National Health Information Incentive Act of 2005 - Establishes within the executive office of the President an Office of the National Coordinator for Health Information Technology.
Amends title XI of the Social Security Act to add a new part D (Standards for Building The National Health Information Infrastructure) to direct the Secretary to develop or adopt standards for transactions and data elements for such transactions to enable the creation of a national health care information infrastructure.
Requires the Secretary to include additional Medicare payment incentives to assure small health care providers have the capability to move toward a national health care information infrastructure by acquiring electronic health record systems and other health information technologies that meet such standards.
Provides for optional financial incentives to small health care providers and entities to implement a national health information infrastructure.
Authorizes the Secretary to: (1) make grants to small health care providers and entities for expenditures relating to the implementation of a national health information infrastructure; and (2) make and guarantee loans to small health care providers for the purpose of assisting them to implement, design, test, acquire, and adopt electronic health records and other health information technologies.
Amends the Internal Revenue Code to provide for a refundable credit for a portion of the expenses of for establishing a health care information technology system (infrastructure).
[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 747 Introduced in House (IH)]
109th CONGRESS
1st Session
H. R. 747
To amend title XI of the Social Security Act to achieve a national
health information infrastructure, and to amend the Internal Revenue
Code of 1986 to establish a refundable credit for expenditures of
health care providers implementing such infrastructure.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 10, 2005
Mr. Gonzalez (for himself, Mr. McHugh, Ms. Jackson-Lee of Texas, Mr.
Towns, Mr. Lipinski, Mr. Hinojosa, Mr. Crowley, Mrs. Christensen, Mr.
Moore of Kansas, and Mr. Miller of North Carolina) introduced the
following bill; which was referred to the Committee on Energy and
Commerce, and in addition to the Committee on Ways and Means, for a
period to be subsequently determined by the Speaker, in each case for
consideration of such provisions as fall within the jurisdiction of the
committee concerned
_______________________________________________________________________
A BILL
To amend title XI of the Social Security Act to achieve a national
health information infrastructure, and to amend the Internal Revenue
Code of 1986 to establish a refundable credit for expenditures of
health care providers implementing such infrastructure.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as ``National Health Information Incentive
Act of 2005''.
SEC. 2. FINDINGS AND PURPOSE.
(a) Findings.--The Congress finds as follows:
(1) A March 2001 Institute of Medicine (``IOM'') study
concludes that in order to improve quality, the nation must
have a national commitment to building an information
infrastructure to support healthcare delivery, consumer health,
quality measurement and improvement, public accountability,
clinical and health services research, and clinical education.
(2) A November 2001 National Committee on Vital Health
Statistics study lauds the importance of a national health
information infrastructure to improve patient safety, improve
healthcare quality, improve bioterrorism detection, better
inform and empower healthcare consumers regarding their own
personal health information, and to better understand
healthcare costs.
(3) An October 2002 IOM report calls on the federal
government to take steps to encourage and facilitate
development in the information technology infrastructure that
is critical to healthcare quality and safety enhancement.
(4) A General Accounting Office October 2003 report found
that the benefits of an electronic healthcare information
system included improved quality of care, reduced costs
associated with medication errors, more accurate and complete
medical documentation, more accurate capture of codes and
charges, and improved communication among providers enabling
them to respond more quickly to patients' needs.
(5) Other studies and surveys show that cultivating a
national healthcare information infrastructure and improving
patient care will depend crucially on adoption of uniform
medical data standards and interoperability.
(6) Acquisition costs, physician and staff time required to
transition from paper-based offices to electronic health
systems, and the lack of industry standards on interoperability
are the principle barriers to creating a national health
information infrastructure.
(7) The success of a national health information
infrastructure depends on the widespread use and acceptance of
electronic health records in physician offices.
(b) Purposes.--The purposes of this Act are as follows:
(1) To facilitate the development of standards and to
create incentives that encourage physicians and other health
professionals to adopt interoperable electronic health records,
electronic prescribing systems, evidence-based clinical support
tools, patient registries, and other health information
technology as a key component of a national health care
information infrastructure in the United States to ensure the
rapid flow of secure, private and digitized information
relevant to all facets of patient care.
(2) To do so in a voluntary manner that does not become an
unfunded mandate on small physician practices.
(3) To do so in a manner that does not compromise the
health care provider's ability to make patient care decisions
based solely on his or her clinical expertise and experience,
and what the provider concludes is the best for a particular
patient based upon scientific evidence and knowledge of the
patient's medical history.
SEC. 3. OFFICE OF THE NATIONAL COORDINATOR FOR HEALTH INFORMATION
TECHNOLOGY.
(a) Establishment.--There is established within the executive
office of the President an Office of the National Coordinator for
Health Information Technology (referred to in this section as the
``Office''). The Office shall be headed by a Director appointed by the
President. The Director of the Office shall report directly to the
President.
(b) Resources.--The President shall make available to the Office
the resources, both financial and otherwise, necessary to enable the
Director of the Office to carry out the purposes of, and perform the
duties and responsibilities of, the Office.
SEC. 4. STANDARDS FOR BUILDING THE NATIONAL HEALTH INFORMATION
INFRASTRUCTURE.
Title XI of the Social Security Act (42 U.S.C. 1301 et seq.) is
amended by adding at the end the following part:
``PART D--STANDARDS FOR BUILDING THE NATIONAL HEALTH INFORMATION
INFRASTRUCTURE
``SEC. 1181. STANDARDS FOR BUILDING THE NATIONAL HEALTH INFORMATION
INFRASTRUCTURE.
``(a) Standards.--
``(1) Development and adoption.--
``(A) In general.--The Secretary, through the
Office of the National Coordinator for Health
Information Technology and in collaboration with the
Committee on Systematic Interoperability, shall develop
or adopt standards for transactions and data elements
for such transactions (in this section referred to as
`standards') to enable the creation of a national
health care information infrastructure.
``(B) Role of standard setting organizations.--
``(i) In general.--Except as provided in
clause (ii), any standard adopted under this
section shall be a standard that has been
developed, adopted, or modified by a standard
setting organization.
``(ii) Standard setting organization.--For
purposes of this section, the term `standard
setting organization' means an organization
accredited by the American National Standards
Institute that develops standards for
information transactions, data elements, or any
other standard that is necessary to, or will
facilitate, the implementation of this part.
``(C) Consultation.--In developing and adopting
standards, the Secretary shall consult with national
organizations representing physicians in clinical
practice, hospitals, pharmacists, pharmacies,
pharmaceutical manufacturers, patients, standard
setting organizations, pharmacy benefit managers,
beneficiary information exchange networks, technology
experts, and representatives of the Departments of
Veterans Affairs and Defense and other interested
parties.
``(D) Assistance to the secretary.--In complying
with the requirements under this section, the Secretary
shall rely on the recommendations of the National
Committee on Vital and Health Statistics established
under section 306(k) of the Public Health Service Act
(42 U.S.C. 242k(k)), and shall consult with appropriate
Federal and State agencies and national organizations.
The Secretary shall publish in the Federal Register any
recommendations of the National Committee on Vital and
Health Statistics regarding the adoption of a standard
under this section.
``(2) Objective.--Any standards developed or adopted under
this section shall be consistent with the objectives of
improving--
``(A) patient safety; and
``(B) the quality of care provided to patients.
``(3) Requirements.--Any standards developed or adopted
under this section shall comply with the following:
``(A) Undue burden.--The standards shall be
designed so that, to the extent practicable, the
standards do not impose an undue administrative or
financial burden on the practice of medicine, or any
other health care profession, particularly on small
physician practices and practices in rural areas.
``(B) Compatibility with administrative
simplification and privacy laws.--The standards shall
be--
``(i) consistent with the Federal
regulations (concerning the privacy and
security of individually identifiable
information) promulgated under section 264(c)
of the Health Insurance Portability and
Accountability Act of 1996, and any State
privacy laws preserved under the Federal
regulations promulgated under section 1178; and
``(ii) compatible with the standards under
section 3.
``(b) Timetable for Adoption of Standards.--
``(1) In general.--The Secretary shall adopt trial
standards under this section two years after the date of the
enactment of this part, or at a subsequent date determined by
the Secretary, as may be required to complete development of
the trial standards.
``(2) Pilot program to test trial standards.--
``(A) Pilot program.--In accordance with the
development and adoption of standards, the Secretary
shall conduct a pilot program to test the effectiveness
and impact of trial standards for transaction and data
elements as defined in subsection (a)(1)(A).
``(B) Location of program.--The pilot program shall
be conducted through various health care facilities,
including small physician practices, throughout the
country that capture both rural and urban settings.
``(C) Duration of the program.--The pilot program
shall be conducted during the two-year period beginning
on the date of adoption of the standards.
``(D) Designation and selection of program sites.--
In designing the pilot program and in selecting
locations and sites for the pilot test, the Secretary
shall consult with national organizations representing
affected parties, as defined in subsection (a)(1)(C),
and appropriate standard setting organizations, as
defined in subsection (a)(1)(B).
``(E) Report of findings.--The Secretary,
consistent and accordance with subsections (a)(1)(B)
and (a)(1)(C), shall submit to Congress a report on the
pilot program no earlier than one year following the
completion of the pilot program. The Secretary shall
include in the report the following:
``(i) The Secretary's assessment of the
impact and effectiveness of the trial
standards, as applied to a variety of clinical
and geographic setting as described under this
section.
``(ii) The Secretary's assessment of the
effect of the pilot program and trial standards
on patient safety, including the effect on
delivery and the quality of health care, and on
the typical costs incurred by providers in
acquiring necessary technology systems, and the
necessary training to comply with the trial
standards.
``(iii) The Secretary's assessment of the
clinical usefulness of health information
technologies that meet the trial standards,
including the amount of time required of
physicians, other health professionals and
other office staff in sending, receiving,
updating, maintaining, and recording clinical
information using such technologies.
``(iv) In consultation with appropriate
standard setting organizations, as defined in
subsection (a)(1)(B), and with national
organizations representing affected parties, as
defined in subsection (a)(1)(C), the findings
and conclusions of the Secretary with respect
to the pilot program and notice of adoption of
a modified standard.
``(v) Any recommendations of the Secretary
for continuation of the pilot program for
further study or testing to other clinical or
geographic service areas prior to full
implementation.
``(3) Additions and modifications to standards.--The
Secretary shall, in consultation with appropriate
representatives of interested parties, as defined in subsection
(a)(1)(C) of this section, and with standard setting
organizations, as defined in subsection (a)(1)(B), review the
standards developed or adopted under this section and adopt
modifications to the standards (including additions to the
standards), as determined appropriate. Any addition or
modification to such standards shall be completed in a manner
which minimizes the disruption and cost of compliance.
``(c) Compliance With Standards.--
``(1) Requirement for all individuals and entities that
utilize health information technology.--
``(A) In general.--Individuals or entities that
voluntarily utilize electronic health records, and
other health information technology defined by the
Secretary as being a key component of a national health
care information infrastructure shall comply with the
standards adopted or modified under this section.
``(B) Relation to state laws.--Consistent with
subsection (a)(3)(B), the standards adopted or modified
under this section shall supersede any State law or
regulations pertaining to the electronic transmission
of patient history, eligibility, benefit and any other
information.
``(2) Timetable for compliance.--
``(A) Initial compliance.--
``(i) In general.--Not later than 24 months
after the date on which a modified standard is
adopted under this section, each individual or
entity to whom the standard applies shall
comply with the standard.
``(ii) Special rules for small health
plans.--In the case of a `small health plan',
as defined by the Secretary for purposes of
section 1175(b)(1)(B), clause (i) shall be
applied by substituting, `36 months' for `24
months'.
``(iii) Special rule for small provider of
services.--In the case of a small provider of
services, clause (i) shall be applied by
substituting `36 months' for `24 months'.
``(iv) Exception.--In consultation with
national organizations representing affected
parties, as defined in subsection (a)(1)(C),
the Secretary may delay initial compliance
until such time as the Secretary deems
appropriate to assure maximum compliance.
``(d) No Requirement to Obtain Specific Technologies or Products.--
Nothing in this part shall be construed to require an individual or
entity to obtain specific technologies or products to utilize a
national health care information infrastructure.
``(e) Preservation of Health Care Provider or Other Entity to Make
Unbiased Patient Care Decisions.--Interoperable health care technology
shall be designed to facilitate access to unbiased and evidence-based
decision support tools. All patient care decisions shall be based
solely on the provider's clinical expertise and experience, without
outside influence.
``(f) Small Health Care Providers.--For purposes of this part, a
health care provider or practice is considered `small' if it is small
under the provisions of section 1862(h).
``SEC. 1182. FINANCIAL INCENTIVE TO SMALL HEALTH CARE PROVIDERS AND
ENTITIES TO IMPLEMENT A NATIONAL HEALTH INFORMATION
INFRASTRUCTURE.
``(a) In General.--The Secretary shall include additional Medicare
payment incentives to assure small health care providers have the
capability to move toward a national health care information
infrastructure by acquiring electronic health record systems and other
health information technologies that meet the standards adopted or
modified under section 1181.
``(b) Conditions for Qualification.--As a condition of qualifying
for financial incentives described in this section, the Secretary, in
consultation with national organizations representing affected parties,
as defined in section 1181(a)(1)(C), and appropriate standards setting
organizations, as defined in section 1181(a)(1)(B), shall grant the use
of financial incentives to assure that such technologies are consistent
with the goals of creation of a national health information
infrastructure, such as--
``(1) voluntary participation in studies or demonstration
projects to evaluate the use of such systems to measure and
report quality data based on accepted clinical performance
measures; and
``(2) voluntary participation in studies to demonstrate the
impact of such technologies on improving patient care, reducing
costs and increasing efficiencies.
``(c) Additional Medicare Payment to Small Health Care Providers
and Entities for Expenditures Relating to the Implementation of a
National Health Information Infrastructure.--
``(1) In general.--The Secretary shall provide for
additional payment to small health care providers, including
physicians and others in clinical practice, for the purpose of
assisting such entities to implement, design, test, acquire,
and adopt electronic health records and other health
information technologies defined by the Secretary as a key
component of a national health care information infrastructure
that comply with the standards adopted or modified under
section 1181.
``(2) Types of reimbursement incentives.--In developing the
reimbursement incentives described in paragraph (1), the
Secretary shall consider inclusion of one or more of the
following types of incentives:
``(A) Adds-ons to payments for evaluation and
management services.
``(B) Care management fees for physicians who use
information technology to manage care of patients with
chronic illnesses.
``(C) Payments for structured e-mail consults
resulting in a separately identifiable medical service
from other evaluation and management services.
``(D) Any other method deemed appropriate by the
Secretary to encourage participation.
``(3) Amount of reimbursement.--The amount of reimbursement
made to small health care providers and entities to implement a
national health care information infrastructure shall be in a
manner determined by the Secretary, in accordance with section
1181(b)(2)(ii), that takes into account the costs of
implementation, training, and complying with standards.
``(4) Exemption from budget neutrality under the physician
fee schedule.--Any increased expenditures pursuant to this
section shall be treated as additional allowed expenditures for
purposes of computing any update under section 1848(d).
``SEC. 1183. OPTIONAL FINANCIAL INCENTIVES TO SMALL HEALTH CARE
PROVIDERS AND ENTITIES TO IMPLEMENT A NATIONAL HEALTH
INFORMATION INFRASTRUCTURE.
``(a) In General.--The Secretary may utilize any, all, or a
combination of financial incentives thereof, to assure small health
care providers have the capability to move toward a national health
care information infrastructure by acquiring electronic health record
systems and other health information technologies that meet the
standards adopted or modified under section 1181.
``(b) Conditions for Qualification.--As a condition of qualifying
for financial incentives described in this section, the Secretary, in
consultation with national organizations representing affected parties,
as defined in section 1181(a)(1)(C), and appropriate standards setting
organizations, as defined in section 1181(a)(1)(B), shall grant the use
of financial incentives to assure that such technologies are consistent
with the goals of creation of a national health information
infrastructure, such as--
``(1) voluntary participation in studies or demonstration
projects to evaluate the use of such systems to measure and
report quality data based on accepted clinical performance
measures; and
``(2) voluntary participation in studies to demonstrate the
impact of such technologies on improving patient care, reducing
costs and increasing efficiencies.
``(c) Grants to Small Health Care Providers and Entities for
Expenditures Relating to the Implementation of a National Health
Information Infrastructure.--
``(1) In general.--The Secretary is authorized to make
grants to small health care providers, including physicians and
others in clinical practice, for the purpose of assisting such
entities to implement, design, test, acquire, and adopt
electronic health records and other health information
technologies identified by the Secretary as a key component of
a national health care information infrastructure that comply
with the standards adopted or modified under section 1181.
``(2) Amount of grant.--The grant amount made to small
health care providers and entities to implement a national
health care information infrastructure shall be in a manner
determined by the Secretary, in accordance with section
1181(b)(2)(ii), that takes into account the costs of
implementation, training, and complying with standards.
``(3) Application.--No grant may be made under this
subsection except pursuant to a grant application that is
submitted in a time, manner, and form approved by the
Secretary.
``(4) Authorization of appropriations.--There are
authorized to be appropriated to carry out this subsection such
sums as may be necessary for each fiscal year.
``(d) Revolving Loans to Small Health Care Providers and Entities
for Expenditures Relating to the Implementation of a National Health
Information Infrastructure.--
``(1) In general.--The Secretary is authorized to make and
guarantee loans to small health care providers, including
physicians and others in clinical practice, for the purpose of
assisting such entities to implement, design, test, acquire,
and adopt electronic health records and other health
information technologies identified by the Secretary as a key
component of a national health care information infrastructure
that comply with the standards adopted or modified under
section 1181.
``(2) Amount of loan.--The loan amount made to small health
care providers and entities to implement a national health care
information infrastructure shall be in a manner determined by
the Secretary, in accordance with section 1181(b)(2)(ii), that
takes into account the costs of implementation, training, and
complying with standards.
``(3) Application.--No loan may be made under this
subsection except pursuant to a loan application that is
submitted in a time, manner, and form approved by the
Secretary.
``(4) Authorization of appropriations.--There are
authorized to be appropriated to carry out this subsection such
sums as may be necessary for each fiscal year.''.
SEC. 5. REFUNDABLE CREDIT FOR HEALTH CARE INFORMATION INFRASTRUCTURE.
(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 redesignating section 36 as section 37 and by inserting
after section 35 the following new section:
``SEC. 36. HEALTH CARE INFORMATION INFRASTRUCTURE.
``(a) In General.--In the case of a qualified health care provider,
there shall be allowed as a credit against the tax imposed by this
chapter for the taxable year an amount equal to 10 percent of the
amounts paid or incurred during the taxable year by the taxpayer for
establishing a qualified health information technology system.
``(b) Qualified Health Information Technology System.--For purposes
of this section, the term `qualified health information technology
system' means a system which has been individually approved by the
Secretary of Health and Human Services for purposes of this section and
which consists of electronic health record systems and other health
information technologies that meet the standards and conditions of
qualification adopted or modified under sections 1181 and 1183 of the
Social Security Act.
``(c) Qualified Health Care Provider.--For purposes of this
section, the term `qualified health care provider' means any person in
the trade or business of providing health care.
``(d) Termination.--This section shall not apply to amounts paid or
incurred during taxable years beginning after December 31, 2014.''.
(b) Denial of Double Benefit.--Section 280C of such Code is amended
by adding at the end the following new subsection:
``(e) Credit for Health Care Information Infrastructure.--No
deduction shall be allowed for that portion of the expenses (otherwise
allowable as a deduction) taken into account in determining the credit
under section 36 for the taxable year which is equal to the amount of
the credit determined for such taxable year under section 36(a).''.
(c) Conforming Amendments.--
(1) Paragraph (2) of section 1324(b) of title 31, United
States Code, is amended by inserting ``or 36'' after ``section
35''.
(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 striking the item relating to section 36 and
inserting the following new items:
``Sec. 36. Health care information infrastructure.
``Sec. 37. Overpayment of taxes.''.
(d) Effective Date.--The amendments made by this section shall
apply to amounts paid or incurred during taxable years beginning after
December 31, 2005.
<all>
Introduced in House
Introduced in House
Referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Subcommittee on Health.
Referred to the Subcommittee on Health.
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