling
            aimed at preventing domestic violence, sexual violence, sexual
            assault, or stalking.
                (9) Violence.--The term ``violence'' means actual violence
            and the risk or threat of violence.

    SEC. 10212. ESTABLISHMENT OF PREGNANCY ASSISTANCE FUND.

        (a) In General.--The Secretary, in collaboration and coordination
    with the Secretary of Education (as appropriate), shall establish a
    Pregnancy Assistance Fund to be administered by the Secretary, for the
    purpose of awarding competitive grants to States to assist pregnant and
    parenting teens and women.
        (b) Use of Fund.--A State may apply for a grant under subsection
    (a) to carry out any activities provided for in section 10213.
        (c) Applications.--To be eligible to receive a grant under
    subsection (a), a State shall submit to the Secretary an application at
    such time, in such manner, and containing such information as the
    Secretary may require, including a description of the purposes for
    which the grant is being requested and the designation of a State
    agency for receipt and administration of funding received under this
    part.

    SEC. 10213. PERMISSIBLE USES OF FUND.

        (a) In General.--A State shall use amounts received under a grant
    under section 10212 for the purposes described in this section to
    assist pregnant and parenting teens and women.
        (b) Institutions of Higher Education.--
                (1) In general.--A State may use amounts received under a
            grant under section 10212 to make funding available to eligible
            institutions of higher education to enable the eligible
            institutions to establish, maintain, or operate pregnant and
            parenting student services. Such funding shall be used to
            supplement, not supplant, existing funding for such services.
                (2) Application.--An eligible institution of higher
            education that desires to receive funding under this subsection
            shall submit an application to the designated State agency at
            such time, in such manner, and containing such information as
            the State agency may require.
                (3) Matching requirement.--An eligible institution of
            higher education that receives funding under this subsection
            shall contribute to the conduct of the pregnant and parenting
            student services office supported by the funding an amount from
            non-Federal funds equal to 25 percent of the amount of the
            funding provided. The non-Federal share may be in cash or in-
            kind, fairly evaluated, including services, facilities,
            supplies, or equipment.
                (4) Use of funds for assisting pregnant and parenting
            college students.--An eligible institution of higher education
            that receives funding under this subsection shall use such
            funds to establish, maintain or operate pregnant and parenting
            student services and may use such funding for the following
            programs and activities:
                        (A) Conduct a needs assessment on campus and within
                    the local community--
                                (i) to assess pregnancy and parenting
                            resources, located on the campus or within the
                            local community, that are available to meet the
                            needs described in subparagraph (B); and
                                (ii) to set goals for--
                                        (I) improving such resources for
                                    pregnant, parenting, and prospective
                                    parenting students; and
                                        (II) improving access to such
                                    resources.
                        (B) Annually assess the performance of the eligible
                    institution in meeting the following needs of students
                    enrolled in the eligible institution who are pregnant
                    or are parents:
                                (i) The inclusion of maternity coverage and
                            the availability of riders for additional
                            family members in student health care.
                                (ii) Family housing.
                                (iii) Child care.
                                (iv) Flexible or alternative academic
                            scheduling, such as telecommuting programs, to
                            enable pregnant or parenting students to
                            continue their education or stay in school.
                                (v) Education to improve parenting skills
                            for mothers and fathers and to strengthen
                            marriages.
                                (vi) Maternity and baby clothing, baby food
                            (including formula), baby furniture, and
                            similar items to assist parents and prospective
                            parents in meeting the material needs of their
                            children.
                                (vii) Post-partum counseling.
                        (C) Identify public and private service providers,
                    located on the campus of the eligible institution or
                    within the local community, that are qualified to meet
                    the needs described in subparagraph (B), and
                    establishes programs with qualified providers to meet
                    such needs.
                        (D) Assist pregnant and parenting students, fathers
                    or spouses in locating and obtaining services that meet
                    the needs described in subparagraph (B).
                        (E) If appropriate, provide referrals for prenatal
                    care and delivery, infant or foster care, or adoption,
                    to a student who requests such information. An office
                    shall make such referrals only to service providers
                    that serve the following types of individuals:
                                (i) Parents.
                                (ii) Prospective parents awaiting adoption.
                                (iii) Women who are pregnant and plan on
                            parenting or placing the child for adoption.
                                (iv) Parenting or prospective parenting
                            couples.
                (5) Reporting.--
                        (A) Annual report by institutions.--
                                (i) In general.--For each fiscal year that
                            an eligible institution of higher education
                            receives funds under this subsection, the
                            eligible institution shall prepare and submit
                            to the State, by the date determined by the
                            State, a report that--
                                        (I) itemizes the pregnant and
                                    parenting student services office's
                                    expenditures for the fiscal year;
                                        (II) contains a review and
                                    evaluation of the performance of the
                                    office in fulfilling the requirements
                                    of this section, using the specific
                                    performance criteria or standards
                                    established under subparagraph (B)(i);
                                    and
                                        (III) describes the achievement of
                                    the office in meeting the needs listed
                                    in paragraph (4)(B) of the students
                                    served by the eligible institution, and
                                    the frequency of use of the office by
                                    such students.
                                (ii) Performance criteria.--Not later than
                            180 days before the date the annual report
                            described in clause (i) is submitted, the
                            State--
                                        (I) shall identify the specific
                                    performance criteria or standards that
                                    shall be used to prepare the report;
                                    and
                                        (II) may establish the form or
                                    format of the report.
                        (B) Report by state.--The State shall annually
                    prepare and submit a report on the findings under this
                    subsection, including the number of eligible
                    institutions of higher education that were awarded
                    funds and the number of students served by each
                    pregnant and parenting student services office
                    receiving funds under this section, to the Secretary.
        (c) Support for Pregnant and Parenting Teens.--A State may use
    amounts received under a grant under section 10212 to make funding
    available to eligible high schools and community service centers to
    establish, maintain or operate pregnant and parenting services in the
    same general manner and in accordance with all conditions and
    requirements described in subsection (b), except that paragraph (3) of
    such subsection shall not apply for purposes of this subsection.
        (d) Improving Services for Pregnant Women Who Are Victims of
    Domestic Violence, Sexual Violence, Sexual Assault, and Stalking.--
                (1) In general.--A State may use amounts received under a
            grant under section 10212 to make funding available tp its
            State Attorney General to assist Statewide offices in
            providing--
                        (A) intervention services, accompaniment, and
                    supportive social services for eligible pregnant women
                    who are victims of domestic violence, sexual violence,
                    sexual assault, or stalking.
                        (B) technical assistance and training (as described
                    in subsection (c)) relating to violence against
                    eligible pregnant women to be made available to the
                    following:
                                (i) Federal, State, tribal, territorial,
                            and local governments, law enforcement
                            agencies, and courts.
                                (ii) Professionals working in legal, social
                            service, and health care settings.
                                (iii) Nonprofit organizations.
                                (iv) Faith-based organizations.
                (2) Eligibility.--To be eligible for a grant under
            paragraph (1), a State Attorney General shall submit an
            application to the designated State agency at such time, in
            such manner, and containing such information, as specified by
            the State.
                (3) Technical assistance and training described.--For
            purposes of paragraph (1)(B), technical assistance and training
            is--
                        (A) the identification of eligible pregnant women
                    experiencing domestic violence, sexual violence, sexual
                    assault, or stalking;
                        (B) the assessment of the immediate and short-term
                    safety of such a pregnant woman, the evaluation of the
                    impact of the violence or stalking on the pregnant
                    woman's health, and the assistance of the pregnant
                    woman in developing a plan aimed at preventing further
                    domestic violence, sexual violence, sexual assault, or
                    stalking, as appropriate;
                        (C) the maintenance of complete medical or forensic
                    records that include the documentation of any
                    examination, treatment given, and referrals made,
                    recording the location and nature of the pregnant
                    woman's injuries, and the establishment of mechanisms
                    to ensure the privacy and confidentiality of those
                    medical records; and
                        (D) the identification and referral of the pregnant
                    woman to appropriate public and private nonprofit
                    entities that provide intervention services,
                    accompaniment, and supportive social services.
                (4) Eligible pregnant woman.--In this subsection, the term
            ``eligible pregnant woman'' means any woman who is pregnant on
            the date on which such woman becomes a victim of domestic
            violence, sexual violence, sexual assault, or stalking or who
            was pregnant during the one-year period before such date.
        (e) Public Awareness and Education.--A State may use amounts
    received under a grant under section 10212 to make funding available to
    increase public awareness and education concerning any services
    available to pregnant and parenting teens and women under this part, or
    any other resources available to pregnant and parenting women in
    keeping with the intent and purposes of this part. The State shall be
    responsible for setting guidelines or limits as to how much of funding
    may be utilized for public awareness and education in any funding
    award.

    SEC. 10214. APPROPRIATIONS.

        There is authorized to be appropriated, and there are appropriated,
    $25,000,000 for each of fiscal years 2010 through 2019, to carry out
    this part.

                    PART III--INDIAN HEALTH CARE IMPROVEMENT

    SEC. 10221. INDIAN HEALTH CARE IMPROVEMENT.

        (a) In General.--Except as provided in subsection (b), S. 1790
    entitled ``A bill to amend the Indian Health Care Improvement Act to
    revise and extend that Act, and for other purposes.'', as reported by
    the Committee on Indian Affairs of the Senate in December 2009, is
    enacted into law.
        (b) Amendments.--
                (1) Section 119 of the Indian Health Care Improvement Act
            (as amended by section 111 of the bill referred to in
            subsection (a)) is amended--
                        (A) in subsection (d)--
                                (i) in paragraph (2), by striking ``In
                            establishing'' and inserting ``Subject to
                            paragraphs (3) and (4), in establishing''; and
                                (ii) by adding at the end the following:
                ``(3) Election of indian tribe or tribal organization.--
                        ``(A) In general.--Subparagraph (B) of paragraph
                    (2) shall not apply in the case of an election made by
                    an Indian tribe or tribal organization located in a
                    State (other than Alaska) in which the use of dental
                    health aide therapist services or midlevel dental
                    health provider services is authorized under State law
                    to supply such services in accordance with State law.
                        ``(B) Action by secretary.--On an election by an
                    Indian tribe or tribal organization under subparagraph
                    (A), the Secretary, acting through the Service, shall
                    facilitate implementation of the services elected.
                ``(4) Vacancies.--The Secretary shall not fill any vacancy
            for a certified dentist in a program operated by the Service
            with a dental health aide therapist.''; and
                        (B) by adding at the end the following:
        ``(e) Effect of Section.--Nothing in this section shall restrict
    the ability of the Service, an Indian tribe, or a tribal organization
    to participate in any program or to provide any service authorized by
    any other Federal law.''.
                (2) The Indian Health Care Improvement Act (as amended by
            section 134(b) of the bill referred to in subsection (a)) is
            amended by striking section 125 (relating to treatment of
            scholarships for certain purposes).
                (3) Section 806 of the Indian Health Care Improvement Act
            (25 U.S.C. 1676) is amended--
                        (A) by striking ``Any limitation'' and inserting
                    the following:
        ``(a) HHS Appropriations.--Any limitation''; and
                        (B) by adding at the end the following:
        ``(b) Limitations Pursuant to Other Federal Law.--Any limitation
    pursuant to other Federal laws on the use of Federal funds appropriated
    to the Service shall apply with respect to the performance or coverage
    of abortions.''.
                (4) The bill referred to in subsection (a) is amended by
            striking section 201.

                  Subtitle C--Provisions Relating to Title III

    SEC. 10301. PLANS FOR A VALUE-BASED PURCHASING PROGRAM FOR AMBULATORY
                  SURGICAL CENTERS.

        (a) In General.--Section 3006 is amended by adding at the end the
    following new subsection:
        ``(f) Ambulatory Surgical Centers.--
                ``(1) In general.--The Secretary shall develop a plan to
            implement a value-based purchasing program for payments under
            the Medicare program under title XVIII of the Social Security
            Act for ambulatory surgical centers (as described in section
            1833(i) of the Social Security Act (42 U.S.C. 1395l(i))).
                ``(2) Details.--In developing the plan under paragraph (1),
            the Secretary shall consider the following issues:
                        ``(A) The ongoing development, selection, and
                    modification process for measures (including under
                    section 1890 of the Social Security Act (42 U.S.C.
                    1395aaa) and section 1890A of such Act, as added by
                    section 3014), to the extent feasible and practicable,
                    of all dimensions of quality and efficiency in
                    ambulatory surgical centers.
                        ``(B) The reporting, collection, and validation of
                    quality data.
                        ``(C) The structure of value-based payment
                    adjustments, including the determination of thresholds
                    or improvements in quality that would substantiate a
                    payment adjustment, the size of such payments, and the
                    sources of funding for the value-based bonus payments.
                        ``(D) Methods for the public disclosure of
                    information on the performance of ambulatory surgical
                    centers.
                        ``(E) Any other issues determined appropriate by
                    the Secretary.
                ``(3) Consultation.--In developing the plan under paragraph
            (1), the Secretary shall--
                        ``(A) consult with relevant affected parties; and
                        ``(B) consider experience with such demonstrations
                    that the Secretary determines are relevant to the
                    value-based purchasing program described in paragraph
                    (1).
                ``(4) Report to congress.--Not later than January 1, 2011,
            the Secretary shall submit to Congress a report containing the
            plan developed under paragraph (1).''.
        (b) Technical.--Section 3006(a)(2)(A) is amended by striking
    clauses (i) and (ii).

    SEC. 10302. REVISION TO NATIONAL STRATEGY FOR QUALITY IMPROVEMENT IN
                  HEALTH CARE.

        Section 399HH(a)(2)(B)(iii) of the Public Health Service Act, as
    added by section 3011, is amended by inserting ``(taking into
    consideration the limitations set forth in subsections (c) and (d) of
    section 1182 of the Social Security Act)'' after ``information''.

    SEC. 10303. DEVELOPMENT OF OUTCOME MEASURES.

        (a) Development.--Section 931 of the Public Health Service Act, as
    added by section 3013(a), is amended by adding at the end the following
    new subsection:
        ``(f) Development of Outcome Measures.--
                ``(1) In general.--The Secretary shall develop, and
            periodically update (not less than every 3 years), provider-
            level outcome measures for hospitals and physicians, as well as
            other providers as determined appropriate by the Secretary.
                ``(2) Categories of measures.--The measures developed under
            this subsection shall include, to the extent determined
            appropriate by the Secretary--
                        ``(A) outcome measurement for acute and chronic
                    diseases, including, to the extent feasible, the 5 most
                    prevalent and resource-intensive acute and chronic
                    medical conditions; and
                        ``(B) outcome measurement for primary and
                    preventative care, including, to the extent feasible,
                    measurements that cover provision of such care for
                    distinct patient populations (such as healthy children,
                    chronically ill adults, or infirm elderly individuals).
                ``(3) Goals.--In developing such measures, the Secretary
            shall seek to--
                        ``(A) address issues regarding risk adjustment,
                    accountability, and sample size;
                        ``(B) include the full scope of services that
                    comprise a cycle of care; and
                        ``(C) include multiple dimensions.
                ``(4) Timeframe.--
                        ``(A) Acute and chronic diseases.--Not later than
                    24 months after the date of enactment of this Act, the
                    Secretary shall develop not less than 10 measures
                    described in paragraph (2)(A).
                        ``(B) Primary and preventive care.--Not later than
                    36 months after the date of enactment of this Act, the
                    Secretary shall develop not less than 10 measures
                    described in paragraph (2)(B).''.
        (b) Hospital-acquired Conditions.--Section 1890A of the Social
    Security Act, as amended by section 3013(b), is amended by adding at
    the end the following new subsection:
        ``(f) Hospital Acquired Conditions.--The Secretary shall, to the
    extent practicable, publicly report on measures for hospital-acquired
    conditions that are currently utilized by the Centers for Medicare &
    Medicaid Services for the adjustment of the amount of payment to
    hospitals based on rates of hospital-acquired infections.''.
        (c) Clinical Practice Guidelines.--Section 304(b) of the Medicare
    Improvements for Patients and Providers Act of 2008 (Public Law 110-
    275) is amended by adding at the end the following new paragraph:
                ``(4) Identification.--
                        ``(A) In general.--Following receipt of the report
                    submitted under paragraph (2), and not less than every
                    3 years thereafter, the Secretary shall contract with
                    the Institute to employ the results of the study
                    performed under paragraph (1) and the best methods
                    identified by the Institute for the purpose of
                    identifying existing and new clinical practice
                    guidelines that were developed using such best methods,
                    including guidelines listed in the National Guideline
                    Clearinghouse.
                        ``(B) Consultation.--In carrying out the
                    identification process under subparagraph (A), the
                    Secretary shall allow for consultation with
                    professional societies, voluntary health care
                    organizations, and expert panels.''.

    SEC. 10304. SELECTION OF EFFICIENCY MEASURES.

        Sections 1890(b)(7) and 1890A of the Social Security Act, as added
    by section 3014, are amended by striking ``quality'' each place it
    appears and inserting ``quality and efficiency''.

    SEC. 10305. DATA COLLECTION; PUBLIC REPORTING.

        Section 399II(a) of the Public Health Service Act, as added by
    section 3015, is amended to read as follows:
        ``(a) In General.--
                ``(1) Establishment of strategic framework.--The Secretary
            shall establish and implement an overall strategic framework to
            carry out the public reporting of performance information, as
            described in section 399JJ. Such strategic framework may
            include methods and related timelines for implementing
            nationally consistent data collection, data aggregation, and
            analysis methods.
                ``(2) Collection and aggregation of data.--The Secretary
            shall collect and aggregate consistent data on quality and
            resource use measures from information systems used to support
            health care delivery, and may award grants or contracts for
            this purpose. The Secretary shall align such collection and
            aggregation efforts with the requirements and assistance
            regarding the expansion of health information technology
            systems, the interoperability of such technology systems, and
            related standards that are in effect on the date of enactment
            of the Patient Protection and Affordable Care Act.
                ``(3) Scope.--The Secretary shall ensure that the data
            collection, data aggregation, and analysis systems described in
            paragraph (1) involve an increasingly broad range of patient
            populations, providers, and geographic areas over time.''.

    SEC. 10306. IMPROVEMENTS UNDER THE CENTER FOR MEDICARE AND MEDICAID
                  INNOVATION.

        Section 1115A of the Social Security Act, as added by section 3021,
    is amended--
                (1) in subsection (a), by inserting at the end the
            following new paragraph:
                ``(5) Testing within certain geographic areas.--For
            purposes of testing payment and service delivery models under
            this section, the Secretary may elect to limit testing of a
            model to certain geographic areas.'';
                (2) in subsection (b)(2)--
                        (A) in subparagraph (A)--
                                (i) in the second sentence, by striking
                            ``the preceding sentence may include'' and
                            inserting ``this subparagraph may include, but
                            are not limited to,''; and
                                (ii) by inserting after the first sentence
                            the following new sentence: ``The Secretary
                            shall focus on models expected to reduce
                            program costs under the applicable title while
                            preserving or enhancing the quality of care
                            received by individuals receiving benefits
                            under such title.'';
                        (B) in subparagraph (B), by adding at the end the
                    following new clauses:
                                ``(xix) Utilizing, in particular in
                            entities located in medically underserved areas
                            and facilities of the Indian Health Service
                            (whether operated by such Service or by an
                            Indian tribe or tribal organization (as those
                            terms are defined in section 4 of the Indian
                            Health Care Improvement Act)), telehealth
                            services--
                                        ``(I) in treating behavioral health
                                    issues (such as post-traumatic stress
                                    disorder) and stroke; and
                                        ``(II) to improve the capacity of
                                    non-medical providers and non-
                                    specialized medical providers to
                                    provide health services for patients
                                    with chronic complex conditions.
                                ``(xx) Utilizing a diverse network of
                            providers of services and suppliers to improve
                            care coordination for applicable individuals
                            described in subsection (a)(4)(A)(i) with 2 or
                            more chronic conditions and a history of prior-
                            year hospitalization through interventions
                            developed under the Medicare Coordinated Care
                            Demonstration Project under section 4016 of the
                            Balanced Budget Act of 1997 (42 U.S.C. 1395b-1
                            note).''; and
                        (C) in subparagraph (C), by adding at the end the
                    following new clause:
                                ``(viii) Whether the model demonstrates
                            effective linkage with other public sector or
                            private sector payers.'';
                (3) in subsection (b)(4), by adding at the end the
            following new subparagraph:
                        ``(C) Measure selection.--To the extent feasible,
                    the Secretary shall select measures under this
                    paragraph that reflect national priorities for quality
                    improvement and patient-centered care consistent with
                    the measures described in 1890(b)(7)(B).''; and
                (4) in subsection (c)--
                        (A) in paragraph (1)(B), by striking ``care and
                    reduce spending; and'' and inserting ``patient care
                    without increasing spending;'';
                        (B) in paragraph (2), by striking ``reduce program
                    spending under applicable titles.'' and inserting
                    ``reduce (or would not result in any increase in) net
                    program spending under applicable titles; and''; and
                        (C) by adding at the end the following:
                ``(3) the Secretary determines that such expansion would
            not deny or limit the coverage or provision of benefits under
            the applicable title for applicable individuals.
    In determining which models or demonstration projects to expand under
    the preceding sentence, the Secretary shall focus on models and
    demonstration projects that improve the quality of patient care and
    reduce spending.''.

    SEC. 10307. IMPROVEMENTS TO THE MEDICARE SHARED SAVINGS PROGRAM.

        Section 1899 of the Social Security Act, as added by section 3022,
    is amended by adding at the end the following new subsections:
        ``(i) Option To Use Other Payment Models.--
                ``(1) In general.--If the Secretary determines appropriate,
            the Secretary may use any of the payment models described in
            paragraph (2) or (3) for making payments under the program
            rather than the payment model described in subsection (d).
                ``(2) Partial capitation model.--
                        ``(A) In general.--Subject to subparagraph (B), a
                    model described in this paragraph is a partial
                    capitation model in which an ACO is at financial risk
                    for some, but not all, of the items and services
                    covered under parts A and B, such as at risk for some
                    or all physicians' services or all items and services
                    under part B. The Secretary may limit a partial
                    capitation model to ACOs that are highly integrated
                    systems of care and to ACOs capable of bearing risk, as
                    determined to be appropriate by the Secretary.
                        ``(B) No additional program expenditures.--Payments
                    to an ACO for items and services under this title for
                    beneficiaries for a year under the partial capitation
                    model shall be established in a manner that does not
                    result in spending more for such ACO for such
                    beneficiaries than would otherwise be expended for such
                    ACO for such beneficiaries for such year if the model
                    were not implemented, as estimated by the Secretary.
                ``(3) Other payment models.--
                        ``(A) In general.--Subject to subparagraph (B), a
                    model described in this paragraph is any payment model
                    that the Secretary determines will improve the quality
                    and efficiency of items and services furnished under
                    this title.
                        ``(B) No additional program expenditures.--
                    Subparagraph (B) of paragraph (2) shall apply to a
                    payment model under subparagraph (A) in a similar
                    manner as such subparagraph (B) applies to the payment
                    model under paragraph (2).
        ``(j) Involvement in Private Payer and Other Third Party
    Arrangements.--The Secretary may give preference to ACOs who are
    participating in similar arrangements with other payers.
        ``(k) Treatment of Physician Group Practice Demonstration.--During
    the period beginning on the date of the enactment of this section and
    ending on the date the program is established, the Secretary may enter
    into an agreement with an ACO under the demonstration under section
    1866A, subject to rebasing and other modifications deemed appropriate
    by the Secretary.''.

    SEC. 10308. REVISIONS TO NATIONAL PILOT PROGRAM ON PAYMENT BUNDLING.

        (a) In General.--Section 1866D of the Social Security Act, as added
    by section 3023, is amended--
                (1) in paragraph (a)(2)(B), in the matter preceding clause
            (i), by striking ``8 conditions'' and inserting ``10
            conditions'';
                (2) by striking subsection (c)(1)(B) and inserting the
            following:
                        ``(B) Expansion.--The Secretary may, at any point
                    after January 1, 2016, expand the duration and scope of
                    the pilot program, to the extent determined appropriate
                    by the Secretary, if--
                                ``(i) the Secretary determines that such
                            expansion is expected to--
                                        ``(I) reduce spending under title
                                    XVIII of the Social Security Act
                                    without reducing the quality of care;
                                    or
                                        ``(II) improve the quality of care
                                    and reduce spending;
                                ``(ii) the Chief Actuary of the Centers for
                            Medicare & Medicaid Services certifies that
                            such expansion would reduce program spending
                            under such title XVIII; and
                                ``(iii) the Secretary determines that such
                            expansion would not deny or limit the coverage
                            or provision of benefits under this title for
                            individuals.''; and
                (3) by striking subsection (g) and inserting the following
            new subsection:
        ``(g) Application of Pilot Program to Continuing Care Hospitals.--
                ``(1) In general.--In conducting the pilot program, the
            Secretary shall apply the provisions of the program so as to
            separately pilot test the continuing care hospital model.
                ``(2) Special rules.--In pilot testing the continuing care
            hospital model under paragraph (1), the following rules shall
            apply:
                        ``(A) Such model shall be tested without the
                    limitation to the conditions selected under subsection
                    (a)(2)(B).
                        ``(B) Notwithstanding subsection (a)(2)(D), an
                    episode of care shall be defined as the full period
                    that a patient stays in the continuing care hospital
                    plus the first 30 days following discharge from such
                    hospital.
                ``(3) Continuing care hospital defined.--In this
            subsection, the term `continuing care hospital' means an entity
            that has demonstrated the ability to meet patient care and
            patient safety standards and that provides under common
            management the medical and rehabilitation services provided in
            inpatient rehabilitation hospitals and units (as defined in
            section 1886(d)(1)(B)(ii)), long term care hospitals (as
            defined in section 1886(d)(1)(B)(iv)(I)), and skilled nursing
            facilities (as defined in section 1819(a)) that are located in
            a hospital described in section 1886(d).''.
        (b) Technical Amendments.--
                (1) Section 3023 is amended by striking ``1886C'' and
            inserting ``1866C''.
                (2) Title XVIII of the Social Security Act is amended by
            redesignating section 1866D, as added by section 3024, as
            section 1866E.

    SEC. 10309. REVISIONS TO HOSPITAL READMISSIONS REDUCTION PROGRAM.

        Section 1886(q)(1) of the Social Security Act, as added by section
    3025, in the matter preceding subparagraph (A), is amended by striking
    ``the Secretary shall reduce the payments'' and all that follows
    through ``the product of'' and inserting ``the Secretary shall make
    payments (in addition to the payments described in paragraph
    (2)(A)(ii)) for such a discharge to such hospital under subsection (d)
    (or section 1814(b)(3), as the case may be) in an amount equal to the
    product of''.

    SEC. 10310. REPEAL OF PHYSICIAN PAYMENT UPDATE.

        The provisions of, and the amendment made by, section 3101 are
    repealed.

    SEC. 10311. REVISIONS TO EXTENSION OF AMBULANCE ADD-ONS.

        (a) Ground Ambulance.--Section 1834(l)(13)(A) of the Social
    Security Act (42 U.S.C. 1395m(l)(13)(A)), as amended by section
    3105(a), is further amended--
                (1) in the matter preceding clause (i)--
                        (A) by striking ``2007, for'' and inserting ``2007,
                    and for''; and
                        (B) by striking ``2010, and for such services
                    furnished on or after April 1, 2010, and before January
                    1, 2011'' and inserting ``2011''; and
                (2) in each of clauses (i) and (ii)--
                        (A) by striking ``, and on or after April 1, 2010,
                    and before January 1, 2011'' each place it appears; and
                        (B) by striking ``January 1, 2010'' and inserting
                    ``January 1, 2011'' each place it appears.
        (b) Air Ambulance.--Section 146(b)(1) of the Medicare Improvements
    for Patients and Providers Act of 2008 (Public Law 110-275), as amended
    by section 3105(b), is further amended by striking ``December 31, 2009,
    and during the period beginning on April 1, 2010, and ending on January
    1, 2011'' and inserting ``December 31, 2010''.
        (c) Super Rural Ambulance.--Section 1834(l)(12)(A) of the Social
    Security Act (42 U.S.C. 1395m(l)(12)(A)), as amended by section
    3105(c), is further amended by striking ``2010, and on or after April
    1, 2010, and before January 1, 2011'' and inserting ``2011''.

    SEC. 10312. CERTAIN PAYMENT RULES FOR LONG-TERM CARE HOSPITAL SERVICES
                  AND MORATORIUM ON THE ESTABLISHMENT OF CERTAIN HOSPITALS
                  AND FACILITIES.

        (a) Certain Payment Rules.--Section 114(c) of the Medicare,
    Medicaid, and SCHIP Extension Act of 2007 (42 U.S.C. 1395ww note), as
    amended by section 4302(a) of the American Recovery and Reinvestment
    Act (Public Law 111-5) and section 3106(a) of this Act, is further
    amended by striking ``4-year period'' each place it appears and
    inserting ``5-year period''.
        (b) Moratorium.--Section 114(d) of such Act (42 U.S.C. 1395ww
    note), as amended by section 3106(b) of this Act, in the matter
    preceding subparagraph (A), is amended by striking ``4-year period''
    and inserting ``5-year period''.

    SEC. 10313. REVISIONS TO THE EXTENSION FOR THE RURAL COMMUNITY HOSPITAL
                  DEMONSTRATION PROGRAM.

        (a) In General.--Subsection (g) of section 410A of the Medicare
    Prescription Drug, Improvement, and Modernization Act of 2003 (Public
    Law 108-173; 117 Stat. 2272), as added by section 3123(a) of this Act,
    is amended to read as follows:
        ``(g) Five-Year Extension of Demonstration Program.--
                ``(1) In general.--Subject to the succeeding provisions of
            this subsection, the Secretary shall conduct the demonstration
            program under this section for an additional 5-year period (in
            this section referred to as the `5-year extension period') that
            begins on the date immediately following the last day of the
            initial 5-year period under subsection (a)(5).
                ``(2) Expansion of demonstration states.--Notwithstanding
            subsection (a)(2), during the 5-year extension period, the
            Secretary shall expand the number of States with low population
            densities determined by the Secretary under such subsection to
            20. In determining which States to include in such expansion,
            the Secretary shall use the same criteria and data that the
            Secretary used to determine the States under such subsection
            for purposes of the initial 5-year period.
                ``(3) Increase in maximum number of hospitals participating
            in the demonstration program.--Notwithstanding subsection
            (a)(4), during the 5-year extension period, not more than 30
            rural community hospitals may participate in the demonstration
            program under this section.
                ``(4) Hospitals in demonstration program on date of
            enactment.--In the case of a rural community hospital that is
            participating in the demonstration program under this section
            as of the last day of the initial 5-year period, the
            Secretary--
                        ``(A) shall provide for the continued participation
                    of such rural community hospital in the demonstration
                    program during the 5-year extension period unless the
                    rural community hospital makes an election, in such
                    form and manner as the Secretary may specify, to
                    discontinue such participation; and
                        ``(B) in calculating the amount of payment under
                    subsection (b) to the rural community hospital for
                    covered inpatient hospital services furnished by the
                    hospital during such 5-year extension period, shall
                    substitute, under paragraph (1)(A) of such subsection--
                                ``(i) the reasonable costs of providing
                            such services for discharges occurring in the
                            first cost reporting period beginning on or
                            after the first day of the 5-year extension
                            period, for
                                ``(ii) the reasonable costs of providing
                            such services for discharges occurring in the
                            first cost reporting period beginning on or
                            after the implementation of the demonstration
                            program.''.
        (b) Conforming Amendments.--Subsection (a)(5) of section 410A of
    the Medicare Prescription Drug, Improvement, and Modernization Act of
    2003 (Public Law 108-173; 117 Stat. 2272), as amended by section
    3123(b) of this Act, is amended by striking ``1-year extension'' and
    inserting ``5-year extension''.

    SEC. 10314. ADJUSTMENT TO LOW-VOLUME HOSPITAL PROVISION.

        Section 1886(d)(12) of the Social Security Act (42 U.S.C.
    1395ww(d)(12), as amended by section 3125, is amended--
                (1) in subparagraph (C)(i), by striking ``1,500
            discharges'' and inserting ``1,600 discharges''; and
                (2) in subparagraph (D), by striking ``1,500 discharges''
            and inserting ``1,600 discharges''.

    SEC. 10315. REVISIONS TO HOME HEALTH CARE PROVISIONS.

        (a) Rebasing.--Section 1895(b)(3)(A)(iii) of the Social Security
    Act, as added by section 3131, is amended--
                (1) in the clause heading, by striking ``2013'' and
            inserting ``2014'';
                (2) in subclause (I), by striking ``2013'' and inserting
            ``2014''; and
                (3) in subclause (II), by striking ``2016'' and inserting
            ``2017''.
        (b) Revision of Home Health Study and Report.--Section 3131(d) is
    amended to read as follows:
        ``(d) Study and Report on the Development of Home Health Payment
    Revisions in Order to Ensure Access to Care and Payment for Severity of
    Illness.--
                ``(1) In general.--The Secretary of Health and Human
            Services (in this section referred to as the `Secretary') shall
            conduct a study on home health agency costs involved with
            providing ongoing access to care to low-income Medicare
            beneficiaries or beneficiaries in medically underserved areas,
            and in treating beneficiaries with varying levels of severity
            of illness. In conducting the study, the Secretary may analyze
            items such as the following:
                        ``(A) Methods to potentially revise the home health
                    prospective payment system under section 1895 of the
                    Social Security Act (42 U.S.C. 1395fff) to account for
                    costs related to patient severity of illness or to
                    improving beneficiary access to care, such as--
                                ``(i) payment adjustments for services that
                            may involve additional or fewer resources;
                                ``(ii) changes to reflect resources
                            involved with providing home health services to
                            low-income Medicare beneficiaries or Medicare
                            beneficiaries residing in medically underserved
                            areas;
                                ``(iii) ways outlier payments might be
                            revised to reflect costs of treating Medicare
                            beneficiaries with high levels of severity of
                            illness; and
                                ``(iv) other issues determined appropriate
                            by the Secretary.
                        ``(B) Operational issues involved with potential
                    implementation of potential revisions to the home
                    health payment system, including impacts for both home
                    health agencies and administrative and systems issues
                    for the Centers for Medicare & Medicaid Services, and
                    any possible payment vulnerabilities associated with
                    implementing potential revisions.
                        ``(C) Whether additional research might be needed.
                        ``(D) Other items determined appropriate by the
                    Secretary.
                ``(2) Considerations.--In conducting the study under
            paragraph (1), the Secretary may consider whether patient
            severity of illness and access to care could be measured by
            factors, such as--
                        ``(A) population density and relative patient
                    access to care;
                        ``(B) variations in service costs for providing
                    care to individuals who are dually eligible under the
                    Medicare and Medicaid programs;
                        ``(C) the presence of severe or chronic diseases,
                    which might be measured by multiple, discontinuous home
                    health episodes;
                        ``(D) poverty status, such as evidenced by the
                    receipt of Supplemental Security Income under title XVI
                    of the Social Security Act; and
                        ``(E) other factors determined appropriate by the
                    Secretary.
                ``(3) Report.--Not later than March 1, 2014, the Secretary
            shall submit to Congress a report on the study conducted under
            paragraph (1), together with recommendations for such
            legislation and administrative action as the Secretary
            determines appropriate.
                ``(4) Consultations.--In conducting the study under
            paragraph (1), the Secretary shall consult with appropriate
            stakeholders, such as groups representing home health agencies
            and groups representing Medicare beneficiaries.
                ``(5) Medicare demonstration project based on the results
            of the study.--
                        ``(A) In general.--Subject to subparagraph (D),
                    taking into account the results of the study conducted
                    under paragraph (1), the Secretary may, as determined
                    appropriate, provide for a demonstration project to
                    test whether making payment adjustments for home health
                    services under the Medicare program would substantially
                    improve access to care for patients with high severity
                    levels of illness or for low-income or underserved
                    Medicare beneficiaries.
                        ``(B) Waiving budget neutrality.--The Secretary
                    shall not reduce the standard prospective payment
                    amount (or amounts) under section 1895 of the Social
                    Security Act (42 U.S.C. 1395fff) applicable to home
                    health services furnished during a period to offset any
                    increase in payments during such period resulting from
                    the application of the payment adjustments under
                    subparagraph (A).
                        ``(C) No effect on subsequent periods.--A payment
                    adjustment resulting from the application of
                    subparagraph (A) for a period--
                                ``(i) shall not apply to payments for home
                            health services under title XVIII after such
                            period; and
                                ``(ii) shall not be taken into account in
                            calculating the payment amounts applicable for
                            such services after such period.
                        ``(D) Duration.--If the Secretary determines it
                    appropriate to conduct the demonstration project under
                    this subsection, the Secretary shall conduct the
                    project for a four year period beginning not later than
                    January 1, 2015.
                        ``(E) Funding.--The Secretary shall provide for the
                    transfer from the Federal Hospital Insurance Trust Fund
                    under section 1817 of the Social Security Act (42
                    U.S.C. 1395i) and the Federal Supplementary Medical
                    Insurance Trust Fund established under section 1841 of
                    such Act (42 U.S.C. 1395t), in such proportion as the
                    Secretary determines appropriate, of $500,000,000 for
                    the period of fiscal years 2015 through 2018. Such
                    funds shall be made available for the study described
                    in paragraph (1) and the design, implementation and
                    evaluation of the demonstration described in this
                    paragraph. Amounts available under this subparagraph
                    shall be available until expended.
                        ``(F) Evaluation and report.--If the Secretary
                    determines it appropriate to conduct the demonstration
                    project under this subsection, the Secretary shall--
                                ``(i) provide for an evaluation of the
                            project; and
                                ``(ii) submit to Congress, by a date
                            specified by the Secretary, a report on the
                            project.
                        ``(G) Administration.--Chapter 35 of title 44,
                    United States Code, shall not apply with respect to
                    this subsection.''.

    SEC. 10316. MEDICARE DSH.

        Section 1886(r)(2)(B) of the Social Security Act, as added by
    section 3133, is amended--
                (1) in clause (i)--
                        (A) in the matter preceding subclause (I), by
                    striking ``(divided by 100)'';
                        (B) in subclause (I), by striking ``2012'' and
                    inserting ``2013'';
                        (C) in subclause (II), by striking the period at
                    the end and inserting a comma; and
                        (D) by adding at the end the following flush
                    matter:
                            ``minus 1.5 percentage points.''.
                (2) in clause (ii)--
                        (A) in the matter preceding subclause (I), by
                    striking ``(divided by 100)'';
                        (B) in subclause (I), by striking ``2012'' and
                    inserting ``2013'';
                        (C) in subclause (II), by striking the period at
                    the end and inserting a comma; and
                        (D) by adding at the end the following flush
                    matter:
                            ``and, for each of 2018 and 2019, minus 1.5
                            percentage points.''.

    SEC. 10317. REVISIONS TO EXTENSION OF SECTION 508 HOSPITAL PROVISIONS.

        Section 3137(a) is amended to read as follows:
        ``(a) Extension.--
                ``(1) In general.--Subsection (a) of section 106 of
            division B of the Tax Relief and Health Care Act of 2006 (42
            U.S.C. 1395 note), as amended by section 117 of the Medicare,
            Medicaid, and SCHIP Extension Act of 2007 (Public Law 110-173)
            and section 124 of the Medicare Improvements for Patients and
            Providers Act of 2008 (Public Law 110-275), is amended by
            striking `September 30, 2009' and inserting `September 30,
            2010'.
                ``(2) Special rule for fiscal year 2010.--
                        ``(A) In general.--Subject to subparagraph (B), for
                    purposes of implementation of the amendment made by
                    paragraph (1), including (notwithstanding paragraph (3)
                    of section 117(a) of the Medicare, Medicaid and SCHIP
                    Extension Act of 2007 (Public Law 110-173), as amended
                    by section 124(b) of the Medicare Improvements for
                    Patients and Providers Act of 2008 (Public Law 110-
                    275)) for purposes of the implementation of paragraph
                    (2) of such section 117(a), during fiscal year 2010,
                    the Secretary of Health and Human Services (in this
                    subsection referred to as the `Secretary') shall use
                    the hospital wage index that was promulgated by the
                    Secretary in the Federal Register on August 27, 2009
                    (74 Fed. Reg. 43754), and any subsequent corrections.
                        ``(B) Exception.--Beginning on April 1, 2010, in
                    determining the wage index applicable to hospitals that
                    qualify for wage index reclassification, the Secretary
                    shall include the average hourly wage data of hospitals
                    whose reclassification was extended pursuant to the
                    amendment made by paragraph (1) only if including such
                    data results in a higher applicable reclassified wage
                    index.
                ``(3) Adjustment for certain hospitals in fiscal year
            2010.--
                        ``(A) In general.--In the case of a subsection (d)
                    hospital (as defined in subsection (d)(1)(B) of section
                    1886 of the Social Security Act (42 U.S.C. 1395ww))
                    with respect to which--
                                ``(i) a reclassification of its wage index
                            for purposes of such section was extended
                            pursuant to the amendment made by paragraph
                            (1); and
                                ``(ii) the wage index applicable for such
                            hospital for the period beginning on October 1,
                            2009, and ending on March 31, 2010, was lower
                            than for the period beginning on April 1, 2010,
                            and ending on September 30, 2010, by reason of
                            the application of paragraph (2)(B);
                    the Secretary shall pay such hospital an additional
                    payment that reflects the difference between the wage
                    index for such periods.
                        ``(B) Timeframe for payments.--The Secretary shall
                    make payments required under subparagraph by not later
                    than December 31, 2010.''.

    SEC. 10318. REVISIONS TO TRANSITIONAL EXTRA BENEFITS UNDER MEDICARE
                  ADVANTAGE.

        Section 1853(p)(3)(A) of the Social Security Act, as added by
    section 3201(h), is amended by inserting ``in 2009'' before the period
    at the end.

    SEC. 10319. REVISIONS TO MARKET BASKET ADJUSTMENTS.

        (a) Inpatient Acute Hospitals.--Section 1886(b)(3)(B)(xii) of the
    Social Security Act, as added by section 3401(a), is amended--
                (1) in subclause (I), by striking ``and'' at the end;
                (2) by redesignating subclause (II) as subclause (III);
                (3) by inserting after subclause (II) the following new
            subclause:
                ``(II) for each of fiscal years 2012 and 2013, by 0.1
            percentage point; and''; and
                (4) in subclause (III), as redesignated by paragraph (2),
            by striking ``2012'' and inserting ``2014''.
        (b) Long-term Care Hospitals.--Section 1886(m)(4) of the Social
    Security Act, as added by section 3401(c), is amended--
                (1) in subparagraph (A)--
                        (A) in clause (i)--
                                (i) by striking ``each of rate years 2010
                            and 2011'' and inserting ``rate year 2010'';
                            and
                                (ii) by striking ``and'' at the end;
                        (B) by redesignating clause (ii) as clause (iv);
                        (C) by inserting after clause (i) the following new
                    clauses:
                                ``(ii) for rate year 2011, 0.50 percentage
                            point;
                                ``(iii) for each of the rate years
                            beginning in 2012 and 2013, 0.1 percentage
                            point; and''; and
                        (D) in clause (iv), as redesignated by subparagraph
                    (B), by striking ``2012'' and inserting ``2014''; and
                (2) in subparagraph (B), by striking ``(A)(ii)'' and
            inserting ``(A)(iv)''.
        (c) Inpatient Rehabilitation Facilities.--Section 1886(j)(3)(D)(i)
    of the Social Security Act, as added by section 3401(d), is amended--
                (1) in subclause (I), by striking ``and'' at the end;
                (2) by redesignating subclause (II) as subclause (III);
                (3) by inserting after subclause (II) the following new
            subclause:
                                        ``(II) for each of fiscal years
                                    2012 and 2013, 0.1 percentage point;
                                    and''; and
                (4) in subclause (III), as redesignated by paragraph (2),
            by striking ``2012'' and inserting ``2014''.
        (d) Home Health Agencies.--Section 1895(b)(3)(B)(vi)(II) of such
    Act, as added by section 3401(e), is amended by striking ``and 2012''
    and inserting ``, 2012, and 2013''.
        (e) Psychiatric Hospitals.--Section 1886(s)(3)(A) of the Social
    Security Act, as added by section 3401(f), is amended--
                (1) in clause (i), by striking ``and'' at the end;
                (2) by redesignating clause (ii) as clause (iii);
                (3) by inserting after clause (ii) the following new
            clause:
                                ``(ii) for each of the rate years beginning
                            in 2012 and 2013, 0.1 percentage point; and'';
                            and
                (4) in clause (iii), as redesignated by paragraph (2), by
            striking ``2012'' and inserting ``2014''.
        (f) Hospice Care.--Section 1814(i)(1)(C) of the Social Security Act
    (42 U.S.C. 1395f(i)(1)(C)), as amended by section 3401(g), is amended--
                (1) in clause (iv)(II), by striking ``0.5'' and inserting
            ``0.3''; and
                (2) in clause (v), in the matter preceding subclause (I),
            by striking ``0.5'' and inserting ``0.3''.
        (g) Outpatient Hospitals.--Section 1833(t)(3)(G)(i) of the Social
    Security Act, as added by section 3401(i), is amended--
                (1) in subclause (I), by striking ``and'' at the end;
                (2) by redesignating subclause (II) as subclause (III);
                (3) by inserting after subclause (II) the following new
            subclause:
                                        ``(II) for each of 2012 and 2013,
                                    0.1 percentage point; and''; and
                (4) in subclause (III), as redesignated by paragraph (2),
            by striking ``2012'' and inserting ``2014''.

    SEC. 10320. EXPANSION OF THE SCOPE OF, AND ADDITIONAL IMPROVEMENTS TO,
                  THE INDEPENDENT MEDICARE ADVISORY BOARD.

        (a) In General.--Section 1899A of the Social Security Act, as added
    by section 3403, is amended--
                (1) in subsection (c)--
                        (A) in paragraph (1)(B), by adding at the end the
                    following new sentence: ``In any year (beginning with
                    2014) that the Board is not required to submit a
                    proposal under this section, the Board shall submit to
                    Congress an advisory report on matters related to the
                    Medicare program.'';
                        (B) in paragraph (2)(A)--
                                (i) in clause (iv), by inserting ``or the
                            full premium subsidy under section 1860D-
                            14(a)'' before the period at the end of the
                            last sentence; and
                                (ii) by adding at the end the following new
                            clause:
                                ``(vii) If the Chief Actuary of the Centers
                            for Medicare & Medicaid Services has made a
                            determination described in subsection
                            (e)(3)(B)(i)(II) in the determination year, the
                            proposal shall be designed to help reduce the
                            growth rate described in paragraph (8) while
                            maintaining or enhancing beneficiary access to
                            quality care under this title.'';
                        (C) in paragraph (2)(B)--
                                (i) in clause (v), by striking ``and'' at
                            the end;
                                (ii) in clause (vi), by striking the period
                            at the end and inserting ``; and''; and
                                (iii) by adding at the end the following
                            new clause:
                                ``(vii) take into account the data and
                            findings contained in the annual reports under
                            subsection (n) in order to develop proposals
                            that can most effectively promote the delivery
                            of efficient, high quality care to Medicare
                            beneficiaries.'';
                        (D) in paragraph (3)--
                                (i) in the heading, by striking
                            ``Transmission of board proposal to president''
                            and inserting ``Submission of board proposal to
                            congress and the president'';
                                (ii) in subparagraph (A)(i), by striking
                            ``transmit a proposal under this section to the
                            President'' and insert ``submit a proposal
                            under this section to Congress and the
                            President''; and
                                (iii) in subparagraph (A)(ii)--
                                        (I) in subclause (I), by inserting
                                    ``or'' at the end;
                                        (II) in subclause (II), by striking
                                    ``; or'' and inserting a period; and
                                        (III) by striking subclause (III);
                        (E) in paragraph (4)--
                                (i) by striking ``the Board under paragraph
                            (3)(A)(i) or''; and
                                (ii) by striking ``immediately'' and
                            inserting ``within 2 days'';
                        (F) in paragraph (5)--
                                (i) by striking ``to but'' and inserting
                            ``but''; and
                                (ii) by inserting ``Congress and'' after
                            ``submit a proposal to''; and
                        (G) in paragraph (6)(B)(i), by striking ``per
                    unduplicated enrollee'' and inserting ``(calculated as
                    the sum of per capita spending under each of parts A,
                    B, and D)'';
                (2) in subsection (d)--
                        (A) in paragraph (1)(A)--
                                (i) by inserting ``the Board or'' after ``a
                            proposal is submitted by''; and
                                (ii) by inserting ``subsection (c)(3)(A)(i)
                            or'' after ``the Senate under''; and
                        (B) in paragraph (2)(A), by inserting ``the Board
                    or'' after ``a proposal is submitted by'';
                (3) in subsection (e)--
                        (A) in paragraph (1), by inserting ``the Board or''
                    after ``a proposal submitted by''; and
                        (B) in paragraph (3)--
                                (i) by striking ``Exception.--The Secretary
                            shall not be required to implement the
                            recommendations contained in a proposal
                            submitted in a proposal year by'' and inserting
                            ``Exceptions.--
                        ``(A) In general.--The Secretary shall not
                    implement the recommendations contained in a proposal
                    submitted in a proposal year by the Board or'';
                                (ii) by redesignating subparagraphs (A) and
                            (B) as clauses (i) and (ii), respectively, and
                            indenting appropriately; and
                                (iii) by adding at the end the following
                            new subparagraph:
                        ``(B) Limited additional exception.--
                                ``(i) In general.--Subject to clause (ii),
                            the Secretary shall not implement the
                            recommendations contained in a proposal
                            submitted by the Board or the President to
                            Congress pursuant to this section in a proposal
                            year (beginning with proposal year 2019) if--
                                        ``(I) the Board was required to
                                    submit a proposal to Congress under
                                    this section in the year preceding the
                                    proposal year; and
                                        ``(II) the Chief Actuary of the
                                    Centers for Medicare & Medicaid
                                    Services makes a determination in the
                                    determination year that the growth rate
                                    described in subsection (c)(8) exceeds
                                    the growth rate described in subsection
                                    (c)(6)(A)(i).
                                ``(ii) Limited additional exception may not
                            be applied in two consecutive years.--This
                            subparagraph shall not apply if the
                            recommendations contained in a proposal
                            submitted by the Board or the President to
                            Congress pursuant to this section in the year
                            preceding the proposal year were not required
                            to be implemented by reason of this
                            subparagraph.
                                ``(iii) No affect on requirement to submit
                            proposals or for congressional consideration of
                            proposals.--Clause (i) and (ii) shall not
                            affect--
                                        ``(I) the requirement of the Board
                                    or the President to submit a proposal
                                    to Congress in a proposal year in
                                    accordance with the provisions of this
                                    section; or
                                        ``(II) Congressional consideration
                                    of a legislative proposal (described in
                                    subsection (c)(3)(B)(iv)) contained
                                    such a proposal in accordance with
                                    subsection (d).'';
                (4) in subsection (f)(3)(B)--
                        (A) by striking ``or advisory reports to Congress''
                    and inserting ``, advisory reports, or advisory
                    recommendations''; and
                        (B) by inserting ``or produce the public report
                    under subsection (n)'' after ``this section''; and
                (5) by adding at the end the following new subsections:
        ``(n) Annual Public Report.--
                ``(1) In general.--Not later than July 1, 2014, and
            annually thereafter, the Board shall produce a public report
            containing standardized information on system-wide health care
            costs, patient access to care, utilization, and quality-of-care
            that allows for comparison by region, types of services, types
            of providers, and both private payers and the program under
            this title.
                ``(2) Requirements.--Each report produced pursuant to
            paragraph (1) shall include information with respect to the
            following areas:
                        ``(A) The quality and costs of care for the
                    population at the most local level determined practical
                    by the Board (with quality and costs compared to
                    national benchmarks and reflecting rates of change,
                    taking into account quality measures described in
                    section 1890(b)(7)(B)).
                        ``(B) Beneficiary and consumer access to care,
                    patient and caregiver experience of care, and the cost-
                    sharing or out-of-pocket burden on patients.
                        ``(C) Epidemiological shifts and demographic
                    changes.
                        ``(D) The proliferation, effectiveness, and
                    utilization of health care technologies, including
                    variation in provider practice patterns and costs.
                        ``(E) Any other areas that the Board determines
                    affect overall spending and quality of care in the
                    private sector.
        ``(o) Advisory Recommendations for Non-Federal Health Care
    Programs.--
                ``(1) In general.--Not later than January 15, 2015, and at
            least once every two years thereafter, the Board shall submit
            to Congress and the President recommendations to slow the
            growth in national health expenditures (excluding expenditures
            under this title and in other Federal health care programs)
            while preserving or enhancing quality of care, such as
            recommendations--
                        ``(A) that the Secretary or other Federal agencies
                    can implement administratively;
                        ``(B) that may require legislation to be enacted by
                    Congress in order to be implemented;
                        ``(C) that may require legislation to be enacted by
                    State or local governments in order to be implemented;
                        ``(D) that private sector entities can voluntarily
                    implement; and
                        ``(E) with respect to other areas determined
                    appropriate by the Board.
                ``(2) Coordination.--In making recommendations under
            paragraph (1), the Board shall coordinate such recommendations
            with recommendations contained in proposals and advisory
            reports produced by the Board under subsection (c).
                ``(3) Available to public.--The Board shall make
            recommendations submitted to Congress and the President under
            this subsection available to the public.''.
        (b) Name Change.--Any reference in the provisions of, or amendments
    made by, section 3403 to the ``Independent Medicare Advisory Board''
    shall be deemed to be a reference to the ``Independent Payment Advisory
    Board''.
        (c) Rule of Construction.--Nothing in the amendments made by this
    section shall preclude the Independent Medicare Advisory Board, as
    established under section 1899A of the Social Security Act (as added by
    section 3403), from solely using data from public or private sources to
    carry out the amendments made by subsection (a)(4).

    SEC. 10321. REVISION TO COMMUNITY HEALTH TEAMS.

        Section 3502(c)(2)(A) is amended by inserting ``or other primary
    care providers'' after ``physicians''.

    SEC. 10322. QUALITY REPORTING FOR PSYCHIATRIC HOSPITALS.

        (a) In General.--Section 1886(s) of the Social Security Act, as
    added by section 3401(f), is amended by adding at the end the following
    new paragraph:
                ``(4) Quality reporting.--
                        ``(A) Reduction in update for failure to report.--
                                ``(i) In general.--Under the system
                            described in paragraph (1), for rate year 2014
                            and each subsequent rate year, in the case of a
                            psychiatric hospital or psychiatric unit that
                            does not submit data to the Secretary in
                            accordance with subparagraph (C) with respect
                            to such a rate year, any annual update to a
                            standard Federal rate for discharges for the
                            hospital during the rate year, and after
                            application of paragraph (2), shall be reduced
                            by 2 percentage points.
                                ``(ii) Special rule.--The application of
                            this subparagraph may result in such annual
                            update being less than 0.0 for a rate year, and
                            may result in payment rates under the system
                            described in paragraph (1) for a rate year
                            being less than such payment rates for the
                            preceding rate year.
                        ``(B) Noncumulative application.--Any reduction
                    under subparagraph (A) shall apply only with respect to
                    the rate year involved and the Secretary shall not take
                    into account such reduction in computing the payment
                    amount under the system described in paragraph (1) for
                    a subsequent rate year.
                        ``(C) Submission of quality data.--For rate year
                    2014 and each subsequent rate year, each psychiatric
                    hospital and psychiatric unit shall submit to the
                    Secretary data on quality measures specified under
                    subparagraph (D). Such data shall be submitted in a
                    form and manner, and at a time, specified by the
                    Secretary for purposes of this subparagraph.
                        ``(D) Quality measures.--
                                ``(i) In general.--Subject to clause (ii),
                            any measure specified by the Secretary under
                            this subparagraph must have been endorsed by
                            the entity with a contract under section
                            1890(a).
                                ``(ii) Exception.--In the case of a
                            specified area or medical topic determined
                            appropriate by the Secretary for which a
                            feasible and practical measure has not been
                            endorsed by the entity with a contract under
                            section 1890(a), the Secretary may specify a
                            measure that is not so endorsed as long as due
                            consideration is given to measures that have
                            been endorsed or adopted by a consensus
                            organization identified by the Secretary.
                                ``(iii) Time frame.--Not later than October
                            1, 2012, the Secretary shall publish the
                            measures selected under this subparagraph that
                            will be applicable with respect to rate year
                            2014.
                        ``(E) Public availability of data submitted.--The
                    Secretary shall establish procedures for making data
                    submitted under subparagraph (C) available to the
                    public. Such procedures shall ensure that a psychiatric
                    hospital and a psychiatric unit has the opportunity to
                    review the data that is to be made public with respect
                    to the hospital or unit prior to such data being made
                    public. The Secretary shall report quality measures
                    that relate to services furnished in inpatient settings
                    in psychiatric hospitals and psychiatric units on the
                    Internet website of the Centers for Medicare & Medicaid
                    Services.''.
        (b) Conforming Amendment.--Section 1890(b)(7)(B)(i)(I) of the
    Social Security Act, as added by section 3014, is amended by inserting
    ``1886(s)(4)(D),'' after ``1886(o)(2),''.

    SEC. 10323. MEDICARE COVERAGE FOR INDIVIDUALS EXPOSED TO ENVIRONMENTAL
                  HEALTH HAZARDS.

        (a) In General.--Title XVIII of the Social Security Act (42 U.S.C.
    1395 et seq.) is amended by inserting after section 1881 the following
    new section:

    ``SEC. 1881A. MEDICARE COVERAGE FOR INDIVIDUALS EXPOSED TO
                  ENVIRONMENTAL HEALTH HAZARDS.

        ``(a) Deeming of Individuals as Eligible for Medicare Benefits.--
                ``(1) In general.--For purposes of eligibility for benefits
            under this title, an individual determined under subsection (c)
            to be an environmental exposure affected individual described
            in subsection (e)(2) shall be deemed to meet the conditions
            specified in section 226(a).
                ``(2) Discretionary deeming.--For purposes of eligibility
            for benefits under this title, the Secretary may deem an
            individual determined under subsection (c) to be an
            environmental exposure affected individual described in
            subsection (e)(3) to meet the conditions specified in section
            226(a).
                ``(3) Effective date of coverage.--An Individual who is
            deemed eligible for benefits under this title under paragraph
            (1) or (2) shall be--
                        ``(A) entitled to benefits under the program under
                    Part A as of the date of such deeming; and
                        ``(B) eligible to enroll in the program under Part
                    B beginning with the month in which such deeming
                    occurs.
        ``(b) Pilot Program for Care of Certain Individuals Residing in
    Emergency Declaration Areas.--
                ``(1) Program; purpose.--
                        ``(A) Primary pilot program.--The Secretary shall
                    establish a pilot program in accordance with this
                    subsection to provide innovative approaches to
                    furnishing comprehensive, coordinated, and cost-
                    effective care under this title to individuals
                    described in paragraph (2)(A).
                        ``(B) Optional pilot programs.--The Secretary may
                    establish a separate pilot program, in accordance with
                    this subsection, with respect to each geographic area
                    subject to an emergency declaration (other than the
                    declaration of June 17, 2009), in order to furnish such
                    comprehensive, coordinated and cost-effective care to
                    individuals described in subparagraph (2)(B) who reside
                    in each such area.
                ``(2) Individual described.--For purposes of paragraph (1),
            an individual described in this paragraph is an individual who
            enrolls in part B, submits to the Secretary an application to
            participate in the applicable pilot program under this
            subsection, and--
                        ``(A) is an environmental exposure affected
                    individual described in subsection (e)(2) who resides
                    in or around the geographic area subject to an
                    emergency declaration made as of June 17, 2009; or
                        ``(B) is an environmental exposure affected
                    individual described in subsection (e)(3) who--
                                ``(i) is deemed under subsection (a)(2);
                            and
                                ``(ii) meets such other criteria or
                            conditions for participation in a pilot program
                            under paragraph (1)(B) as the Secretary
                            specifies.
                ``(3) Flexible benefits and services.--A pilot program
            under this subsection may provide for the furnishing of
            benefits, items, or services not otherwise covered or
            authorized under this title, if the Secretary determines that
            furnishing such benefits, items, or services will further the
            purposes of such pilot program (as described in paragraph (1)).
                ``(4) Innovative reimbursement methodologies.--For purposes
            of the pilot program under this subsection, the Secretary--
                        ``(A) shall develop and implement appropriate
                    methodologies to reimburse providers for furnishing
                    benefits, items, or services for which payment is not
                    otherwise covered or authorized under this title, if
                    such benefits, items, or services are furnished
                    pursuant to paragraph (3); and
                        ``(B) may develop and implement innovative
                    approaches to reimbursing providers for any benefits,
                    items, or services furnished under this subsection.
                ``(5) Limitation.--Consistent with section 1862(b), no
            payment shall be made under the pilot program under this
            subsection with respect to benefits, items, or services
            furnished to an environmental exposure affected individual (as
            defined in subsection (e)) to the extent that such individual
            is eligible to receive such benefits, items, or services
            through any other public or private benefits plan or legal
            agreement.
                ``(6) Waiver authority.--The Secretary may waive such
            provisions of this title and title XI as are necessary to carry
            out pilot programs under this subsection.
                ``(7) Funding.--For purposes of carrying out pilot programs
            under this subsection, the Secretary shall provide for the
            transfer, from the Federal Hospital Insurance Trust Fund under
            section 1817 and the Federal Supplementary Medical Insurance
            Trust Fund under section 1841, in such proportion as the
            Secretary determines appropriate, of such sums as the Secretary
            determines necessary, to the Centers for Medicare & Medicaid
            Services Program Management Account.
                ``(8) Waiver of budget neutrality.--The Secretary shall not
            require that pilot programs under this subsection be budget
            neutral with respect to expenditures under this title.
        ``(c) Determinations.--
                ``(1) By the commissioner of social security.--For purposes
            of this section, the Commissioner of Social Security, in
            consultation with the Secretary, and using the cost allocation
            method prescribed in section 201(g), shall determine whether
            individuals are environmental exposure affected individuals.
                ``(2) By the secretary.--The Secretary shall determine
            eligibility for pilot programs under subsection (b).
        ``(d) Emergency Declaration Defined.--For purposes of this section,
    the term `emergency declaration' means a declaration of a public health
    emergency under section 104(a) of the Comprehensive Environmental
    Response, Compensation, and Liability Act of 1980.
        ``(e) Environmental Exposure Affected Individual Defined.--
                ``(1) In general.--For purposes of this section, the term
            `environmental exposure affected individual' means--
                        ``(A) an individual described in paragraph (2); and
                        ``(B) an individual described in paragraph (3).
                ``(2) Individual described.--
                        ``(A) In general.--An individual described in this
                    paragraph is any individual who--
                                ``(i) is diagnosed with 1 or more
                            conditions described in subparagraph (B);
                                ``(ii) as demonstrated in such manner as
                            the Secretary determines appropriate, has been
                            present for an aggregate total of 6 months in
                            the geographic area subject to an emergency
                            declaration specified in subsection (b)(2)(A),
                            during a period ending--
                                        ``(I) not less than 10 years prior
                                    to such diagnosis; and
                                        ``(II) prior to the implementation
                                    of all the remedial and removal actions
                                    specified in the Record of Decision for
                                    Operating Unit 4 and the Record of
                                    Decision for Operating Unit 7;
                                ``(iii) files an application for benefits
                            under this title (or has an application filed
                            on behalf of the individual), including
                            pursuant to this section; and
                                ``(iv) is determined under this section to
                            meet the criteria in this subparagraph.
                        ``(B) Conditions described.--For purposes of
                    subparagraph (A), the following conditions are
                    described in this subparagraph:
                                ``(i) Asbestosis, pleural thickening, or
                            pleural plaques as established by--
                                        ``(I) interpretation by a `B
                                    Reader' qualified physician of a plain
                                    chest x-ray or interpretation of a
                                    computed tomographic radiograph of the
                                    chest by a qualified physician, as
                                    determined by the Secretary; or
                                        ``(II) such other diagnostic
                                    standards as the Secretary specifies,
                            except that this clause shall not apply to
                            pleural thickening or pleural plaques unless
                            there are symptoms or conditions requiring
                            medical treatment as a result of these
                            diagnoses.
                                ``(ii) Mesothelioma, or malignancies of the
                            lung, colon, rectum, larynx, stomach,
                            esophagus, pharynx, or ovary, as established
                            by--
                                        ``(I) pathologic examination of
                                    biopsy tissue;
                                        ``(II) cytology from
                                    bronchioalveolar lavage; or
                                        ``(III) such other diagnostic
                                    standards as the Secretary specifies.
                                ``(iii) Any other diagnosis which the
                            Secretary, in consultation with the
                            Commissioner of Social Security, determines is
                            an asbestos-related medical condition, as
                            established by such diagnostic standards as the
                            Secretary specifies.
                ``(3) Other individual described.--An individual described
            in this paragraph is any individual who--
                        ``(A) is not an individual described in paragraph
                    (2);
                        ``(B) is diagnosed with a medical condition caused
                    by the exposure of the individual to a public health
                    hazard to which an emergency declaration applies, based
                    on such medical conditions, diagnostic standards, and
                    other criteria as the Secretary specifies;
                        ``(C) as demonstrated in such manner as the
                    Secretary determines appropriate, has been present for
                    an aggregate total of 6 months in the geographic area
                    subject to the emergency declaration involved, during a
                    period determined appropriate by the Secretary;
                        ``(D) files an application for benefits under this
                    title (or has an application filed on behalf of the
                    individual), including pursuant to this section; and
                        ``(E) is determined under this section to meet the
                    criteria in this paragraph.''.
        (b) Program for Early Detection of Certain Medical Conditions
    Related to Environmental Health Hazards.--Title XX of the Social
    Security Act (42 U.S.C. 1397 et seq.), as amended by section 5507, is
    amended by adding at the end the following:

    ``SEC. 2009. PROGRAM FOR EARLY DETECTION OF CERTAIN MEDICAL CONDITIONS
                  RELATED TO ENVIRONMENTAL HEALTH HAZARDS.

        ``(a) Program Establishment.--The Secretary shall establish a
    program in accordance with this section to make competitive grants to
    eligible entities specified in subsection (b) for the purpose of--
                ``(1) screening at-risk individuals (as defined in
            subsection (c)(1)) for environmental health conditions (as
            defined in subsection (c)(3)); and
                ``(2) developing and disseminating public information and
            education concerning--
                        ``(A) the availability of screening under the
                    program under this section;
                        ``(B) the detection, prevention, and treatment of
                    environmental health conditions; and
                        ``(C) the availability of Medicare benefits for
                    certain individuals diagnosed with environmental health
                    conditions under section 1881A.
        ``(b) Eligible Entities.--
                ``(1) In general.--For purposes of this section, an
            eligible entity is an entity described in paragraph (2) which
            submits an application to the Secretary in such form and
            manner, and containing such information and assurances, as the
            Secretary determines appropriate.
                ``(2) Types of eligible entities.--The entities described
            in this paragraph are the following:
                        ``(A) A hospital or community health center.
                        ``(B) A Federally qualified health center.
                        ``(C) A facility of the Indian Health Service.
                        ``(D) A National Cancer Institute-designated cancer
                    center.
                        ``(E) An agency of any State or local government.
                        ``(F) A nonprofit organization.
                        ``(G) Any other entity the Secretary determines
                    appropriate.
        ``(c) Definitions.--In this section:
                ``(1) At-risk individual.--The term `at-risk individual'
            means an individual who--
                        ``(A)(i) as demonstrated in such manner as the
                    Secretary determines appropriate, has been present for
                    an aggregate total of 6 months in the geographic area
                    subject to an emergency declaration specified under
                    paragraph (2), during a period ending--
                                ``(I) not less than 10 years prior to the
                            date of such individual's application under
                            subparagraph (B); and
                                ``(II) prior to the implementation of all
                            the remedial and removal actions specified in
                            the Record of Decision for Operating Unit 4 and
                            the Record of Decision for Operating Unit 7; or
                        ``(ii) meets such other criteria as the Secretary
                    determines appropriate considering the type of
                    environmental health condition at issue; and
                        ``(B) has submitted an application (or has an
                    application submitted on the individual's behalf), to
                    an eligible entity receiving a grant under this
                    section, for screening under the program under this
                    section.
                ``(2) Emergency declaration.--The term `emergency
            declaration' means a declaration of a public health emergency
            under section 104(a) of the Comprehensive Environmental
            Response, Compensation, and Liability Act of 1980.
                ``(3) Environmental health condition.--The term
            `environmental health condition' means--
                        ``(A) asbestosis, pleural thickening, or pleural
                    plaques, as established by--
                                ``(i) interpretation by a `B Reader'
                            qualified physician of a plain chest x-ray or
                            interpretation of a computed tomographic
                            radiograph of the chest by a qualified
                            physician, as determined by the Secretary; or
                                ``(ii) such other diagnostic standards as
                            the Secretary specifies;
                        ``(B) mesothelioma, or malignancies of the lung,
                    colon, rectum, larynx, stomach, esophagus, pharynx, or
                    ovary, as established by--
                                ``(i) pathologic examination of biopsy
                            tissue;
                                ``(ii) cytology from bronchioalveolar
                            lavage; or
                                ``(iii) such other diagnostic standards as
                            the Secretary specifies; and
                        ``(C) any other medical condition which the
                    Secretary determines is caused by exposure to a
                    hazardous substance or pollutant or contaminant at a
                    Superfund site to which an emergency declaration
                    applies, based on such criteria and as established by
                    such diagnostic standards as the Secretary specifies.
                ``(4) Hazardous substance; pollutant; contaminant.--The
            terms `hazardous substance', `pollutant', and `contaminant'
            have the meanings given those terms in section 101 of the
            Comprehensive Environmental Response, Compensation, and
            Liability Act of 1980 (42 U.S.C. 9601).
                ``(5) Superfund site.--The term `Superfund site' means a
            site included on the National Priorities List developed by the
            President in accordance with section 105(a)(8)(B) of the
            Comprehensive Environmental Response, Compensation, and
            Liability Act of 1980 (42 U.S.C. 9605(a)(8)(B)).
        ``(d) Health Coverage Unaffected.--Nothing in this section shall be
    construed to affect any coverage obligation of a governmental or
    private health plan or program relating to an at-risk individual.
        ``(e) Funding.--
                ``(1) In general.--Out of any funds in the Treasury not
            otherwise appropriated, there are appropriated to the
            Secretary, to carry out the program under this section--
                        ``(A) $23,000,000 for the period of fiscal years
                    2010 through 2014; and
                        ``(B) $20,000,000 for each 5-fiscal year period
                    thereafter.
                ``(2) Availability.--Funds appropriated under paragraph (1)
            shall remain available until expended.
        ``(f) Nonapplication.--
                ``(1) In general.--Except as provided in paragraph (2), the
            preceding sections of this title shall not apply to grants
            awarded under this section.
                ``(2) Limitations on use of grants.--Section 2005(a) shall
            apply to a grant awarded under this section to the same extent
            and in the same manner as such section applies to payments to
            States under this title, except that paragraph (4) of such
            section shall not be construed to prohibit grantees from
            conducting screening for environmental health conditions as
            authorized under this section.''.

    SEC. 10324. PROTECTIONS FOR FRONTIER STATES.

        (a) Floor on Area Wage Index for Hospitals in Frontier States.--
                (1) In general.--Section 1886(d)(3)(E) of the Social
            Security Act (42 U.S.C. 1395ww(d)(3)(E)) is amended--
                        (A) in clause (i), by striking ``clause (ii)'' and
                    inserting ``clause (ii) or (iii)''; and
                        (B) by adding at the end the following new clause:
                                ``(iii) Floor on area wage index for
                            hospitals in frontier states.--
                                        ``(I) In general.--Subject to
                                    subclause (IV), for discharges
                                    occurring on or after October 1, 2010,
                                    the area wage index applicable under
                                    this subparagraph to any hospital which
                                    is located in a frontier State (as
                                    defined in subclause (II)) may not be
                                    less than 1.00.
                                        ``(II) Frontier state defined.--In
                                    this clause, the term `frontier State'
                                    means a State in which at least 50
                                    percent of the counties in the State
                                    are frontier counties.
                                        ``(III) Frontier county defined.--
                                    In this clause, the term `frontier
                                    county' means a county in which the
                                    population per square mile is less than
                                    6.
                                        ``(IV) Limitation.--This clause
                                    shall not apply to any hospital located
                                    in a State that receives a non-labor
                                    related share adjustment under
                                    paragraph (5)(H).''.
                (2) Waiving budget neutrality.--Section 1886(d)(3)(E) of
            the Social Security Act (42 U.S.C. 1395ww(d)(3)(E)), as amended
            by subsection (a), is amended in the third sentence by
            inserting ``and the amendments made by section 10324(a)(1) of
            the Patient Protection and Affordable Care Act'' after
            ``2003''.
        (b) Floor on Area Wage Adjustment Factor for Hospital Outpatient
    Department Services in Frontier States.--Section 1833(t) of the Social
    Security Act (42 U.S.C. 1395l(t)), as amended by section 3138, is
    amended--
                (1) in paragraph (2)(D), by striking ``the Secretary'' and
            inserting ``subject to paragraph (19), the Secretary''; and
                (2) by adding at the end the following new paragraph:
                ``(19) Floor on area wage adjustment factor for hospital
            outpatient department services in frontier states.--
                        ``(A) In general.--Subject to subparagraph (B),
                    with respect to covered OPD services furnished on or
                    after January 1, 2011, the area wage adjustment factor
                    applicable under the payment system established under
                    this subsection to any hospital outpatient department
                    which is located in a frontier State (as defined in
                    section 1886(d)(3)(E)(iii)(II)) may not be less than
                    1.00. The preceding sentence shall not be applied in a
                    budget neutral manner.
                        ``(B) Limitation.--This paragraph shall not apply
                    to any hospital outpatient department located in a
                    State that receives a non-labor related share
                    adjustment under section 1886(d)(5)(H).''.
        (c) Floor for Practice Expense Index for Physicians' Services
    Furnished in Frontier States.--Section 1848(e)(1) of the Social
    Security Act (42 U.S.C. 1395w-4(e)(1)), as amended by section 3102, is
    amended--
                (1) in subparagraph (A), by striking ``and (H)'' and
            inserting ``(H), and (I)''; and
                (2) by adding at the end the following new subparagraph:
                        ``(I) Floor for practice expense index for services
                    furnished in frontier states.--
                                ``(i) In general.--Subject to clause (ii),
                            for purposes of payment for services furnished
                            in a frontier State (as defined in section
                            1886(d)(3)(E)(iii)(II)) on or after January 1,
                            2011, after calculating the practice expense
                            index in subparagraph (A)(i), the Secretary
                            shall increase any such index to 1.00 if such
                            index would otherwise be less that 1.00. The
                            preceding sentence shall not be applied in a
                            budget neutral manner.
                                ``(ii) Limitation.--This subparagraph shall
                            not apply to services furnished in a State that
                            receives a non-labor related share adjustment
                            under section 1886(d)(5)(H).''.

    SEC. 10325. REVISION TO SKILLED NURSING FACILITY PROSPECTIVE PAYMENT
                  SYSTEM.

        (a) Temporary Delay of RUG-IV.--Notwithstanding any other provision
    of law, the Secretary of Health and Human Services shall not, prior to
    October 1, 2011, implement Version 4 of the Resource Utilization Groups
    (in this subsection refereed to as ``RUG-IV'') published in the Federal
    Register on August 11, 2009, entitled ``Prospective Payment System and
    Consolidated Billing for Skilled Nursing Facilities for FY 2010;
    Minimum Data Set, Version 3.0 for Skilled Nursing Facilities and
    Medicaid Nursing Facilities'' (74 Fed. Reg. 40288). Beginning on
    October 1, 2010, the Secretary of Health and Human Services shall
    implement the change specific to therapy furnished on a concurrent
    basis that is a component of RUG-IV and changes to the lookback period
    to ensure that only those services furnished after admission to a
    skilled nursing facility are used as factors in determining a case mix
    classification under the skilled nursing facility prospective payment
    system under section 1888(e) of the Social Security Act (42 U.S.C.
    1395yy(e)).
        (b) Construction.--Nothing in this section shall be interpreted as
    delaying the implementation of Version 3.0 of the Minimum Data Sets
    (MDS 3.0) beyond the planned implementation date of October 1, 2010.

    SEC. 10326. PILOT TESTING PAY-FOR-PERFORMANCE PROGRAMS FOR CERTAIN
                  MEDICARE PROVIDERS.

        (a) In General.--Not later than January 1, 2016, the Secretary of
    Health and Human Services (in this section referred to as the
    ``Secretary'') shall, for each provider described in subsection (b),
    conduct a separate pilot program under title XVIII of the Social
    Security Act to test the implementation of a value-based purchasing
    program for payments under such title for the provider.
        (b) Providers Described.--The providers described in this paragraph
    are the following:
                (1) Psychiatric hospitals (as described in clause (i) of
            section 1886(d)(1)(B) of such Act (42 U.S.C. 1395ww(d)(1)(B)))
            and psychiatric units (as described in the matter following
            clause (v) of such section).
                (2) Long-term care hospitals (as described in clause (iv)
            of such section).
                (3) Rehabilitation hospitals (as described in clause (ii)
            of such section).
                (4) PPS-exempt cancer hospitals (as described in clause (v)
            of such section).
                (5) Hospice programs (as defined in section 1861(dd)(2) of
            such Act (42 U.S.C. 1395x(dd)(2))).
        (c) Waiver Authority.--The Secretary may waive such requirements of
    titles XI and XVIII of the Social Security Act as may be necessary
    solely for purposes of carrying out the pilot programs under this
    section.
        (d) No Additional Program Expenditures.--Payments under this
    section under the separate pilot program for value based purchasing (as
    described in subsection (a)) for each provider type described in
    paragraphs (1) through (5) of subsection (b) for applicable items and
    services under title XVIII of the Social Security Act for a year shall
    be established in a manner that does not result in spending more under
    each such value based purchasing program for such year than would
    otherwise be expended for such provider type for such year if the pilot
    program were not implemented, as estimated by the Secretary.
        (e) Expansion of Pilot Program.--The Secretary may, at any point
    after January 1, 2018, expand the duration and scope of a pilot program
    conducted under this subsection, to the extent determined appropriate
    by the Secretary, if--
                (1) the Secretary determines that such expansion is
            expected to--
                        (A) reduce spending under title XVIII of the Social
                    Security Act without reducing the quality of care; or
                        (B) improve the quality of care and reduce
                    spending;
                (2) the Chief Actuary of the Centers for Medicare &
            Medicaid Services certifies that such expansion would reduce
            program spending under such title XVIII; and
                (3) the Secretary determines that such expansion would not
            deny or limit the coverage or provision of benefits under such
            title XIII for Medicare beneficiaries.

    SEC. 10327. IMPROVEMENTS TO THE PHYSICIAN QUALITY REPORTING SYSTEM.

        (a) In General.--Section 1848(m) of the Social Security Act (42
    U.S.C. 1395w-4(m)) is amended by adding at the end the following new
    paragraph:
                ``(7) Additional incentive payment.--
                        ``(A) In general.--For 2011 through 2014, if an
                    eligible professional meets the requirements described
                    in subparagraph (B), the applicable quality percent for
                    such year, as described in clauses (iii) and (iv) of
                    paragraph (1)(B), shall be increased by 0.5 percentage
                    points.
                        ``(B) Requirements described.--In order to qualify
                    for the additional incentive payment described in
                    subparagraph (A), an eligible professional shall meet
                    the following requirements:
                                ``(i) The eligible professional shall--
                                        ``(I) satisfactorily submit data on
                                    quality measures for purposes of
                                    paragraph (1) for a year; and
                                        ``(II) have such data submitted on
                                    their behalf through a Maintenance of
                                    Certification Program (as defined in
                                    subparagraph (C)(i)) that meets--
                                                ``(aa) the criteria for a
                                            registry (as described in
                                            subsection (k)(4)); or
                                                ``(bb) an alternative form
                                            and manner determined
                                            appropriate by the Secretary.
                                ``(ii) The eligible professional, more
                            frequently than is required to qualify for or
                            maintain board certification status--
                                        ``(I) participates in such a
                                    Maintenance of Certification program
                                    for a year; and
                                        ``(II) successfully completes a
                                    qualified Maintenance of Certification
                                    Program practice assessment (as defined
                                    in subparagraph (C)(ii)) for such year.
                                ``(iii) A Maintenance of Certification
                            program submits to the Secretary, on behalf of
                            the eligible professional, information--
                                        ``(I) in a form and manner
                                    specified by the Secretary, that the
                                    eligible professional has successfully
                                    met the requirements of clause (ii)
                                    (which may be in the form of a
                                    structural measure);
                                        ``(II) if requested by the
                                    Secretary, on the survey of patient
                                    experience with care (as described in
                                    subparagraph (C)(ii)(II)); and
                                        ``(III) as the Secretary may
                                    require, on the methods, measures, and
                                    data used under the Maintenance of
                                    Certification Program and the qualified
                                    Maintenance of Certification Program
                                    practice assessment.
                        ``(C) Definitions.--For purposes of this paragraph:
                                ``(i) The term `Maintenance of
                            Certification Program' means a continuous
                            assessment program, such as qualified American
                            Board of Medical Specialties Maintenance of
                            Certification program or an equivalent program
                            (as determined by the Secretary), that advances
                            quality and the lifelong learning and self-
                            assessment of board certified specialty
                            physicians by focusing on the competencies of
                            patient care, medical knowledge, practice-based
                            learning, interpersonal and communication
                            skills and professionalism. Such a program
                            shall include the following:
                                        ``(I) The program requires the
                                    physician to maintain a valid,
                                    unrestricted medical license in the
                                    United States.
                                        ``(II) The program requires a
                                    physician to participate in educational
                                    and self-assessment programs that
                                    require an assessment of what was
                                    learned.
                                        ``(III) The program requires a
                                    physician to demonstrate, through a
                                    formalized, secure examination, that
                                    the physician has the fundamental
                                    diagnostic skills, medical knowledge,
                                    and clinical judgment to provide
                                    quality care in their respective
                                    specialty.
                                        ``(IV) The program requires
                                    successful completion of a qualified
                                    Maintenance of Certification Program
                                    practice assessment as described in
                                    clause (ii).
                                ``(ii) The term `qualified Maintenance of
                            Certification Program practice assessment'
                            means an assessment of a physician's practice
                            that--
                                        ``(I) includes an initial
                                    assessment of an eligible
                                    professional's practice that is
                                    designed to demonstrate the physician's
                                    use of evidence-based medicine;
                                        ``(II) includes a survey of patient
                                    experience with care; and
                                        ``(III) requires a physician to
                                    implement a quality improvement
                                    intervention to address a practice
                                    weakness identified in the initial
                                    assessment under subclause (I) and then
                                    to remeasure to assess performance
                                    improvement after such intervention.''.
        (b) Authority.--Section 3002(c) of this Act is amended by adding at
    the end the following new paragraph:
                ``(3) Authority.--For years after 2014, if the Secretary of
            Health and Human Services determines it to be appropriate, the
            Secretary may incorporate participation in a Maintenance of
            Certification Program and successful completion of a qualified
            Maintenance of Certification Program practice assessment into
            the composite of measures of quality of care furnished pursuant
            to the physician fee schedule payment modifier, as described in
            section 1848(p)(2) of the Social Security Act (42 U.S.C. 1395w-
            4(p)(2)).''.
        (c) Elimination of MA Regional Plan Stabilization Fund.--
                (1) In general.--Section 1858 of the Social Security Act
            (42 U.S.C. 1395w-27a) is amended by striking subsection (e).
                (2) Transition.--Any amount contained in the MA Regional
            Plan Stabilization Fund as of the date of the enactment of this
            Act shall be transferred to the Federal Supplementary Medical
            Insurance Trust Fund.

    SEC. 10328. IMPROVEMENT IN PART D MEDICATION THERAPY MANAGEMENT (MTM)
                  PROGRAMS.

        (a) In General.--Section 1860D-4(c)(2) of the Social Security Act
    (42 U.S.C. 1395w-104(c)(2)) is amended--
                (1) by redesignating subparagraphs (C), (D), and (E) as
            subparagraphs (E), (F), and (G), respectively; and
                (2) by inserting after subparagraph (B) the following new
            subparagraphs:
                        ``(C) Required interventions.--For plan years
                    beginning on or after the date that is 2 years after
                    the date of the enactment of the Patient Protection and
                    Affordable Care Act, prescription drug plan sponsors
                    shall offer medication therapy management services to
                    targeted beneficiaries described in subparagraph
                    (A)(ii) that include, at a minimum, the following to
                    increase adherence to prescription medications or other
                    goals deemed necessary by the Secretary:
                                ``(i) An annual comprehensive medication
                            review furnished person-to-person or using
                            telehealth technologies (as defined by the
                            Secretary) by a licensed pharmacist or other
                            qualified provider. The comprehensive
                            medication review--
                                        ``(I) shall include a review of the
                                    individual's medications and may result
                                    in the creation of a recommended
                                    medication action plan or other actions
                                    in consultation with the individual and
                                    with input from the prescriber to the
                                    extent necessary and practicable; and
                                        ``(II) shall include providing the
                                    individual with a written or printed
                                    summary of the results of the review.
                            The Secretary, in consultation with relevant
                            stakeholders, shall develop a standardized
                            format for the action plan under subclause (I)
                            and the summary under subclause (II).
                                ``(ii) Follow-up interventions as warranted
                            based on the findings of the annual medication
                            review or the targeted medication enrollment
                            and which may be provided person-to-person or
                            using telehealth technologies (as defined by
                            the Secretary).
                        ``(D) Assessment.--The prescription drug plan
                    sponsor shall have in place a process to assess, at
                    least on a quarterly basis, the medication use of
                    individuals who are at risk but not enrolled in the
                    medication therapy management program, including
                    individuals who have experienced a transition in care,
                    if the prescription drug plan sponsor has access to
                    that information.
                        ``(E) Automatic enrollment with ability to opt-
                    out.--The prescription drug plan sponsor shall have in
                    place a process to--
                                ``(i) subject to clause (ii), automatically
                            enroll targeted beneficiaries described in
                            subparagraph (A)(ii), including beneficiaries
                            identified under subparagraph (D), in the
                            medication therapy management program required
                            under this subsection; and
                                ``(ii) permit such beneficiaries to opt-out
                            of enrollment in such program.''.
        (b) Rule of Construction.--Nothing in this section shall limit the
    authority of the Secretary of Health and Human Services to modify or
    broaden requirements for a medication therapy management program under
    part D of title XVIII of the Social Security Act or to study new models
    for medication therapy management through the Center for Medicare and
    Medicaid Innovation under section 1115A of such Act, as added by
    section 3021.

    SEC. 10329. DEVELOPING METHODOLOGY TO ASSESS HEALTH PLAN VALUE.

        (a) Development.--The Secretary of Health and Human Services
    (referred to in this section as the ``Secretary''), in consultation
    with relevant stakeholders including health insurance issuers, health
    care consumers, employers, health care providers, and other entities
    determined appropriate by the Secretary, shall develop a methodology to
    measure health plan value. Such methodology shall take into
    consideration, where applicable--
                (1) the overall cost to enrollees under the plan;
                (2) the quality of the care provided for under the plan;
                (3) the efficiency of the plan in providing care;
                (4) the relative risk of the plan's enrollees as compared
            to other plans;
                (5) the actuarial value or other comparative measure of the
            benefits covered under the plan; and
                (6) other factors determined relevant by the Secretary.
        (b) Report.--Not later than 18 months after the date of enactment
    of this Act, the Secretary shall submit to Congress a report concerning
    the methodology developed under subsection (a).

    SEC. 10330. MODERNIZING COMPUTER AND DATA SYSTEMS OF THE CENTERS FOR
                  MEDICARE & MEDICAID SERVICES TO SUPPORT IMPROVEMENTS IN
                  CARE DELIVERY.

        (a) In General.--The Secretary of Health and Human Services (in
    this section referred to as the ``Secretary'') shall develop a plan
    (and detailed budget for the resources needed to implement such plan)
    to modernize the computer and data systems of the Centers for Medicare
    & Medicaid Services (in this section referred to as ``CMS'').
        (b) Considerations.--In developing the plan, the Secretary shall
    consider how such modernized computer system could--
                (1) in accordance with the regulations promulgated under
            section 264(c) of the Health Insurance Portability and
            Accountability Act of 1996, make available data in a reliable
            and timely manner to providers of services and suppliers to
            support their efforts to better manage and coordinate care
            furnished to beneficiaries of CMS programs; and
                (2) support consistent evaluations of payment and delivery
            system reforms under CMS programs.
        (c) Posting of Plan.--By not later than 9 months after the date of
    the enactment of this Act, the Secretary shall post on the website of
    the Centers for Medicare & Medicaid Services the plan described in
    subsection (a).

    SEC. 10331. PUBLIC REPORTING OF PERFORMANCE INFORMATION.

        (a) In General.--
                (1) Development.--Not later than January 1, 2011, the
            Secretary shall develop a Physician Compare Internet website
            with information on physicians enrolled in the Medicare program
            under section 1866(j) of the Social Security Act (42 U.S.C.
            1395cc(j)) and other eligible professionals who participate in
            the Physician Quality Reporting Initiative under section 1848
            of such Act (42 U.S.C. 1395w-4).
                (2) Plan.--Not later than January 1, 2013, and with respect
            to reporting periods that begin no earlier than January 1,
            2012, the Secretary shall also implement a plan for making
            publicly available through Physician Compare, consistent with
            subsection (c), information on physician performance that
            provides comparable information for the public on quality and
            patient experience measures with respect to physicians enrolled
            in the Medicare program under such section 1866(j). To the
            extent scientifically sound measures that are developed
            consistent with the requirements of this section are available,
            such information, to the extent practicable, shall include--
                        (A) measures collected under the Physician Quality
                    Reporting Initiative;
                        (B) an assessment of patient health outcomes and
                    the functional status of patients;
                        (C) an assessment of the continuity and
                    coordination of care and care transitions, including
                    episodes of care and risk-adjusted resource use;
                        (D) an assessment of efficiency;
                        (E) an assessment of patient experience and
                    patient, caregiver, and family engagement;
                        (F) an assessment of the safety, effectiveness, and
                    timeliness of care; and
                        (G) other information as determined appropriate by
                    the Secretary.
        (b) Other Required Considerations.--In developing and implementing
    the plan described in subsection (a)(2), the Secretary shall, to the
    extent practicable, include--
                (1) processes to assure that data made public, either by
            the Centers for Medicare & Medicaid Services or by other
            entities, is statistically valid and reliable, including risk
            adjustment mechanisms used by the Secretary;
                (2) processes by which a physician or other eligible
            professional whose performance on measures is being publicly
            reported has a reasonable opportunity, as determined by the
            Secretary, to review his or her individual results before they
            are made public;
                (3) processes by the Secretary to assure that the
            implementation of the plan and the data made available on
            Physician Compare provide a robust and accurate portrayal of a
            physician's performance;
                (4) data that reflects the care provided to all patients
            seen by physicians, under both the Medicare program and, to the
            extent practicable, other payers, to the extent such
            information would provide a more accurate portrayal of
            physician performance;
                (5) processes to ensure appropriate attribution of care
            when multiple physicians and other providers are involved in
            the care of a patient;
                (6) processes to ensure timely statistical performance
            feedback is provided to physicians concerning the data reported
            under any program subject to public reporting under this
            section; and
                (7) implementation of computer and data systems of the
            Centers for Medicare & Medicaid Services that support valid,
            reliable, and accurate public reporting activities authorized
            under this section.
        (c) Ensuring Patient Privacy.--The Secretary shall ensure that
    information on physician performance and patient experience is not
    disclosed under this section in a manner that violates sections 552 or
    552a of title 5, United States Code, with regard to the privacy of
    individually identifiable health information.
        (d) Feedback From Multi-stakeholder Groups.--The Secretary shall
    take into consideration input provided by multi-stakeholder groups,
    consistent with sections 1890(b)(7) and 1890A of the Social Security
    Act, as added by section 3014 of this Act, in selecting quality
    measures for use under this section.
        (e) Consideration of Transition to Value-based Purchasing.--In
    developing the plan under this subsection (a)(2), the Secretary shall,
    as the Secretary determines appropriate, consider the plan to
    transition to a value-based purchasing program for physicians and other
    practitioners developed under section 131 of the Medicare Improvements
    for Patients and Providers Act of 2008 (Public Law 110-275).
        (f) Report to Congress.--Not later than January 1, 2015, the
    Secretary shall submit to Congress a report on the Physician Compare
    Internet website developed under subsection (a)(1). Such report shall
    include information on the efforts of and plans made by the Secretary
    to collect and publish data on physician quality and efficiency and on
    patient experience of care in support of value-based purchasing and
    consumer choice, together with recommendations for such legislation and
    administrative action as the Secretary determines appropriate.
        (g) Expansion.--At any time before the date on which the report is
    submitted under subsection (f), the Secretary may expand (including
    expansion to other providers of services and suppliers under title
    XVIII of the Social Security Act) the information made available on
    such website.
        (h) Financial Incentives To Encourage Consumers To Choose High
    Quality Providers.--The Secretary may establish a demonstration
    program, not later than January 1, 2019, to provide financial
    incentives to Medicare beneficiaries who are furnished services by high
    quality physicians, as determined by the Secretary based on factors in
    subparagraphs (A) through (G) of subsection (a)(2). In no case may
    Medicare beneficiaries be required to pay increased premiums or cost
    sharing or be subject to a reduction in benefits under title XVIII of
    the Social Security Act as a result of such demonstration program. The
    Secretary shall ensure that any such demonstration program does not
    disadvantage those beneficiaries without reasonable access to high
    performing physicians or create financial inequities under such title.
        (i) Definitions.--In this section:
                (1) Eligible professional.--The term ``eligible
            professional'' has the meaning given that term for purposes of
            the Physician Quality Reporting Initiative under section 1848
            of the Social Security Act (42 U.S.C. 1395w-4).
                (2) Physician.--The term ``physician'' has the meaning
            given that term in section 1861(r) of such Act (42 U.S.C.
            1395x(r)).
                (3) Physician compare.--The term ``Physician Compare''
            means the Internet website developed under subsection (a)(1).
                (4) Secretary.--The term ``Secretary'' means the Secretary
            of Health and Human Services.

    SEC. 10332. AVAILABILITY OF MEDICARE DATA FOR PERFORMANCE MEASUREMENT.

        (a) In General.--Section 1874 of the Social Security Act (42 U.S.C.
    1395kk) is amended by adding at the end the following new subsection:
        ``(e) Availability of Medicare Data.--
                ``(1) In general.--Subject to paragraph (4), the Secretary
            shall make available to qualified entities (as defined in
            paragraph (2)) data described in paragraph (3) for the
            evaluation of the performance of providers of services and
            suppliers.
                ``(2) Qualified entities.--For purposes of this subsection,
            the term `qualified entity' means a public or private entity
            that--
                        ``(A) is qualified (as determined by the Secretary)
                    to use claims data to evaluate the performance of
                    providers of services and suppliers on measures of
                    quality, efficiency, effectiveness, and resource use;
                    and
                        ``(B) agrees to meet the requirements described in
                    paragraph (4) and meets such other requirements as the
                    Secretary may specify, such as ensuring security of
                    data.
                ``(3) Data described.--The data described in this paragraph
            are standardized extracts (as determined by the Secretary) of
            claims data under parts A, B, and D for items and services
            furnished under such parts for one or more specified geographic
            areas and time periods requested by a qualified entity. The
            Secretary shall take such actions as the Secretary deems
            necessary to protect the identity of individuals entitled to or
            enrolled for benefits under such parts.
                ``(4) Requirements.--
                        ``(A) Fee.--Data described in paragraph (3) shall
                    be made available to a qualified entity under this
                    subsection at a fee equal to the cost of making such
                    data available. Any fee collected pursuant to the
                    preceding sentence shall be deposited into the Federal
                    Supplementary Medical Insurance Trust Fund under
                    section 1841.
                        ``(B) Specification of uses and methodologies.--A
                    qualified entity requesting data under this subsection
                    shall--
                                ``(i) submit to the Secretary a description
                            of the methodologies that such qualified entity
                            will use to evaluate the performance of
                            providers of services and suppliers using such
                            data;
                                ``(ii)(I) except as provided in subclause
                            (II), if available, use standard measures, such
                            as measures endorsed by the entity with a
                            contract under section 1890(a) and measures
                            developed pursuant to section 931 of the Public
                            Health Service Act; or
                                ``(II) use alternative measures if the
                            Secretary, in consultation with appropriate
                            stakeholders, determines that use of such
                            alternative measures would be more valid,
                            reliable, responsive to consumer preferences,
                            cost-effective, or relevant to dimensions of
                            quality and resource use not addressed by such
                            standard measures;
                                ``(iii) include data made available under
                            this subsection with claims data from sources
                            other than claims data under this title in the
                            evaluation of performance of providers of
                            services and suppliers;
                                ``(iv) only include information on the
                            evaluation of performance of providers and
                            suppliers in reports described in subparagraph
                            (C);
                                ``(v) make available to providers of
                            services and suppliers, upon their request,
                            data made available under this subsection; and
                                ``(vi) prior to their release, submit to
                            the Secretary the format of reports under
                            subparagraph (C).
                        ``(C) Reports.--Any report by a qualified entity
                    evaluating the performance of providers of services and
                    suppliers using data made available under this
                    subsection shall--
                                ``(i) include an understandable description
                            of the measures, which shall include quality
                            measures and the rationale for use of other
                            measures described in subparagraph (B)(ii)(II),
                            risk adjustment methods, physician attribution
                            methods, other applicable methods, data
                            specifications and limitations, and the
                            sponsors, so that consumers, providers of
                            services and suppliers, health plans,
                            researchers, and other stakeholders can assess
                            such reports;
                                ``(ii) be made available confidentially, to
                            any provider of services or supplier to be
                            identified in such report, prior to the public
                            release of such report, and provide an
                            opportunity to appeal and correct errors;
                                ``(iii) only include information on a
                            provider of services or supplier in an
                            aggregate form as determined appropriate by the
                            Secretary; and
                                ``(iv) except as described in clause (ii),
                            be made available to the public.
                        ``(D) Approval and limitation of uses.--The
                    Secretary shall not make data described in paragraph
                    (3) available to a qualified entity unless the
                    qualified entity agrees to release the information on
                    the evaluation of performance of providers of services
                    and suppliers. Such entity shall only use such data,
                    and information derived from such evaluation, for the
                    reports under subparagraph (C). Data released to a
                    qualified entity under this subsection shall not be
                    subject to discovery or admission as evidence in
                    judicial or administrative proceedings without consent
                    of the applicable provider of services or supplier.''.
        (b) Effective Date.--The amendment made by subsection (a) shall
    take effect on January 1, 2012.

    SEC. 10333. COMMUNITY-BASED COLLABORATIVE CARE NETWORKS.

        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 new
    subpart:

        ``Subpart XI--Community-Based Collaborative Care Network Program

    ``SEC. 340H. COMMUNITY-BASED COLLABORATIVE CARE NETWORK PROGRAM.

        ``(a) In General.--The Secretary may award grants to eligible
    entities to support community-based collaborative care networks that
    meet the requirements of subsection (b).
        ``(b) Community-based Collaborative Care Networks.--
                ``(1) Description.--A community-based collaborative care
            network (referred to in this section as a `network') shall be a
            consortium of health care providers with a joint governance
            structure (including providers within a single entity) that
            provides comprehensive coordinated and integrated health care
            services (as defined by the Secretary) for low-income
            populations.
                ``(2) Required inclusion.--A network shall include the
            following providers (unless such provider does not exist within
            the community, declines or refuses to participate, or places
            unreasonable conditions on their participation):
                        ``(A) A hospital that meets the criteria in section
                    1923(b)(1) of the Social Security Act; and
                        ``(B) All Federally qualified health centers (as
                    defined in section 1861(aa) of the Social Security Act
                    located in the community.
                ``(3) Priority.--In awarding grants, the Secretary shall
            give priority to networks that include--
                        ``(A) the capability to provide the broadest range
                    of services to low-income individuals;
                        ``(B) the broadest range of providers that
                    currently serve a high volume of low-income
                    individuals; and
                        ``(C) a county or municipal department of health.
        ``(c) Application.--
                ``(1) Application.--A network described in subsection (b)
            shall submit an application to the Secretary.
                ``(2) Renewal.--In subsequent years, based on the
            performance of grantees, the Secretary may provide renewal
            grants to prior year grant recipients.
        ``(d) Use of Funds.--
                ``(1) Use by grantees.--Grant funds may be used for the
            following activities:
                        ``(A) Assist low-income individuals to--
                                ``(i) access and appropriately use health
                            services;
                                ``(ii) enroll in health coverage programs;
                            and
                                ``(iii) obtain a regular primary care
                            provider or a medical home.
                        ``(B) Provide case management and care management.
                        ``(C) Perform health outreach using neighborhood
                    health workers or through other means.
                        ``(D) Provide transportation.
                        ``(E) Expand capacity, including through
                    telehealth, after-hours services or urgent care.
                        ``(F) Provide direct patient care services.
                ``(2) Grant funds to hrsa grantees.--The Secretary may
            limit the percent of grant funding that may be spent on direct
            care services provided by grantees of programs administered by
            the Health Resources and Services Administration or impose
            other requirements on such grantees deemed necessary.
        ``(e) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this section such sums as may be necessary
    for each of fiscal years 2011 through 2015.''.

    SEC. 10334. MINORITY HEALTH.

        (a) Office of Minority Health.--
                (1) In general.--Section 1707 of the Public Health Service
            Act (42 U.S.C. 300u-6) is amended--
                        (A) in subsection (a), by striking ``within the
                    Office of Public Health and Science'' and all that
                    follows through the end and inserting ``. The Office of
                    Minority Health as existing on the date of enactment of
                    the Patient Protection and Affordable Care Act shall be
                    transferred to the Office of the Secretary in such
                    manner that there is established in the Office of the
                    Secretary, the Office of Minority Health, which shall
                    be headed by the Deputy Assistant Secretary for
                    Minority Health who shall report directly to the
                    Secretary, and shall retain and strengthen authorities
                    (as in existence on such date of enactment) for the
                    purpose of improving minority health and the quality of
                    health care minorities receive, and eliminating racial
                    and ethnic disparities. In carrying out this
                    subsection, the Secretary, acting through the Deputy
                    Assistant Secretary, shall award grants, contracts,
                    enter into memoranda of understanding, cooperative,
                    interagency, intra-agency and other agreements with
                    public and nonprofit private entities, agencies, as
                    well as Departmental and Cabinet agencies and
                    organizations, and with organizations that are
                    indigenous human resource providers in communities of
                    color to assure improved health status of racial and
                    ethnic minorities, and shall develop measures to
                    evaluate the effectiveness of activities aimed at
                    reducing health disparities and supporting the local
                    community. Such measures shall evaluate community
                    outreach activities, language services, workforce
                    cultural competence, and other areas as determined by
                    the Secretary.''; and
                        (B) by striking subsection (h) and inserting the
                    following:
        ``(h) Authorization of Appropriations.--For the purpose of carrying
    out this section, there are authorized to be appropriated such sums as
    may be necessary for each of fiscal years 2011 through 2016.''.
                (2) Transfer of functions.--There are transferred to the
            Office of Minority Health in the office of the Secretary of
            Health and Human Services, all duties, responsibilities,
            authorities, accountabilities, functions, staff, funds, award
            mechanisms, and other entities under the authority of the
            Office of Minority Health of the Public Health Service as in
            effect on the date before the date of enactment of this Act,
            which shall continue in effect according to the terms in effect
            on the date before such date of enactment, until modified,
            terminated, superseded, set aside, or revoked in accordance
            with law by the President, the Secretary, a court of competent
            jurisdiction, or by operation of law.
                (3) Reports.--Not later than 1 year after the date of
            enactment of this section, and biennially thereafter, the
            Secretary of Health and Human Services shall prepare and submit
            to the appropriate committees of Congress a report describing
            the activities carried out under section 1707 of the Public
            Health Service Act (as amended by this subsection) during the
            period for which the report is being prepared. Not later than 1
            year after the date of enactment of this section, and
            biennially thereafter, the heads of each of the agencies of the
            Department of Health and Human Services shall submit to the
            Deputy Assistant Secretary for Minority Health a report
            summarizing the minority health activities of each of the
            respective agencies.
        (b) Establishment of Individual Offices of Minority Health Within
    the Department of Health and Human Services.--
                (1) In general.--Title XVII of the Public Health Service
            Act (42 U.S.C. 300u et seq.) is amended by inserting after
            section 1707 the following section:

    ``SEC. 1707A. INDIVIDUAL OFFICES OF MINORITY HEALTH WITHIN THE
                  DEPARTMENT.

        ``(a) In General.--The head of each agency specified in subsection
    (b)(1) shall establish within the agency an office to be known as the
    Office of Minority Health. The head of each such Office shall be
    appointed by the head of the agency within which the Office is
    established, and shall report directly to the head of the agency. The
    head of such agency shall carry out this section (as this section
    relates to the agency) acting through such Director.
        ``(b) Specified Agencies.--The agencies referred to in subsection
    (a) are the Centers for Disease Control and Prevention, the Health
    Resources and Services Administration, the Substance Abuse and Mental
    Health Services Administration, the Agency for Healthcare Research and
    Quality, the Food and Drug Administration, and the Centers for Medicare
    & Medicaid Services.
        ``(c) Director; Appointment.--Each Office of Minority Health
    established in an agency listed in subsection (a) shall be headed by a
    director, with documented experience and expertise in minority health
    services research and health disparities elimination.
        ``(d) References.--Except as otherwise specified, any reference in
    Federal law to an Office of Minority Health (in the Department of
    Health and Human Services) is deemed to be a reference to the Office of
    Minority Health in the Office of the Secretary.
        ``(e) Funding.--
                ``(1) Allocations.--Of the amounts appropriated for a
            specified agency for a fiscal year, the Secretary must
            designate an appropriate amount of funds for the purpose of
            carrying out activities under this section through the minority
            health office of the agency. In reserving an amount under the
            preceding sentence for a minority health office for a fiscal
            year, the Secretary shall reduce, by substantially the same
            percentage, the amount that otherwise would be available for
            each of the programs of the designated agency involved.
                ``(2) Availability of funds for staffing.--The purposes for
            which amounts made available under paragraph may be expended by
            a minority health office include the costs of employing staff
            for such office.''.
                (2) No new regulatory authority.--Nothing in this
            subsection and the amendments made by this subsection may be
            construed as establishing regulatory authority or modifying any
            existing regulatory authority.
                (3) Limitation on termination.--Notwithstanding any other
            provision of law, a Federal office of minority health or
            Federal appointive position with primary responsibility over
            minority health issues that is in existence in an office of
            agency of the Department of Health and Human Services on the
            date of enactment of this section shall not be terminated,
            reorganized, or have any of its power or duties transferred
            unless such termination, reorganization, or transfer is
            approved by an Act of Congress.
        (c) Redesignation of National Center on Minority Health and Health
    Disparities.--
                (1) Redesignation.--Title IV of the Public Health Service
            Act (42 U.S.C. 281 et seq.) is amended--
                        (A) by redesignating subpart 6 of part E as subpart
                    20;
                        (B) by transferring subpart 20, as so redesignated,
                    to part C of such title IV;
                        (C) by inserting subpart 20, as so redesignated,
                    after subpart 19 of such part C; and
                        (D) in subpart 20, as so redesignated--
                                (i) by redesignating sections 485E through
                            485H as sections 464z-3 through 464z-6,
                            respectively;
                                (ii) by striking ``National Center on
                            Minority Health and Health Disparities'' each
                            place such term appears and inserting
                            ``National Institute on Minority Health and
                            Health Disparities''; and
                                (iii) by striking ``Center'' each place
                            such term appears and inserting ``Institute''.
                (2) Purpose of institute; duties.--Section 464z-3 of the
            Public Health Service Act, as so redesignated, is amended--
                        (A) in subsection (h)(1), by striking ``research
                    endowments at centers of excellence under section
                    736.'' and inserting the following: ``research
                    endowments--
                ``(1) at centers of excellence under section 736; and
                ``(2) at centers of excellence under section 464z-4.'';
                        (B) in subsection (h)(2)(A), by striking
                    ``average'' and inserting ``median''; and
                        (C) by adding at the end the following:
        ``(h) Interagency Coordination.--The Director of the Institute, as
    the primary Federal officials with responsibility for coordinating all
    research and activities conducted or supported by the National
    Institutes of Health on minority health and health disparities, shall
    plan, coordinate, review and evaluate research and other activities
    conducted or supported by the Institutes and Centers of the National
    Institutes of Health.''.
                (3) Technical and conforming amendments.--
                        (A) Section 401(b)(24) of the Public Health Service
                    Act (42 U.S.C. 281(b)(24)) is amended by striking
                    ``Center'' and inserting ``Institute''.
                        (B) Subsection (d)(1) of section 903 of the Public
                    Health Service Act (42 U.S.C. 299a-1(d)(1)) is amended
                    by striking ``section 485E'' and inserting ``section
                    464z-3''.

    SEC. 10335. TECHNICAL CORRECTION TO THE HOSPITAL VALUE-BASED PURCHASING
                  PROGRAM.

        Section 1886(o)(2)A) of the Social Security Act, as added by
    section 3001, is amended, in the first sentence, by inserting ``, other
    than measures of readmissions,'' after ``shall select measures''.

    SEC. 10336. GAO STUDY AND REPORT ON MEDICARE BENEFICIARY ACCESS TO
                  HIGH-QUALITY DIALYSIS SERVICES.

        (a) Study.--
                (1) In general.--The Comptroller General of the United
            States shall conduct a study on the impact on Medicare
            beneficiary access to high-quality dialysis services of
            including specified oral drugs that are furnished to such
            beneficiaries for the treatment of end stage renal disease in
            the bundled prospective payment system under section
            1881(b)(14) of the Social Security Act (42 U.S.C.
            1395rr(b)(14)) (pursuant to the proposed rule published by the
            Secretary of Health and Human Services in the Federal Register
            on September 29, 2009 (74 Fed. Reg. 49922 et seq.)). Such study
            shall include an analysis of--
                        (A) the ability of providers of services and renal
                    dialysis facilities to furnish specified oral drugs or
                    arrange for the provision of such drugs;
                        (B) the ability of providers of services and renal
                    dialysis facilities to comply, if necessary, with
                    applicable State laws (such as State pharmacy licensure
                    requirements) in order to furnish specified oral drugs;
                        (C) whether appropriate quality measures exist to
                    safeguard care for Medicare beneficiaries being
                    furnished specified oral drugs by providers of services
                    and renal dialysis facilities; and
                        (D) other areas determined appropriate by the
                    Comptroller General.
                (2) Specified oral drug defined.--For purposes of paragraph
            (1), the term ``specified oral drug'' means a drug or
            biological for which there is no injectable equivalent (or
            other non-oral form of administration).
        (b) Report.--Not later than 1 year after the date of the enactment
    of this Act, the Comptroller General of the United States shall submit
    to Congress a report containing the results of the study conducted
    under subsection (a), together with recommendations for such
    legislation and administrative action as the Comptroller General
    determines appropriate.

                  Subtitle D--Provisions Relating to Title IV

    SEC. 10401. AMENDMENTS TO SUBTITLE A.

        (a) Section 4001(h)(4) and (5) of this Act is amended by striking
    ``2010'' each place such appears and inserting ``2020''.
        (b) Section 4002(c) of this Act is amended--
                (1) by striking ``research and health screenings'' and
            inserting ``research, health screenings, and initiatives''; and
                (2) by striking ``for Preventive'' and inserting
            ``Regarding Preventive''.
        (c) Section 4004(a)(4) of this Act is amended by striking ``a
    Gateway'' and inserting ``an Exchange''.

    SEC. 10402. AMENDMENTS TO SUBTITLE B.

        (a) Section 399Z-1(a)(1(A) of the Public Health Service Act, as
    added by section 4101(b) of this Act, is amended by inserting ``and
    vision'' after ``oral''.
        (b) Section 1861(hhh)(4)(G) of the Social Security Act, as added by
    section 4103(b), is amended to read as follows:
                        ``(G) A beneficiary shall be eligible to receive
                    only an initial preventive physical examination (as
                    defined under subsection (ww)(1)) during the 12-month
                    period after the date that the beneficiary's coverage
                    begins under part B and shall be eligible to receive
                    personalized prevention plan services under this
                    subsection each year thereafter provided that the
                    beneficiary has not received either an initial
                    preventive physical examination or personalized
                    prevention plan services within the preceding 12-month
                    period.''.

    SEC. 10403. AMENDMENTS TO SUBTITLE C.

        Section 4201 of this Act is amended--
                (1) in subsection (a), by adding before the period the
            following: ``, with not less than 20 percent of such grants
            being awarded to rural and frontier areas'';
                (2) in subsection (c)(2)(B)(vii), by striking ``both urban
            and rural areas'' and inserting ``urban, rural, and frontier
            areas''; and
                (3) in subsection (f), by striking ``each fiscal years''
            and inserting ``each of fiscal year''.

    SEC. 10404. AMENDMENTS TO SUBTITLE D.

        Section 399MM(2) of the Public Health Service Act, as added by
    section 4303 of this Act, is amended by striking ``by ensuring'' and
    inserting ``and ensuring''.

    SEC. 10405. AMENDMENTS TO SUBTITLE E.

        Subtitle E of title IV of this Act is amended by striking section
    4401.

    SEC. 10406. AMENDMENT RELATING TO WAIVING COINSURANCE FOR PREVENTIVE
                  SERVICES.

        Section 4104(b) of this Act is amended to read as follows:
        ``(b) Payment and Elimination of Coinsurance in All Settings.--
    Section 1833(a)(1) of the Social Security Act (42 U.S.C. 1395l(a)(1)),
    as amended by section 4103(c)(1), is amended--
                ``(1) in subparagraph (T), by inserting `(or 100 percent if
            such services are recommended with a grade of A or B by the
            United States Preventive Services Task Force for any indication
            or population and are appropriate for the individual)' after
            `80 percent';
                ``(2) in subparagraph (W)--
                        ``(A) in clause (i), by inserting `(if such
                    subparagraph were applied, by substituting ``100
                    percent'' for ``80 percent'')' after `subparagraph
                    (D)'; and
                        ``(B) in clause (ii), by striking `80 percent' and
                    inserting `100 percent';
                ``(3) by striking `and' before `(X)'; and
                ``(4) by inserting before the semicolon at the end the
            following: `, and (Y) with respect to preventive services
            described in subparagraphs (A) and (B) of section 1861(ddd)(3)
            that are appropriate for the individual and, in the case of
            such services described in subparagraph (A), are recommended
            with a grade of A or B by the United States Preventive Services
            Task Force for any indication or population, the amount paid
            shall be 100 percent of (i) except as provided in clause (ii),
            the lesser of the actual charge for the services or the amount
            determined under the fee schedule that applies to such services
            under this part, and (ii) in the case of such services that are
            covered OPD services (as defined in subsection (t)(1)(B)), the
            amount determined under subsection (t)'.''.

    SEC. 10407. BETTER DIABETES CARE.

        (a) Short Title.--This section may be cited as the ``Catalyst to
    Better Diabetes Care Act of 2009''.
        (b) National Diabetes Report Card.--
                (1) In general.--The Secretary, in collaboration with the
            Director of the Centers for Disease Control and Prevention
            (referred to in this section as the ``Director''), shall
            prepare on a biennial basis a national diabetes report card
            (referred to in this section as a ``Report Card'') and, to the
            extent possible, for each State.
                (2) Contents.--
                        (A) In general.--Each Report Card shall include
                    aggregate health outcomes related to individuals
                    diagnosed with diabetes and prediabetes including--
                                (i) preventative care practices and quality
                            of care;
                                (ii) risk factors; and
                                (iii) outcomes.
                        (B) Updated reports.--Each Report Card that is
                    prepared after the initial Report Card shall include
                    trend analysis for the Nation and, to the extent
                    possible, for each State, for the purpose of--
                                (i) tracking progress in meeting
                            established national goals and objectives for
                            improving diabetes care, costs, and prevalence
                            (including Healthy People 2010); and
                                (ii) informing policy and program
                            development.
                (3) Availability.--The Secretary, in collaboration with the
            Director, shall make each Report Card publicly available,
            including by posting the Report Card on the Internet.
        (c) Improvement of Vital Statistics Collection.--
                (1) In general.--The Secretary, acting through the Director
            of the Centers for Disease Control and Prevention and in
            collaboration with appropriate agencies and States, shall--
                        (A) promote the education and training of
                    physicians on the importance of birth and death
                    certificate data and how to properly complete these
                    documents, including the collection of such data for
                    diabetes and other chronic diseases;
                        (B) encourage State adoption of the latest standard
                    revisions of birth and death certificates; and
                        (C) work with States to re-engineer their vital
                    statistics systems in order to provide cost-effective,
                    timely, and accurate vital systems data.
                (2) Death certificate additional language.--In carrying out
            this subsection, the Secretary may promote improvements to the
            collection of diabetes mortality data, including the addition
            of a question for the individual certifying the cause of death
            regarding whether the deceased had diabetes.
        (d) Study on Appropriate Level of Diabetes Medical Education.--
                (1) In general.--The Secretary shall, in collaboration with
            the Institute of Medicine and appropriate associations and
            councils, conduct a study of the impact of diabetes on the
            practice of medicine in the United States and the
            appropriateness of the level of diabetes medical education that
            should be required prior to licensure, board certification, and
            board recertification.
                (2) Report.--Not later than 2 years after the date of the
            enactment of this Act, the Secretary shall submit a report on
            the study under paragraph (1) to the Committees on Ways and
            Means and Energy and Commerce of the House of Representatives
            and the Committees on Finance and Health, Education, Labor, and
            Pensions of the Senate.
        (e) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this section such sums as may be necessary.

    SEC. 10408. GRANTS FOR SMALL BUSINESSES TO PROVIDE COMPREHENSIVE
                  WORKPLACE WELLNESS PROGRAMS.

        (a) Establishment.--The Secretary shall award grants to eligible
    employers to provide their employees with access to comprehensive
    workplace wellness programs (as described under subsection (c)).
        (b) Scope.--
                (1) Duration.--The grant program established under this
            section shall be conducted for a 5-year period.
                (2) Eligible employer.--The term ``eligible employer''
            means an employer (including a non-profit employer) that--
                        (A) employs less than 100 employees who work 25
                    hours or greater per week; and
                        (B) does not provide a workplace wellness program
                    as of the date of enactment of this Act.
        (c) Comprehensive Workplace Wellness Programs.--
                (1) Criteria.--The Secretary shall develop program criteria
            for comprehensive workplace wellness programs under this
            section that are based on and consistent with evidence-based
            research and best practices, including research and practices
            as provided in the Guide to Community Preventive Services, the
            Guide to Clinical Preventive Services, and the National
            Registry for Effective Programs.
                (2) Requirements.--A comprehensive workplace wellness
            program shall be made available by an eligible employer to all
            employees and include the following components:
                        (A) Health awareness initiatives (including health
                    education, preventive screenings, and health risk
                    assessments).
                        (B) Efforts to maximize employee engagement
                    (including mechanisms to encourage employee
                    participation).
                        (C) Initiatives to change unhealthy behaviors and
                    lifestyle choices (including counseling, seminars,
                    online programs, and self-help materials).
                        (D) Supportive environment efforts (including
                    workplace policies to encourage healthy lifestyles,
                    healthy eating, increased physical activity, and
                    improved mental health).
        (d) Application.--An eligible employer desiring to participate in
    the grant program under this section shall submit an application to the
    Secretary, in such manner and containing such information as the
    Secretary may require, which shall include a proposal for a
    comprehensive workplace wellness program that meet the criteria and
    requirements described under subsection (c).
        (e) Authorization of Appropriation.--For purposes of carrying out
    the grant program under this section, there is authorized to be
    appropriated $200,000,000 for the period of fiscal years 2011 through
    2015. Amounts appropriated pursuant to this subsection shall remain
    available until expended.

    SEC. 10409. CURES ACCELERATION NETWORK.

        (a) Short Title.--This section may be cited as the ``Cures
    Acceleration Network Act of 2009''.
        (b) Requirement for the Director of NIH To Establish a Cures
    Acceleration Network.--Section 402(b) of the Public Health Service Act
    (42 U.S.C. 282(b)) is amended--
                (1) in paragraph (22), by striking ``and'' at the end;
                (2) in paragraph (23), by striking the period and inserting
            ``; and''; and
                (3) by inserting after paragraph (23), the following:
                ``(24) implement the Cures Acceleration Network described
            in section 402C.''.
        (c) Accepting Gifts To Support the Cures Acceleration Network.--
    Section 499(c)(1) of the Public Health Service Act (42 U.S.C.
    290b(c)(1)) is amended by adding at the end the following:
                        ``(E) The Cures Acceleration Network described in
                    section 402C.''.
        (d) Establishment of the Cures Acceleration Network.--Part A of
    title IV of the Public Health Service Act is amended by inserting after
    section 402B (42 U.S.C. 282b) the following:

    ``SEC. 402C. CURES ACCELERATION NETWORK.

        ``(a) Definitions.--In this section:
                ``(1) Biological product.--The term `biological product'
            has the meaning given such term in section 351 of the Public
            Health Service Act.
                ``(2) Drug; device.--The terms `drug' and `device' have the
            meanings given such terms in section 201 of the Federal Food,
            Drug, and Cosmetic Act.
                ``(3) High need cure.--The term `high need cure' means a
            drug (as that term is defined by section 201(g)(1) of the
            Federal Food, Drug, and Cosmetic Act, biological product (as
            that term is defined by section 262(i)), or device (as that
            term is defined by section 201(h) of the Federal Food, Drug,
            and Cosmetic Act) that, in the determination of the Director of
            NIH--
                        ``(A) is a priority to diagnose, mitigate, prevent,
                    or treat harm from any disease or condition; and
                        ``(B) for which the incentives of the commercial
                    market are unlikely to result in its adequate or timely
                    development.
                ``(4) Medical product.--The term `medical product' means a
            drug, device, biological product, or product that is a
            combination of drugs, devices, and biological products.
        ``(b) Establishment of the Cures Acceleration Network.--Subject to
    the appropriation of funds as described in subsection (g), there is
    established within the Office of the Director of NIH a program to be
    known as the Cures Acceleration Network (referred to in this section as
    `CAN'), which shall--
                ``(1) be under the direction of the Director of NIH, taking
            into account the recommendations of a CAN Review Board
            (referred to in this section as the `Board'), described in
            subsection (d); and
                ``(2) award grants and contracts to eligible entities, as
            described in subsection (e), to accelerate the development of
            high need cures, including through the development of medical
            products and behavioral therapies.
        ``(c) Functions.--The functions of the CAN are to--
                ``(1) conduct and support revolutionary advances in basic
            research, translating scientific discoveries from bench to
            bedside;
                ``(2) award grants and contracts to eligible entities to
            accelerate the development of high need cures;
                ``(3) provide the resources necessary for government
            agencies, independent investigators, research organizations,
            biotechnology companies, academic research institutions, and
            other entities to develop high need cures;
                ``(4) reduce the barriers between laboratory discoveries
            and clinical trials for new therapies; and
                ``(5) facilitate review in the Food and Drug Administration
            for the high need cures funded by the CAN, through activities
            that may include--
                        ``(A) the facilitation of regular and ongoing
                    communication with the Food and Drug Administration
                    regarding the status of activities conducted under this
                    section;
                        ``(B) ensuring that such activities are coordinated
                    with the approval requirements of the Food and Drug
                    Administration, with the goal of expediting the
                    development and approval of countermeasures and
                    products; and
                        ``(C) connecting interested persons with additional
                    technical assistance made available under section 565
                    of the Federal Food, Drug, and Cosmetic Act.
        ``(d) CAN Board.--
                ``(1) Establishment.--There is established a Cures
            Acceleration Network Review Board (referred to in this section
            as the `Board'), which shall advise the Director of NIH on the
            conduct of the activities of the Cures Acceleration Network.
                ``(2) Membership.--
                        ``(A) In general.--
                                ``(i) Appointment.--The Board shall be
                            comprised of 24 members who are appointed by
                            the Secretary and who serve at the pleasure of
                            the Secretary.
                                ``(ii) Chairperson and vice chairperson.--
                            The Secretary shall designate, from among the
                            24 members appointed under clause (i), one
                            Chairperson of the Board (referred to in this
                            section as the `Chairperson') and one Vice
                            Chairperson.
                        ``(B) Terms.--
                                ``(i) In general.--Each member shall be
                            appointed to serve a 4-year term, except that
                            any member appointed to fill a vacancy
                            occurring prior to the expiration of the term
                            for which the member's predecessor was
                            appointed shall be appointed for the remainder
                            of such term.
                                ``(ii) Consecutive appointments; maximum
                            terms.--A member may be appointed to serve not
                            more than 3 terms on the Board, and may not
                            serve more than 2 such terms consecutively.
                        ``(C) Qualifications.--
                                ``(i) In general.--The Secretary shall
                            appoint individuals to the Board based solely
                            upon the individual's established record of
                            distinguished service in one of the areas of
                            expertise described in clause (ii). Each
                            individual appointed to the Board shall be of
                            distinguished achievement and have a broad
                            range of disciplinary interests.
                                ``(ii) Expertise.--The Secretary shall
                            select individuals based upon the following
                            requirements:
                                        ``(I) For each of the fields of--
                                                ``(aa) basic research;
                                                ``(bb) medicine;
                                                ``(cc) biopharmaceuticals;
                                                ``(dd) discovery and
                                            delivery of medical products;
                                                ``(ee) bioinformatics and
                                            gene therapy;
                                                ``(ff) medical
                                            instrumentation; and
                                                ``(gg) regulatory review
                                            and approval of medical
                                            products,
                                    the Secretary shall select at least 1
                                    individual who is eminent in such
                                    fields.
                                        ``(II) At least 4 individuals shall
                                    be recognized leaders in professional
                                    venture capital or private equity
                                    organizations and have demonstrated
                                    experience in private equity investing.
                                        ``(III) At least 8 individuals
                                    shall represent disease advocacy
                                    organizations.
                ``(3) Ex-officio members.--
                        ``(A) Appointment.--In addition to the 24 Board
                    members described in paragraph (2), the Secretary shall
                    appoint as ex-officio members of the Board--
                                ``(i) a representative of the National
                            Institutes of Health, recommended by the
                            Secretary of the Department of Health and Human
                            Services;
                                ``(ii) a representative of the Office of
                            the Assistant Secretary of Defense for Health
                            Affairs, recommended by the Secretary of
                            Defense;
                                ``(iii) a representative of the Office of
                            the Under Secretary for Health for the Veterans
                            Health Administration, recommended by the
                            Secretary of Veterans Affairs;
                                ``(iv) a representative of the National
                            Science Foundation, recommended by the Chair of
                            the National Science Board; and
                                ``(v) a representative of the Food and Drug
                            Administration, recommended by the Commissioner
                            of Food and Drugs.
                        ``(B) Terms.--Each ex-officio member shall serve a
                    3-year term on the Board, except that the Chairperson
                    may adjust the terms of the initial ex-officio members
                    in order to provide for a staggered term of appointment
                    for all such members.
                ``(4) Responsibilities of the board and the director of
            nih.--
                        ``(A) Responsibilities of the board.--
                                ``(i) In general.--The Board shall advise,
                            and provide recommendations to, the Director of
                            NIH with respect to--
                                        ``(I) policies, programs, and
                                    procedures for carrying out the duties
                                    of the Director of NIH under this
                                    section; and
                                        ``(II) significant barriers to
                                    successful translation of basic science
                                    into clinical application (including
                                    issues under the purview of other
                                    agencies and departments).
                                ``(ii) Report.--In the case that the Board
                            identifies a significant barrier, as described
                            in clause (i)(II), the Board shall submit to
                            the Secretary a report regarding such barrier.
                        ``(B) Responsibilities of the director of nih.--
                    With respect to each recommendation provided by the
                    Board under subparagraph (A)(i), the Director of NIH
                    shall respond in writing to the Board, indicating
                    whether such Director will implement such
                    recommendation. In the case that the Director of NIH
                    indicates a recommendation of the Board will not be
                    implemented, such Director shall provide an explanation
                    of the reasons for not implementing such
                    recommendation.
                ``(5) Meetings.--
                        ``(A) In general.--The Board shall meet 4 times per
                    calendar year, at the call of the Chairperson.
                        ``(B) Quorum; requirements; limitations.--
                                ``(i) Quorum.--A quorum shall consist of a
                            total of 13 members of the Board, excluding ex-
                            officio members, with diverse representation as
                            described in clause (iii).
                                ``(ii) Chairperson or vice chairperson.--
                            Each meeting of the Board shall be attended by
                            either the Chairperson or the Vice Chairperson.
                                ``(iii) Diverse representation.--At each
                            meeting of the Board, there shall be not less
                            than one scientist, one representative of a
                            disease advocacy organization, and one
                            representative of a professional venture
                            capital or private equity organization.
                ``(6) Compensation and travel expenses.--
                        ``(A) Compensation.--Members shall receive
                    compensation at a rate to be fixed by the Chairperson
                    but not to exceed a rate equal to the daily equivalent
                    of the annual rate of basic pay prescribed for level IV
                    of the Executive Schedule under section 5315 of title
                    5, United States Code, for each day (including travel
                    time) during which the member is engaged in the
                    performance of the duties of the Board. All members of
                    the Board who are officers or employees of the United
                    States shall serve without compensation in addition to
                    that received for their services as officers or
                    employees of the United States.
                        ``(B) Travel expenses.--Members of the Board shall
                    be allowed travel expenses, including per diem in lieu
                    of subsistence, at rates authorized for persons
                    employed intermittently by the Federal Government under
                    section 5703(b) of title 5, United States Code, while
                    away from their homes or regular places of business in
                    the performance of services for the Board.
        ``(e) Grant Program.--
                ``(1) Supporting innovation.--To carry out the purposes
            described in this section, the Director of NIH shall award
            contracts, grants, or cooperative agreements to the entities
            described in paragraph (2), to--
                        ``(A) promote innovation in technologies supporting
                    the advanced research and development and production of
                    high need cures, including through the development of
                    medical products and behavioral therapies.
                        ``(B) accelerate the development of high need
                    cures, including through the development of medical
                    products, behavioral therapies, and biomarkers that
                    demonstrate the safety or effectiveness of medical
                    products; or
                        ``(C) help the award recipient establish protocols
                    that comply with Food and Drug Administration standards
                    and otherwise permit the recipient to meet regulatory
                    requirements at all stages of development,
                    manufacturing, review, approval, and safety
                    surveillance of a medical product.
                ``(2) Eligible entities.--To receive assistance under
            paragraph (1), an entity shall--
                        ``(A) be a public or private entity, which may
                    include a private or public research institution, an
                    institution of higher education, a medical center, a
                    biotechnology company, a pharmaceutical company, a
                    disease advocacy organization, a patient advocacy
                    organization, or an academic research institution;
                        ``(B) submit an application containing--
                                ``(i) a detailed description of the project
                            for which the entity seeks such grant or
                            contract;
                                ``(ii) a timetable for such project;
                                ``(iii) an assurance that the entity will
                            submit--
                                        ``(I) interim reports describing
                                    the entity's--
                                                ``(aa) progress in carrying
                                            out the project; and
                                                ``(bb) compliance with all
                                            provisions of this section and
                                            conditions of receipt of such
                                            grant or contract; and
                                        ``(II) a final report at the
                                    conclusion of the grant period,
                                    describing the outcomes of the project;
                                    and
                                ``(iv) a description of the protocols the
                            entity will follow to comply with Food and Drug
                            Administration standards and regulatory
                            requirements at all stages of development,
                            manufacturing, review, approval, and safety
                            surveillance of a medical product; and
                        ``(C) provide such additional information as the
                    Director of NIH may require.
                ``(3) Awards.--
                        ``(A) The cures acceleration partnership awards.--
                                ``(i) Initial award amount.--Each award
                            under this subparagraph shall be not more than
                            $15,000,000 per project for the first fiscal
                            year for which the project is funded, which
                            shall be payable in one payment.
                                ``(ii) Funding in subsequent fiscal
                            years.--An eligible entity receiving an award
                            under clause (i) may apply for additional
                            funding for such project by submitting to the
                            Director of NIH the information required under
                            subparagraphs (B) and (C) of paragraph (2). The
                            Director may fund a project of such eligible
                            entity in an amount not to exceed $15,000,000
                            for a fiscal year subsequent to the initial
                            award under clause (i).
                                ``(iii) Matching funds.--As a condition for
                            receiving an award under this subsection, an
                            eligible entity shall contribute to the project
                            non-Federal funds in the amount of $1 for every
                            $3 awarded under clauses (i) and (ii), except
                            that the Director of NIH may waive or modify
                            such matching requirement in any case where the
                            Director determines that the goals and
                            objectives of this section cannot adequately be
                            carried out unless such requirement is waived.
                        ``(B) The cures acceleration grant awards.--
                                ``(i) Initial award amount.--Each award
                            under this subparagraph shall be not more than
                            $15,000,000 per project for the first fiscal
                            year for which the project is funded, which
                            shall be payable in one payment.
                                ``(ii) Funding in subsequent fiscal
                            years.--An eligible entity receiving an award
                            under clause (i) may apply for additional
                            funding for such project by submitting to the
                            Board the information required under
                            subparagraphs (B) and (C) of paragraph (2). The
                            Director of NIH may fund a project of such
                            eligible entity in an amount not to exceed
                            $15,000,000 for a fiscal year subsequent to the
                            initial award under clause (i).
                        ``(C) The cures acceleration flexible research
                    awards.--If the Director of NIH determines that the
                    goals and objectives of this section cannot adequately
                    be carried out through a contract, grant, or
                    cooperative agreement, the Director of NIH shall have
                    flexible research authority to use other transactions
                    to fund projects in accordance with the terms and
                    conditions of this section. Awards made under such
                    flexible research authority for a fiscal year shall not
                    exceed 20 percent of the total funds appropriated under
                    subsection (g)(1) for such fiscal year.
                ``(4) Suspension of awards for defaults, noncompliance with
            provisions and plans, and diversion of funds; repayment of
            funds.--The Director of NIH may suspend the award to any entity
            upon noncompliance by such entity with provisions and plans
            under this section or diversion of funds.
                ``(5) Audits.--The Director of NIH may enter into
            agreements with other entities to conduct periodic audits of
            the projects funded by grants or contracts awarded under this
            subsection.
                ``(6) Closeout procedures.--At the end of a grant or
            contract period, a recipient shall follow the closeout
            procedures under section 74.71 of title 45, Code of Federal
            Regulations (or any successor regulation).
                ``(7) Review.--A determination by the Director of NIH as to
            whether a drug, device, or biological product is a high need
            cure (for purposes of subsection (a)(3)) shall not be subject
            to judicial review.
        ``(f) Competitive Basis of Awards.--Any grant, cooperative
    agreement, or contract awarded under this section shall be awarded on a
    competitive basis.
        ``(g) Authorization of Appropriations.--
                ``(1) In general.--For purposes of carrying out this
            section, there are authorized to be appropriated $500,000,000
            for fiscal year 2010, and such sums as may be necessary for
            subsequent fiscal years. Funds appropriated under this section
            shall be available until expended.
                ``(2) Limitation on use of funds otherwise appropriated.--
            No funds appropriated under this Act, other than funds
            appropriated under paragraph (1), may be allocated to the Cures
            Acceleration Network.''.

    SEC. 10410. CENTERS OF EXCELLENCE FOR DEPRESSION.

        (a) Short Title.--This section may be cited as the ``Establishing a
    Network of Health-Advancing National Centers of Excellence for
    Depression Act of 2009'' or the ``ENHANCED Act of 2009''.
        (b) Centers of Excellence for Depression.--Subpart 3 of part B of
    title V of the Public Health Service Act (42 U.S.C. 290bb et seq.) is
    amended by inserting after section 520A the following:

    ``SEC. 520B. NATIONAL CENTERS OF EXCELLENCE FOR DEPRESSION.

        ``(a) Depressive Disorder Defined.--In this section, the term
    `depressive disorder' means a mental or brain disorder relating to
    depression, including major depression, bipolar disorder, and related
    mood disorders.
        ``(b) Grant Program.--
                ``(1) In general.--The Secretary, acting through the
            Administrator, shall award grants on a competitive basis to
            eligible entities to establish national centers of excellence
            for depression (referred to in this section as `Centers'),
            which shall engage in activities related to the treatment of
            depressive disorders.
                ``(2) Allocation of awards.--If the funds authorized under
            subsection (f) are appropriated in the amounts provided for
            under such subsection, the Secretary shall allocate such
            amounts so that--
                        ``(A) not later than 1 year after the date of
                    enactment of the ENHANCED Act of 2009, not more than 20
                    Centers may be established; and
                        ``(B) not later than September 30, 2016, not more
                    than 30 Centers may be established.
                ``(3) Grant period.--
                        ``(A) In general.--A grant awarded under this
                    section shall be for a period of 5 years.
                        ``(B) Renewal.--A grant awarded under subparagraph
                    (A) may be renewed, on a competitive basis, for 1
                    additional 5-year period, at the discretion of the
                    Secretary. In determining whether to renew a grant, the
                    Secretary shall consider the report cards issued under
                    subsection (e)(2).
                ``(4) Use of funds.--Grant funds awarded under this
            subsection shall be used for the establishment and ongoing
            activities of the recipient of such funds.
                ``(5) Eligible entities.--
                        ``(A) Requirements.--To be eligible to receive a
                    grant under this section, an entity shall--
                                ``(i) be an institution of higher education
                            or a public or private nonprofit research
                            institution; and
                                ``(ii) submit an application to the
                            Secretary at such time and in such manner as
                            the Secretary may require, as described in
                            subparagraph (B).
                        ``(B) Application.--An application described in
                    subparagraph (A)(ii) shall include--
                                ``(i) evidence that such entity--
                                        ``(I) provides, or is capable of
                                    coordinating with other entities to
                                    provide, comprehensive health services
                                    with a focus on mental health services
                                    and subspecialty expertise for
                                    depressive disorders;
                                        ``(II) collaborates with other
                                    mental health providers, as necessary,
                                    to address co-occurring mental
                                    illnesses;
                                        ``(III) is capable of training
                                    health professionals about mental
                                    health; and
                                ``(ii) such other information, as the
                            Secretary may require.
                        ``(C) Priorities.--In awarding grants under this
                    section, the Secretary shall give priority to eligible
                    entities that meet 1 or more of the following criteria:
                                ``(i) Demonstrated capacity and expertise
                            to serve the targeted population.
                                ``(ii) Existing infrastructure or expertise
                            to provide appropriate, evidence-based and
                            culturally and linguistically competent
                            services.
                                ``(iii) A location in a geographic area
                            with disproportionate numbers of underserved
                            and at-risk populations in medically
                            underserved areas and health professional
                            shortage areas.
                                ``(iv) Proposed innovative approaches for
                            outreach to initiate or expand services.
                                ``(v) Use of the most up-to-date science,
                            practices, and interventions available.
                                ``(vi) Demonstrated capacity to establish
                            cooperative and collaborative agreements with
                            community mental health centers and other
                            community entities to provide mental health,
                            social, and human services to individuals with
                            depressive disorders.
                ``(6) National coordinating center.--
                        ``(A) In general.--The Secretary, acting through
                    the Administrator, shall designate 1 recipient of a
                    grant under this section to be the coordinating center
                    of excellence for depression (referred to in this
                    section as the `coordinating center'). The Secretary
                    shall select such coordinating center on a competitive
                    basis, based upon the demonstrated capacity of such
                    center to perform the duties described in subparagraph
                    (C).
                        ``(B) Application.--A Center that has been awarded
                    a grant under paragraph (1) may apply for designation
                    as the coordinating center by submitting an application
                    to the Secretary at such time, in such manner, and
                    containing such information as the Secretary may
                    require.
                        ``(C) Duties.--The coordinating center shall--
                                ``(i) develop, administer, and coordinate
                            the network of Centers under this section;
                                ``(ii) oversee and coordinate the national
                            database described in subsection (d);
                                ``(iii) lead a strategy to disseminate the
                            findings and activities of the Centers through
                            such database; and
                                ``(iv) serve as a liaison with the
                            Administration, the National Registry of
                            Evidence-based Programs and Practices of the
                            Administration, and any Federal interagency or
                            interagency forum on mental health.
                ``(7) Matching funds.--The Secretary may not award a grant
            or contract under this section to an entity unless the entity
            agrees that it will make available (directly or through
            contributions from other public or private entities) non-
            Federal contributions toward the activities to be carried out
            under the grant or contract in an amount equal to $1 for each
            $5 of Federal funds provided under the grant or contract. Such
            non-Federal matching funds may be provided directly or through
            donations from public or private entities and may be in cash or
            in-kind, fairly evaluated, including plant, equipment, or
            services.
        ``(c) Activities of the Centers.--Each Center shall carry out the
    following activities:
                ``(1) General activities.--Each Center shall--
                        ``(A) integrate basic, clinical, or health services
                    interdisciplinary research and practice in the
                    development, implementation, and dissemination of
                    evidence-based interventions;
                        ``(B) involve a broad cross-section of
                    stakeholders, such as researchers, clinicians,
                    consumers, families of consumers, and voluntary health
                    organizations, to develop a research agenda and
                    disseminate findings, and to provide support in the
                    implementation of evidence-based practices;
                        ``(C) provide training and technical assistance to
                    mental health professionals, and engage in and
                    disseminate translational research with a focus on
                    meeting the needs of individuals with depressive
                    disorders; and
                        ``(D) educate policy makers, employers, community
                    leaders, and the public about depressive disorders to
                    reduce stigma and raise awareness of treatments.
                ``(2) Improved treatment standards, clinical guidelines,
            diagnostic protocols, and care coordination practice.--Each
            Center shall collaborate with other Centers in the network to--
                        ``(A) develop and implement treatment standards,
                    clinical guidelines, and protocols that emphasize
                    primary prevention, early intervention, treatment for,
                    and recovery from, depressive disorders;
                        ``(B) foster communication with other providers
                    attending to co-occurring physical health conditions
                    such as cardiovascular, diabetes, cancer, and substance
                    abuse disorders;
                        ``(C) leverage available community resources,
                    develop and implement improved self-management
                    programs, and, when appropriate, involve family and
                    other providers of social support in the development
                    and implementation of care plans; and
                        ``(D) use electronic health records and telehealth
                    technology to better coordinate and manage, and improve
                    access to, care, as determined by the coordinating
                    center.
                ``(3) Translational research through collaboration of
            centers and community-based organizations.--Each Center shall--
                        ``(A) demonstrate effective use of a public-private
                    partnership to foster collaborations among members of
                    the network and community-based organizations such as
                    community mental health centers and other social and
                    human services providers;
                        ``(B) expand interdisciplinary, translational, and
                    patient-oriented research and treatment; and
                        ``(C) coordinate with accredited academic programs
                    to provide ongoing opportunities for the professional
                    and continuing education of mental health providers.
        ``(d) National Database.--
                ``(1) In general.--The coordinating center shall establish
            and maintain a national, publicly available database to improve
            prevention programs, evidence-based interventions, and disease
            management programs for depressive disorders, using data
            collected from the Centers, as described in paragraph (2).
                ``(2) Data collection.--Each Center shall submit data
            gathered at such center, as appropriate, to the coordinating
            center regarding--
                        ``(A) the prevalence and incidence of depressive
                    disorders;
                        ``(B) the health and social outcomes of individuals
                    with depressive disorders;
                        ``(C) the effectiveness of interventions designed,
                    tested, and evaluated;
                        ``(D) other information, as the Secretary may
                    require.
                ``(3) Submission of data to the administrator.--The
            coordinating center shall submit to the Administrator the data
            and financial information gathered under paragraph (2).
                ``(4) Publication using data from the database.--A Center,
            or an individual affiliated with a Center, may publish findings
            using the data described in paragraph (2) only if such center
            submits such data to the coordinating center, as required under
            such paragraph.
        ``(e) Establishment of Standards; Report Cards and Recommendations;
    Third Party Review.--
                ``(1) Establishment of standards.--The Secretary, acting
            through the Administrator, shall establish performance
            standards for--
                        ``(A) each Center; and
                        ``(B) the network of Centers as a whole.
                ``(2) Report cards.--The Secretary, acting through the
            Administrator, shall--
                        ``(A) for each Center, not later than 3 years after
                    the date on which such center of excellence is
                    established and annually thereafter, issue a report
                    card to the coordinating center to rate the performance
                    of such Center; and
                        ``(B) not later than 3 years after the date on
                    which the first grant is awarded under subsection
                    (b)(1) and annually thereafter, issue a report card to
                    Congress to rate the performance of the network of
                    centers of excellence as a whole.
                ``(3) Recommendations.--Based upon the report cards
            described in paragraph (2), the Secretary shall, not later than
            September 30, 2015--
                        ``(A) make recommendations to the Centers regarding
                    improvements such centers shall make; and
                        ``(B) make recommendations to Congress for
                    expanding the Centers to serve individuals with other
                    types of mental disorders.
                ``(4) Third party review.--Not later than 3 years after the
            date on which the first grant is awarded under subsection
            (b)(1) and annually thereafter, the Secretary shall arrange for
            an independent third party to conduct an evaluation of the
            network of Centers to ensure that such centers are meeting the
            goals of this section.
        ``(f) Authorization of Appropriations.--
                ``(1) In general.--To carry out this section, there are
            authorized to be appropriated--
                        ``(A) $100,000,000 for each of the fiscal years
                    2011 through 2015; and
                        ``(B) $150,000,000 for each of the fiscal years
                    2016 through 2020.
                ``(2) Allocation of funds authorized.--Of the amount
            appropriated under paragraph (1) for a fiscal year, the
            Secretary shall determine the allocation of each Center
            receiving a grant under this section, but in no case may the
            allocation be more than $5,000,000, except that the Secretary
            may allocate not more than $10,000,000 to the coordinating
            center.''.

    SEC. 10411. PROGRAMS RELATING TO CONGENITAL HEART DISEASE.

        (a) Short Title.--This subtitle may be cited as the ``Congenital
    Heart Futures Act''.
        (b) Programs Relating to Congenital Heart Disease.--
                (1) National congenital heart disease surveillance
            system.--Part P of title III of the Public Health Service Act
            (42 U.S.C. 280g et seq.), as amended by section 5405, is
            further amended by adding at the end the following:

    ``SEC. 399V-2. NATIONAL CONGENITAL HEART DISEASE SURVEILLANCE SYSTEM.

        ``(a) In General.--The Secretary, acting through the Director of
    the Centers for Disease Control and Prevention, may--
                ``(1) enhance and expand infrastructure to track the
            epidemiology of congenital heart disease and to organize such
            information into a nationally-representative, population-based
            surveillance system that compiles data concerning actual
            occurrences of congenital heart disease, to be known as the
            `National Congenital Heart Disease Surveillance System'; or
                ``(2) award a grant to one eligible entity to undertake the
            activities described in paragraph (1).
        ``(b) Purpose.--The purpose of the Congenital Heart Disease
    Surveillance System shall be to facilitate further research into the
    types of health services patients use and to identify possible areas
    for educational outreach and prevention in accordance with standard
    practices of the Centers for Disease Control and Prevention.
        ``(c) Content.--The Congenital Heart Disease Surveillance System--
                ``(1) may include information concerning the incidence and
            prevalence of congenital heart disease in the United States;
                ``(2) may be used to collect and store data on congenital
            heart disease, including data concerning--
                        ``(A) demographic factors associated with
                    congenital heart disease, such as age, race, ethnicity,
                    sex, and family history of individuals who are
                    diagnosed with the disease;
                        ``(B) risk factors associated with the disease;
                        ``(C) causation of the disease;
                        ``(D) treatment approaches; and
                        ``(E) outcome measures, such that analysis of the
                    outcome measures will allow derivation of evidence-
                    based best practices and guidelines for congenital
                    heart disease patients; and
                ``(3) may ensure the collection and analysis of
            longitudinal data related to individuals of all ages with
            congenital heart disease, including infants, young children,
            adolescents, and adults of all ages.
        ``(d) Public Access.--The Congenital Heart Disease Surveillance
    System shall be made available to the public, as appropriate, including
    congenital heart disease researchers.
        ``(e) Patient Privacy.--The Secretary shall ensure that the
    Congenital Heart Disease Surveillance System is maintained in a manner
    that complies with the regulations promulgated under section 264 of the
    Health Insurance Portability and Accountability Act of 1996.
        ``(f) Eligibility for Grant.--To be eligible to receive a grant
    under subsection (a)(2), an entity shall--
                ``(1) be a public or private nonprofit entity with
            specialized experience in congenital heart disease; and
                ``(2) submit to the Secretary an application at such time,
            in such manner, and containing such information as the
            Secretary may require.''.
                (2) Congenital heart disease research.--Subpart 2 of part C
            of title IV of the Public Health Service Act (42 U.S.C. 285b et
            seq.) is amended by adding at the end the following:

    ``SEC. 425. CONGENITAL HEART DISEASE.

        ``(a) In General.--The Director of the Institute may expand,
    intensify, and coordinate research and related activities of the
    Institute with respect to congenital heart disease, which may include
    congenital heart disease research with respect to--
                ``(1) causation of congenital heart disease, including
            genetic causes;
                ``(2) long-term outcomes in individuals with congenital
            heart disease, including infants, children, teenagers, adults,
            and elderly individuals;
                ``(3) diagnosis, treatment, and prevention;
                ``(4) studies using longitudinal data and retrospective
            analysis to identify effective treatments and outcomes for
            individuals with congenital heart disease; and
                ``(5) identifying barriers to life-long care for
            individuals with congenital heart disease.
        ``(b) Coordination of Research Activities.--The Director of the
    Institute may coordinate research efforts related to congenital heart
    disease among multiple research institutions and may develop research
    networks.
        ``(c) Minority and Medically Underserved Communities.--In carrying
    out the activities described in this section, the Director of the
    Institute shall consider the application of such research and other
    activities to minority and medically underserved communities.''.
        (c) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out the amendments made by this section such sums
    as may be necessary for each of fiscal years 2011 through 2015.

    SEC. 10412. AUTOMATED DEFIBRILLATION IN ADAM'S MEMORY ACT.

        Section 312 of the Public Health Service Act (42 U.S.C. 244) is
    amended--
                (1) in subsection (c)(6), after ``clearinghouse'' insert
            ``, that shall be administered by an organization that has
            substantial expertise in pediatric education, pediatric
            medicine, and electrophysiology and sudden death,''; and
                (2) in the first sentence of subsection (e), by striking
            ``fiscal year 2003'' and all that follows through ``2006'' and
            inserting ``for each of fiscal years 2003 through 2014''.

    SEC. 10413. YOUNG WOMEN'S BREAST HEALTH AWARENESS AND SUPPORT OF YOUNG
                  WOMEN DIAGNOSED WITH BREAST CANCER.

        (a) Short Title.--This section may be cited as the ``Young Women's
    Breast Health Education and Awareness Requires Learning Young Act of
    2009'' or the ``EARLY Act''.
        (b) Amendment.--Title III of the Public Health Service Act (42
    U.S.C. 241 et seq.), as amended by this Act, is further amended by
    adding at the end the following:

            ``PART V--PROGRAMS RELATING TO BREAST HEALTH AND CANCER

    ``SEC. 399NN. YOUNG WOMEN'S BREAST HEALTH AWARENESS AND SUPPORT OF
                  YOUNG WOMEN DIAGNOSED WITH BREAST CANCER.

        ``(a) Public Education Campaign.--
                ``(1) In general.--The Secretary, acting through the
            Director of the Centers for Disease Control and Prevention,
            shall conduct a national evidence-based education campaign to
            increase awareness of young women's knowledge regarding--
                        ``(A) breast health in young women of all racial,
                    ethnic, and cultural backgrounds;
                        ``(B) breast awareness and good breast health
                    habits;
                        ``(C) the occurrence of breast cancer and the
                    general and specific risk factors in women who may be
                    at high risk for breast cancer based on familial,
                    racial, ethnic, and cultural backgrounds such as
                    Ashkenazi Jewish populations;
                        ``(D) evidence-based information that would
                    encourage young women and their health care
                    professional to increase early detection of breast
                    cancers; and
                        ``(E) the availability of health information and
                    other resources for young women diagnosed with breast
                    cancer.
                ``(2) Evidence-based, age appropriate messages.--The
            campaign shall provide evidence-based, age-appropriate messages
            and materials as developed by the Centers for Disease Control
            and Prevention and the Advisory Committee established under
            paragraph (4).
                ``(3) Media campaign.--In conducting the education campaign
            under paragraph (1), the Secretary shall award grants to
            entities to establish national multimedia campaigns oriented to
            young women that may include advertising through television,
            radio, print media, billboards, posters, all forms of existing
            and especially emerging social networking media, other Internet
            media, and any other medium determined appropriate by the
            Secretary.
                ``(4) Advisory committee.--
                        ``(A) Establishment.--Not later than 60 days after
                    the date of the enactment of this section, the
                    Secretary, acting through the Director of the Centers
                    for Disease Control and Prevention, shall establish an
                    advisory committee to assist in creating and conducting
                    the education campaigns under paragraph (1) and
                    subsection (b)(1).
                        ``(B) Membership.--The Secretary, acting through
                    the Director of the Centers for Disease Control and
                    Prevention, shall appoint to the advisory committee
                    under subparagraph (A) such members as deemed necessary
                    to properly advise the Secretary, and shall include
                    organizations and individuals with expertise in breast
                    cancer, disease prevention, early detection, diagnosis,
                    public health, social marketing, genetic screening and
                    counseling, treatment, rehabilitation, palliative care,
                    and survivorship in young women.
        ``(b) Health Care Professional Education Campaign.--The Secretary,
    acting through the Director of the Centers for Disease Control and
    Prevention, and in consultation with the Administrator of the Health
    Resources and Services Administration, shall conduct an education
    campaign among physicians and other health care professionals to
    increase awareness--
                ``(1) of breast health, symptoms, and early diagnosis and
            treatment of breast cancer in young women, including specific
            risk factors such as family history of cancer and women that
            may be at high risk for breast cancer, such as Ashkenazi Jewish
            population;
                ``(2) on how to provide counseling to young women about
            their breast health, including knowledge of their family cancer
            history and importance of providing regular clinical breast
            examinations;
                ``(3) concerning the importance of discussing healthy
            behaviors, and increasing awareness of services and programs
            available to address overall health and wellness, and making
            patient referrals to address tobacco cessation, good nutrition,
            and physical activity;
                ``(4) on when to refer patients to a health care provider
            with genetics expertise;
                ``(5) on how to provide counseling that addresses long-term
            survivorship and health concerns of young women diagnosed with
            breast cancer; and
                ``(6) on when to provide referrals to organizations and
            institutions that provide credible health information and
            substantive assistance and support to young women diagnosed
            with breast cancer.
        ``(c) Prevention Research Activities.--The Secretary, acting
    through--
                ``(1) the Director of the Centers for Disease Control and
            Prevention, shall conduct prevention research on breast cancer
            in younger women, including--
                        ``(A) behavioral, survivorship studies, and other
                    research on the impact of breast cancer diagnosis on
                    young women;
                        ``(B) formative research to assist with the
                    development of educational messages and information for
                    the public, targeted populations, and their families
                    about breast health, breast cancer, and healthy
                    lifestyles;
                        ``(C) testing and evaluating existing and new
                    social marketing strategies targeted at young women;
                    and
                        ``(D) surveys of health care providers and the
                    public regarding knowledge, attitudes, and practices
                    related to breast health and breast cancer prevention
                    and control in high-risk populations; and
                ``(2) the Director of the National Institutes of Health,
            shall conduct research to develop and validate new screening
            tests and methods for prevention and early detection of breast
            cancer in young women.
        ``(d) Support for Young Women Diagnosed With Breast Cancer.--
                ``(1) In general.--The Secretary shall award grants to
            organizations and institutions to provide health information
            from credible sources and substantive assistance directed to
            young women diagnosed with breast cancer and pre-neoplastic
            breast diseases.
                ``(2) Priority.--In making grants under paragraph (1), the
            Secretary shall give priority to applicants that deal
            specifically with young women diagnosed with breast cancer and
            pre-neoplastic breast disease.
        ``(e) No Duplication of Effort.--In conducting an education
    campaign or other program under subsections (a), (b), (c), or (d), the
    Secretary shall avoid duplicating other existing Federal breast cancer
    education efforts.
        ``(f) Measurement; Reporting.--The Secretary, acting through the
    Director of the Centers for Disease Control and Prevention, shall--
                ``(1) measure--
                        ``(A) young women's awareness regarding breast
                    health, including knowledge of family cancer history,
                    specific risk factors and early warning signs, and
                    young women's proactive efforts at early detection;
                        ``(B) the number or percentage of young women
                    utilizing information regarding lifestyle interventions
                    that foster healthy behaviors;
                        ``(C) the number or percentage of young women
                    receiving regular clinical breast exams; and
                        ``(D) the number or percentage of young women who
                    perform breast self exams, and the frequency of such
                    exams, before the implementation of this section;
                ``(2) not less than every 3 years, measure the impact of
            such activities; and
                ``(3) submit reports to the Congress on the results of such
            measurements.
        ``(g) Definition.--In this section, the term `young women' means
    women 15 to 44 years of age.
        ``(h) Authorization of Appropriations.--To carry out subsections
    (a), (b), (c)(1), and (d), there are authorized to be appropriated
    $9,000,000 for each of the fiscal years 2010 through 2014.''.

                   Subtitle E--Provisions Relating to Title V

    SEC. 10501. AMENDMENTS TO THE PUBLIC HEALTH SERVICE ACT, THE SOCIAL
                  SECURITY ACT, AND TITLE V OF THIS ACT.

        (a) Section 5101 of this Act is amended--
                (1) in subsection (c)(2)(B)(i)(II), by inserting ``,
            including representatives of small business and self-employed
            individuals'' after ``employers'';
                (2) in subsection (d)(4)(A)--
                        (A) by redesignating clause (iv) as clause (v); and
                        (B) by inserting after clause (iii) the following:
                                ``(iv) An analysis of, and recommendations
                            for, eliminating the barriers to entering and
                            staying in primary care, including provider
                            compensation.''; and
                (3) in subsection (i)(2)(B), by inserting ``optometrists,
            ophthalmologists,'' after ``occupational therapists,''.
        (b) Subtitle B of title V of this Act is amended by adding at the
    end the following:

    ``SEC. 5104. INTERAGENCY TASK FORCE TO ASSESS AND IMPROVE ACCESS TO
                  HEALTH CARE IN THE STATE OF ALASKA.

        ``(a) Establishment.--There is established a task force to be known
    as the `Interagency Access to Health Care in Alaska Task Force'
    (referred to in this section as the `Task Force').
        ``(b) Duties.--The Task Force shall--
                ``(1) assess access to health care for beneficiaries of
            Federal health care systems in Alaska; and
                ``(2) develop a strategy for the Federal Government to
            improve delivery of health care to Federal beneficiaries in the
            State of Alaska.
        ``(c) Membership.--The Task Force shall be comprised of Federal
    members who shall be appointed, not later than 45 days after the date
    of enactment of this Act, as follows:
                ``(1) The Secretary of Health and Human Services shall
            appoint one representative of each of the following:
                        ``(A) The Department of Health and Human Services.
                        ``(B) The Centers for Medicare and Medicaid
                    Services.
                        ``(C) The Indian Health Service.
                ``(2) The Secretary of Defense shall appoint one
            representative of the TRICARE Management Activity.
                ``(3) The Secretary of the Army shall appoint one
            representative of the Army Medical Department.
                ``(4) The Secretary of the Air Force shall appoint one
            representative of the Air Force, from among officers at the Air
            Force performing medical service functions.
                ``(5) The Secretary of Veterans Affairs shall appoint one
            representative of each of the following:
                        ``(A) The Department of Veterans Affairs.
                        ``(B) The Veterans Health Administration.
                ``(6) The Secretary of Homeland Security shall appoint one
            representative of the United States Coast Guard.
        ``(d) Chairperson.--One chairperson of the Task Force shall be
    appointed by the Secretary at the time of appointment of members under
    subsection (c), selected from among the members appointed under
    paragraph (1).
        ``(e) Meetings.--The Task Force shall meet at the call of the
    chairperson.
        ``(f) Report.--Not later than 180 days after the date of enactment
    of this Act, the Task Force shall submit to Congress a report detailing
    the activities of the Task Force and containing the findings,
    strategies, recommendations, policies, and initiatives developed
    pursuant to the duty described in subsection (b)(2). In preparing such
    report, the Task Force shall consider completed and ongoing efforts by
    Federal agencies to improve access to health care in the State of
    Alaska.
        ``(g) Termination.--The Task Force shall be terminated on the date
    of submission of the report described in subsection (f).''.
        (c) Section 399V of the Public Health Service Act, as added by
    section 5313, is amended--
                (1) in subsection (b)(4), by striking ``identify, educate,
            refer, and enroll'' and inserting ``identify and refer''; and
                (2) in subsection (k)(1), by striking ``, as defined by the
            Department of Labor as Standard Occupational Classification
            [21-1094]''.
        (d) Section 738(a)(3) of the Public Health Service Act (42 U.S.C.
    293b(a)(3)) is amended by inserting ``schools offering physician
    assistant education programs,'' after ``public health,''.
        (e) Subtitle D of title V of this Act is amended by adding at the
    end the following:

    ``SEC. 5316. DEMONSTRATION GRANTS FOR FAMILY NURSE PRACTITIONER
                  TRAINING PROGRAMS.

        ``(a) Establishment of Program.--The Secretary of Health and Human
    Services (referred to in this section as the `Secretary') shall
    establish a training demonstration program for family nurse
    practitioners (referred to in this section as the `program') to employ
    and provide 1-year training for nurse practitioners who have graduated
    from a nurse practitioner program for careers as primary care providers
    in Federally qualified health centers (referred to in this section as
    `FQHCs') and nurse-managed health clinics (referred to in this section
    as `NMHCs').
        ``(b) Purpose.--The purpose of the program is to enable each grant
    recipient to--
                ``(1) provide new nurse practitioners with clinical
            training to enable them to serve as primary care providers in
            FQHCs and NMHCs;
                ``(2) train new nurse practitioners to work under a model
            of primary care that is consistent with the principles set
            forth by the Institute of Medicine and the needs of vulnerable
            populations; and
                ``(3) create a model of FQHC and NMHC training for nurse
            practitioners that may be replicated nationwide.
        ``(c) Grants.--The Secretary shall award 3-year grants to eligible
    entities that meet the requirements established by the Secretary, for
    the purpose of operating the nurse practitioner primary care programs
    described in subsection (a) in such entities.
        ``(d) Eligible Entities.--To be eligible to receive a grant under
    this section, an entity shall--
                ``(1)(A) be a FQHC as defined in section 1861(aa) of the
            Social Security Act (42 U.S.C. 1395x(aa)); or
                ``(B) be a nurse-managed health clinic, as defined in
            section 330A-1 of the Public Health Service Act (as added by
            section 5208 of this Act); and
                ``(2) submit to the Secretary an application at such time,
            in such manner, and containing such information as the
            Secretary may require.
        ``(e) Priority in Awarding Grants.--In awarding grants under this
    section, the Secretary shall give priority to eligible entities that--
                ``(1) demonstrate sufficient infrastructure in size, scope,
            and capacity to undertake the requisite training of a minimum
            of 3 nurse practitioners per year, and to provide to each
            awardee 12 full months of full-time, paid employment and
            benefits consistent with the benefits offered to other full-
            time employees of such entity;
                ``(2) will assign not less than 1 staff nurse practitioner
            or physician to each of 4 precepted clinics;
                ``(3) will provide to each awardee specialty rotations,
            including specialty training in prenatal care and women's
            health, adult and child psychiatry, orthopedics, geriatrics,
            and at least 3 other high-volume, high-burden specialty areas;
                ``(4) provide sessions on high-volume, high-risk health
            problems and have a record of training health care
            professionals in the care of children, older adults, and
            underserved populations; and
                ``(5) collaborate with other safety net providers, schools,
            colleges, and universities that provide health professions
            training.
        ``(f) Eligibility of Nurse Practitioners.--
                ``(1) In general.--To be eligible for acceptance to a
            program funded through a grant awarded under this section, an
            individual shall--
                        ``(A) be licensed or eligible for licensure in the
                    State in which the program is located as an advanced
                    practice registered nurse or advanced practice nurse
                    and be eligible or board-certified as a family nurse
                    practitioner; and
                        ``(B) demonstrate commitment to a career as a
                    primary care provider in a FQHC or in a NMHC.
                ``(2) Preference.--In selecting awardees under the program,
            each grant recipient shall give preference to bilingual
            candidates that meet the requirements described in paragraph
            (1).
                ``(3) Deferral of certain service.--The starting date of
            required service of individuals in the National Health Service
            Corps Service program under title II of the Public Health
            Service Act (42 U.S.C. 202 et seq.) who receive training under
            this section shall be deferred until the date that is 22 days
            after the date of completion of the program.
        ``(g) Grant Amount.--Each grant awarded under this section shall be
    in an amount not to exceed $600,000 per year. A grant recipient may
    carry over funds from 1 fiscal year to another without obtaining
    approval from the Secretary.
        ``(h) Technical Assistance Grants.--The Secretary may award
    technical assistance grants to 1 or more FQHCs or NMHCs that have
    demonstrated expertise in establishing a nurse practitioner residency
    training program. Such technical assistance grants shall be for the
    purpose of providing technical assistance to other recipients of grants
    under subsection (c).
        ``(i) Authorization of Appropriations.--To carry out this section,
    there is authorized to be appropriated such sums as may be necessary
    for each of fiscal years 2011 through 2014.''.
        (f)(1) Section 399W of the Public Health Service Act, as added by
    section 5405, is redesignated as section 399V-1.
        (2) Section 399V-1 of the Public Health Service Act, as so
    redesignated, is amended in subsection (b)(2)(A) by striking ``and the
    departments of 1 or more health professions schools in the State that
    train providers in primary care'' and inserting ``and the departments
    that train providers in primary care in 1 or more health professions
    schools in the State''.
        (3) Section 934 of the Public Health Service Act, as added by
    section 3501, is amended by striking ``399W'' each place such term
    appears and inserting ``399V-1''.
        (4) Section 935(b) of the Public Health Service Act, as added by
    section 3503, is amended by striking ``399W'' and inserting ``399V-1''.
        (g) Part P of title III of the Public Health Service Act 42 U.S.C.
    280g et seq.), as amended by section 10411, is amended by adding at the
    end the following:

    ``SEC. 399V-3. NATIONAL DIABETES PREVENTION PROGRAM.

        ``(a) In General.--The Secretary, acting through the Director of
    the Centers for Disease Control and Prevention, shall establish a
    national diabetes prevention program (referred to in this section as
    the `program') targeted at adults at high risk for diabetes in order to
    eliminate the preventable burden of diabetes.
        ``(b) Program Activities.--The program described in subsection (a)
    shall include--
                ``(1) a grant program for community-based diabetes
            prevention program model sites;
                ``(2) a program within the Centers for Disease Control and
            Prevention to determine eligibility of entities to deliver
            community-based diabetes prevention services;
                ``(3) a training and outreach program for lifestyle
            intervention instructors; and
                ``(4) evaluation, monitoring and technical assistance, and
            applied research carried out by the Centers for Disease Control
            and Prevention.
        ``(c) Eligible Entities.--To be eligible for a grant under
    subsection (b)(1), an entity shall be a State or local health
    department, a tribal organization, a national network of community-
    based non-profits focused on health and wellbeing, an academic
    institution, or other entity, as the Secretary determines.
        ``(d) Authorization of Appropriations.--For the purpose of carrying
    out this section, there are authorized to be appropriated such sums as
    may be necessary for each of fiscal years 2010 through 2014.''.
        (h) The provisions of, and amendment made by, section 5501(c) of
    this Act are repealed.
        (i)(1) The provisions of, and amendments made by, section 5502 of
    this Act are repealed.
        (2)(A) Section 1861(aa)(3)(A) of the Social Security Act (42 U.S.C.
    1395w(aa)(3)(A)) is amended to read as follows:
                ``(A) services of the type described in subparagraphs (A)
            through (C) of paragraph (1) and preventive services (as
            defined in section 1861(ddd)(3)); and''.
        (B) The amendment made by subparagraph (A) shall apply to services
    furnished on or after January 1, 2011.
        (3)(A) Section 1834 of the Social Security Act (42 U.S.C. 1395m),
    as amended by section 4105, is amended by adding at the end the
    following new subsection:
        ``(o) Development and Implementation of Prospective Payment
    System.--
                ``(1) Development.--
                        ``(A) In general.--The Secretary shall develop a
                    prospective payment system for payment for Federally
                    qualified health center services furnished by Federally
                    qualified health centers under this title. Such system
                    shall include a process for appropriately describing
                    the services furnished by Federally qualified health
                    centers and shall establish payment rates for specific
                    payment codes based on such appropriate descriptions of
                    services. Such system shall be established to take into
                    account the type, intensity, and duration of services
                    furnished by Federally qualified health centers. Such
                    system may include adjustments, including geographic
                    adjustments, determined appropriate by the Secretary.
                        ``(B) Collection of data and evaluation.--By not
                    later than January 1, 2011, the Secretary shall require
                    Federally qualified health centers to submit to the
                    Secretary such information as the Secretary may require
                    in order to develop and implement the prospective
                    payment system under this subsection, including the
                    reporting of services using HCPCS codes.
                ``(2) Implementation.--
                        ``(A) In general.--Notwithstanding section
                    1833(a)(3)(A), the Secretary shall provide, for cost
                    reporting periods beginning on or after October 1,
                    2014, for payments of prospective payment rates for
                    Federally qualified health center services furnished by
                    Federally qualified health centers under this title in
                    accordance with the prospective payment system
                    developed by the Secretary under paragraph (1).
                        ``(B) Payments.--
                                ``(i) Initial payments.--The Secretary
                            shall implement such prospective payment system
                            so that the estimated aggregate amount of
                            prospective payment rates (determined prior to
                            the application of section 1833(a)(1)(Z)) under
                            this title for Federally qualified health
                            center services in the first year that such
                            system is implemented is equal to 100 percent
                            of the estimated amount of reasonable costs
                            (determined without the application of a per
                            visit payment limit or productivity screen and
                            prior to the application of section
                            1866(a)(2)(A)(ii)) that would have occurred for
                            such services under this title in such year if
                            the system had not been implemented.
                                ``(ii) Payments in subsequent years.--
                            Payment rates in years after the year of
                            implementation of such system shall be the
                            payment rates in the previous year increased--
                                        ``(I) in the first year after
                                    implementation of such system, by the
                                    percentage increase in the MEI (as
                                    defined in section 1842(i)(3)) for the
                                    year involved; and
                                        ``(II) in subsequent years, by the
                                    percentage increase in a market basket
                                    of Federally qualified health center
                                    goods and services as promulgated
                                    through regulations, or if such an
                                    index is not available, by the
                                    percentage increase in the MEI (as
                                    defined in section 1842(i)(3)) for the
                                    year involved.
                        ``(C) Preparation for pps implementation.--
                    Notwithstanding any other provision of law, the
                    Secretary may establish and implement by program
                    instruction or otherwise the payment codes to be used
                    under the prospective payment system under this
                    section.''.
        (B) Section 1833(a)(1) of the Social Security Act (42 U.S.C.
    1395l(a)(1)), as amended by section 4104, is amended--
                (i) by striking ``and'' before ``(Y)''; and
                (ii) by inserting before the semicolon at the end the
            following: ``, and (Z) with respect to Federally qualified
            health center services for which payment is made under section
            1834(o), the amounts paid shall be 80 percent of the lesser of
            the actual charge or the amount determined under such
            section''.
        (C) Section 1833(a) of the Social Security Act (42 U.S.C. 1395l(a))
    is amended--
                (i) in paragraph (3)(B)(i)--
                        (I) by inserting ``(I)'' after ``otherwise been
                    provided''; and
                        (II) by inserting ``, or (II) in the case of such
                    services furnished on or after the implementation date
                    of the prospective payment system under section
                    1834(o), under such section (calculated as if `100
                    percent' were substituted for `80 percent' in such
                    section) for such services if the individual had not
                    been so enrolled'' after ``been so enrolled''; and
                (ii) by adding at the end the following flush sentence:
            ``Paragraph (3)(A) shall not apply to Federally qualified
            health center services furnished on or after the implementation
            date of the prospective payment system under section
            1834(0).''.
        (j) Section 5505 is amended by adding at the end the following new
    subsection:
        ``(d) Application.--The amendments made by this section shall not
    be applied in a manner that requires reopening of any settled cost
    reports as to which there is not a jurisdictionally proper appeal
    pending as of the date of the enactment of this Act on the issue of
    payment for indirect costs of medical education under section
    1886(d)(5)(B) of the Social Security Act (42 U.S.C. 1395ww(d)(5)(B)) or
    for direct graduate medical education costs under section 1886(h) of
    such Act (42 U.S.C. 1395ww(h)).''.
        (k) Subtitle G of title V of this Act is amended by adding at the
    end the following:

    ``SEC. 5606. STATE GRANTS TO HEALTH CARE PROVIDERS WHO PROVIDE SERVICES
                  TO A HIGH PERCENTAGE OF MEDICALLY UNDERSERVED POPULATIONS
                  OR OTHER SPECIAL POPULATIONS.

        ``(a) In General.--A State may award grants to health care
    providers who treat a high percentage, as determined by such State, of
    medically underserved populations or other special populations in such
    State.
        ``(b) Source of Funds.--A grant program established by a State
    under subsection (a) may not be established within a department,
    agency, or other entity of such State that administers the Medicaid
    program under title XIX of the Social Security Act (42 U.S.C. 1396 et
    seq.), and no Federal or State funds allocated to such Medicaid
    program, the Medicare program under title XVIII of the Social Security
    Act (42 U.S.C. 1395 et seq.), or the TRICARE program under chapter 55
    of title 10, United States Code, may be used to award grants or to pay
    administrative costs associated with a grant program established under
    subsection (a).''.
        (l) Part C of title VII of the Public Health Service Act (42 U.S.C.
    293k et seq.) is amended--
                (1) after the part heading, by inserting the following:

                   ``Subpart I--Medical Training Generally'';

            and
                (2) by inserting at the end the following:

               ``Subpart II--Training in Underserved Communities

    ``SEC. 749B. RURAL PHYSICIAN TRAINING GRANTS.

        ``(a) In General.--The Secretary, acting through the Administrator
    of the Health Resources and Services Administration, shall establish a
    grant program for the purposes of assisting eligible entities in
    recruiting students most likely to practice medicine in underserved
    rural communities, providing rural-focused training and experience, and
    increasing the number of recent allopathic and osteopathic medical
    school graduates who practice in underserved rural communities.
        ``(b) Eligible Entities.--In order to be eligible to receive a
    grant under this section, an entity shall--
                ``(1) be a school of allopathic or osteopathic medicine
            accredited by a nationally recognized accrediting agency or
            association approved by the Secretary for this purpose, or any
            combination or consortium of such schools; and
                ``(2) submit an application to the Secretary that includes
            a certification that such entity will use amounts provided to
            the institution as described in subsection (d)(1).
        ``(c) Priority.--In awarding grant funds under this section, the
    Secretary shall give priority to eligible entities that--
                ``(1) demonstrate a record of successfully training
            students, as determined by the Secretary, who practice medicine
            in underserved rural communities;
                ``(2) demonstrate that an existing academic program of the
            eligible entity produces a high percentage, as determined by
            the Secretary, of graduates from such program who practice
            medicine in underserved rural communities;
                ``(3) demonstrate rural community institutional
            partnerships, through such mechanisms as matching or
            contributory funding, documented in-kind services for
            implementation, or existence of training partners with
            interprofessional expertise in community health center training
            locations or other similar facilities; or
                ``(4) submit, as part of the application of the entity
            under subsection (b), a plan for the long-term tracking of
            where the graduates of such entity practice medicine.
        ``(d) Use of Funds.--
                ``(1) Establishment.--An eligible entity receiving a grant
            under this section shall use the funds made available under
            such grant to establish, improve, or expand a rural-focused
            training program (referred to in this section as the `Program')
            meeting the requirements described in this subsection and to
            carry out such program.
                ``(2) Structure of program.--An eligible entity shall--
                        ``(A) enroll no fewer than 10 students per class
                    year into the Program; and
                        ``(B) develop criteria for admission to the Program
                    that gives priority to students--
                                ``(i) who have originated from or lived for
                            a period of 2 or more years in an underserved
                            rural community; and
                                ``(ii) who express a commitment to practice
                            medicine in an underserved rural community.
                ``(3) Curricula.--The Program shall require students to
            enroll in didactic coursework and clinical experience
            particularly applicable to medical practice in underserved
            rural communities, including--
                        ``(A) clinical rotations in underserved rural
                    communities, and in applicable specialties, or other
                    coursework or clinical experience deemed appropriate by
                    the Secretary; and
                        ``(B) in addition to core school curricula,
                    additional coursework or training experiences focused
                    on medical issues prevalent in underserved rural
                    communities.
                ``(4) Residency placement assistance.--Where available, the
            Program shall assist all students of the Program in obtaining
            clinical training experiences in locations with postgraduate
            programs offering residency training opportunities in
            underserved rural communities, or in local residency training
            programs that support and train physicians to practice in
            underserved rural communities.
                ``(5) Program student cohort support.--The Program shall
            provide and require all students of the Program to participate
            in group activities designed to further develop, maintain, and
            reinforce the original commitment of such students to practice
            in an underserved rural community.
        ``(e) Annual Reporting.--An eligible entity receiving a grant under
    this section shall submit an annual report to the Secretary on the
    success of the Program, based on criteria the Secretary determines
    appropriate, including the residency program selection of graduating
    students who participated in the Program.
        ``(f) Regulations.--Not later than 60 days after the date of
    enactment of this section, the Secretary shall by regulation define
    `underserved rural community' for purposes of this section.
        ``(g) Supplement Not Supplant.--Any eligible entity receiving funds
    under this section shall use such funds to supplement, not supplant,
    any other Federal, State, and local funds that would otherwise be
    expended by such entity to carry out the activities described in this
    section.
        ``(h) Maintenance of Effort.--With respect to activities for which
    funds awarded under this section are to be expended, the entity shall
    agree to maintain expenditures of non-Federal amounts for such
    activities at a level that is not less than the level of such
    expenditures maintained by the entity for the fiscal year preceding the
    fiscal year for which the entity receives a grant under this section.
        ``(i) Authorization of Appropriations.--There are authorized to be
    appropriated $4,000,000 for each of the fiscal years 2010 through
    2013.''.
        (m)(1) Section 768 of the Public Health Service Act (42 U.S.C.
    295c) is amended to read as follows:

    ``SEC. 768. PREVENTIVE MEDICINE AND PUBLIC HEALTH TRAINING GRANT
                  PROGRAM.

        ``(a) Grants.--The Secretary, acting through the Administrator of
    the Health Resources and Services Administration and in consultation
    with the Director of the Centers for Disease Control and Prevention,
    shall award grants to, or enter into contracts with, eligible entities
    to provide training to graduate medical residents in preventive
    medicine specialties.
        ``(b) Eligibility.--To be eligible for a grant or contract under
    subsection (a), an entity shall be--
                ``(1) an accredited school of public health or school of
            medicine or osteopathic medicine;
                ``(2) an accredited public or private nonprofit hospital;
                ``(3) a State, local, or tribal health department; or
                ``(4) a consortium of 2 or more entities described in
            paragraphs (1) through (3).
        ``(c) Use of Funds.--Amounts received under a grant or contract
    under this section shall be used to--
                ``(1) plan, develop (including the development of
            curricula), operate, or participate in an accredited residency
            or internship program in preventive medicine or public health;
                ``(2) defray the costs of practicum experiences, as
            required in such a program; and
                ``(3) establish, maintain, or improve--
                        ``(A) academic administrative units (including
                    departments, divisions, or other appropriate units) in
                    preventive medicine and public health; or
                        ``(B) programs that improve clinical teaching in
                    preventive medicine and public health.
        ``(d) Report.--The Secretary shall submit to the Congress an annual
    report on the program carried out under this section.''.
                (2) Section 770(a) of the Public Health Service Act (42
            U.S.C. 295e(a)) is amended to read as follows:
        ``(a) In General.--For the purpose of carrying out this subpart,
    there is authorized to be appropriated $43,000,000 for fiscal year
    2011, and such sums as may be necessary for each of the fiscal years
    2012 through 2015.''.
        (n)(1) Subsection (i) of section 331 of the Public Health Service
    Act (42 U.S.C. 254d) of the Public Health Service Act is amended--
                (A) in paragraph (1), by striking ``In carrying out subpart
            III'' and all that follows through the period and inserting
            ``In carrying out subpart III, the Secretary may, in accordance
            with this subsection, issue waivers to individuals who have
            entered into a contract for obligated service under the
            Scholarship Program or the Loan Repayment Program under which
            the individuals are authorized to satisfy the requirement of
            obligated service through providing clinical practice that is
            half time.'';
                (B) in paragraph (2)--
                        (i) in subparagraphs (A)(ii) and (B), by striking
                    ``less than full time'' each place it appears and
                    inserting ``half time'';
                        (ii) in subparagraphs (C) and (F), by striking
                    ``less than full-time service'' each place it appears
                    and inserting ``half-time service''; and
                        (iii) by amending subparagraphs (D) and (E) to read
                    as follows:
                ``(D) the entity and the Corps member agree in writing that
            the Corps member will perform half-time clinical practice;
                ``(E) the Corps member agrees in writing to fulfill all of
            the service obligations under section 338C through half-time
            clinical practice and either--
                        ``(i) double the period of obligated service that
                    would otherwise be required; or
                        ``(ii) in the case of contracts entered into under
                    section 338B, accept a minimum service obligation of 2
                    years with an award amount equal to 50 percent of the
                    amount that would otherwise be payable for full-time
                    service; and''; and
                (C) in paragraph (3), by striking ``In evaluating a
            demonstration project described in paragraph (1)'' and
            inserting ``In evaluating waivers issued under paragraph (1)''.
        (2) Subsection (j) of section 331 of the Public Health Service Act
    (42 U.S.C. 254d) is amended by adding at the end the following:
                ``(5) The terms `full time' and `full-time' mean a minimum
            of 40 hours per week in a clinical practice, for a minimum of
            45 weeks per year.
                ``(6) The terms `half time' and `half-time' mean a minimum
            of 20 hours per week (not to exceed 39 hours per week) in a
            clinical practice, for a minimum of 45 weeks per year.''.
        (3) Section 337(b)(1) of the Public Health Service Act (42 U.S.C.
    254j(b)(1)) is amended by striking ``Members may not be reappointed to
    the Council.''.
        (4) Section 338B(g)(2)(A) of the Public Health Service Act (42
    U.S.C. 254l-1(g)(2)(A)) is amended by striking ``$35,000'' and
    inserting ``$50,000, plus, beginning with fiscal year 2012, an amount
    determined by the Secretary on an annual basis to reflect inflation,''.
        (5) Subsection (a) of section 338C of the Public Health Service Act
    (42 U.S.C. 254m), as amended by section 5508, is amended--
                (A) by striking the second sentence and inserting the
            following: ``The Secretary may treat teaching as clinical
            practice for up to 20 percent of such period of obligated
            service.''; and
                (B) by adding at the end the following: ``Notwithstanding
            the preceding sentence, with respect to a member of the Corps
            participating in the teaching health centers graduate medical
            education program under section 340H, for the purpose of
            calculating time spent in full-time clinical practice under
            this section, up to 50 percent of time spent teaching by such
            member may be counted toward his or her service obligation.''.

    SEC. 10502. INFRASTRUCTURE TO EXPAND ACCESS TO CARE.

        (a) Appropriation.--There are authorized to be appropriated, and
    there are appropriated to the Department of Health and Human Services,
    $100,000,000 for fiscal year 2010, to remain available for obligation
    until September 30, 2011, to be used for debt service on, or direct
    construction or renovation of, a health care facility that provides
    research, inpatient tertiary care, or outpatient clinical services.
    Such facility shall be affiliated with an academic health center at a
    public research university in the United States that contains a State's
    sole public academic medical and dental school.
        (b) Requirement.--Amount appropriated under subsection (a) may only
    be made available by the Secretary of Health and Human Services upon
    the receipt of an application from the Governor of a State that
    certifies that--
                (1) the new health care facility is critical for the
            provision of greater access to health care within the State;
                (2) such facility is essential for the continued financial
            viability of the State's sole public medical and dental school
            and its academic health center;
                (3) the request for Federal support represents not more
            than 40 percent of the total cost of the proposed new facility;
            and
                (4) the State has established a dedicated funding mechanism
            to provide all remaining funds necessary to complete the
            construction or renovation of the proposed facility.

    SEC. 10503. COMMUNITY HEALTH CENTERS AND THE NATIONAL HEALTH SERVICE
                  CORPS FUND.

        (a) Purpose.--It is the purpose of this section to establish a
    Community Health Center Fund (referred to in this section as the ``CHC
    Fund''), to be administered through the Office of the Secretary of the
    Department of Health and Human Services to provide for expanded and
    sustained national investment in community health centers under section
    330 of the Public Health Service Act and the National Health Service
    Corps.
        (b) Funding.--There is authorized to be appropriated, and there is
    appropriated, out of any monies in the Treasury not otherwise
    appropriated, to the CHC Fund--
                (1) to be transferred to the Secretary of Health and Human
            Services to provide enhanced funding for the community health
            center program under section 330 of the Public Health Service
            Act--
                        (A) $700,000,000 for fiscal year 2011;
                        (B) $800,000,000 for fiscal year 2012;
                        (C) $1,000,000,000 for fiscal year 2013;
                        (D) $1,600,000,000 for fiscal year 2014; and
                        (E) $2,900,000,000 for fiscal year 2015; and
                (2) to be transferred to the Secretary of Health and Human
            Services to provide enhanced funding for the National Health
            Service Corps--
                        (A) $290,000,000 for fiscal year 2011;
                        (B) $295,000,000 for fiscal year 2012;
                        (C) $300,000,000 for fiscal year 2013;
                        (D) $305,000,000 for fiscal year 2014; and
                        (E) $310,000,000 for fiscal year 2015.
        (c) Construction.--There is authorized to be appropriated, and
    there is appropriated, out of any monies in the Treasury not otherwise
    appropriated, $1,500,000,000 to be available for fiscal years 2011
    through 2015 to be used by the Secretary of Health and Human Services
    for the construction and renovation of community health centers.
        (d) Use of Fund.--The Secretary of Health and Human Services shall
    transfer amounts in the CHC Fund to accounts within the Department of
    Health and Human Services to increase funding, over the fiscal year
    2008 level, for community health centers and the National Health
    Service Corps.
        (e) Availability.--Amounts appropriated under subsections (b) and
    (c) shall remain available until expended.

    SEC. 10504. DEMONSTRATION PROJECT TO PROVIDE ACCESS TO AFFORDABLE CARE.

        (a) In General.--Not later than 6 months after the date of
    enactment of this Act, the Secretary of Health and Human Services
    (referred to in this section as the ``Secretary''), acting through the
    Health Resources and Services Administration, shall establish a 3 year
    demonstration project in up to 10 States to provide access to
    comprehensive health care services to the uninsured at reduced fees.
    The Secretary shall evaluate the feasibility of expanding the project
    to additional States.
        (b) Eligibility.--To be eligible to participate in the
    demonstration project, an entity shall be a State-based, nonprofit,
    public-private partnership that provides access to comprehensive health
    care services to the uninsured at reduced fees. Each State in which a
    participant selected by the Secretary is located shall receive not more
    than $2,000,000 to establish and carry out the project for the 3-year
    demonstration period.
        (c) Authorization.--There is authorized to be appropriated such
    sums as may be necessary to carry out this section.

                  Subtitle F--Provisions Relating to Title VI

    SEC. 10601. REVISIONS TO LIMITATION ON MEDICARE EXCEPTION TO THE
                  PROHIBITION ON CERTAIN PHYSICIAN REFERRALS FOR HOSPITALS.

        (a) In General.--Section 1877(i) of the Social Security Act, as
    added by section 6001(a), is amended--
                (1) in paragraph (1)(A)(i), by striking ``February 1,
            2010'' and inserting ``August 1, 2010''; and
                (2) in paragraph (3)(A)--
                        (A) in clause (iii), by striking ``August 1, 2011''
                    and inserting ``February 1, 2012''; and
                        (B) in clause (iv), by striking ``July 1, 2011''
                    and inserting ``January 1, 2012''.
        (b) Conforming Amendment.--Section 6001(b)(2) of this Act is
    amended by striking ``November 1, 2011'' and inserting ``May 1, 2012''.

    SEC. 10602. CLARIFICATIONS TO PATIENT-CENTERED OUTCOMES RESEARCH.

        Section 1181 of the Social Security Act (as added by section 6301)
    is amended--
                (1) in subsection (d)(2)(B)--
                        (A) in clause (ii)(IV)--
                                (i) by inserting ``, as described in
                            subparagraph (A)(ii),'' after ``original
                            research''; and
                                (ii) by inserting ``, as long as the
                            researcher enters into a data use agreement
                            with the Institute for use of the data from the
                            original research, as appropriate'' after
                            ``publication''; and
                        (B) by amending clause (iv) to read as follows:
                                ``(iv) Subsequent use of the data.--The
                            Institute shall not allow the subsequent use of
                            data from original research in work-for-hire
                            contracts with individuals, entities, or
                            instrumentalities that have a financial
                            interest in the results, unless approved under
                            a data use agreement with the Institute.'';
                (2) in subsection (d)(8)(A)(iv), by striking ``not be
            construed as mandates for'' and inserting ``do not include'';
            and
                (3) in subsection (f)(1)(C), by amending clause (ii) to
            read as follows:
                                ``(ii) 7 members representing physicians
                            and providers, including 4 members representing
                            physicians (at least 1 of whom is a surgeon), 1
                            nurse, 1 State-licensed integrative health care
                            practitioner, and 1 representative of a
                            hospital.''.

    SEC. 10603. STRIKING PROVISIONS RELATING TO INDIVIDUAL PROVIDER
                  APPLICATION FEES.

        (a) In General.--Section 1866(j)(2)(C) of the Social Security Act,
    as added by section 6401(a), is amended--
                (1) by striking clause (i);
                (2) by redesignating clauses (ii) through (iv),
            respectively, as clauses (i) through (iii); and
                (3) in clause (i), as redesignated by paragraph (2), by
            striking ``clause (iii)'' and inserting ``clause (ii)''.
        (b) Technical Correction.--Section 6401(a)(2) of this Act is
    amended to read as follows:
                ``(2) by redesignating paragraph (2) as paragraph (8);
            and''.

    SEC. 10604. TECHNICAL CORRECTION TO SECTION 6405.

        Paragraphs (1) and (2) of section 6405(b) are amended to read as
    follows:
                ``(1) Part a.--Section 1814(a)(2) of the Social Security
            Act (42 U.S.C. 1395(a)(2)) is amended in the matter preceding
            subparagraph (A) by inserting `, or, in the case of services
            described in subparagraph (C), a physician enrolled under
            section 1866(j),' after `in collaboration with a physician,'.
                ``(2) Part b.--Section 1835(a)(2) of the Social Security
            Act (42 U.S.C. 1395n(a)(2)) is amended in the matter preceding
            subparagraph (A) by inserting `, or, in the case of services
            described in subparagraph (A), a physician enrolled under
            section 1866(j),' after `a physician'.''.

    SEC. 10605. CERTAIN OTHER PROVIDERS PERMITTED TO CONDUCT FACE TO FACE
                  ENCOUNTER FOR HOME HEALTH SERVICES.

        (a) Part A.--Section 1814(a)(2)(C) of the Social Security Act (42
    U.S.C. 1395f(a)(2)(C)), as amended by section 6407(a)(1), is amended by
    inserting ``, or a nurse practitioner or clinical nurse specialist (as
    those terms are defined in section 1861(aa)(5)) who is working in
    collaboration with the physician in accordance with State law, or a
    certified nurse-midwife (as defined in section 1861(gg)) as authorized
    by State law, or a physician assistant (as defined in section
    1861(aa)(5)) under the supervision of the physician,'' after ``himself
    or herself''.
        (b) Part B.--Section 1835(a)(2)(A)(iv) of the Social Security Act,
    as added by section 6407(a)(2), is amended by inserting ``, or a nurse
    practitioner or clinical nurse specialist (as those terms are defined
    in section 1861(aa)(5)) who is working in collaboration with the
    physician in accordance with State law, or a certified nurse-midwife
    (as defined in section 1861(gg)) as authorized by State law, or a
    physician assistant (as defined in section 1861(aa)(5)) under the
    supervision of the physician,'' after ``must document that the
    physician''.

    SEC. 10606. HEALTH CARE FRAUD ENFORCEMENT.

        (a) Fraud Sentencing Guidelines.--
                (1) Definition.--In this subsection, the term ``Federal
            health care offense'' has the meaning given that term in
            section 24 of title 18, United States Code, as amended by this
            Act.
                (2) Review and amendments.--Pursuant to the authority under
            section 994 of title 28, United States Code, and in accordance
            with this subsection, the United States Sentencing Commission
            shall--
                        (A) review the Federal Sentencing Guidelines and
                    policy statements applicable to persons convicted of
                    Federal health care offenses;
                        (B) amend the Federal Sentencing Guidelines and
                    policy statements applicable to persons convicted of
                    Federal health care offenses involving Government
                    health care programs to provide that the aggregate
                    dollar amount of fraudulent bills submitted to the
                    Government health care program shall constitute prima
                    facie evidence of the amount of the intended loss by
                    the defendant; and
                        (C) amend the Federal Sentencing Guidelines to
                    provide--
                                (i) a 2-level increase in the offense level
                            for any defendant convicted of a Federal health
                            care offense relating to a Government health
                            care program which involves a loss of not less
                            than $1,000,000 and less than $7,000,000;
                                (ii) a 3-level increase in the offense
                            level for any defendant convicted of a Federal
                            health care offense relating to a Government
                            health care program which involves a loss of
                            not less than $7,000,000 and less than
                            $20,000,000;
                                (iii) a 4-level increase in the offense
                            level for any defendant convicted of a Federal
                            health care offense relating to a Government
                            health care program which involves a loss of
                            not less than $20,000,000; and
                                (iv) if appropriate, otherwise amend the
                            Federal Sentencing Guidelines and policy
                            statements applicable to persons convicted of
                            Federal health care offenses involving
                            Government health care programs.
                (3) Requirements.--In carrying this subsection, the United
            States Sentencing Commission shall--
                        (A) ensure that the Federal Sentencing Guidelines
                    and policy statements--
                                (i) reflect the serious harms associated
                            with health care fraud and the need for
                            aggressive and appropriate law enforcement
                            action to prevent such fraud; and
                                (ii) provide increased penalties for
                            persons convicted of health care fraud offenses
                            in appropriate circumstances;
                        (B) consult with individuals or groups representing
                    health care fraud victims, law enforcement officials,
                    the health care industry, and the Federal judiciary as
                    part of the review described in paragraph (2);
                        (C) ensure reasonable consistency with other
                    relevant directives and with other guidelines under the
                    Federal Sentencing Guidelines;
                        (D) account for any aggravating or mitigating
                    circumstances that might justify exceptions, including
                    circumstances for which the Federal Sentencing
                    Guidelines, as in effect on the date of enactment of
                    this Act, provide sentencing enhancements;
                        (E) make any necessary conforming changes to the
                    Federal Sentencing Guidelines; and
                        (F) ensure that the Federal Sentencing Guidelines
                    adequately meet the purposes of sentencing.
        (b) Intent Requirement for Health Care Fraud.--Section 1347 of
    title 18, United States Code, is amended--
                (1) by inserting ``(a)'' before ``Whoever knowingly''; and
                (2) by adding at the end the following:
        ``(b) With respect to violations of this section, a person need not
    have actual knowledge of this section or specific intent to commit a
    violation of this section.''.
        (c) Health Care Fraud Offense.--Section 24(a) of title 18, United
    States Code, is amended--
                (1) in paragraph (1), by striking the semicolon and
            inserting ``or section 1128B of the Social Security Act (42
            U.S.C. 1320a-7b); or''; and
                (2) in paragraph (2)--
                        (A) by inserting ``1349,'' after ``1343,''; and
                        (B) by inserting ``section 301 of the Federal Food,
                    Drug, and Cosmetic Act (21 U.S.C. 331), or section 501
                    of the Employee Retirement Income Security Act of 1974
                    (29 U.S.C. 1131),'' after ``title,''.
        (d) Subpoena Authority Relating to Health Care.--
                (1) Subpoenas under the health insurance portability and
            accountability act of 1996.--Section 1510(b) of title 18,
            United States Code, is amended--
                        (A) in paragraph (1), by striking ``to the grand
                    jury''; and
                        (B) in paragraph (2)--
                                (i) in subparagraph (A), by striking
                            ``grand jury subpoena'' and inserting
                            ``subpoena for records''; and
                                (ii) in the matter following subparagraph
                            (B), by striking ``to the grand jury''.
                (2) Subpoenas under the civil rights of institutionalized
            persons act.--The Civil Rights of Institutionalized Persons Act
            (42 U.S.C. 1997 et seq.) is amended by inserting after section
            3 the following:

    ``SEC. 3A. SUBPOENA AUTHORITY.

        ``(a) Authority.--The Attorney General, or at the direction of the
    Attorney General, any officer or employee of the Department of Justice
    may require by subpoena access to any institution that is the subject
    of an investigation under this Act and to any document, record,
    material, file, report, memorandum, policy, procedure, investigation,
    video or audio recording, or quality assurance report relating to any
    institution that is the subject of an investigation under this Act to
    determine whether there are conditions which deprive persons residing
    in or confined to the institution of any rights, privileges, or
    immunities secured or protected by the Constitution or laws of the
    United States.
        ``(b) Issuance and Enforcement of Subpoenas.--
                ``(1) Issuance.--Subpoenas issued under this section--
                        ``(A) shall bear the signature of the Attorney
                    General or any officer or employee of the Department of
                    Justice as designated by the Attorney General; and
                        ``(B) shall be served by any person or class of
                    persons designated by the Attorney General or a
                    designated officer or employee for that purpose.
                ``(2) Enforcement.--In the case of contumacy or failure to
            obey a subpoena issued under this section, the United States
            district court for the judicial district in which the
            institution is located may issue an order requiring compliance.
            Any failure to obey the order of the court may be punished by
            the court as a contempt that court.
        ``(c) Protection of Subpoenaed Records and Information.--Any
    document, record, material, file, report, memorandum, policy,
    procedure, investigation, video or audio recording, or quality
    assurance report or other information obtained under a subpoena issued
    under this section--
                ``(1) may not be used for any purpose other than to protect
            the rights, privileges, or immunities secured or protected by
            the Constitution or laws of the United States of persons who
            reside, have resided, or will reside in an institution;
                ``(2) may not be transmitted by or within the Department of
            Justice for any purpose other than to protect the rights,
            privileges, or immunities secured or protected by the
            Constitution or laws of the United States of persons who
            reside, have resided, or will reside in an institution; and
                ``(3) shall be redacted, obscured, or otherwise altered if
            used in any publicly available manner so as to prevent the
            disclosure of any personally identifiable information.''.

    SEC. 10607. STATE DEMONSTRATION PROGRAMS TO EVALUATE ALTERNATIVES TO
                  CURRENT MEDICAL TORT LITIGATION.

        Part P of title III of the Public Health Service Act (42 U.S.C.
    280g et seq.), as amended by this Act, is further amended by adding at
    the end the following:

    ``SEC. 399V-4. STATE DEMONSTRATION PROGRAMS TO EVALUATE ALTERNATIVES TO
                  CURRENT MEDICAL TORT LITIGATION.

        ``(a) In General.--The Secretary is authorized to award
    demonstration grants to States for the development, implementation, and
    evaluation of alternatives to current tort litigation for resolving
    disputes over injuries allegedly caused by health care providers or
    health care organizations. In awarding such grants, the Secretary shall
    ensure the diversity of the alternatives so funded.
        ``(b) Duration.--The Secretary may award grants under subsection
    (a) for a period not to exceed 5 years.
        ``(c) Conditions for Demonstration Grants.--
                ``(1) Requirements.--Each State desiring a grant under
            subsection (a) shall develop an alternative to current tort
            litigation that--
                        ``(A) allows for the resolution of disputes over
                    injuries allegedly caused by health care providers or
                    health care organizations; and
                        ``(B) promotes a reduction of health care errors by
                    encouraging the collection and analysis of patient
                    safety data related to disputes resolved under
                    subparagraph (A) by organizations that engage in
                    efforts to improve patient safety and the quality of
                    health care.
                ``(2) Alternative to current tort litigation.--Each State
            desiring a grant under subsection (a) shall demonstrate how the
            proposed alternative described in paragraph (1)(A)--
                        ``(A) makes the medical liability system more
                    reliable by increasing the availability of prompt and
                    fair resolution of disputes;
                        ``(B) encourages the efficient resolution of
                    disputes;
                        ``(C) encourages the disclosure of health care
                    errors;
                        ``(D) enhances patient safety by detecting,
                    analyzing, and helping to reduce medical errors and
                    adverse events;
                        ``(E) improves access to liability insurance;
                        ``(F) fully informs patients about the differences
                    in the alternative and current tort litigation;
                        ``(G) provides patients the ability to opt out of
                    or voluntarily withdraw from participating in the
                    alternative at any time and to pursue other options,
                    including litigation, outside the alternative;
                        ``(H) would not conflict with State law at the time
                    of the application in a way that would prohibit the
                    adoption of an alternative to current tort litigation;
                    and
                        ``(I) would not limit or curtail a patient's
                    existing legal rights, ability to file a claim in or
                    access a State's legal system, or otherwise abrogate a
                    patient's ability to file a medical malpractice claim.
                ``(3) Sources of compensation.--Each State desiring a grant
            under subsection (a) shall identify the sources from and
            methods by which compensation would be paid for claims resolved
            under the proposed alternative to current tort litigation,
            which may include public or private funding sources, or a
            combination of such sources. Funding methods shall to the
            extent practicable provide financial incentives for activities
            that improve patient safety.
                ``(4) Scope.--
                        ``(A) In general.--Each State desiring a grant
                    under subsection (a) shall establish a scope of
                    jurisdiction (such as Statewide, designated geographic
                    region, a designated area of health care practice, or a
                    designated group of health care providers or health
                    care organizations) for the proposed alternative to
                    current tort litigation that is sufficient to evaluate
                    the effects of the alternative. No scope of
                    jurisdiction shall be established under this paragraph
                    that is based on a health care payer or patient
                    population.
                        ``(B) Notification of patients.--A State shall
                    demonstrate how patients would be notified that they
                    are receiving health care services that fall within
                    such scope, and the process by which they may opt out
                    of or voluntarily withdraw from participating in the
                    alternative. The decision of the patient whether to
                    participate or continue participating in the
                    alternative process shall be made at any time and shall
                    not be limited in any way.
                ``(5) Preference in awarding demonstration grants.--In
            awarding grants under subsection (a), the Secretary shall give
            preference to States--
                        ``(A) that have developed the proposed alternative
                    through substantive consultation with relevant
                    stakeholders, including patient advocates, health care
                    providers and health care organizations, attorneys with
                    expertise in representing patients and health care
                    providers, medical malpractice insurers, and patient
                    safety experts;
                        ``(B) that make proposals that are likely to
                    enhance patient safety by detecting, analyzing, and
                    helping to reduce medical errors and adverse events;
                    and
                        ``(C) that make proposals that are likely to
                    improve access to liability insurance.
        ``(d) Application.--
                ``(1) In general.--Each State desiring a grant under
            subsection (a) shall submit to the Secretary an application, at
            such time, in such manner, and containing such information as
            the Secretary may require.
                ``(2) Review panel.--
                        ``(A) In general.--In reviewing applications under
                    paragraph (1), the Secretary shall consult with a
                    review panel composed of relevant experts appointed by
                    the Comptroller General.
                        ``(B) Composition.--
                                ``(i) Nominations.--The Comptroller General
                            shall solicit nominations from the public for
                            individuals to serve on the review panel.
                                ``(ii) Appointment.--The Comptroller
                            General shall appoint, at least 9 but not more
                            than 13, highly qualified and knowledgeable
                            individuals to serve on the review panel and
                            shall ensure that the following entities
                            receive fair representation on such panel:
                                        ``(I) Patient advocates.
                                        ``(II) Health care providers and
                                    health care organizations.
                                        ``(III) Attorneys with expertise in
                                    representing patients and health care
                                    providers.
                                        ``(IV) Medical malpractice
                                    insurers.
                                        ``(V) State officials.
                                        ``(VI) Patient safety experts.
                        ``(C) Chairperson.--The Comptroller General, or an
                    individual within the Government Accountability Office
                    designated by the Comptroller General, shall be the
                    chairperson of the review panel.
                        ``(D) Availability of information.--The Comptroller
                    General shall make available to the review panel such
                    information, personnel, and administrative services and
                    assistance as the review panel may reasonably require
                    to carry out its duties.
                        ``(E) Information from agencies.--The review panel
                    may request directly from any department or agency of
                    the United States any information that such panel
                    considers necessary to carry out its duties. To the
                    extent consistent with applicable laws and regulations,
                    the head of such department or agency shall furnish the
                    requested information to the review panel.
        ``(e) Reports.--
                ``(1) By state.--Each State receiving a grant under
            subsection (a) shall submit to the Secretary an annual report
            evaluating the effectiveness of activities funded with grants
            awarded under such subsection. Such report shall, at a minimum,
            include the impact of the activities funded on patient safety
            and on the availability and price of medical liability
            insurance.
                ``(2) By secretary.--The Secretary shall submit to Congress
            an annual compendium of the reports submitted under paragraph
            (1) and an analysis of the activities funded under subsection
            (a) that examines any differences that result from such
            activities in terms of the quality of care, number and nature
            of medical errors, medical resources used, length of time for
            dispute resolution, and the availability and price of liability
            insurance.
        ``(f) Technical Assistance.--
                ``(1) In general.--The Secretary shall provide technical
            assistance to the States applying for or awarded grants under
            subsection (a).
                ``(2) Requirements.--Technical assistance under paragraph
            (1) shall include--
                        ``(A) guidance on non-economic damages, including
                    the consideration of individual facts and circumstances
                    in determining appropriate payment, guidance on
                    identifying avoidable injuries, and guidance on
                    disclosure to patients of health care errors and
                    adverse events; and
                        ``(B) the development, in consultation with States,
                    of common definitions, formats, and data collection
                    infrastructure for States receiving grants under this
                    section to use in reporting to facilitate aggregation
                    and analysis of data both within and between States.
                ``(3) Use of common definitions, formats, and data
            collection infrastructure.--States not receiving grants under
            this section may also use the common definitions, formats, and
            data collection infrastructure developed under paragraph
            (2)(B).
        ``(g) Evaluation.--
                ``(1) In general.--The Secretary, in consultation with the
            review panel established under subsection (d)(2), shall enter
            into a contract with an appropriate research organization to
            conduct an overall evaluation of the effectiveness of grants
            awarded under subsection (a) and to annually prepare and submit
            a report to Congress. Such an evaluation shall begin not later
            than 18 months following the date of implementation of the
            first program funded by a grant under subsection (a).
                ``(2) Contents.--The evaluation under paragraph (1) shall
            include--
                        ``(A) an analysis of the effects of the grants
                    awarded under subsection (a) with regard to the
                    measures described in paragraph (3);
                        ``(B) for each State, an analysis of the extent to
                    which the alternative developed under subsection (c)(1)
                    is effective in meeting the elements described in
                    subsection (c)(2);
                        ``(C) a comparison among the States receiving
                    grants under subsection (a) of the effectiveness of the
                    various alternatives developed by such States under
                    subsection (c)(1);
                        ``(D) a comparison, considering the measures
                    described in paragraph (3), of States receiving grants
                    approved under subsection (a) and similar States not
                    receiving such grants; and
                        ``(E) a comparison, with regard to the measures
                    described in paragraph (3), of--
                                ``(i) States receiving grants under
                            subsection (a);
                                ``(ii) States that enacted, prior to the
                            date of enactment of the Patient Protection and
                            Affordable Care Act, any cap on non-economic
                            damages; and
                                ``(iii) States that have enacted, prior to
                            the date of enactment of the Patient Protection
                            and Affordable Care Act, a requirement that the
                            complainant obtain an opinion regarding the
                            merit of the claim, although the substance of
                            such opinion may have no bearing on whether the
                            complainant may proceed with a case.
                ``(3) Measures.--The evaluations under paragraph (2) shall
            analyze and make comparisons on the basis of--
                        ``(A) the nature and number of disputes over
                    injuries allegedly caused by health care providers or
                    health care organizations;
                        ``(B) the nature and number of claims in which tort
                    litigation was pursued despite the existence of an
                    alternative under subsection (a);
                        ``(C) the disposition of disputes and claims,
                    including the length of time and estimated costs to all
                    parties;
                        ``(D) the medical liability environment;
                        ``(E) health care quality;
                        ``(F) patient safety in terms of detecting,
                    analyzing, and helping to reduce medical errors and
                    adverse events;
                        ``(G) patient and health care provider and
                    organization satisfaction with the alternative under
                    subsection (a) and with the medical liability
                    environment; and
                        ``(H) impact on utilization of medical services,
                    appropriately adjusted for risk.
                ``(4) Funding.--The Secretary shall reserve 5 percent of
            the amount appropriated in each fiscal year under subsection
            (k) to carry out this subsection.
        ``(h) MedPAC and MACPAC Reports.--
                ``(1) MedPAC.--The Medicare Payment Advisory Commission
            shall conduct an independent review of the alternatives to
            current tort litigation that are implemented under grants under
            subsection (a) to determine the impact of such alternatives on
            the Medicare program under title XVIII of the Social Security
            Act, and its beneficiaries.
                ``(2) MACPAC.--The Medicaid and CHIP Payment and Access
            Commission shall conduct an independent review of the
            alternatives to current tort litigation that are implemented
            under grants under subsection (a) to determine the impact of
            such alternatives on the Medicaid or CHIP programs under titles
            XIX and XXI of the Social Security Act, and their
            beneficiaries.
                ``(3) Reports.--Not later than December 31, 2016, the
            Medicare Payment Advisory Commission and the Medicaid and CHIP
            Payment and Access Commission shall each submit to Congress a
            report that includes the findings and recommendations of each
            respective Commission based on independent reviews conducted
            under paragraphs (1) and (2), including an analysis of the
            impact of the alternatives reviewed on the efficiency and
            effectiveness of the respective programs.
        ``(i) Option To Provide for Initial Planning Grants.--Of the funds
    appropriated pursuant to subsection (k), the Secretary may use a
    portion not to exceed $500,000 per State to provide planning grants to
    such States for the development of demonstration project applications
    meeting the criteria described in subsection (c). In selecting States
    to receive such planning grants, the Secretary shall give preference to
    those States in which State law at the time of the application would
    not prohibit the adoption of an alternative to current tort litigation.
        ``(j) Definitions.--In this section:
                ``(1) Health care services.--The term `health care
            services' means any services provided by a health care
            provider, or by any individual working under the supervision of
            a health care provider, that relate to--
                        ``(A) the diagnosis, prevention, or treatment of
                    any human disease or impairment; or
                        ``(B) the assessment of the health of human beings.
                ``(2) Health care organization.--The term `health care
            organization' means any individual or entity which is obligated
            to provide, pay for, or administer health benefits under any
            health plan.
                ``(3) Health care provider.--The term `health care
            provider' means any individual or entity--
                        ``(A) licensed, registered, or certified under
                    Federal or State laws or regulations to provide health
                    care services; or
                        ``(B) required to be so licensed, registered, or
                    certified but that is exempted by other statute or
                    regulation.
        ``(k) Authorization of Appropriations.--There are authorized to be
    appropriated to carry out this section, $50,000,000 for the 5-fiscal
    year period beginning with fiscal year 2011.
        ``(l) Current State Efforts To Establish Alternative To Tort
    Litigation.--Nothing in this section shall be construed to limit any
    prior, current, or future efforts of any State to establish any
    alternative to tort litigation.
        ``(m) Rule of Construction.--Nothing in this section shall be
    construed as limiting states' authority over or responsibility for
    their state justice systems.''.

    SEC. 10608. EXTENSION OF MEDICAL MALPRACTICE COVERAGE TO FREE CLINICS.

        (a) In General.--Section 224(o)(1) of the Public Health Service Act
    (42 U.S.C. 233(o)(1)) is amended by inserting after ``to an
    individual'' the following: ``, or an officer, governing board member,
    employee, or contractor of a free clinic shall in providing services
    for the free clinic,''.
        (b) Effective Date.--The amendment made by this section shall take
    effect on the date of enactment of this Act and apply to any act or
    omission which occurs on or after that date.

    SEC. 10609. LABELING CHANGES.

        Section 505(j) of the Federal Food, Drug, and Cosmetic Act (21
    U.S.C. 355(j)) is amended by adding at the end the following:
        ``(10)(A) If the proposed labeling of a drug that is the subject of
    an application under this subsection differs from the listed drug due
    to a labeling revision described under clause (i), the drug that is the
    subject of such application shall, notwithstanding any other provision
    of this Act, be eligible for approval and shall not be considered
    misbranded under section 502 if--
                ``(i) the application is otherwise eligible for approval
            under this subsection but for expiration of patent, an
            exclusivity period, or of a delay in approval described in
            paragraph (5)(B)(iii), and a revision to the labeling of the
            listed drug has been approved by the Secretary within 60 days
            of such expiration;
                ``(ii) the labeling revision described under clause (i)
            does not include a change to the `Warnings' section of the
            labeling;
                ``(iii) the sponsor of the application under this
            subsection agrees to submit revised labeling of the drug that
            is the subject of such application not later than 60 days after
            the notification of any changes to such labeling required by
            the Secretary; and
                ``(iv) such application otherwise meets the applicable
            requirements for approval under this subsection.
        ``(B) If, after a labeling revision described in subparagraph
    (A)(i), the Secretary determines that the continued presence in
    interstate commerce of the labeling of the listed drug (as in effect
    before the revision described in subparagraph (A)(i)) adversely impacts
    the safe use of the drug, no application under this subsection shall be
    eligible for approval with such labeling.''.

                 Subtitle G--Provisions Relating to Title VIII

    SEC. 10801. PROVISIONS RELATING TO TITLE VIII.

        (a) Title XXXII of the Public Health Service Act, as added by
    section 8002(a)(1), is amended--
                (1) in section 3203--
                        (A) in subsection (a)(1), by striking subparagraph
                    (E);
                        (B) in subsection (b)(1)(C)(i), by striking ``for
                    enrollment'' and inserting ``for reenrollment''; and
                        (C) in subsection (c)(1), by striking ``, as part
                    of their automatic enrollment in the CLASS program,'';
                    and
                (2) in section 3204--
                        (A) in subsection (c)(2), by striking subparagraph
                    (A) and inserting the following:
                        ``(A) receives wages or income on which there is
                    imposed a tax under section 3101(a) or 3201(a) of the
                    Internal Revenue Code of 1986; or'';
                        (B) in subsection (d), by striking ``subparagraph
                    (B) or (C) of subsection (c)(1)'' and inserting
                    ``subparagraph (A) or (B) of subsection (c)(2)'';
                        (C) in subsection (e)(2)(A), by striking
                    ``subparagraph (A)'' and inserting ``paragraph (1)'';
                    and
                        (D) in subsection (g)(1), by striking ``has elected
                    to waive enrollment'' and inserting ``has not
                    enrolled''.
        (b) Section 8002 of this Act is amended in the heading for
    subsection (d), by striking ``Information on Supplemental Coverage''
    and inserting ``CLASS Program Information''.
        (c) Section 6021(d)(2)(A)(iv) of the Deficit Reduction Act of 2005,
    as added by section 8002(d) of this Act, is amended by striking ``and
    coverage available'' and all that follows through ``that program,''.

                  Subtitle H--Provisions Relating to Title IX

    SEC. 10901. MODIFICATIONS TO EXCISE TAX ON HIGH COST EMPLOYER-SPONSORED
                  HEALTH COVERAGE.

        (a) Longshore Workers Treated as Employees Engaged in High-risk
    Professions.--Paragraph (3) of section 4980I(f) of the Internal Revenue
    Code of 1986, as added by section 9001 of this Act, is amended by
    inserting ``individuals whose primary work is longshore work (as
    defined in section 258(b) of the Immigration and Nationality Act (8
    U.S.C. 1288(b)), determined without regard to paragraph (2) thereof),''
    before ``and individuals engaged in the construction, mining''.
        (b) Exemption From High-cost Insurance Tax Includes Certain
    Additional Excepted Benefits.--Clause (i) of section 4980I(d)(1)(B) of
    the Internal Revenue Code of 1986, as added by section 9001 of this
    Act, is amended by striking ``section 9832(c)(1)(A)'' and inserting
    ``section 9832(c)(1) (other than subparagraph (G) thereof)''.
        (c) Effective Date.--The amendments made by this section shall
    apply to taxable years beginning after December 31, 2012.

    SEC. 10902. INFLATION ADJUSTMENT OF LIMITATION ON HEALTH FLEXIBLE
                  SPENDING ARRANGEMENTS UNDER CAFETERIA PLANS.

        (a) In General.--Subsection (i) of section 125 of the Internal
    Revenue Code of 1986, as added by section 9005 of this Act, is amended
    to read as follows:
        ``(i) Limitation on Health Flexible Spending Arrangements.--
                ``(1) In general.--For purposes of this section, if a
            benefit is provided under a cafeteria plan through employer
            contributions to a health flexible spending arrangement, such
            benefit shall not be treated as a qualified benefit unless the
            cafeteria plan provides that an employee may not elect for any
            taxable year to have salary reduction contributions in excess
            of $2,500 made to such arrangement.
                ``(2) Adjustment for inflation.--In the case of any taxable
            year beginning after December 31, 2011, the dollar amount in
            paragraph (1) shall be increased by an amount equal to--
                        ``(A) such amount, multiplied by
                        ``(B) the cost-of-living adjustment determined
                    under section 1(f)(3) for the calendar year in which
                    such taxable year begins by substituting `calendar year
                    2010' for `calendar year 1992' in subparagraph (B)
                    thereof.
            If any increase determined under this paragraph is not a
            multiple of $50, such increase shall be rounded to the next
            lowest multiple of $50.''.
        (b) Effective Date.--The amendment made by this section shall apply
    to taxable years beginning after December 31, 2010.

    SEC. 10903. MODIFICATION OF LIMITATION ON CHARGES BY CHARITABLE
                  HOSPITALS.

        (a) In General.--Subparagraph (A) of section 501(r)(5) of the
    Internal Revenue Code of 1986, as added by section 9007 of this Act, is
    amended by striking ``the lowest amounts charged'' and inserting ``the
    amounts generally billed''.
        (b) Effective Date.--The amendment made by this section shall apply
    to taxable years beginning after the date of the enactment of this Act.

    SEC. 10904. MODIFICATION OF ANNUAL FEE ON MEDICAL DEVICE MANUFACTURERS
                  AND IMPORTERS.

        (a) In General.--Section 9009 of this Act is amended--
                (1) by striking ``2009'' in subsection (a)(1) and inserting
            ``2010'',
                (2) by inserting ``($3,000,000,000 after 2017)'' after
            ``$2,000,000,000'', and
                (3) by striking ``2008'' in subsection (i) and inserting
            ``2009''.
        (b) Effective Date.--The amendments made by this section shall take
    effect as if included in the enactment of section 9009.

    SEC. 10905. MODIFICATION OF ANNUAL FEE ON HEALTH INSURANCE PROVIDERS.

        (a) Determination of Fee Amount.--Subsection (b) of section 9010 of
    this Act is amended to read as follows:
        ``(b) Determination of Fee Amount.--
                ``(1) In general.--With respect to each covered entity, the
            fee under this section for any calendar year shall be equal to
            an amount that bears the same ratio to the applicable amount
            as--
                        ``(A) the covered entity's net premiums written
                    with respect to health insurance for any United States
                    health risk that are taken into account during the
                    preceding calendar year, bears to
                        ``(B) the aggregate net premiums written with
                    respect to such health insurance of all covered
                    entities that are taken into account during such
                    preceding calendar year.
                ``(2) Amounts taken into account.--For purposes of
            paragraph (1), the net premiums written with respect to health
            insurance for any United States health risk that are taken into
            account during any calendar year with respect to any covered
            entity shall be determined in accordance with the following
            table:

      ``With respect to a covered entity's    The percentage of net premiums
        net premiums written during the        written that are taken into
            calendar year that are:                    account is:

      Not more than $25,000,000............  0 percent
      More than $25,000,000 but not more     50 percent
       than $50,000,000.
      More than $50,000,000................  100 percent.

                ``(3) Secretarial determination.--The Secretary shall
            calculate the amount of each covered entity's fee for any
            calendar year under paragraph (1). In calculating such amount,
            the Secretary shall determine such covered entity's net
            premiums written with respect to any United States health risk
            on the basis of reports submitted by the covered entity under
            subsection (g) and through the use of any other source of
            information available to the Secretary.''.
        (b) Applicable Amount.--Subsection (e) of section 9010 of this Act
    is amended to read as follows:
        ``(e) Applicable Amount.--For purposes of subsection (b)(1), the
    applicable amount shall be determined in accordance with the following
    table:

    ``Calendar year                          Applicable amount
      2011.................................  $2,000,000,000
      2012.................................  $4,000,000,000
      2013.................................  $7,000,000,000
      2014, 2015 and 2016..................  $9,000,000,000
      2017 and thereafter..................  $10,000,000,000.''.

        (c) Exemption From Annual Fee on Health Insurance for Certain
    Nonprofit Entities.--Section 9010(c)(2) of this Act is amended by
    striking ``or'' at the end of subparagraph (A), by striking the period
    at the end of subparagraph (B) and inserting a comma, and by adding at
    the end the following new subparagraphs:
                        ``(C) any entity--
                                ``(i)(I) which is incorporated as, is a
                            wholly owned subsidiary of, or is a wholly
                            owned affiliate of, a nonprofit corporation
                            under a State law, or
                                ``(II) which is described in section
                            501(c)(4) of the Internal Revenue Code of 1986
                            and the activities of which consist of
                            providing commercial-type insurance (within the
                            meaning of section 501(m) of such Code),
                                ``(ii) the premium rate increases of which
                            are regulated by a State authority,
                                ``(iii) which, as of the date of the
                            enactment of this section, acts as the insurer
                            of last resort in the State and is subject to
                            State guarantee issue requirements, and
                                ``(iv) for which the medical loss ratio
                            (determined in a manner consistent with the
                            determination of such ratio under section
                            2718(b)(1)(A) of the Public Health Service Act)
                            with respect to the individual insurance market
                            for such entity for the calendar year is not
                            less than 100 percent,
                        ``(D) any entity--
                                ``(i)(I) which is incorporated as a
                            nonprofit corporation under a State law, or
                                ``(II) which is described in section
                            501(c)(4) of the Internal Revenue Code of 1986
                            and the activities of which consist of
                            providing commercial-type insurance (within the
                            meaning of section 501(m) of such Code), and
                                ``(ii) for which the medical loss ratio (as
                            so determined)--
                                        ``(I) with respect to each of the
                                    individual, small group, and large
                                    group insurance markets for such entity
                                    for the calendar year is not less than
                                    90 percent, and
                                        ``(II) with respect to all such
                                    markets for such entity for the
                                    calendar year is not less than 92
                                    percent, or
                        ``(E) any entity--
                                ``(i) which is a mutual insurance company,
                                ``(ii) which for the period reported on the
                            2008 Accident and Health Policy Experience
                            Exhibit of the National Association of
                            Insurance Commissioners had--
                                        ``(I) a market share of the insured
                                    population of a State of at least 40
                                    but not more than 60 percent, and
                                        ``(II) with respect to all markets
                                    described in subparagraph (D)(ii)(I), a
                                    medical loss ratio of not less than 90
                                    percent, and
                                ``(iii) with respect to annual payment
                            dates in calendar years after 2011, for which
                            the medical loss ratio (determined in a manner
                            consistent with the determination of such ratio
                            under section 2718(b)(1)(A) of the Public
                            Health Service Act) with respect to all such
                            markets for such entity for the preceding
                            calendar year is not less than 89 percent
                            (except that with respect to such annual
                            payment date for 2012, the calculation under
                            2718(b)(1)(B)(ii) of such Act is determined by
                            reference to the previous year, and with
                            respect to such annual payment date for 2013,
                            such calculation is determined by reference to
                            the average for the previous 2 years).''.
        (d) Certain Insurance Exempted From Fee.--Paragraph (3) of section
    9010(h) of this Act is amended to read as follows:
                ``(3) Health insurance.--The term `health insurance' shall
            not include--
                        ``(A) any insurance coverage described in paragraph
                    (1)(A) or (3) of section 9832(c) of the Internal
                    Revenue Code of 1986,
                        ``(B) any insurance for long-term care, or
                        ``(C) any medicare supplemental health insurance
                    (as defined in section 1882(g)(1) of the Social
                    Security Act).''.
        (e) Anti-avoidance Guidance.--Subsection (i) of section 9010 of
    this Act is amended by inserting ``and shall prescribe such regulations
    as are necessary or appropriate to prevent avoidance of the purposes of
    this section, including inappropriate actions taken to qualify as an
    exempt entity under subsection (c)(2)'' after ``section''.
        (f) Conforming Amendments.--
                (1) Section 9010(a)(1) of this Act is amended by striking
            ``2009'' and inserting ``2010''.
                (2) Section 9010(c)(2)(B) of this Act is amended by
            striking ``(except'' and all that follows through ``1323)''.
                (3) Section 9010(c)(3) of this Act is amended by adding at
            the end the following new sentence: ``If any entity described
            in subparagraph (C)(i)(I), (D)(i)(I), or (E)(i) of paragraph
            (2) is treated as a covered entity by reason of the application
            of the preceding sentence, the net premiums written with
            respect to health insurance for any United States health risk
            of such entity shall not be taken into account for purposes of
            this section.''.
                (4) Section 9010(g)(1) of this Act is amended by striking
            ``and third party administration agreement fees''.
                (5) Section 9010(j) of this Act is amended--
                        (A) by striking ``2008'' and inserting ``2009'',
                    and
                        (B) by striking ``, and any third party
                    administration agreement fees received after such
                    date''.
        (g) Effective Date.--The amendments made by this section shall take
    effect as if included in the enactment of section 9010.

    SEC. 10906. MODIFICATIONS TO ADDITIONAL HOSPITAL INSURANCE TAX ON HIGH-
                  INCOME TAXPAYERS.

        (a) FICA.--Section 3101(b)(2) of the Internal Revenue Code of 1986,
    as added by section 9015(a)(1) of this Act, is amended by striking
    ``0.5 percent'' and inserting ``0.9 percent''.
        (b) SECA.--Section 1401(b)(2)(A) of the Internal Revenue Code of
    1986, as added by section 9015(b)(1) of this Act, is amended by
    striking ``0.5 percent'' and inserting ``0.9 percent''.
        (c) Effective Date.--The amendments made by this section shall
    apply with respect to remuneration received, and taxable years
    beginning, after December 31, 2012.

    SEC. 10907. EXCISE TAX ON INDOOR TANNING SERVICES IN LIEU OF ELECTIVE
                  COSMETIC MEDICAL PROCEDURES.

        (a) In General.--The provisions of, and amendments made by, section
    9017 of this Act are hereby deemed null, void, and of no effect.
        (b) Excise Tax on Indoor Tanning Services.--Subtitle D of the
    Internal Revenue Code of 1986, as amended by this Act, is amended by
    adding at the end the following new chapter:

                        ``CHAPTER 49--COSMETIC SERVICES

    ``Sec. 5000B. Imposition of tax on indoor tanning services.

    ``SEC. 5000B. IMPOSITION OF TAX ON INDOOR TANNING SERVICES.

        ``(a) In General.--There is hereby imposed on any indoor tanning
    service a tax equal to 10 percent of the amount paid for such service
    (determined without regard to this section), whether paid by insurance
    or otherwise.
        ``(b) Indoor Tanning Service.--For purposes of this section--
                ``(1) In general.--The term `indoor tanning service' means
            a service employing any electronic product designed to
            incorporate 1 or more ultraviolet lamps and intended for the
            irradiation of an individual by ultraviolet radiation, with
            wavelengths in air between 200 and 400 nanometers, to induce
            skin tanning.
                ``(2) Exclusion of phototherapy services.--Such term does
            not include any phototherapy service performed by a licensed
            medical professional.
        ``(c) Payment of Tax.--
                ``(1) In general.--The tax imposed by this section shall be
            paid by the individual on whom the service is performed.
                ``(2) Collection.--Every person receiving a payment for
            services on which a tax is imposed under subsection (a) shall
            collect the amount of the tax from the individual on whom the
            service is performed and remit such tax quarterly to the
            Secretary at such time and in such manner as provided by the
            Secretary.
                ``(3) Secondary liability.--Where any tax imposed by
            subsection (a) is not paid at the time payments for indoor
            tanning services are made, then to the extent that such tax is
            not collected, such tax shall be paid by the person who
            performs the service.''.
        (c) Clerical Amendment.--The table of chapter for subtitle D of the
    Internal Revenue Code of 1986, as amended by this Act, is amended by
    inserting after the item relating to chapter 48 the following new item:

                       ``Chapter 49--Cosmetic Services''.

        (d) Effective Date.--The amendments made by this section shall
    apply to services performed on or after July 1, 2010.

    SEC. 10908. EXCLUSION FOR ASSISTANCE PROVIDED TO PARTICIPANTS IN STATE
                  STUDENT LOAN REPAYMENT PROGRAMS FOR CERTAIN HEALTH
                  PROFESSIONALS.

        (a) In General.--Paragraph (4) of section 108(f) of the Internal
    Revenue Code of 1986 is amended to read as follows:
                ``(4) Payments under national health service corps loan
            repayment program and certain state loan repayment programs.--
            In the case of an individual, gross income shall not include
            any amount received under section 338B(g) of the Public Health
            Service Act, under a State program described in section 338I of
            such Act, or under any other State loan repayment or loan
            forgiveness program that is intended to provide for the
            increased availability of health care services in underserved
            or health professional shortage areas (as determined by such
            State).''.
        (b) Effective Date.--The amendment made by this section shall apply
    to amounts received by an individual in taxable years beginning after
    December 31, 2008.

    SEC. 10909. EXPANSION OF ADOPTION CREDIT AND ADOPTION ASSISTANCE
                  PROGRAMS.

        (a) Increase in Dollar Limitation.--
                (1) Adoption credit.--
                        (A) In general.--Paragraph (1) of section 23(b) of
                    the Internal Revenue Code of 1986 (relating to dollar
                    limitation) is amended by striking ``$10,000'' and
                    inserting ``$13,170''.
                        (B) Child with special needs.--Paragraph (3) of
                    section 23(a) of such Code (relating to $10,000 credit
                    for adoption of child with special needs regardless of
                    expenses) is amended--
                                (i) in the text by striking ``$10,000'' and
                            inserting ``$13,170'', and
                                (ii) in the heading by striking ``$10,000''
                            and inserting ``$13,170''.
                        (C) Conforming amendment to inflation adjustment.--
                    Subsection (h) of section 23 of such Code (relating to
                    adjustments for inflation) is amended to read as
                    follows:
        ``(h) Adjustments for Inflation.--
                ``(1) Dollar limitations.--In the case of a taxable year
            beginning after December 31, 2010, each of the dollar amounts
            in subsections (a)(3) and (b)(1) shall be increased by an
            amount equal to--
                        ``(A) such dollar amount, multiplied by
                        ``(B) the cost-of-living adjustment determined
                    under section 1(f)(3) for the calendar year in which
                    the taxable year begins, determined by substituting
                    `calendar year 2009' for `calendar year 1992' in
                    subparagraph (B) thereof.
            If any amount as increased under the preceding sentence is not
            a multiple of $10, such amount shall be rounded to the nearest
            multiple of $10.
                ``(2) Income limitation.--In the case of a taxable year
            beginning after December 31, 2002, the dollar amount in
            subsection (b)(2)(A)(i) shall be increased by an amount equal
            to--
                        ``(A) such dollar amount, multiplied by
                        ``(B) the cost-of-living adjustment determined
                    under section 1(f)(3) for the calendar year in which
                    the taxable year begins, determined by substituting
                    `calendar year 2001' for `calendar year 1992' in
                    subparagraph (B) thereof.
            If any amount as increased under the preceding sentence is not
            a multiple of $10, such amount shall be rounded to the nearest
            multiple of $10.''.
                (2) Adoption assistance programs.--
                        (A) In general.--Paragraph (1) of section 137(b) of
                    the Internal Revenue Code of 1986 (relating to dollar
                    limitation) is amended by striking ``$10,000'' and
                    inserting ``$13,170''.
                        (B) Child with special needs.--Paragraph (2) of
                    section 137(a) of such Code (relating to $10,000
                    exclusion for adoption of child with special needs
                    regardless of expenses) is amended--
                                (i) in the text by striking ``$10,000'' and
                            inserting ``$13,170'', and
                                (ii) in the heading by striking ``$10,000''
                            and inserting ``$13,170''.
                        (C) Conforming amendment to inflation adjustment.--
                    Subsection (f) of section 137 of such Code (relating to
                    adjustments for inflation) is amended to read as
                    follows:
        ``(f) Adjustments for Inflation.--
                ``(1) Dollar limitations.--In the case of a taxable year
            beginning after December 31, 2010, each of the dollar amounts
            in subsections (a)(2) and (b)(1) shall be increased by an
            amount equal to--
                        ``(A) such dollar amount, multiplied by
                        ``(B) the cost-of-living adjustment determined
                    under section 1(f)(3) for the calendar year in which
                    the taxable year begins, determined by substituting
                    `calendar year 2009' for `calendar year 1992' in
                    subparagraph (B) thereof.
            If any amount as increased under the preceding sentence is not
            a multiple of $10, such amount shall be rounded to the nearest
            multiple of $10.
                ``(2) Income limitation.--In the case of a taxable year
            beginning after December 31, 2002, the dollar amount in
            subsection (b)(2)(A) shall be increased by an amount equal to--
                        ``(A) such dollar amount, multiplied by
                        ``(B) the cost-of-living adjustment determined
                    under section 1(f)(3) for the calendar year in which
                    the taxable year begins, determined by substituting
                    `calendar year 2001' for `calendar year 1992' in
                    subparagraph thereof.
            If any amount as increased under the preceding sentence is not
            a multiple of $10, such amount shall be rounded to the nearest
            multiple of $10.''.
        (b) Credit Made Refundable.--
                (1) Credit moved to subpart relating to refundable
            credits.--The Internal Revenue Code of 1986 is amended--
                        (A) by redesignating section 23, as amended by
                    subsection (a), as section 36C, and
                        (B) by moving section 36C (as so redesignated) from
                    subpart A of part IV of subchapter A of chapter 1 to
                    the location immediately before section 37 in subpart C
                    of part IV of subchapter A of chapter 1.
                (2) Conforming amendments.--
                        (A) Section 24(b)(3)(B) of such Code is amended by
                    striking ``23,''.
                        (B) Section 25(e)(1)(C) of such Code is amended by
                    striking ``23,'' both places it appears.
                        (C) Section 25A(i)(5)(B) of such Code is amended by
                    striking ``23, 25D,'' and inserting ``25D''.
                        (D) Section 25B(g)(2) of such Code is amended by
                    striking ``23,''.
                        (E) Section 26(a)(1) of such Code is amended by
                    striking ``23,''.
                        (F) Section 30(c)(2)(B)(ii) of such Code is amended
                    by striking ``23, 25D,'' and inserting ``25D''.
                        (G) Section 30B(g)(2)(B)(ii) of such Code is
                    amended by striking ``23,''.
                        (H) Section 30D(c)(2)(B)(ii) of such Code is
                    amended by striking ``sections 23 and'' and inserting
                    ``section''.
                        (I) Section 36C of such Code, as so redesignated,
                    is amended--
                                (i) by striking paragraph (4) of subsection
                            (b), and
                                (ii) by striking subsection (c).
                        (J) Section 137 of such Code is amended--
                                (i) by striking ``section 23(d)'' in
                            subsection (d) and inserting ``section
                            36C(d)'', and
                                (ii) by striking ``section 23'' in
                            subsection (e) and inserting ``section 36C''.
                        (K) Section 904(i) of such Code is amended by
                    striking ``23,''.
                        (L) Section 1016(a)(26) is amended by striking
                    ``23(g)'' and inserting ``36C(g)''.
                        (M) Section 1400C(d) of such Code is amended by
                    striking ``23,''.
                        (N) Section 6211(b)(4)(A) of such Code is amended
                    by inserting ``36C,'' before ``53(e)''.
                        (O) The table of sections for subpart A of part IV
                    of subchapter A of chapter 1 of such Code of 1986 is
                    amended by striking the item relating to section 23.
                        (P) Paragraph (2) of section 1324(b) of title 31,
                    United States Code, as amended by this Act, is amended
                    by inserting ``36C,'' after ``36B,''.
                        (Q) The table of sections for subpart C of part IV
                    of subchapter A of chapter 1 of the Internal Revenue
                    Code of 1986, as amended by this Act, is amended by
                    inserting after the item relating to section 36B the
                    following new item:

    ``Sec. 36C. Adoption expenses.''.
        (c) Application and Extension of EGTRRA Sunset.--Notwithstanding
    section 901 of the Economic Growth and Tax Relief Reconciliation Act of
    2001, such section shall apply to the amendments made by this section
    and the amendments made by section 202 of such Act by substituting
    ``December 31, 2011'' for ``December 31, 2010'' in subsection (a)(1)
    thereof.
        (d) Effective Date.--The amendments made by this section shall
    apply to taxable years beginning after December 31, 2009.

                Amend the title so as to read: ``An Act entitled The
            Patient Protection and Affordable Care Act.''.

                Attest:

                                                                 Secretary.
    111th CONGRESS

      1st Session

                                   H. R. 3590

    _______________________________________________________________________

                                   AMENDMENTS