    [Congressional Bills 111th Congress]
    [From the U.S. Government Publishing Office]
    [H.R. 3590 Enrolled Bill (ENR)]

            H.R.3590

                          One Hundred Eleventh Congress

                                     of the

                            United States of America

                              AT THE SECOND SESSION

              Begun and held at the City of Washington on Tuesday,
                 the fifth day of January, two thousand and ten

                                     An Act

            Entitled The Patient Protection and Affordable Care Act.

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

    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    If the State is not an
     ``For any fiscal year     expansion State, the    expansion State, the
      quarter occurring in    applicable percentage    applicable percentage
       the calendar year:       point 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.

                                   Speaker of the House of Representatives.

                                Vice President of the United States and
                                                   President of the Senate.