Establish a commissioned Regular Corps and a Ready Reserve Corps for service in time of a national emergency.

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Support comparative effectiveness research by establishing a non-profit Patient-Centered Outcomes Research Institute.

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Authorize the Food and Drug Administration to approve generic versions of biologic drugs and grant biologics manufacturers 12 years of exclusive use before generics can be developed.

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Require the Secretary of HHS to issue regulations to establish a process for public notice and comment for section 1115 waivers in Medicaid and CHIP.

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Increase the Medicaid drug rebate percentage for brand name drugs to 23.1% (except the rebate for clotting factors and drugs approved exclusively for pediatric use increases to 17.1%); increase the Medicaid rebate for non-innovator, multiple source drugs to 13% of average manufacturer price; and extend the drug rebate to Medicaid managed care plans.

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Creates a new option for states to provide CHIP coverage to children of state employees eligible for health benefits if certain conditions are met.

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Creates a state option to provide Medicaid coverage for family planning services to certain low-income individuals through a Medicaid State Plan Amendment up to the highest level of eligibility for pregnant women.

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Creates a state option to cover childless adults though a Medicaid State Plan Amendment.

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Ban new physician-owned hospitals in Medicare, requiring hospitals to have a provider agreement in effect by December 31; limit the growth of certain grandfathered physician-owned hospitals.

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