Common Sense Health Reform Americans Actually Want Act - Repeals the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010, effective as of their enactment. Restores provisions of law amended by such Acts.
Requires each state to operate a qualifying high risk pool to provide health coverage to certain individuals with a preexisting condition.
Prohibits a health insurance issuer from applying an annual or lifetime aggregate spending cap on any health insurance coverage or plan.
Amends the Employee Retirement Income Security Act of 1974 (ERISA) to provide for the establishment and governance of small business health plans, which are group health plans sponsored by trade, industry, professional, chamber of commerce, or similar business associations that meet ERISA certification requirements.
Amends ERISA, the Public Health Service Act (PHSA), and the Internal Revenue Code (IRC) to: (1) continue in effect for group (not individual) health plans dependent coverage until the beneficiary turns 26 years of age, (2) continue in effect the prohibition on imposition of preexisting condition exclusions on a participant or beneficiary under 19 years of age, and (3) permit a health plan to vary premiums and cost-sharing by up to 50% of the benefits based on participation in a wellness program.
Amends the PHSA to provide that the laws of the state designated by a health insurance issuer (primary state) shall apply to individual health insurance coverage offered by that issuer in the primary state and in any other state (secondary state), but only if the coverage and issuer comply with the conditions of this Act.
Amends the IRC to: (1) revise provisions related to health savings accounts, including to allow the payment of premiums for high deductible health plans from such accounts; (2) allow self-employed individuals to deduct health insurance costs in computing the tax on self-employment income; and (3) allow a tax deduction from gross income for the cost of health insurance coverage for individual taxpayers, their spouses, and dependents.
Sets forth requirements for civil actions for an injury or death as the result of health care.
Declares that nothing in this Act shall be construed to interfere with the doctor-patient relationship or the practice of medicine.
Repeals provisions of the American Recovery and Reinvestment Act that establish the Federal Coordinating Council for Comparative Effectiveness Research.
Prohibits the expenditure of funds authorized or appropriated by federal law or funds in any trust fund to which funds are authorized or appropriated by federal law for any abortion. Prohibits federal funds from being used for any health benefits coverage that includes coverage of abortion. (Currently, federal funds cannot be used for abortion services and plans receiving federal funds must keep federal funds segregated from any funds for abortion services.) Sets forth certain exceptions, including for rape and a life-endangering physical condition.
Requires the Secretary of Health and Human Services (HHS) to address: (1) enforcement of Medicare secondary payer provisions; (2) screening of providers and suppliers under the Medicare program; and (3) tracking of providers that have been excluded from Medicare, including by permitting data matching between Medicare, Medicaid, and Social Security.
[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3165 Introduced in House (IH)]
113th CONGRESS
1st Session
H. R. 3165
To repeal the Patient Protection and Affordable Care Act and to take
meaningful steps to lower health care costs and increase access to
health insurance coverage without raising taxes, cutting Medicare
benefits for seniors, adding to the national deficit, intervening in
the doctor-patient relationship, or instituting a government takeover
of health care.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
September 20, 2013
Mr. Latham introduced the following bill; which was referred to the
Committee on Energy and Commerce, and in addition to the Committees on
Ways and Means, Education and the Workforce, Natural Resources, the
Judiciary, House Administration, Rules, and Appropriations, 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 repeal the Patient Protection and Affordable Care Act and to take
meaningful steps to lower health care costs and increase access to
health insurance coverage without raising taxes, cutting Medicare
benefits for seniors, adding to the national deficit, intervening in
the doctor-patient relationship, or instituting a government takeover
of health care.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; PURPOSE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Common Sense
Health Reform Americans Actually Want Act''.
(b) Purpose.--The purpose of this Act is to take meaningful steps
to lower health care costs and increase access to health insurance
coverage (especially for individuals with preexisting conditions)
without--
(1) raising taxes;
(2) cutting Medicare benefits for seniors;
(3) adding to the national deficit;
(4) intervening in the doctor-patient relationship; or
(5) instituting a government takeover of health care.
(c) Table of Contents.--The table of contents of this Act is as
follows:
Sec. 1. Short title; purpose; table of contents.
Sec. 2. Repeal of the Patient Protection and Affordable Care Act and
the Health Care and Education
Reconciliation Act of 2010.
DIVISION A--ENSURING COVERAGE FOR INDIVIDUALS WITH PREEXISTING
CONDITIONS AND MULTIPLE HEALTH CARE NEEDS
Sec. 101. Establish universal access programs to improve high risk
pools and reinsurance markets.
Sec. 102. No annual or lifetime spending caps.
Sec. 103. Preventing unjust cancellation of insurance coverage.
DIVISION B--REDUCING HEALTH CARE PREMIUMS AND THE NUMBER OF UNINSURED
AMERICANS
TITLE I--EXPANDING ACCESS AND LOWERING COSTS FOR SMALL BUSINESSES
Subtitle A--Enhanced Marketplace Pools
Sec. 201. Rules governing enhanced marketplace pools.
Sec. 202. Cooperation between Federal and State authorities.
Sec. 203. Effective date and transitional and other rules.
Subtitle B--Market Relief
Sec. 204. Market relief.
TITLE II--TARGETED EFFORTS TO EXPAND ACCESS
Sec. 211. Extending coverage of dependents.
Sec. 212. Prohibiting preexisting condition exclusions for enrollees
under age 19.
Sec. 213. Health plan finders.
TITLE III--EXPANDING CHOICES BY ALLOWING AMERICANS TO BUY HEALTH CARE
COVERAGE ACROSS STATE LINES
Sec. 221. Interstate purchasing of health insurance.
TITLE IV--IMPROVING HEALTH SAVINGS ACCOUNTS
Sec. 231. HSA funds for premiums for high deductible health plans.
Sec. 232. Requiring greater coordination between HDHP administrators
and HSA account administrators so that
enrollees can enroll in both at the same
time.
Sec. 233. Special rule for certain medical expenses incurred before
establishment of account.
TITLE V--TAX-RELATED HEALTH INCENTIVES
Sec. 241. SECA tax deduction for health insurance costs.
Sec. 242. Deduction for qualified health insurance costs of
individuals.
DIVISION C--ENACTING REAL MEDICAL LIABILITY REFORM
Sec. 301. Cap on non-economic damages against health care
practitioners.
Sec. 302. Cap on non-economic damages against health care institutions.
Sec. 303. Cap, in wrongful death cases, on total damages against any
single health care practitioner.
Sec. 304. Limitation of insurer liability when insurer rejects certain
settlement offers.
Sec. 305. Mandatory jury instruction on cap on damages.
Sec. 306. Determination of negligence; mandatory jury instruction.
Sec. 307. Expert reports required to be served in civil actions.
Sec. 308. Expert opinions relating to physicians may be provided only
by actively practicing physicians.
Sec. 309. Payment of future damages on periodic or accrual basis.
Sec. 310. Unanimous jury required for punitive or exemplary damages.
Sec. 311. Proportionate liability.
Sec. 312. Defense-initiated settlement process.
Sec. 313. Statute of limitations; statute of repose.
Sec. 314. Limitation on liability for Good Samaritans providing
emergency health care.
Sec. 315. Definitions.
DIVISION D--PROTECTING THE DOCTOR-PATIENT RELATIONSHIP
Sec. 401. Rule of construction.
Sec. 402. Repeal of Federal Coordinating Council for Comparative
Effectiveness Research.
DIVISION E--INCENTIVIZING WELLNESS AND QUALITY IMPROVEMENTS
Sec. 501. Incentives for prevention and wellness programs.
DIVISION F--PROTECTING TAXPAYERS
Sec. 601. Permanently prohibiting taxpayer funded abortions and
ensuring conscience protections.
Sec. 602. Improved enforcement of the Medicare and Medicaid secondary
payer provisions.
Sec. 603. Strengthen Medicare provider enrollment standards and
safeguards.
Sec. 604. Tracking banned providers across State lines.
SEC. 2. REPEAL OF THE PATIENT PROTECTION AND AFFORDABLE CARE ACT AND
THE HEALTH CARE AND EDUCATION RECONCILIATION ACT OF 2010.
(a) Patient Protection and Affordable Care Act.--The Patient
Protection and Affordable Care Act (Public Law 111-148) is repealed and
the provisions of law amended or repealed by such Act are restored or
revived as if such Act had not been enacted.
(b) Health Care and Education Reconciliation Act of 2010.--The
Health Care and Education Reconciliation Act of 2010 (Public Law 111-
152) is repealed and the provisions of law amended or repealed by such
Act are restored or revived as if such Act had not been enacted.
DIVISION A--ENSURING COVERAGE FOR INDIVIDUALS WITH PREEXISTING
CONDITIONS AND MULTIPLE HEALTH CARE NEEDS
SEC. 101. ESTABLISH UNIVERSAL ACCESS PROGRAMS TO IMPROVE HIGH RISK
POOLS AND REINSURANCE MARKETS.
(a) State Requirement.--
(1) In general.--Not later than 90 days after the date of
the enactment of this Act, each State shall--
(A) subject to paragraph (3), operate a qualifying
State high risk pool described in subsection (b)(1);
and
(B) subject to paragraph (3), apply to the
operation of such a program from State funds an amount
equivalent to the portion of State funds derived from
State premium assessments (as defined by the Secretary)
that are not otherwise used on State health care
programs.
(2) Relation to current qualified high risk pool program.--
(A) States not operating a qualified high risk
pool.--In the case of a State that is not operating a
current section 2745 qualified high risk pool as of the
date of the enactment of this Act, the State's
operation of a qualifying State high risk pool
described in subsection (b)(1) shall be treated, for
purposes of section 2745 of the Public Health Service
Act, as the operation of a qualified high risk pool
described in such section.
(B) State operating a qualified high risk pool.--In
the case of a State that is operating a current section
2745 qualified high risk pool as of the date of the
enactment of this Act, as of the date that is 90 days
after the date of the enactment of this Act, such a
pool shall not be treated as a qualified high risk pool
under section 2745 of the Public Health Service Act
unless the pool is a qualifying State high risk pool
described in subsection (b)(1).
(3) Application of funds.--If the pool operated under
paragraph (1)(A) is in strong fiscal health, as determined in
accordance with standards established by the National
Association of Insurance Commissioners and as approved by the
State Insurance Commissioner involved, the requirement of
paragraph (1)(B) shall be deemed to be met.
(b) Qualifying State High Risk Pool.--
(1) In general.--A qualifying State high risk pool
described in this subsection means a current section 2745
qualified high risk pool that meets the following requirements:
(A) The pool must be funded with a stable funding
source.
(B) The pool must eliminate any waiting lists so
that all eligible residents who are seeking coverage
through the pool should be allowed to receive coverage
through the pool.
(C) The pool must allow for coverage of individuals
who, but for the 24-month disability waiting period
under section 226(b) of the Social Security Act, would
be eligible for Medicare during the period of such
waiting period.
(D) The pool must limit the pool premiums to no
more than 150 percent of the average premium for
applicable standard risk rates in that State.
(E) The pool must conduct education and outreach
initiatives so that residents and brokers understand
that the pool is available to eligible residents.
(F) The pool must provide coverage for preventive
services and disease management for chronic diseases.
(G) Subject to subparagraph (C), an individual may
only be eligible for coverage through the pool if the
individual has a pre-existing condition, as determined
in a manner consistent with guidance ussed by the
Secretary of Health and Human Services and--
(i) was denied health insurance coverage in
the individual market because of a pre-existing
condition or health status; or
(ii) was offered such coverage--
(I) under terms that limit the
coverage for such a pre-existing
condition; or
(II) at a premium rate that is
above the premium rate for coverage
through the pool pursuant to this
section.
(H) No pre-existing condition exclusion period may
be imposed on coverage through the pool.
(I) The pool shall not require an individual to be
uninsured for any period as a condition of eligibility
to receive coverage through the pool.
(2) Verification of citizenship or alien qualification.--
(A) In general.--Notwithstanding any other
provision of law, only citizens and nationals of the
United States shall be eligible to participate in a
qualifying State high risk pool that receives funds
under section 2745 of the Public Health Service Act or
this section.
(B) Condition of participation.--As a condition of
a State receiving such funds, the Secretary shall
require the State to certify, to the satisfaction of
the Secretary, that such State requires all applicants
for coverage in the qualifying State high risk pool to
provide satisfactory documentation of citizenship or
nationality in a manner consistent with section 1903(x)
of the Social Security Act.
(C) Records.--The Secretary shall keep sufficient
records such that a determination of citizenship or
nationality only has to be made once for any individual
under this paragraph.
(3) Relation to section 2745.--As of January 1, 2012, a
pool shall not qualify as qualified high risk pool under
section 2745 of the Public Health Service Act unless the pool
is a qualifying State high risk pool described in paragraph
(1).
(c) Waivers.--In order to accommodate new and innovative programs,
the Secretary may waive such requirements of this section for
qualifying State high risk pools as the Secretary deems appropriate.
(d) Funding.--In addition to any other amounts appropriated, there
is appropriated to carry out section 2745 of the Public Health Service
Act (including through a pool described in subsection (a)(1))--
(1) $15,000,000,000 for the period of fiscal years 2011
through 2021; and
(2) an additional $10,000,000,000 for the period of fiscal
years 2017 through 2021.
(e) Definitions.--In this section:
(1) Health insurance coverage; health insurance issuer.--
The terms ``health insurance coverage'' and ``health insurance
issuer'' have the meanings given such terms in section 2791 of
the Public Health Service Act.
(2) Current section 2745 qualified high risk pool.--The
term ``current section 2745 qualified high risk pool'' has the
meaning given the term ``qualified high risk pool'' under
section 2745(g) of the Public Health Service Act as in effect
as of the date of the enactment of this Act.
(3) Secretary.--The term ``Secretary'' means Secretary of
Health and Human Services.
(4) Standard risk rate.--The term ``standard risk rate''
means a rate that--
(A) is determined under the State high risk pool by
considering the premium rates charged by other health
insurance issuers offering health insurance coverage to
individuals in the insurance market served;
(B) is established using reasonable actuarial
techniques; and
(C) reflects anticipated claims experience and
expenses for the coverage involved.
(5) State.--The term ``State'' means any of the 50 States
or the District of Columbia.
SEC. 102. NO ANNUAL OR LIFETIME SPENDING CAPS.
Notwithstanding any other provision of law, a health insurance
issuer (including an entity licensed to sell insurance with respect to
a State or group health plan) may not apply an annual or lifetime
aggregate spending cap on any health insurance coverage or plan offered
by such issuer.
SEC. 103. PREVENTING UNJUST CANCELLATION OF INSURANCE COVERAGE.
(a) Clarification Regarding Application of Guaranteed Renewability
of Individual Health Insurance Coverage.--Section 2742 of the Public
Health Service Act (42 U.S.C. 300gg-42), as restored by section 2, is
amended--
(1) in its heading, by inserting ``, continuation in force,
including prohibition of rescission,'' after ``guaranteed
renewability'';
(2) in subsection (a), by inserting ``, including without
rescission,'' after ``continue in force''; and
(3) in subsection (b)(2), by inserting before the period at
the end the following: ``, including intentional concealment of
material facts regarding a health condition related to the
condition for which coverage is being claimed''.
(b) Opportunity for Independent, External Third Party Review in
Certain Cases.--Subpart 1 of part B of title XXVII of the Public Health
Service Act, as restored by section 2, is amended by adding at the end
the following new section:
``SEC. 2746. OPPORTUNITY FOR INDEPENDENT, EXTERNAL THIRD PARTY REVIEW
IN CERTAIN CASES.
``(a) Notice and Review Right.--If a health insurance issuer
determines to nonrenew or not continue in force, including rescind,
health insurance coverage for an individual in the individual market on
the basis described in section 2742(b)(2) before such nonrenewal,
discontinuation, or rescission, may take effect the issuer shall
provide the individual with notice of such proposed nonrenewal,
discontinuation, or rescission and an opportunity for a review of such
determination by an independent, external third party under procedures
specified by the Secretary.
``(b) Independent Determination.--If the individual requests such
review by an independent, external third party of a nonrenewal,
discontinuation, or rescission of health insurance coverage, the
coverage shall remain in effect until such third party determines that
the coverage may be nonrenewed, discontinued, or rescinded under
section 2742(b)(2).''.
(c) Effective Date.--The amendments made by this section shall
apply after the date of the enactment of this Act with respect to
health insurance coverage issued before, on, or after such date.
DIVISION B--REDUCING HEALTH CARE PREMIUMS AND THE NUMBER OF UNINSURED
AMERICANS
TITLE I--EXPANDING ACCESS AND LOWERING COSTS FOR SMALL BUSINESSES
Subtitle A--Enhanced Marketplace Pools
SEC. 201. RULES GOVERNING ENHANCED MARKETPLACE POOLS.
(a) In General.--Subtitle B of title I of the Employee Retirement
Income Security Act of 1974, as restored by section 2, is amended by
adding after part 7 the following new part:
``PART 8--RULES GOVERNING ENHANCED MARKETPLACE POOLS
``SEC. 801. SMALL BUSINESS HEALTH PLANS.
``(a) In General.--For purposes of this part, the term `small
business health plan' means a fully insured group health plan whose
sponsor is (or is deemed under this part to be) described in subsection
(b).
``(b) Sponsorship.--The sponsor of a group health plan is described
in this subsection if such sponsor--
``(1) is organized and maintained in good faith, with a
constitution and bylaws specifically stating its purpose and
providing for periodic meetings on at least an annual basis, as
a bona fide trade association, a bona fide industry association
(including a rural electric cooperative association or a rural
telephone cooperative association), a bona fide professional
association, or a bona fide chamber of commerce (or similar
bona fide business association, including a corporation or
similar organization that operates on a cooperative basis
(within the meaning of section 1381 of the Internal Revenue
Code of 1986)), for substantial purposes other than that of
obtaining medical care;
``(2) is established as a permanent entity which receives
the active support of its members and requires for membership
payment on a periodic basis of dues or payments necessary to
maintain eligibility for membership;
``(3) does not condition membership, such dues or payments,
or coverage under the plan on the basis of health status-
related factors with respect to the employees of its members
(or affiliated members), or the dependents of such employees,
and does not condition such dues or payments on the basis of
group health plan participation; and
``(4) does not condition membership on the basis of a
minimum group size.
Any sponsor consisting of an association of entities which meet the
requirements of paragraphs (1), (2), (3), and (4) shall be deemed to be
a sponsor described in this subsection.
``SEC. 802. ALTERNATIVE MARKET POOLING ORGANIZATIONS.
``(a) In General.--The Secretary, not later than 1 year after the
date of enactment of this part, shall promulgate regulations that apply
the rules and standards of this part, as necessary, to circumstances in
which a pooling entity other (hereinafter `Alternative Market Pooling
Organizations') is not made up principally of employers and their
employees, or not a professional organization or such small business
health plan entity identified in section 801.
``(b) Adaption of Standards.--In developing and promulgating
regulations pursuant to subsection (a), the Secretary, in consultation
with the Secretary of Health and Human Services, small business health
plans, small and large employers, large and small insurance issuers,
consumer representatives, and state insurance commissioners, shall--
``(1) adapt the standards of this part, to the maximum
degree practicable, to assure balanced and comparable oversight
standards for both small business health plans and alternative
market pooling organizations;
``(2) permit the participation as alternative market
pooling organizations unions, churches and other faith-based
organizations, or other organizations composed of individuals
and groups which may have little or no association with
employment, provided however, that such alternative market
pooling organizations meet, and continue meeting on an ongoing
basis, to satisfy standards, rules, and requirements materially
equivalent to those set forth in this part with respect to
small business health plans;
``(3) conduct periodic verification of such compliance by
alternative market pooling organizations, in consultation with
the Secretary of Health and Human Services and the National
Association of Insurance Commissioners, except that such
periodic verification shall not materially impede market entry
or participation as pooling entities comparable to that of
small business health plans;
``(4) assure that consistent, clear, and regularly
monitored standards are applied with respect to alternative
market pooling organizations to avert material risk-selection
within or among the composition of such organizations;
``(5) the expedited and deemed certification procedures
provided in section 805(d) shall not apply to alternative
market pooling organizations until sooner of the promulgation
of regulations under this subsection or the expiration of one
year following enactment of this Act; and
``(6) make such other appropriate adjustments to the
requirements of this part as the Secretary may reasonably deem
appropriate to fit the circumstances of an individual
alternative market pooling organization or category of such
organization, including but not limited to the application of
the membership payment requirements of section 801(b)(2) to
alternative market pooling organizations composed primarily of
church- or faith-based membership.
``SEC. 803. CERTIFICATION OF SMALL BUSINESS HEALTH PLANS.
``(a) In General.--Not later than 6 months after the date of
enactment of this part, the applicable authority shall prescribe by
interim final rule a procedure under which the applicable authority
shall certify small business health plans which apply for certification
as meeting the requirements of this part.
``(b) Requirements Applicable to Certified Plans.--A small business
health plan with respect to which certification under this part is in
effect shall meet the applicable requirements of this part, effective
on the date of certification (or, if later, on the date on which the
plan is to commence operations).
``(c) Requirements for Continued Certification.--The applicable
authority may provide by regulation for continued certification of
small business health plans under this part. Such regulation shall
provide for the revocation of a certification if the applicable
authority finds that the small business health plan involved is failing
to comply with the requirements of this part.
``(d) Expedited and Deemed Certification.--
``(1) In general.--If the Secretary fails to act on an
application for certification under this section within 90 days
of receipt of such application, the applying small business
health plan shall be deemed certified until such time as the
Secretary may deny for cause the application for certification.
``(2) Civil penalty.--The Secretary may assess a civil
penalty against the board of trustees and plan sponsor (jointly
and severally) of a small business health plan that is deemed
certified under paragraph (1) of up to $500,000 in the event
the Secretary determines that the application for certification
of such small business health plan was willfully or with gross
negligence incomplete or inaccurate.
``SEC. 804. REQUIREMENTS RELATING TO SPONSORS AND BOARDS OF TRUSTEES.
``(a) Sponsor.--The requirements of this subsection are met with
respect to a small business health plan if the sponsor has met (or is
deemed under this part to have met) the requirements of section 801(b)
for a continuous period of not less than 3 years ending with the date
of the application for certification under this part.
``(b) Board of Trustees.--The requirements of this subsection are
met with respect to a small business health plan if the following
requirements are met:
``(1) Fiscal control.--The plan is operated, pursuant to a
plan document, by a board of trustees which pursuant to a trust
agreement has complete fiscal control over the plan and which
is responsible for all operations of the plan.
``(2) Rules of operation and financial controls.--The board
of trustees has in effect rules of operation and financial
controls, based on a 3-year plan of operation, adequate to
carry out the terms of the plan and to meet all requirements of
this title applicable to the plan.
``(3) Rules governing relationship to participating
employers and to contractors.--
``(A) Board membership.--
``(i) In general.--Except as provided in
clauses (ii) and (iii), the members of the
board of trustees are individuals selected from
individuals who are the owners, officers,
directors, or employees of the participating
employers or who are partners in the
participating employers and actively
participate in the business.
``(ii) Limitation.--
``(I) General rule.--Except as
provided in subclauses (II) and (III),
no such member is an owner, officer,
director, or employee of, or partner
in, a contract administrator or other
service provider to the plan.
``(II) Limited exception for
providers of services solely on behalf
of the sponsor.--Officers or employees
of a sponsor which is a service
provider (other than a contract
administrator) to the plan may be
members of the board if they constitute
not more than 25 percent of the
membership of the board and they do not
provide services to the plan other than
on behalf of the sponsor.
``(III) Treatment of providers of
medical care.--In the case of a sponsor
which is an association whose
membership consists primarily of
providers of medical care, subclause
(I) shall not apply in the case of any
service provider described in subclause
(I) who is a provider of medical care
under the plan.
``(iii) Certain plans excluded.--Clause (i)
shall not apply to a small business health plan
which is in existence on the date of the
enactment of this part.
``(B) Sole authority.--The board has sole authority
under the plan to approve applications for
participation in the plan and to contract with
insurers.
``(c) Treatment of Franchises.--In the case of a group health plan
which is established and maintained by a franchiser for a franchisor or
for its franchisees--
``(1) the requirements of subsection (a) and section 801(a)
shall be deemed met if such requirements would otherwise be met
if the franchisor were deemed to be the sponsor referred to in
section 801(b) and each franchisee were deemed to be a member
(of the sponsor) referred to in section 801(b); and
``(2) the requirements of section 804(a)(1) shall be deemed
met.
For purposes of this subsection the terms `franchisor' and `franchisee'
shall have the meanings given such terms for purposes of sections
436.2(a) through 436.2(c) of title 16, Code of Federal Regulations
(including any such amendments to such regulation after the date of
enactment of this part).
``SEC. 805. PARTICIPATION AND COVERAGE REQUIREMENTS.
``(a) Covered Employers and Individuals.--The requirements of this
subsection are met with respect to a small business health plan if,
under the terms of the plan--
``(1) each participating employer must be--
``(A) a member of the sponsor;
``(B) the sponsor; or
``(C) an affiliated member of the sponsor, except
that, in the case of a sponsor which is a professional
association or other individual-based association, if
at least one of the officers, directors, or employees
of an employer, or at least one of the individuals who
are partners in an employer and who actively
participates in the business, is a member or such an
affiliated member of the sponsor, participating
employers may also include such employer; and
``(2) all individuals commencing coverage under the plan
after certification under this part must be--
``(A) active or retired owners (including self-
employed individuals), officers, directors, or
employees of, or partners in, participating employers;
or
``(B) the dependents of individuals described in
subparagraph (A).
``(b) Individual Market Unaffected.--The requirements of this
subsection are met with respect to a small business health plan if,
under the terms of the plan, no participating employer may provide
health insurance coverage in the individual market for any employee not
covered under the plan which is similar to the coverage
contemporaneously provided to employees of the employer under the plan,
if such exclusion of the employee from coverage under the plan is based
on a health status-related factor with respect to the employee and such
employee would, but for such exclusion on such basis, be eligible for
coverage under the plan.
``(c) Prohibition of Discrimination Against Employers and Employees
Eligible To Participate.--The requirements of this subsection are met
with respect to a small business health plan if--
``(1) under the terms of the plan, all employers meeting
the preceding requirements of this section are eligible to
qualify as participating employers for all geographically
available coverage options, unless, in the case of any such
employer, participation or contribution requirements of the
type referred to in section 2711 of the Public Health Service
Act are not met;
``(2) information regarding all coverage options available
under the plan is made readily available to any employer
eligible to participate; and
``(3) the applicable requirements of sections 701, 702, and
703 are met with respect to the plan.
``SEC. 806. OTHER REQUIREMENTS RELATING TO PLAN DOCUMENTS, CONTRIBUTION
RATES, AND BENEFIT OPTIONS.
``(a) In General.--The requirements of this section are met with
respect to a small business health plan if the following requirements
are met:
``(1) Contents of governing instruments.--
``(A) In general.--The instruments governing the
plan include a written instrument, meeting the
requirements of an instrument required under section
402(a)(1), which--
``(i) provides that the board of trustees
serves as the named fiduciary required for
plans under section 402(a)(1) and serves in the
capacity of a plan administrator (referred to
in section 3(16)(A)); and
``(ii) provides that the sponsor of the
plan is to serve as plan sponsor (referred to
in section 3(16)(B)).
``(B) Description of material provisions.--The
terms of the health insurance coverage (including the
terms of any individual certificates that may be
offered to individuals in connection with such
coverage) describe the material benefit and rating, and
other provisions set forth in this section and such
material provisions are included in the summary plan
description.
``(2) Contribution rates must be nondiscriminatory.--
``(A) In general.--The contribution rates for any
participating small employer shall not vary on the
basis of any health status-related factor in relation
to employees of such employer or their beneficiaries
and shall not vary on the basis of the type of business
or industry in which such employer is engaged, subject
to subparagraph (B) and the terms of this title.
``(B) Effect of title.--Nothing in this title or
any other provision of law shall be construed to
preclude a health insurance issuer offering health
insurance coverage in connection with a small business
health plan that meets the requirements of this part,
and at the request of such small business health plan,
from--
``(i) setting contribution rates for the
small business health plan based on the claims
experience of the small business health plan so
long as any variation in such rates for
participating small employers complies with the
requirements of clause (ii), except that small
business health plans shall not be subject, in
non-adopting states, to subparagraphs (A)(ii)
and (C) of section 2912(a)(2) of the Public
Health Service Act, and in adopting states, to
any State law that would have the effect of
imposing requirements as outlined in such
subparagraphs (A)(ii) and (C); or
``(ii) varying contribution rates for
participating small employers in a small
business health plan in a State to the extent
that such rates could vary using the same
methodology employed in such State for
regulating small group premium rates, subject
to the terms of part I of subtitle A of title
XXXI of the Public Health Service Act (relating
to rating requirements), as added by subtitle B
of title II of the Health Security for All
Americans Act of 2010.
``(3) Exceptions regarding self-employed and large
employers.--
``(A) Self-employed.--
``(i) In general.--Small business health
plans with participating employers who are
self-employed individuals (and their
dependents) shall enroll such self-employed
participating employers in accordance with
rating rules that do not violate the rating
rules for self-employed individuals in the
State in which such self-employed participating
employers are located.
``(ii) Guarantee issue.--Small business
health plans with participating employers who
are self-employed individuals (and their
dependents) may decline to guarantee issue to
such participating employers in States in which
guarantee issue is not otherwise required for
the self-employed in that State.
``(B) Large employers.--Small business health plans
with participating employers that are larger than small
employers (as defined in section 808(a)(10)) shall
enroll such large participating employers in accordance
with rating rules that do not violate the rating rules
for large employers in the State in which such large
participating employers are located.
``(4) Regulatory requirements.--Such other requirements as
the applicable authority determines are necessary to carry out
the purposes of this part, which shall be prescribed by the
applicable authority by regulation.
``(b) Ability of Small Business Health Plans To Design Benefit
Options.--Nothing in this part or any provision of State law (as
defined in section 514(c)(1)) shall be construed to preclude a small
business health plan or a health insurance issuer offering health
insurance coverage in connection with a small business health plan from
exercising its sole discretion in selecting the specific benefits and
services consisting of medical care to be included as benefits under
such plan or coverage, except that such benefits and services must meet
the terms and specifications of part II of subtitle A of title XXXI of
the Public Health Service Act (relating to lower cost plans), as added
by subtitle B of title II of the Health Security for All Americans Act
of 2010.
``(c) Domicile and Non-Domicile States.--
``(1) Domicile state.--Coverage shall be issued to a small
business health plan in the State in which the sponsor's
principal place of business is located.
``(2) Non-domicile states.--With respect to a State (other
than the domicile State) in which participating employers of a
small business health plan are located but in which the insurer
of the small business health plan in the domicile State is not
yet licensed, the following shall apply:
``(A) Temporary preemption.--If, upon the
expiration of the 90-day period following the
submission of a licensure application by such insurer
(that includes a certified copy of an approved
licensure application as submitted by such insurer in
the domicile State) to such State, such State has not
approved or denied such application, such State's
health insurance licensure laws shall be temporarily
preempted and the insurer shall be permitted to operate
in such State, subject to the following terms:
``(i) Application of non-domicile state
law.--Except with respect to licensure and with
respect to the terms of subtitle A of title
XXXI of the Public Health Service Act (relating
to rating and benefits as added by subtitle B
of title II of the Health Security for All
Americans Act of 2010), the laws and authority
of the non-domicile State shall remain in full
force and effect.
``(ii) Revocation of preemption.--The
preemption of a non-domicile State's health
insurance licensure laws pursuant to this
subparagraph, shall be terminated upon the
occurrence of either of the following:
``(I) Approval or denial of
application.--The approval of denial of
an insurer's licensure application,
following the laws and regulations of
the non-domicile State with respect to
licensure.
``(II) Determination of material
violation.--A determination by a non-
domicile State that an insurer
operating in a non-domicile State
pursuant to the preemption provided for
in this subparagraph is in material
violation of the insurance laws (other
than licensure and with respect to the
terms of subtitle A of title XXXI of
the Public Health Service Act (relating
to rating and benefits added by
subtitle B of title II of the Health
Security for All Americans Act of
2010)) of such State.
``(B) No prohibition on promotion.--Nothing in this
paragraph shall be construed to prohibit a small
business health plan or an insurer from promoting
coverage prior to the expiration of the 90-day period
provided for in subparagraph (A), except that no
enrollment or collection of contributions shall occur
before the expiration of such 90-day period.
``(C) Licensure.--Except with respect to the
application of the temporary preemption provision of
this paragraph, nothing in this part shall be construed
to limit the requirement that insurers issuing coverage
to small business health plans shall be licensed in
each State in which the small business health plans
operate.
``(D) Servicing by licensed insurers.--
Notwithstanding subparagraph (C), the requirements of
this subsection may also be satisfied if the
participating employers of a small business health plan
are serviced by a licensed insurer in that State, even
where such insurer is not the insurer of such small
business health plan in the State in which such small
business health plan is domiciled.
``SEC. 807. REQUIREMENTS FOR APPLICATION AND RELATED REQUIREMENTS.
``(a) Filing Fee.--Under the procedure prescribed pursuant to
section 802(a), a small business health plan shall pay to the
applicable authority at the time of filing an application for
certification under this part a filing fee in the amount of $5,000,
which shall be available in the case of the Secretary, to the extent
provided in appropriation Acts, for the sole purpose of administering
the certification procedures applicable with respect to small business
health plans.
``(b) Information To Be Included in Application for
Certification.--An application for certification under this part meets
the requirements of this section only if it includes, in a manner and
form which shall be prescribed by the applicable authority by
regulation, at least the following information:
``(1) Identifying information.--The names and addresses
of--
``(A) the sponsor; and
``(B) the members of the board of trustees of the
plan.
``(2) States in which plan intends to do business.--The
States in which participants and beneficiaries under the plan
are to be located and the number of them expected to be located
in each such State.
``(3) Bonding requirements.--Evidence provided by the board
of trustees that the bonding requirements of section 412 will
be met as of the date of the application or (if later)
commencement of operations.
``(4) Plan documents.--A copy of the documents governing
the plan (including any bylaws and trust agreements), the
summary plan description, and other material describing the
benefits that will be provided to participants and
beneficiaries under the plan.
``(5) Agreements with service providers.--A copy of any
agreements between the plan, health insurance issuer, and
contract administrators and other service providers.
``(c) Filing Notice of Certification With States.--A certification
granted under this part to a small business health plan shall not be
effective unless written notice of such certification is filed with the
applicable State authority of each State in which the small business
health plans operate.
``(d) Notice of Material Changes.--In the case of any small
business health plan certified under this part, descriptions of
material changes in any information which was required to be submitted
with the application for the certification under this part shall be
filed in such form and manner as shall be prescribed by the applicable
authority by regulation. The applicable authority may require by
regulation prior notice of material changes with respect to specified
matters which might serve as the basis for suspension or revocation of
the certification.
``SEC. 808. NOTICE REQUIREMENTS FOR VOLUNTARY TERMINATION.
``A small business health plan which is or has been certified under
this part may terminate (upon or at any time after cessation of
accruals in benefit liabilities) only if the board of trustees, not
less than 60 days before the proposed termination date--
``(1) provides to the participants and beneficiaries a
written notice of intent to terminate stating that such
termination is intended and the proposed termination date;
``(2) develops a plan for winding up the affairs of the
plan in connection with such termination in a manner which will
result in timely payment of all benefits for which the plan is
obligated; and
``(3) submits such plan in writing to the applicable
authority.
Actions required under this section shall be taken in such form and
manner as may be prescribed by the applicable authority by regulation.
``SEC. 809. IMPLEMENTATION AND APPLICATION AUTHORITY BY SECRETARY.
``The Secretary shall, through promulgation and implementation of
such regulations as the Secretary may reasonably determine necessary or
appropriate, and in consultation with a balanced spectrum of effected
entities and persons, modify the implementation and application of this
part to accommodate with minimum disruption such changes to State or
Federal law provided in this part and the (and the amendments made by
such Act) or in regulations issued thereto.
``SEC. 810. DEFINITIONS AND RULES OF CONSTRUCTION.
``(a) Definitions.--For purposes of this part--
``(1) Affiliated member.--The term `affiliated member'
means, in connection with a sponsor--
``(A) a person who is otherwise eligible to be a
member of the sponsor but who elects an affiliated
status with the sponsor, or
``(B) in the case of a sponsor with members which
consist of associations, a person who is a member or
employee of any such association and elects an
affiliated status with the sponsor.
``(2) Applicable authority.--The term `applicable
authority' means the Secretary of Labor, except that, in
connection with any exercise of the Secretary's authority with
respect to which the Secretary is required under section 506(d)
to consult with a State, such term means the Secretary, in
consultation with such State.
``(3) Applicable state authority.--The term `applicable
State authority' means, with respect to a health insurance
issuer in a State, the State insurance commissioner or official
or officials designated by the State to enforce the
requirements of title XXVII of the Public Health Service Act
for the State involved with respect to such issuer.
``(4) Group health plan.--The term `group health plan' has
the meaning provided in section 733(a)(1) (after applying
subsection (b) of this section).
``(5) Health insurance coverage.--The term `health
insurance coverage' has the meaning provided in section
733(b)(1), except that such term shall not include excepted
benefits (as defined in section 733(c)).
``(6) Health insurance issuer.--The term `health insurance
issuer' has the meaning provided in section 733(b)(2).
``(7) Individual market.--
``(A) In general.--The term `individual market'
means the market for health insurance coverage offered
to individuals other than in connection with a group
health plan.
``(B) Treatment of very small groups.--
``(i) In general.--Subject to clause (ii),
such term includes coverage offered in
connection with a group health plan that has
fewer than 2 participants as current employees
or participants described in section 732(d)(3)
on the first day of the plan year.
``(ii) State exception.--Clause (i) shall
not apply in the case of health insurance
coverage offered in a State if such State
regulates the coverage described in such clause
in the same manner and to the same extent as
coverage in the small group market (as defined
in section 2791(e)(5) of the Public Health
Service Act) is regulated by such State.
``(8) Medical care.--The term `medical care' has the
meaning provided in section 733(a)(2).
``(9) Participating employer.--The term `participating
employer' means, in connection with a small business health
plan, any employer, if any individual who is an employee of
such employer, a partner in such employer, or a self-employed
individual who is such employer (or any dependent, as defined
under the terms of the plan, of such individual) is or was
covered under such plan in connection with the status of such
individual as such an employee, partner, or self-employed
individual in relation to the plan.
``(10) Small employer.--The term `small employer' means, in
connection with a group health plan with respect to a plan
year, a small employer as defined in section 2791(e)(4).
``(11) Trade association and professional association.--The
terms `trade association' and `professional association' mean
an entity that meets the requirements of section 1.501(c)(6)-1
of title 26, Code of Federal Regulations (as in effect on the
date of enactment of this Act).
``(b) Rule of Construction.--For purposes of determining whether a
plan, fund, or program is an employee welfare benefit plan which is a
small business health plan, and for purposes of applying this title in
connection with such plan, fund, or program so determined to be such an
employee welfare benefit plan--
``(1) in the case of a partnership, the term `employer' (as
defined in section 3(5)) includes the partnership in relation
to the partners, and the term `employee' (as defined in section
3(6)) includes any partner in relation to the partnership; and
``(2) in the case of a self-employed individual, the term
`employer' (as defined in section 3(5)) and the term `employee'
(as defined in section 3(6)) shall include such individual.
``(c) Renewal.--Notwithstanding any provision of law to the
contrary, a participating employer in a small business health plan
shall not be deemed to be a plan sponsor in applying requirements
relating to coverage renewal.
``(d) Health Savings Accounts.--Nothing in this part shall be
construed to create any mandates for coverage of benefits for HSA-
qualified health plans that would require reimbursements in violation
of section 223(c)(2) of the Internal Revenue Code of 1986.''.
(b) Conforming Amendments to Preemption Rules.--
(1) Section 514(b)(6) of such Act (29 U.S.C. 1144(b)(6)),
as restored by section 2, is amended by adding at the end the
following new subparagraph:
``(E) The preceding subparagraphs of this paragraph do not apply
with respect to any State law in the case of a small business health
plan which is certified under part 8.''.
(2) Section 514 of such Act (29 U.S.C. 1144), as restored
by section 2, is amended--
(A) in subsection (b)(4), by striking ``Subsection
(a)'' and inserting ``Subsections (a) and (d)'';
(B) in subsection (b)(5), by striking ``subsection
(a)'' in subparagraph (A) and inserting ``subsection
(a) of this section and subsections (a)(2)(B) and (b)
of section 805'', and by striking ``subsection (a)'' in
subparagraph (B) and inserting ``subsection (a) of this
section or subsection (a)(2)(B) or (b) of section
805'';
(C) by redesignating subsection (d) as subsection
(e); and
(D) by inserting after subsection (c) the following
new subsection:
``(d)(1) Except as provided in subsection (b)(4), the provisions of
this title shall supersede any and all State laws insofar as they may
now or hereafter preclude a health insurance issuer from offering
health insurance coverage in connection with a small business health
plan which is certified under part 8.
``(2) In any case in which health insurance coverage of any policy
type is offered under a small business health plan certified under part
8 to a participating employer operating in such State, the provisions
of this title shall supersede any and all laws of such State insofar as
they may establish rating and benefit requirements that would otherwise
apply to such coverage, provided the requirements of subtitle A of
title XXXI of the Public Health Service Act (as added by title II of
the Health Security for All Americans Act of 2010) (concerning health
plan rating and benefits) are met.''.
(c) Plan Sponsor.--Section 3(16)(B) of such Act (29 U.S.C.
102(16)(B)), as restored by section 2, is amended by adding at the end
the following new sentence: ``Such term also includes a person serving
as the sponsor of a small business health plan under part 8.''.
(d) Savings Clause.--Section 731(c) of such Act, as restored by
section 2, is amended by inserting ``or part 8'' after ``this part''.
(e) Clerical Amendment.--The table of contents in section 1 of the
Employee Retirement Income Security Act of 1974, as restored by section
2, is amended by inserting after the item relating to section 734 the
following new items:
``Part 8--Rules Governing Small Business Health Plans
``801. Small business health plans.
``802. Alternative market pooling organizations.
``803. Certification of small business health plans.
``804. Requirements relating to sponsors and boards of trustees.
``805. Participation and coverage requirements.
``806. Other requirements relating to plan documents, contribution
rates, and benefit options.
``807. Requirements for application and related requirements.
``808. Notice requirements for voluntary termination.
``809. Implementation and application authority by Secretary.
``810. Definitions and rules of construction.''.
SEC. 202. COOPERATION BETWEEN FEDERAL AND STATE AUTHORITIES.
Section 506 of the Employee Retirement Income Security Act of 1974
(29 U.S.C. 1136), as restored by section 2, is amended by adding at the
end the following new subsection:
``(d) Consultation With States With Respect to Small Business
Health Plans.--
``(1) Agreements with states.--The Secretary shall consult
with the State recognized under paragraph (2) with respect to a
small business health plan regarding the exercise of--
``(A) the Secretary's authority under sections 502
and 504 to enforce the requirements for certification
under part 8; and
``(B) the Secretary's authority to certify small
business health plans under part 8 in accordance with
regulations of the Secretary applicable to
certification under part 8.
``(2) Recognition of domicile state.--In carrying out
paragraph (1), the Secretary shall ensure that only one State
will be recognized, with respect to any particular small
business health plan, as the State with which consultation is
required. In carrying out this paragraph such State shall be
the domicile State, as defined in section 805(c).''.
SEC. 203. EFFECTIVE DATE AND TRANSITIONAL AND OTHER RULES.
(a) Effective Date.--The amendments made by this subtitle shall
take effect 12 months after the date of the enactment of this Act. The
Secretary of Labor shall first issue all regulations necessary to carry
out the amendments made by this subtitle within 6 months after the date
of the enactment of this Act.
(b) Treatment of Certain Existing Health Benefits Programs.--
(1) In general.--In any case in which, as of the date of
the enactment of this Act, an arrangement is maintained in a
State for the purpose of providing benefits consisting of
medical care for the employees and beneficiaries of its
participating employers, at least 200 participating employers
make contributions to such arrangement, such arrangement has
been in existence for at least 10 years, and such arrangement
is licensed under the laws of one or more States to provide
such benefits to its participating employers, upon the filing
with the applicable authority (as defined in section 808(a)(2)
of the Employee Retirement Income Security Act of 1974 (as
amended by this subtitle)) by the arrangement of an application
for certification of the arrangement under part 8 of subtitle B
of title I of such Act--
(A) such arrangement shall be deemed to be a group
health plan for purposes of title I of such Act;
(B) the requirements of sections 801(a) and 803(a)
of the Employee Retirement Income Security Act of 1974
shall be deemed met with respect to such arrangement;
(C) the requirements of section 803(b) of such Act
shall be deemed met, if the arrangement is operated by
a board of trustees which has control over the
arrangement;
(D) the requirements of section 804(a) of such Act
shall be deemed met with respect to such arrangement;
and
(E) the arrangement may be certified by any
applicable authority with respect to its operations in
any State only if it operates in such State on the date
of certification.
The provisions of this subsection shall cease to apply with
respect to any such arrangement at such time after the date of
the enactment of this Act as the applicable requirements of
this subsection are not met with respect to such arrangement or
at such time that the arrangement provides coverage to
participants and beneficiaries in any State other than the
States in which coverage is provided on such date of enactment.
(2) Definitions.--For purposes of this subsection, the
terms ``group health plan'', ``medical care'', and
``participating employer'' shall have the meanings provided in
section 808 of the Employee Retirement Income Security Act of
1974, except that the reference in paragraph (7) of such
section to an ``small business health plan'' shall be deemed a
reference to an arrangement referred to in this subsection.
Subtitle B--Market Relief
SEC. 204. MARKET RELIEF.
The Public Health Service Act (42 U.S.C. 201 et seq.), as restored
by section 2, is amended by inserting after title XXX the following:
``TITLE XXXI--HEALTH CARE INSURANCE MARKETPLACE MODERNIZATION
``SEC. 3101. GENERAL INSURANCE DEFINITIONS.
``In this title, the terms `health insurance coverage', `health
insurance issuer', `group health plan', and `individual health
insurance' shall have the meanings given such terms in section 2791.
``SEC. 3102. IMPLEMENTATION AND APPLICATION AUTHORITY BY SECRETARY.
``The Secretary shall, through promulgation and implementation of
such regulations as the Secretary may reasonably determine necessary or
appropriate, and in consultation with a balanced spectrum of effected
entities and persons, modify the implementation and application of this
title to accommodate with minimum disruption such changes to State or
Federal law provided in this title and the (and the amendments made by
such Act) or in regulations issued thereto.
``Subtitle A--Market Relief
``PART I--RATING REQUIREMENTS
``SEC. 3111. DEFINITIONS.
``In this part:
``(1) Adopting state.--The term `adopting State' means a
State that, with respect to the small group market, has enacted
small group rating rules that meet the minimum standards set
forth in section 3112(a)(1) or, as applicable, transitional
small group rating rules set forth in section 3112(b).
``(2) Applicable state authority.--The term `applicable
State authority' means, with respect to a health insurance
issuer in a State, the State insurance commissioner or official
or officials designated by the State to enforce the insurance
laws of such State.
``(3) Base premium rate.--The term `base premium rate'
means, for each class of business with respect to a rating
period, the lowest premium rate charged or that could have been
charged under a rating system for that class of business by the
small employer carrier to small employers with similar case
characteristics for health benefit plans with the same or
similar coverage.
``(4) Eligible insurer.--The term `eligible insurer' means
a health insurance issuer that is licensed in a State and
that--
``(A) notifies the Secretary, not later than 30
days prior to the offering of coverage described in
this subparagraph, that the issuer intends to offer
health insurance coverage consistent with the Model
Small Group Rating Rules or, as applicable,
transitional small group rating rules in a State;
``(B) notifies the insurance department of a
nonadopting State (or other State agency), not later
than 30 days prior to the offering of coverage
described in this subparagraph, that the issuer intends
to offer small group health insurance coverage in that
State consistent with the Model Small Group Rating
Rules, and provides with such notice a copy of any
insurance policy that it intends to offer in the State,
its most recent annual and quarterly financial reports,
and any other information required to be filed with the
insurance department of the State (or other State
agency); and
``(C) includes in the terms of the health insurance
coverage offered in nonadopting States (including in
the terms of any individual certificates that may be
offered to individuals in connection with such group
health coverage) and filed with the State pursuant to
subparagraph (B), a description in the insurer's
contract of the Model Small Group Rating Rules and an
affirmation that such Rules are included in the terms
of such contract.
``(5) Health insurance coverage.--The term `health
insurance coverage' means any coverage issued in the small
group health insurance market, except that such term shall not
include excepted benefits (as defined in section 2791(c)).
``(6) Index rate.--The term `index rate' means for each
class of business with respect to the rating period for small
employers with similar case characteristics, the arithmetic
average of the applicable base premium rate and the
corresponding highest premium rate.
``(7) Model small group rating rules.--The term `Model
Small Group Rating Rules' means the rules set forth in section
3112(a)(2).
``(8) Nonadopting state.--The term `nonadopting State'
means a State that is not an adopting State.
``(9) Small group insurance market.--The term `small group
insurance market' shall have the meaning given the term `small
group market' in section 2791(e)(5).
``(10) State law.--The term `State law' means all laws,
decisions, rules, regulations, or other State actions
(including actions by a State agency) having the effect of law,
of any State.
``(11) Variation limits.--
``(A) Composite variation limit.--
``(i) In general.--The term `composite
variation limit' means the total variation in
premium rates charged by a health insurance
issuer in the small group market as permitted
under applicable State law based on the
following factors or case characteristics:
``(I) Age.
``(II) Duration of coverage.
``(III) Claims experience.
``(IV) Health status.
``(ii) Use of factors.--With respect to the
use of the factors described in clause (i) in
setting premium rates, a health insurance
issuer shall use one or both of the factors
described in subclauses (I) or (IV) of such
clause and may use the factors described in
subclauses (II) or (III) of such clause.
``(B) Total variation limit.--The term `total
variation limit' means the total variation in premium
rates charged by a health insurance issuer in the small
group market as permitted under applicable State law
based on all factors and case characteristics (as
described in section 3112(a)(1)).
``SEC. 3112. RATING RULES.
``(a) Establishment of Minimum Standards for Premium Variations and
Model Small Group Rating Rules.--Not later than 6 months after the date
of enactment of this title, the Secretary shall promulgate regulations
establishing the following Minimum Standards and Model Small Group
Rating Rules:
``(1) Minimum standards for premium variations.--
``(A) Composite variation limit.--The composite
variation limit shall not be less than 3:1.
``(B) Total variation limit.--The total variation
limit shall not be less than 5:1.
``(C) Prohibition on use of certain case
characteristics.--For purposes of this paragraph, in
calculating the total variation limit, the State shall
not use case characteristics other than those used in
calculating the composite variation limit and industry,
geographic area, group size, participation rate, class
of business, and participation in wellness programs.
``(2) Model small group rating rules.--The following apply
to an eligible insurer in a non-adopting State:
``(A) Premium rates.--Premium rates for small group
health benefit plans to which this title applies shall
comply with the following provisions relating to
premiums, except as provided for under subsection (b):
``(i) Variation in premium rates.--The plan
may not vary premium rates by more than the
minimum standards provided for under paragraph
(1).
``(ii) Index rate.--The index rate for a
rating period for any class of business shall
not exceed the index rate for any other class
of business by more than 20 percent, excluding
those classes of business related to
association groups under this title.
``(iii) Class of businesses.--With respect
to a class of business, the premium rates
charged during a rating period to small
employers with similar case characteristics for
the same or similar coverage or the rates that
could be charged to such employers under the
rating system for that class of business, shall
not vary from the index rate by more than 25
percent of the index rate under clause (ii).
``(iv) Increases for new rating periods.--
The percentage increase in the premium rate
charged to a small employer for a new rating
period may not exceed the sum of the following:
``(I) The percentage change in the
new business premium rate measured from
the first day of the prior rating
period to the first day of the new
rating period. In the case of a health
benefit plan into which the small
employer carrier is no longer enrolling
new small employers, the small employer
carrier shall use the percentage change
in the base premium rate, except that
such change shall not exceed, on a
percentage basis, the change in the new
business premium rate for the most
similar health benefit plan into which
the small employer carrier is actively
enrolling new small employers.
``(II) Any adjustment, not to
exceed 15 percent annually and adjusted
pro rata for rating periods of less
then 1 year, due to the claim
experience, health status or duration
of coverage of the employees or
dependents of the small employer as
determined from the small employer
carrier's rate manual for the class of
business involved.
``(III) Any adjustment due to
change in coverage or change in the
case characteristics of the small
employer as determined from the small
employer carrier's rate manual for the
class of business.
``(v) Uniform application of adjustments.--
Adjustments in premium rates for claim
experience, health status, or duration of
coverage shall not be charged to individual
employees or dependents. Any such adjustment
shall be applied uniformly to the rates charged
for all employees and dependents of the small
employer.
``(vi) Prohibition on use of certain case
characteristic.--A small employer carrier shall
not utilize case characteristics, other than
those permitted under paragraph (1)(C), without
the prior approval of the applicable State
authority.
``(vii) Consistent application of
factors.--Small employer carriers shall apply
rating factors, including case characteristics,
consistently with respect to all small
employers in a class of business. Rating
factors shall produce premiums for identical
groups which differ only by the amounts
attributable to plan design and do not reflect
differences due to the nature of the groups
assumed to select particular health benefit
plans.
``(viii) Treatment of plans as having same
rating period.--A small employer carrier shall
treat all health benefit plans issued or
renewed in the same calendar month as having
the same rating period.
``(ix) Require compliance.--Premium rates
for small business health benefit plans shall
comply with the requirements of this subsection
notwithstanding any assessments paid or payable
by a small employer carrier as required by a
State's small employer carrier reinsurance
program.
``(B) Establishment of separate class of
business.--Subject to subparagraph (C), a small
employer carrier may establish a separate class of
business only to reflect substantial differences in
expected claims experience or administrative costs
related to the following:
``(i) The small employer carrier uses more
than one type of system for the marketing and
sale of health benefit plans to small
employers.
``(ii) The small employer carrier has
acquired a class of business from another small
employer carrier.
``(iii) The small employer carrier provides
coverage to one or more association groups that
meet the requirements of this title.
``(C) Limitation.--A small employer carrier may
establish up to 9 separate classes of business under
subparagraph (B), excluding those classes of business
related to association groups under this title.
``(D) Limitation on transfers.--A small employer
carrier shall not transfer a small employer
involuntarily into or out of a class of business. A
small employer carrier shall not offer to transfer a
small employer into or out of a class of business
unless such offer is made to transfer all small
employers in the class of business without regard to
case characteristics, claim experience, health status
or duration of coverage since issue.
``(b) Transitional Model Small Group Rating Rules.--
``(1) In general.--Not later than 6 months after the date
of enactment of this title and to the extent necessary to
provide for a graduated transition to the minimum standards for
premium variation as provided for in subsection (a)(1), the
Secretary, in consultation with the National Association of
Insurance Commissioners (NAIC), shall promulgate State-specific
transitional small group rating rules in accordance with this
subsection, which shall be applicable with respect to non-
adopting States and eligible insurers operating in such States
for a period of not to exceed 3 years from the date of the
promulgation of the minimum standards for premium variation
pursuant to subsection (a).
``(2) Compliance with transitional model small group rating
rules.--During the transition period described in paragraph
(1), a State that, on the date of enactment of this title, has
in effect a small group rating rules methodology that allows
for a variation that is less than the variation provided for
under subsection (a)(1) (concerning minimum standards for
premium variation), shall be deemed to be an adopting State if
the State complies with the transitional small group rating
rules as promulgated by the Secretary pursuant to paragraph
(1).
``(3) Transitioning of old business.--
``(A) In general.--In developing the transitional
small group rating rules under paragraph (1), the
Secretary shall, after consultation with the National
Association of Insurance Commissioners and
representatives of insurers operating in the small
group health insurance market in non-adopting States,
promulgate special transition standards with respect to
independent rating classes for old and new business, to
the extent reasonably necessary to protect health
insurance consumers and to ensure a stable and fair
transition for old and new market entrants.
``(B) Period for operation of independent rating
classes.--In developing the special transition
standards pursuant to subparagraph (A), the Secretary
shall permit a carrier in a non-adopting State, at its
option, to maintain independent rating classes for old
and new business for a period of up to 5 years, with
the commencement of such 5-year period to begin at such
time, but not later than the date that is 3 years after
the date of enactment of this title, as the carrier
offers a book of business meeting the minimum standards
for premium variation provided for in subsection (a)(1)
or the transitional small group rating rules under
paragraph (1).
``(4) Other transitional authority.--In developing the
transitional small group rating rules under paragraph (1), the
Secretary shall provide for the application of the transitional
small group rating rules in transition States as the Secretary
may determine necessary for a an effective transition.
``(c) Market Re-Entry.--
``(1) In general.--Notwithstanding any other provision of
law, a health insurance issuer that has voluntarily withdrawn
from providing coverage in the small group market prior to the
date of enactment of this title shall not be excluded from re-
entering such market on a date that is more than 180 days after
such date of enactment.
``(2) Termination.--The provision of this subsection shall
terminate on the date that is 24 months after the date of
enactment of this title.
``SEC. 3113. APPLICATION AND PREEMPTION.
``(a) Superseding of State Law.--
``(1) In general.--This part shall supersede any and all
State laws of a non-adopting State insofar as such State laws
(whether enacted prior to or after the date of enactment of
this subtitle) relate to rating in the small group insurance
market as applied to an eligible insurer, or small group health
insurance coverage issued by an eligible insurer, including
with respect to coverage issued to a small employer through a
small business health plan, in a State.
``(2) Nonadopting states.--This part shall supersede any
and all State laws of a nonadopting State insofar as such State
laws (whether enacted prior to or after the date of enactment
of this subtitle)--
``(A) prohibit an eligible insurer from offering,
marketing, or implementing small group health insurance
coverage consistent with the Model Small Group Rating
Rules or transitional model small group rating rules;
or
``(B) have the effect of retaliating against or
otherwise punishing in any respect an eligible insurer
for offering, marketing, or implementing small group
health insurance coverage consistent with the Model
Small Group Rating Rules or transitional model small
group rating rules.
``(b) Savings Clause and Construction.--
``(1) Nonapplication to adopting states.--Subsection (a)
shall not apply with respect to adopting states.
``(2) Nonapplication to certain insurers.--Subsection (a)
shall not apply with respect to insurers that do not qualify as
eligible insurers that offer small group health insurance
coverage in a nonadopting State.
``(3) Nonapplication where obtaining relief under state
law.--Subsection (a)(1) shall not supercede any State law in a
nonadopting State to the extent necessary to permit individuals
or the insurance department of the State (or other State
agency) to obtain relief under State law to require an eligible
insurer to comply with the Model Small Group Rating Rules or
transitional model small group rating rules.
``(4) No effect on preemption.--In no case shall this part
be construed to limit or affect in any manner the preemptive
scope of sections 502 and 514 of the Employee Retirement Income
Security Act of 1974. In no case shall this part be construed
to create any cause of action under Federal or State law or
enlarge or affect any remedy available under the Employee
Retirement Income Security Act of 1974.
``(5) Preemption limited to rating.--Subsection (a) shall
not preempt any State law that does not have a reference to or
a connection with State rating rules that would otherwise apply
to eligible insurers.
``(c) Effective Date.--This section shall apply, at the election of
the eligible insurer, beginning in the first plan year or the first
calendar year following the issuance of the final rules by the
Secretary under the Model Small Group Rating Rules or, as applicable,
the Transitional Model Small Group Rating Rules, but in no event
earlier than the date that is 12 months after the date of enactment of
this title.
``SEC. 3114. CIVIL ACTIONS AND JURISDICTION.
``(a) In General.--The courts of the United States shall have
exclusive jurisdiction over civil actions involving the interpretation
of this part.
``(b) Actions.--An eligible insurer may bring an action in the
district courts of the United States for injunctive or other equitable
relief against any officials or agents of a nonadopting State in
connection with any conduct or action, or proposed conduct or action,
by such officials or agents which violates, or which would if
undertaken violate, section 3113.
``(c) Direct Filing in Court of Appeals.--At the election of the
eligible insurer, an action may be brought under subsection (b)
directly in the United States Court of Appeals for the circuit in which
the nonadopting State is located by the filing of a petition for review
in such Court.
``(d) Expedited Review.--
``(1) District court.--In the case of an action brought in
a district court of the United States under subsection (b),
such court shall complete such action, including the issuance
of a judgment, prior to the end of the 120-day period beginning
on the date on which such action is filed, unless all parties
to such proceeding agree to an extension of such period.
``(2) Court of appeals.--In the case of an action brought
directly in a United States Court of Appeal under subsection
(c), or in the case of an appeal of an action brought in a
district court under subsection (b), such Court shall complete
all action on the petition, including the issuance of a
judgment, prior to the end of the 60-day period beginning on
the date on which such petition is filed with the Court, unless
all parties to such proceeding agree to an extension of such
period.
``(e) Standard of Review.--A court in an action filed under this
section, shall render a judgment based on a review of the merits of all
questions presented in such action and shall not defer to any conduct
or action, or proposed conduct or action, of a nonadopting State.
``SEC. 3115. ONGOING REVIEW.
``Not later than 5 years after the date on which the Model Small
Group Rating Rules are issued under this part, and every 5 years
thereafter, the Secretary, in consultation with the National
Association of Insurance Commissioners, shall prepare and submit to the
appropriate committees of Congress a report that assesses the effect of
the Model Small Group Rating Rules on access, cost, and market
functioning in the small group market. Such report may, if the
Secretary, in consultation with the National Association of Insurance
Commissioners, determines such is appropriate for improving access,
costs, and market functioning, contain legislative proposals for
recommended modification to such Model Small Group Rating Rules.
``PART II--AFFORDABLE PLANS
``SEC. 3121. DEFINITIONS.
``In this part:
``(1) Adopting state.--The term `adopting State' means a
State that has enacted a law providing that small group,
individual, and large group health insurers in such State may
offer and sell products in accordance with the List of Required
Benefits and the Terms of Application as provided for in
section 3122(b).
``(2) Eligible insurer.--The term `eligible insurer' means
a health insurance issuer that is licensed in a nonadopting
State and that--
``(A) notifies the Secretary, not later than 30
days prior to the offering of coverage described in
this subparagraph, that the issuer intends to offer
health insurance coverage consistent with the List of
Required Benefits and Terms of Application in a
nonadopting State;
``(B) notifies the insurance department of a
nonadopting State (or other applicable State agency),
not later than 30 days prior to the offering of
coverage described in this subparagraph, that the
issuer intends to offer health insurance coverage in
that State consistent with the List of Required
Benefits and Terms of Application, and provides with
such notice a copy of any insurance policy that it
intends to offer in the State, its most recent annual
and quarterly financial reports, and any other
information required to be filed with the insurance
department of the State (or other State agency) by the
Secretary in regulations; and
``(C) includes in the terms of the health insurance
coverage offered in nonadopting States (including in
the terms of any individual certificates that may be
offered to individuals in connection with such group
health coverage) and filed with the State pursuant to
subparagraph (B), a description in the insurer's
contract of the List of Required Benefits and a
description of the Terms of Application, including a
description of the benefits to be provided, and that
adherence to such standards is included as a term of
such contract.
``(3) Health insurance coverage.--The term `health
insurance coverage' means any coverage issued in the small
group, individual, or large group health insurance markets,
including with respect to small business health plans, except
that such term shall not include excepted benefits (as defined
in section 2791(c)).
``(4) List of required benefits.--The term `List of
Required Benefits' means the List issued under section 3122(a).
``(5) Nonadopting state.--The term `nonadopting State'
means a State that is not an adopting State.
``(6) State law.--The term `State law' means all laws,
decisions, rules, regulations, or other State actions
(including actions by a State agency) having the effect of law,
of any State.
``(7) State provider freedom of choice law.--The term
`State Provider Freedom of Choice Law' means a State law
requiring that a health insurance issuer, with respect to
health insurance coverage, not discriminate with respect to
participation, reimbursement, or indemnification as to any
provider who is acting within the scope of the provider's
license or certification under applicable State law.
``(8) Terms of application.--The term `Terms of
Application' means terms provided under section 3122(a).
``SEC. 3122. OFFERING AFFORDABLE PLANS.
``(a) List of Required Benefits.--Not later than 3 months after the
date of enactment of this title, the Secretary, in consultation with
the National Association of Insurance Commissioners, shall issue by
interim final rule a list (to be known as the `List of Required
Benefits') of covered benefits, services, or categories of providers
that are required to be provided by health insurance issuers, in each
of the small group, individual, and large group markets, in at least 26
States as a result of the application of State covered benefit,
service, and category of provider mandate laws. With respect to plans
sold to or through small business health plans, the List of Required
Benefits applicable to the small group market shall apply.
``(b) Terms of Application.--
``(1) State with mandates.--With respect to a State that
has a covered benefit, service, or category of provider mandate
in effect that is covered under the List of Required Benefits
under subsection (a), such State mandate shall, subject to
paragraph (3) (concerning uniform application), apply to a
coverage plan or plan in, as applicable, the small group,
individual, or large group market or through a small business
health plan in such State.
``(2) States without mandates.--With respect to a State
that does not have a covered benefit, service, or category of
provider mandate in effect that is covered under the List of
Required Benefits under subsection (a), such mandate shall not
apply, as applicable, to a coverage plan or plan in the small
group, individual, or large group market or through a small
business health plan in such State.
``(3) Uniform application of laws.--
``(A) In general.--With respect to a State
described in paragraph (1), in applying a covered
benefit, service, or category of provider mandate that
is on the List of Required Benefits under subsection
(a) the State shall permit a coverage plan or plan
offered in the small group, individual, or large group
market or through a small business health plan in such
State to apply such benefit, service, or category of
provider coverage in a manner consistent with the
manner in which such coverage is applied under one of
the three most heavily subscribed national health plans
offered under the Federal Employee Health Benefits
Program under chapter 89 of title 5, United States Code
(as determined by the Secretary in consultation with
the Director of the Office of Personnel Management),
and consistent with the Publication of Benefit
Applications under subsection (c). In the event a
covered benefit, service, or category of provider
appearing in the List of Required Benefits is not
offered in one of the three most heavily subscribed
national health plans offered under the Federal
Employees Health Benefits Program, such covered
benefit, service, or category of provider requirement
shall be applied in a manner consistent with the manner
in which such coverage is offered in the remaining most
heavily subscribed plan of the remaining Federal
Employees Health Benefits Program plans, as determined
by the Secretary, in consultation with the Director of
the Office of Personnel Management.
``(B) Exception regarding state provider freedom of
choice laws.--Notwithstanding subparagraph (A), in the
event a category of provider mandate is included in the
List of Covered Benefits, any State Provider Freedom of
Choice Law (as defined in section 3121(7)) that is in
effect in any State in which such category of provider
mandate is in effect shall not be preempted, with
respect to that category of provider, by this part.
``(c) Publication of Benefit Applications.--Not later than 3 months
after the date of enactment of this title, and on the first day of
every calendar year thereafter, the Secretary, in consultation with the
Director of the Office of Personnel Management, shall publish in the
Federal Register a description of such covered benefits, services, and
categories of providers covered in that calendar year by each of the
three most heavily subscribed nationally available Federal Employee
Health Benefits Plan options which are also included on the List of
Required Benefits.
``(d) Effective Dates.--
``(1) Small business health plans.--With respect to health
insurance provided to participating employers of small business
health plans, the requirements of this part (concerning lower
cost plans) shall apply beginning on the date that is 12 months
after the date of enactment of this title.
``(2) Non-association coverage.--With respect to health
insurance provided to groups or individuals other than
participating employers of small business health plans, the
requirements of this part shall apply beginning on the date
that is 15 months after the date of enactment of this title.
``(e) Updating of List of Required Benefits.--Not later than 2
years after the date on which the list of required benefits is issued
under subsection (a), and every 2 years thereafter, the Secretary, in
consultation with the National Association of Insurance Commissioners,
shall update the list based on changes in the laws and regulations of
the States. The Secretary shall issue the updated list by regulation,
and such updated list shall be effective upon the first plan year
following the issuance of such regulation.
``SEC. 3123. APPLICATION AND PREEMPTION.
``(a) Superceding of State Law.--
``(1) In general.--This part shall supersede any and all
State laws insofar as such laws relate to mandates relating to
covered benefits, services, or categories of provider in the
health insurance market as applied to an eligible insurer, or
health insurance coverage issued by an eligible insurer,
including with respect to coverage issued to a small business
health plan, in a nonadopting State.
``(2) Nonadopting states.--This part shall supersede any
and all State laws of a nonadopting State (whether enacted
prior to or after the date of enactment of this title) insofar
as such laws--
``(A) prohibit an eligible insurer from offering,
marketing, or implementing health insurance coverage
consistent with the Benefit Choice Standards, as
provided for in section 3122(a); or
``(B) have the effect of retaliating against or
otherwise punishing in any respect an eligible insurer
for offering, marketing, or implementing health
insurance coverage consistent with the Benefit Choice
Standards.
``(b) Savings Clause and Construction.--
``(1) Nonapplication to adopting states.--Subsection (a)
shall not apply with respect to adopting States.
``(2) Nonapplication to certain insurers.--Subsection (a)
shall not apply with respect to insurers that do not qualify as
eligible insurers who offer health insurance coverage in a
nonadopting State.
``(3) Nonapplication where obtaining relief under state
law.--Subsection (a)(1) shall not supercede any State law of a
nonadopting State to the extent necessary to permit individuals
or the insurance department of the State (or other State
agency) to obtain relief under State law to require an eligible
insurer to comply with the Benefit Choice Standards.
``(4) No effect on preemption.--In no case shall this part
be construed to limit or affect in any manner the preemptive
scope of sections 502 and 514 of the Employee Retirement Income
Security Act of 1974. In no case shall this part be construed
to create any cause of action under Federal or State law or
enlarge or affect any remedy available under the Employee
Retirement Income Security Act of 1974.
``(5) Preemption limited to benefits.--Subsection (a) shall
not preempt any State law that does not have a reference to or
a connection with State mandates regarding covered benefits,
services, or categories of providers that would otherwise apply
to eligible insurers.
``SEC. 3124. CIVIL ACTIONS AND JURISDICTION.
``(a) In General.--The courts of the United States shall have
exclusive jurisdiction over civil actions involving the interpretation
of this part.
``(b) Actions.--An eligible insurer may bring an action in the
district courts of the United States for injunctive or other equitable
relief against any officials or agents of a nonadopting State in
connection with any conduct or action, or proposed conduct or action,
by such officials or agents which violates, or which would if
undertaken violate, section 3123.
``(c) Direct Filing in Court of Appeals.--At the election of the
eligible insurer, an action may be brought under subsection (b)
directly in the United States Court of Appeals for the circuit in which
the nonadopting State is located by the filing of a petition for review
in such Court.
``(d) Expedited Review.--
``(1) District court.--In the case of an action brought in
a district court of the United States under subsection (b),
such court shall complete such action, including the issuance
of a judgment, prior to the end of the 120-day period beginning
on the date on which such action is filed, unless all parties
to such proceeding agree to an extension of such period.
``(2) Court of appeals.--In the case of an action brought
directly in a United States Court of Appeal under subsection
(c), or in the case of an appeal of an action brought in a
district court under subsection (b), such Court shall complete
all action on the petition, including the issuance of a
judgment, prior to the end of the 60-day period beginning on
the date on which such petition is filed with the Court, unless
all parties to such proceeding agree to an extension of such
period.
``(e) Standard of Review.--A court in an action filed under this
section, shall render a judgment based on a review of the merits of all
questions presented in such action and shall not defer to any conduct
or action, or proposed conduct or action, of a nonadopting State.
``SEC. 3125. RULES OF CONSTRUCTION.
``(a) In General.--Notwithstanding any other provision of Federal
or State law, a health insurance issuer in an adopting State or an
eligible insurer in a non-adopting State may amend its existing
policies to be consistent with the terms of this subtitle (concerning
rating and benefits).
``(b) Health Savings Accounts.--Nothing in this subtitle shall be
construed to create any mandates for coverage of benefits for HSA-
qualified health plans that would require reimbursements in violation
of section 223(c)(2) of the Internal Revenue Code of 1986.''.
TITLE II--TARGETED EFFORTS TO EXPAND ACCESS
SEC. 211. EXTENDING COVERAGE OF DEPENDENTS.
(a) Employee Retirement Income Security Act of 1974.--
(1) In general.--Part 7 of subtitle B of title I of the
Employee Retirement Income Security Act of 1974 is amended by
inserting after section 714 the following new section:
``SEC. 715. EXTENDING COVERAGE OF DEPENDENTS.
``(a) In General.--In the case of a group health plan, or health
insurance coverage offered in connection with a group health plan, that
treats as a beneficiary under the plan an individual who is a dependent
child of a participant or beneficiary under the plan, the plan or
coverage shall continue to treat the individual as a dependent child
without regard to the individual's age until the individual turns 26
years of age.
``(b) Construction.--Nothing in this section shall be construed as
requiring a group health plan to provide benefits for dependent
children as beneficiaries under the plan or to require a participant to
elect coverage of dependent children.''.
(2) Clerical amendment.--The table of contents of such Act
is amended by inserting after the item relating to section 714
the following new item:
``Sec. 715. Extending coverage of dependents.''.
(b) PHSA.--Title XXVII of the Public Health Service Act, as
restored by section 2, is amended by inserting after section 2707 the
following new section:
``SEC. 2708. EXTENDING COVERAGE OF DEPENDENTS.
``(a) In General.--In the case of a group health plan, or health
insurance coverage offered in connection with a group health plan, that
treats as a beneficiary under the plan an individual who is a dependent
child of a participant or beneficiary under the plan, the plan or
coverage shall continue to treat the individual as a dependent child
without regard to the individual's age until the individual turns 26
years of age.
``(b) Construction.--Nothing in this section shall be construed as
requiring a group health plan to provide benefits for dependent
children as beneficiaries under the plan or to require a participant to
elect coverage of dependent children.''.
(c) IRC.--
(1) In general.--Subchapter B of chapter 100 of the
Internal Revenue Code of 1986 is amended by adding at the end
the following new section:
``SEC. 9814. EXTENDING COVERAGE OF DEPENDENTS.
``(a) In General.--In the case of a group health plan that treats
as a beneficiary under the plan an individual who is a dependent child
of a participant or beneficiary under the plan, the plan shall continue
to treat the individual as a dependent child without regard to the
individual's age until the individual turns 26 years of age.
``(b) Construction.--Nothing in this section shall be construed as
requiring a group health plan to provide coverage for dependent
children as beneficiaries under the plan or to require a participant to
elect coverage of dependent children.''.
(2) Clerical amendment.--The table of sections in such
subchapter is amended by adding at the end the following new
item:
``Sec. 9814. Extending coverage of dependents.''.
(d) Effective Date.--The amendments made by subsections (a), (b),
and (c) shall apply to group health plans for plan years beginning more
than 3 months after the date of the enactment of this Act and shall
apply to individuals who are dependent children under a group health
plan, or health insurance coverage offered in connection with such a
plan, on or after such date.
(e) Adult Dependents.--
(1) Exclusion of amounts expended for medical care.--The
first sentence of section 105(b) of the Internal Revenue Code
of 1986 (relating to amounts expended for medical care) is
amended--
(A) by striking ``and his dependents'' and
inserting ``his dependents''; and
(B) by inserting before the period the following:
``, and any child (as defined in section 152(f)(1)) of
the taxpayer who as of the end of the taxable year has
not attained age 27''.
(2) Self-employed health insurance deduction.--Section
162(l)(1) of such Code is amended to read as follows:
``(1) Allowance of deduction.--In the case of a taxpayer
who is an employee within the meaning of section 401(c)(1),
there shall be allowed as a deduction under this section an
amount equal to the amount paid during the taxable year for
insurance which constitutes medical care for
``(A) the taxpayer,
``(B) the taxpayer's spouse,
``(C) the taxpayer's dependents, and
``(D) any child (as defined in section 152(f)(1))
of the taxpayer who as of the end of the taxable year
has not attained age 27.''.
(3) Coverage under self-employed deduction.--Section
162(l)(2)(B) of such Code is amended by inserting ``, or any
dependent, or individual described in subparagraph (D) of
paragraph (1) with respect to,'' after ``spouse of''.
(4) Sick and accident benefits provided to members of a
voluntary employees' beneficiary association and their
dependents.--Section 501(c)(9) of such Code is amended by
adding at the end the following new sentence: ``For purposes of
providing for the payment of sick and accident benefits to
members of such an association and their dependents, the term
`dependent' shall include any individual who is a child (as
defined in section 152(f)(1)) of a member who as of the end of
the calendar year has not attained age 27.''.
(5) Medical and other benefits for retired employees.--
Section 401(h) of such Code is amended by adding at the end the
following: ``For purposes of this subsection, the term
`dependent' shall include any individual who is a child (as
defined in section 152(f)(1)) of a retired employee who as of
the end of the calendar year has not attained age 27.''.
SEC. 212. PROHIBITING PREEXISTING CONDITION EXCLUSIONS FOR ENROLLEES
UNDER AGE 19.
(a) PHSA.--Section 2701(a) of the Public Health Service Act (42
U.S.C. 300gg(a)), as restored by section 2, is amended--
(1) in the matter preceding paragraph (1), by inserting
``and the last sentence of this subsection'' after ``subsection
(d)''; and
(2) by adding at the end the following new sentence:
``In the case of a participant or beneficiary who is under 19 years of
age, 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.''.
(b) ERISA.--Section 701(a) of the Employee Retirement Income
Security Act of 1974, as restored by section 2, is amended--
(1) in the matter preceding paragraph (1), by inserting
``and the last sentence of this subsection'' after ``subsection
(d)''; and
(2) by adding at the end the following new sentence:
``In the case of a participant or beneficiary who is under 19 years of
age, 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.''.
(c) IRC.--Section 9801 of the Internal Revenue Code of 1986, as
restored by section 2, is amended--
(1) in the matter preceding paragraph (1), by inserting
``and the last sentence of this subsection'' after ``subsection
(d)''; and
(2) by adding at the end the following new sentence:
``In the case of a participant or beneficiary who is under 19 years of
age, a group health plan may not impose any preexisting condition
exclusion with respect to such plan.''.
SEC. 213. HEALTH PLAN FINDERS.
(a) State Plan Finders.--Not later than 12 months after the date of
the enactment of this Act, each State may contract with a private
entity to develop and operate a plan finder website (referred to in
this section as a ``State plan finder'') which shall provide
information to individuals in such State on plans of health insurance
coverage that are available to individuals in such State (in this
section referred to as a ``health insurance plan'') . Such State may
not operate a plan finder itself.
(b) Multi-State Plan Finders.--
(1) In general.--A private entity may operate a multi-State
finder that operates under this section in the States involved
in the same manner as a State plan finder would operate in a
single State.
(2) Sharing of information.--States shall regulate the
manner in which data is shared between plan finders to ensure
consistency and accuracy in the information about health
insurance plans contained in such finders.
(c) Requirements for Plan Finders.--Each plan finder shall meet the
following requirements:
(1) The plan finder shall ensure that each health insurance
plan in the plan finder meets the requirements for such plans
under subsection (d).
(2) The plan finder shall present complete information on
the costs and benefits of health insurance plans (including
information on monthly premium, copayments, and deductibles) in
a uniform manner that--
(A) uses the standard definitions developed under
paragraph (3); and
(B) is designed to allow consumers to easily
compare such plans.
(3) The plan finder shall be available on the Internet and
accessible to all individuals in the State or, in the case of a
multi-State plan finder, in all States covered by the multi-
State plan finder.
(4) The plan finder shall allow consumers to search and
sort data on the health insurance plans in the plan finder on
criteria such as coverage of specific benefits (such as
coverage of disease management services or pediatric care
services), as well as data available on quality.
(5) The plan finder shall meet all relevant State laws and
regulations, including laws and regulations related to the
marketing of insurance products. In the case of a multi-State
plan finder, the finder shall meet such laws and regulations
for all of the States involved.
(6) The plan finder shall meet solvency, financial, and
privacy requirements established by the State or States in
which the plan finder operates or the Secretary for multi-State
finders.
(7) The plan finder and the employees of the plan finder
shall be appropriately licensed in the State or States in which
the plan finder operates, if such licensure is required by such
State or States.
(8) Notwithstanding subsection (f)(1), the plan finder
shall assist individuals who are eligible for the Medicaid
program under title XIX of the Social Security Act or State
Children's Health Insurance Program under title XXI of such Act
by including information on Medicaid options, eligibility, and
how to enroll.
(d) Requirements for Plans Participating in a Plan Finder.--
(1) In general.--Each State shall ensure that health
insurance plans participating in the State plan finder or in a
multi-State plan finder meet the requirements of paragraph (2)
(relating to adequacy of insurance coverage, consumer
protection, and financial strength).
(2) Specific requirements.--In order to participate in a
plan finder, a health insurance plan must meet all of the
following requirements, as determined by each State in which
such plan operates:
(A) The health insurance plan shall be actuarially
sound.
(B) The health insurance plan may not have a
history of abusive policy rescissions.
(C) The health insurance plan shall meet financial
and solvency requirements.
(D) The health insurance plan shall disclose--
(i) all financial arrangements involving
the sale and purchase of health insurance, such
as the payment of fees and commissions; and
(ii) such arrangements may not be abusive.
(E) The health insurance plan shall maintain
electronic health records that comply with the
requirements of the American Recovery and Reinvestment
Act of 2009 (Public Law 111-5) related to electronic
health records.
(F) The health insurance plan shall make available
to plan enrollees via the finder, whether by
information provided to the finder or by a website link
directing the enrollee from the finder to the health
insurance plan website, data that includes the price
and cost to the individual of services offered by a
provider according to the terms and conditions of the
health plan. Data described in this paragraph is not
made public by the finder, only made available to the
individual once enrolled in the health plan.
(e) Prohibitions.--
(1) Direct enrollment.--The State plan finder may not
directly enroll individuals in health insurance plans.
(2) Conflicts of interest.--
(A) Companies.--A health insurance issuer offering
a health insurance plan through a plan finder may not--
(i) be the private entity developing and
maintaining a plan finder under subsections (a)
and (b); or
(ii) have an ownership interest in such
private entity or in the plan finder.
(B) Individuals.--An individual employed by a
health insurance issuer offering a health insurance
plan through a plan finder may not serve as a director
or officer for--
(i) the private entity developing and
maintaining a plan finder under subsections (a)
and (b); or
(ii) the plan finder.
(f) Construction.--Nothing in this section shall be construed to
allow the Secretary authority to regulate benefit packages or to
prohibit health insurance brokers and agents from--
(1) utilizing the plan finder for any purpose; or
(2) marketing or offering health insurance products.
(g) Plan Finder Defined.--For purposes of this section, the term
``plan finder'' means a State plan finder under subsection (a) or a
multi-State plan finder under subsection (b).
(h) State Defined.--In this section, the term ``State'' has the
meaning given such term for purposes of title XIX of the Social
Security Act.
TITLE III--EXPANDING CHOICES BY ALLOWING AMERICANS TO BUY HEALTH CARE
COVERAGE ACROSS STATE LINES
SEC. 221. INTERSTATE PURCHASING OF HEALTH INSURANCE.
(a) In General.--Title XXVII of the Public Health Service Act (42
U.S.C. 300gg et seq.), as restored by section 2, is amended by adding
at the end the following new part:
``PART D--COOPERATIVE GOVERNING OF INDIVIDUAL HEALTH INSURANCE COVERAGE
``SEC. 2795. DEFINITIONS.
``In this part:
``(1) Primary state.--The term `primary State' means, with
respect to individual health insurance coverage offered by a
health insurance issuer, the State designated by the issuer as
the State whose covered laws shall govern the health insurance
issuer in the sale of such coverage under this part. An issuer,
with respect to a particular policy, may only designate one
such State as its primary State with respect to all such
coverage it offers. Such an issuer may not change the
designated primary State with respect to individual health
insurance coverage once the policy is issued, except that such
a change may be made upon renewal of the policy. With respect
to such designated State, the issuer is deemed to be doing
business in that State.
``(2) Secondary state.--The term `secondary State' means,
with respect to individual health insurance coverage offered by
a health insurance issuer, any State that is not the primary
State. In the case of a health insurance issuer that is selling
a policy in, or to a resident of, a secondary State, the issuer
is deemed to be doing business in that secondary State.
``(3) Health insurance issuer.--The term `health insurance
issuer' has the meaning given such term in section 2791(b)(2),
except that such an issuer must be licensed in the primary
State and be qualified to sell individual health insurance
coverage in that State.
``(4) Individual health insurance coverage.--The term
`individual health insurance coverage' means health insurance
coverage offered in the individual market, as defined in
section 2791(e)(1).
``(5) Applicable state authority.--The term `applicable
State authority' means, with respect to a health insurance
issuer in a State, the State insurance commissioner or official
or officials designated by the State to enforce the
requirements of this title for the State with respect to the
issuer.
``(6) Hazardous financial condition.--The term `hazardous
financial condition' means that, based on its present or
reasonably anticipated financial condition, a health insurance
issuer is unlikely to be able--
``(A) to meet obligations to policyholders with
respect to known claims and reasonably anticipated
claims; or
``(B) to pay other obligations in the normal course
of business.
``(7) Covered laws.--
``(A) In general.--The term `covered laws' means
the laws, rules, regulations, agreements, and orders
governing the insurance business pertaining to--
``(i) individual health insurance coverage
issued by a health insurance issuer;
``(ii) the offer, sale, rating (including
medical underwriting), renewal, and issuance of
individual health insurance coverage to an
individual;
``(iii) the provision to an individual in
relation to individual health insurance
coverage of health care and insurance related
services;
``(iv) the provision to an individual in
relation to individual health insurance
coverage of management, operations, and
investment activities of a health insurance
issuer; and
``(v) the provision to an individual in
relation to individual health insurance
coverage of loss control and claims
administration for a health insurance issuer
with respect to liability for which the issuer
provides insurance.
``(B) Exception.--Such term does not include any
law, rule, regulation, agreement, or order governing
the use of care or cost management techniques,
including any requirement related to provider
contracting, network access or adequacy, health care
data collection, or quality assurance.
``(8) State.--The term `State' means the 50 States and
includes the District of Columbia, Puerto Rico, the Virgin
Islands, Guam, American Samoa, and the Northern Mariana
Islands.
``(9) Unfair claims settlement practices.--The term `unfair
claims settlement practices' means only the following
practices:
``(A) Knowingly misrepresenting to claimants and
insured individuals relevant facts or policy provisions
relating to coverage at issue.
``(B) Failing to acknowledge with reasonable
promptness pertinent communications with respect to
claims arising under policies.
``(C) Failing to adopt and implement reasonable
standards for the prompt investigation and settlement
of claims arising under policies.
``(D) Failing to effectuate prompt, fair, and
equitable settlement of claims submitted in which
liability has become reasonably clear.
``(E) Refusing to pay claims without conducting a
reasonable investigation.
``(F) Failing to affirm or deny coverage of claims
within a reasonable period of time after having
completed an investigation related to those claims.
``(G) A pattern or practice of compelling insured
individuals or their beneficiaries to institute suits
to recover amounts due under its policies by offering
substantially less than the amounts ultimately
recovered in suits brought by them.
``(H) A pattern or practice of attempting to settle
or settling claims for less than the amount that a
reasonable person would believe the insured individual
or his or her beneficiary was entitled by reference to
written or printed advertising material accompanying or
made part of an application.
``(I) Attempting to settle or settling claims on
the basis of an application that was materially altered
without notice to, or knowledge or consent of, the
insured.
``(J) Failing to provide forms necessary to present
claims within 15 calendar days of a requests with
reasonable explanations regarding their use.
``(K) Attempting to cancel a policy in less time
than that prescribed in the policy or by the law of the
primary State.
``(10) Fraud and abuse.--The term `fraud and abuse' means
an act or omission committed by a person who, knowingly and
with intent to defraud, commits, or conceals any material
information concerning, one or more of the following:
``(A) Presenting, causing to be presented or
preparing with knowledge or belief that it will be
presented to or by an insurer, a reinsurer, broker or
its agent, false information as part of, in support of
or concerning a fact material to one or more of the
following:
``(i) An application for the issuance or
renewal of an insurance policy or reinsurance
contract.
``(ii) The rating of an insurance policy or
reinsurance contract.
``(iii) A claim for payment or benefit
pursuant to an insurance policy or reinsurance
contract.
``(iv) Premiums paid on an insurance policy
or reinsurance contract.
``(v) Payments made in accordance with the
terms of an insurance policy or reinsurance
contract.
``(vi) A document filed with the
commissioner or the chief insurance regulatory
official of another jurisdiction.
``(vii) The financial condition of an
insurer or reinsurer.
``(viii) The formation, acquisition,
merger, reconsolidation, dissolution or
withdrawal from one or more lines of insurance
or reinsurance in all or part of a State by an
insurer or reinsurer.
``(ix) The issuance of written evidence of
insurance.
``(x) The reinstatement of an insurance
policy.
``(B) Solicitation or acceptance of new or renewal
insurance risks on behalf of an insurer reinsurer or
other person engaged in the business of insurance by a
person who knows or should know that the insurer or
other person responsible for the risk is insolvent at
the time of the transaction.
``(C) Transaction of the business of insurance in
violation of laws requiring a license, certificate of
authority or other legal authority for the transaction
of the business of insurance.
``(D) Attempt to commit, aiding or abetting in the
commission of, or conspiracy to commit the acts or
omissions specified in this paragraph.
``SEC. 2796. APPLICATION OF LAW.
``(a) In General.--The covered laws of the primary State shall
apply to individual health insurance coverage offered by a health
insurance issuer in the primary State and in any secondary State, but
only if the coverage and issuer comply with the conditions of this
section with respect to the offering of coverage in any secondary
State.
``(b) Exemptions From Covered Laws in a Secondary State.--Except as
provided in this section, a health insurance issuer with respect to its
offer, sale, rating (including medical underwriting), renewal, and
issuance of individual health insurance coverage in any secondary State
is exempt from any covered laws of the secondary State (and any rules,
regulations, agreements, or orders sought or issued by such State under
or related to such covered laws) to the extent that such laws would--
``(1) make unlawful, or regulate, directly or indirectly,
the operation of the health insurance issuer operating in the
secondary State, except that any secondary State may require
such an issuer--
``(A) to pay, on a nondiscriminatory basis,
applicable premium and other taxes (including high risk
pool assessments) which are levied on insurers and
surplus lines insurers, brokers, or policyholders under
the laws of the State;
``(B) to register with and designate the State
insurance commissioner as its agent solely for the
purpose of receiving service of legal documents or
process;
``(C) to submit to an examination of its financial
condition by the State insurance commissioner in any
State in which the issuer is doing business to
determine the issuer's financial condition, if--
``(i) the State insurance commissioner of
the primary State has not done an examination
within the period recommended by the National
Association of Insurance Commissioners; and
``(ii) any such examination is conducted in
accordance with the examiners' handbook of the
National Association of Insurance Commissioners
and is coordinated to avoid unjustified
duplication and unjustified repetition;
``(D) to comply with a lawful order issued--
``(i) in a delinquency proceeding commenced
by the State insurance commissioner if there
has been a finding of financial impairment
under subparagraph (C); or
``(ii) in a voluntary dissolution
proceeding;
``(E) to comply with an injunction issued by a
court of competent jurisdiction, upon a petition by the
State insurance commissioner alleging that the issuer
is in hazardous financial condition;
``(F) to participate, on a nondiscriminatory basis,
in any insurance insolvency guaranty association or
similar association to which a health insurance issuer
in the State is required to belong;
``(G) to comply with any State law regarding fraud
and abuse (as defined in section 2795(10)), except that
if the State seeks an injunction regarding the conduct
described in this subparagraph, such injunction must be
obtained from a court of competent jurisdiction;
``(H) to comply with any State law regarding unfair
claims settlement practices (as defined in section
2795(9)); or
``(I) to comply with the applicable requirements
for independent review under section 2798 with respect
to coverage offered in the State;
``(2) require any individual health insurance coverage
issued by the issuer to be countersigned by an insurance agent
or broker residing in that Secondary State; or
``(3) otherwise discriminate against the issuer issuing
insurance in both the primary State and in any secondary State.
``(c) Clear and Conspicuous Disclosure.--A health insurance issuer
shall provide the following notice, in 12-point bold type, in any
insurance coverage offered in a secondary State under this part by such
a health insurance issuer and at renewal of the policy, with the 5
blank spaces therein being appropriately filled with the name of the
health insurance issuer, the name of primary State, the name of the
secondary State, the name of the secondary State, and the name of the
secondary State, respectively, for the coverage concerned:
THIS POLICY IS ISSUED BY _____ AND IS GOVERNED BY THE LAWS AND
REGULATIONS OF THE STATE OF _____, AND IT HAS MET ALL THE LAWS OF THAT
STATE AS DETERMINED BY THAT STATE'S DEPARTMENT OF INSURANCE. THIS
POLICY MAY BE LESS EXPENSIVE THAN OTHERS BECAUSE IT IS NOT SUBJECT TO
ALL OF THE INSURANCE LAWS AND REGULATIONS OF THE STATE OF _____,
INCLUDING COVERAGE OF SOME SERVICES OR BENEFITS MANDATED BY THE LAW OF
THE STATE OF _____. ADDITIONALLY, THIS POLICY IS NOT SUBJECT TO ALL OF
THE CONSUMER PROTECTION LAWS OR RESTRICTIONS ON RATE CHANGES OF THE
STATE OF _____. AS WITH ALL INSURANCE PRODUCTS, BEFORE PURCHASING THIS
POLICY, YOU SHOULD CAREFULLY REVIEW THE POLICY AND DETERMINE WHAT
HEALTH CARE SERVICES THE POLICY COVERS AND WHAT BENEFITS IT PROVIDES,
INCLUDING ANY EXCLUSIONS, LIMITATIONS, OR CONDITIONS FOR SUCH SERVICES
OR BENEFITS.''.
``(d) Prohibition on Certain Reclassifications and Premium
Increases.--
``(1) In general.--For purposes of this section, a health
insurance issuer that provides individual health insurance
coverage to an individual under this part in a primary or
secondary State may not upon renewal--
``(A) move or reclassify the individual insured
under the health insurance coverage from the class such
individual is in at the time of issue of the contract
based on the health-status related factors of the
individual; or
``(B) increase the premiums assessed the individual
for such coverage based on a health status-related
factor or change of a health status-related factor or
the past or prospective claim experience of the insured
individual.
``(2) Construction.--Nothing in paragraph (1) shall be
construed to prohibit a health insurance issuer--
``(A) from terminating or discontinuing coverage or
a class of coverage in accordance with subsections (b)
and (c) of section 2742;
``(B) from raising premium rates for all policy
holders within a class based on claims experience;
``(C) from changing premiums or offering discounted
premiums to individuals who engage in wellness
activities at intervals prescribed by the issuer, if
such premium changes or incentives--
``(i) are disclosed to the consumer in the
insurance contract;
``(ii) are based on specific wellness
activities that are not applicable to all
individuals; and
``(iii) are not obtainable by all
individuals to whom coverage is offered;
``(D) from reinstating lapsed coverage; or
``(E) from retroactively adjusting the rates
charged an insured individual if the initial rates were
set based on material misrepresentation by the
individual at the time of issue.
``(e) Prior Offering of Policy in Primary State.--A health
insurance issuer may not offer for sale individual health insurance
coverage in a secondary State unless that coverage is currently offered
for sale in the primary State.
``(f) Licensing of Agents or Brokers for Health Insurance
Issuers.--Any State may require that a person acting, or offering to
act, as an agent or broker for a health insurance issuer with respect
to the offering of individual health insurance coverage obtain a
license from that State, with commissions or other compensation subject
to the provisions of the laws of that State, except that a State may
not impose any qualification or requirement which discriminates against
a nonresident agent or broker.
``(g) Documents for Submission to State Insurance Commissioner.--
Each health insurance issuer issuing individual health insurance
coverage in both primary and secondary States shall submit--
``(1) to the insurance commissioner of each State in which
it intends to offer such coverage, before it may offer
individual health insurance coverage in such State--
``(A) a copy of the plan of operation or
feasibility study or any similar statement of the
policy being offered and its coverage (which shall
include the name of its primary State and its principal
place of business);
``(B) written notice of any change in its
designation of its primary State; and
``(C) written notice from the issuer of the
issuer's compliance with all the laws of the primary
State; and
``(2) to the insurance commissioner of each secondary State
in which it offers individual health insurance coverage, a copy
of the issuer's quarterly financial statement submitted to the
primary State, which statement shall be certified by an
independent public accountant and contain a statement of
opinion on loss and loss adjustment expense reserves made by--
``(A) a member of the American Academy of
Actuaries; or
``(B) a qualified loss reserve specialist.
``(h) Power of Courts To Enjoin Conduct.--Nothing in this section
shall be construed to affect the authority of any Federal or State
court to enjoin--
``(1) the solicitation or sale of individual health
insurance coverage by a health insurance issuer to any person
or group who is not eligible for such insurance; or
``(2) the solicitation or sale of individual health
insurance coverage that violates the requirements of the law of
a secondary State which are described in subparagraphs (A)
through (H) of section 2796(b)(1).
``(i) Power of Secondary States To Take Administrative Action.--
Nothing in this section shall be construed to affect the authority of
any State to enjoin conduct in violation of that State's laws described
in section 2796(b)(1).
``(j) State Powers To Enforce State Laws.--
``(1) In general.--Subject to the provisions of subsection
(b)(1)(G) (relating to injunctions) and paragraph (2), nothing
in this section shall be construed to affect the authority of
any State to make use of any of its powers to enforce the laws
of such State with respect to which a health insurance issuer
is not exempt under subsection (b).
``(2) Courts of competent jurisdiction.--If a State seeks
an injunction regarding the conduct described in paragraphs (1)
and (2) of subsection (h), such injunction must be obtained
from a Federal or State court of competent jurisdiction.
``(k) States' Authority To Sue.--Nothing in this section shall
affect the authority of any State to bring action in any Federal or
State court.
``(l) Generally Applicable Laws.--Nothing in this section shall be
construed to affect the applicability of State laws generally
applicable to persons or corporations.
``(m) Guaranteed Availability of Coverage to HIPAA Eligible
Individuals.--To the extent that a health insurance issuer is offering
coverage in a primary State that does not accommodate residents of
secondary States or does not provide a working mechanism for residents
of a secondary State, and the issuer is offering coverage under this
part in such secondary State which has not adopted a qualified high
risk pool as its acceptable alternative mechanism (as defined in
section 2744(c)(2)), the issuer shall, with respect to any individual
health insurance coverage offered in a secondary State under this part,
comply with the guaranteed availability requirements for eligible
individuals in section 2741.
``SEC. 2797. PRIMARY STATE MUST MEET FEDERAL FLOOR BEFORE ISSUER MAY
SELL INTO SECONDARY STATES.
``A health insurance issuer may not offer, sell, or issue
individual health insurance coverage in a secondary State if the State
insurance commissioner does not use a risk-based capital formula for
the determination of capital and surplus requirements for all health
insurance issuers.
``SEC. 2798. INDEPENDENT EXTERNAL APPEALS PROCEDURES.
``(a) Right to External Appeal.--A health insurance issuer may not
offer, sell, or issue individual health insurance coverage in a
secondary State under the provisions of this title unless--
``(1) both the secondary State and the primary State have
legislation or regulations in place establishing an independent
review process for individuals who are covered by individual
health insurance coverage, or
``(2) in any case in which the requirements of subparagraph
(A) are not met with respect to the either of such States, the
issuer provides an independent review mechanism substantially
identical (as determined by the applicable State authority of
such State) to that prescribed in the `Health Carrier External
Review Model Act' of the National Association of Insurance
Commissioners for all individuals who purchase insurance
coverage under the terms of this part, except that, under such
mechanism, the review is conducted by an independent medical
reviewer, or a panel of such reviewers, with respect to whom
the requirements of subsection (b) are met.
``(b) Qualifications of Independent Medical Reviewers.--In the case
of any independent review mechanism referred to in subsection (a)(2)--
``(1) In general.--In referring a denial of a claim to an
independent medical reviewer, or to any panel of such
reviewers, to conduct independent medical review, the issuer
shall ensure that--
``(A) each independent medical reviewer meets the
qualifications described in paragraphs (2) and (3);
``(B) with respect to each review, each reviewer
meets the requirements of paragraph (4) and the
reviewer, or at least 1 reviewer on the panel, meets
the requirements described in paragraph (5); and
``(C) compensation provided by the issuer to each
reviewer is consistent with paragraph (6).
``(2) Licensure and expertise.--Each independent medical
reviewer shall be a physician (allopathic or osteopathic) or
health care professional who--
``(A) is appropriately credentialed or licensed in
1 or more States to deliver health care services; and
``(B) typically treats the condition, makes the
diagnosis, or provides the type of treatment under
review.
``(3) Independence.--
``(A) In general.--Subject to subparagraph (B),
each independent medical reviewer in a case shall--
``(i) not be a related party (as defined in
paragraph (7));
``(ii) not have a material familial,
financial, or professional relationship with
such a party; and
``(iii) not otherwise have a conflict of
interest with such a party (as determined under
regulations).
``(B) Exception.--Nothing in subparagraph (A) shall
be construed to--
``(i) prohibit an individual, solely on the
basis of affiliation with the issuer, from
serving as an independent medical reviewer if--
``(I) a non-affiliated individual
is not reasonably available;
``(II) the affiliated individual is
not involved in the provision of items
or services in the case under review;
``(III) the fact of such an
affiliation is disclosed to the issuer
and the enrollee (or authorized
representative) and neither party
objects; and
``(IV) the affiliated individual is
not an employee of the issuer and does
not provide services exclusively or
primarily to or on behalf of the
issuer;
``(ii) prohibit an individual who has staff
privileges at the institution where the
treatment involved takes place from serving as
an independent medical reviewer merely on the
basis of such affiliation if the affiliation is
disclosed to the issuer and the enrollee (or
authorized representative), and neither party
objects; or
``(iii) prohibit receipt of compensation by
an independent medical reviewer from an entity
if the compensation is provided consistent with
paragraph (6).
``(4) Practicing health care professional in same field.--
``(A) In general.--In a case involving treatment,
or the provision of items or services--
``(i) by a physician, a reviewer shall be a
practicing physician (allopathic or
osteopathic) of the same or similar specialty,
as a physician who, acting within the
appropriate scope of practice within the State
in which the service is provided or rendered,
typically treats the condition, makes the
diagnosis, or provides the type of treatment
under review; or
``(ii) by a non-physician health care
professional, the reviewer, or at least 1
member of the review panel, shall be a
practicing non-physician health care
professional of the same or similar specialty
as the non-physician health care professional
who, acting within the appropriate scope of
practice within the State in which the service
is provided or rendered, typically treats the
condition, makes the diagnosis, or provides the
type of treatment under review.
``(B) Practicing defined.--For purposes of this
paragraph, the term `practicing' means, with respect to
an individual who is a physician or other health care
professional, that the individual provides health care
services to individual patients on average at least 2
days per week.
``(5) Pediatric expertise.--In the case of an external
review relating to a child, a reviewer shall have expertise
under paragraph (2) in pediatrics.
``(6) Limitations on reviewer compensation.--Compensation
provided by the issuer to an independent medical reviewer in
connection with a review under this section shall--
``(A) not exceed a reasonable level; and
``(B) not be contingent on the decision rendered by
the reviewer.
``(7) Related party defined.--For purposes of this section,
the term `related party' means, with respect to a denial of a
claim under a coverage relating to an enrollee, any of the
following:
``(A) The issuer involved, or any fiduciary,
officer, director, or employee of the issuer.
``(B) The enrollee (or authorized representative).
``(C) The health care professional that provides
the items or services involved in the denial.
``(D) The institution at which the items or
services (or treatment) involved in the denial are
provided.
``(E) The manufacturer of any drug or other item
that is included in the items or services involved in
the denial.
``(F) Any other party determined under any
regulations to have a substantial interest in the
denial involved.
``(8) Definitions.--For purposes of this subsection:
``(A) Enrollee.--The term `enrollee' means, with
respect to health insurance coverage offered by a
health insurance issuer, an individual enrolled with
the issuer to receive such coverage.
``(B) Health care professional.--The term `health
care professional' means an individual who is licensed,
accredited, or certified under State law to provide
specified health care services and who is operating
within the scope of such licensure, accreditation, or
certification.
``SEC. 2799. ENFORCEMENT.
``(a) In General.--Subject to subsection (b), with respect to
specific individual health insurance coverage the primary State for
such coverage has sole jurisdiction to enforce the primary State's
covered laws in the primary State and any secondary State.
``(b) Secondary State's Authority.--Nothing in subsection (a) shall
be construed to affect the authority of a secondary State to enforce
its laws as set forth in the exception specified in section 2796(b)(1).
``(c) Court Interpretation.--In reviewing action initiated by the
applicable secondary State authority, the court of competent
jurisdiction shall apply the covered laws of the primary State.
``(d) Notice of Compliance Failure.--In the case of individual
health insurance coverage offered in a secondary State that fails to
comply with the covered laws of the primary State, the applicable State
authority of the secondary State may notify the applicable State
authority of the primary State.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to individual health insurance coverage offered, issued, or sold
after the date that is one year after the date of the enactment of this
Act.
(c) GAO Ongoing Study and Reports.--
(1) Study.--The Comptroller General of the United States
shall conduct an ongoing study concerning the effect of the
amendment made by subsection (a) on--
(A) the number of uninsured and under-insured;
(B) the availability and cost of health insurance
policies for individuals with preexisting medical
conditions;
(C) the availability and cost of health insurance
policies generally;
(D) the elimination or reduction of different types
of benefits under health insurance policies offered in
different States; and
(E) cases of fraud or abuse relating to health
insurance coverage offered under such amendment and the
resolution of such cases.
(2) Annual reports.--The Comptroller General shall submit
to Congress an annual report, after the end of each of the 5
years following the effective date of the amendment made by
subsection (a), on the ongoing study conducted under paragraph
(1).
TITLE IV--IMPROVING HEALTH SAVINGS ACCOUNTS
SEC. 231. HSA FUNDS FOR PREMIUMS FOR HIGH DEDUCTIBLE HEALTH PLANS.
(a) In General.--Subparagraph (C) of section 223(d)(2) of the
Internal Revenue Code of 1986, as restored by section 2, is amended by
striking ``or'' at the end of clause (iii), by striking the period at
the end of clause (iv) and inserting ``, or'', and by adding at the end
the following:
``(v) a high deductible health plan if--
``(I) such plan is not offered in
connection with a group health plan,
``(II) no portion of any premium
(within the meaning of applicable
premium under section 4980B(f)(4)) for
such plan is excludable from gross
income under section 106, and
``(III) the account beneficiary
demonstrates, using procedures deemed
appropriate by the Secretary, that
after payment of the premium for such
insurance the balance in the health
savings account is at least twice the
minimum deductible in effect under
subsection (c)(2)(A)(i) which is
applicable to such plan.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to premiums for a high deductible health plan for periods
beginning after December 31, 2011.
SEC. 232. REQUIRING GREATER COORDINATION BETWEEN HDHP ADMINISTRATORS
AND HSA ACCOUNT ADMINISTRATORS SO THAT ENROLLEES CAN
ENROLL IN BOTH AT THE SAME TIME.
The Secretary of the Treasury, through the issuance of regulations
or other guidance, shall encourage administrators of health plans and
trustees of health savings accounts to provide for simultaneous
enrollment in high deductible health plans and setup of health savings
accounts.
SEC. 233. SPECIAL RULE FOR CERTAIN MEDICAL EXPENSES INCURRED BEFORE
ESTABLISHMENT OF ACCOUNT.
(a) In General.--Subsection (d) of section 223 of the Internal
Revenue Code of 1986, as restored by section 2, is amended by
redesignating paragraph (4) as paragraph (5) and by inserting after
paragraph (3) the following new paragraph:
``(4) Certain medical expenses incurred before
establishment of account treated as qualified.--
``(A) In general.--For purposes of paragraph (2),
an expense shall not fail to be treated as a qualified
medical expense solely because such expense was
incurred before the establishment of the health savings
account if such expense was incurred during the 60-day
period beginning on the date on which the high
deductible health plan is first effective.
``(B) Special rules.--For purposes of subparagraph
(A)--
``(i) an individual shall be treated as an
eligible individual for any portion of a month
for which the individual is described in
subsection (c)(1), determined without regard to
whether the individual is covered under a high
deductible health plan on the 1st day of such
month, and
``(ii) the effective date of the health
savings account is deemed to be the date on
which the high deductible health plan is first
effective after the date of the enactment of
this paragraph.''.
(b) Effective Date.--The amendment made by this section shall apply
with respect to insurance purchased after the date of the enactment of
this Act in taxable years beginning after such date.
TITLE V--TAX-RELATED HEALTH INCENTIVES
SEC. 241. SECA TAX DEDUCTION FOR HEALTH INSURANCE COSTS.
(a) In General.--Subsection (l) of section 162 of the Internal
Revenue Code of 1986 (relating to special rules for health insurance
costs of self-employed individuals) is amended by striking paragraph
(4) and by redesignating paragraph (5) as paragraph (4).
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after December 31, 2010.
SEC. 242. DEDUCTION FOR QUALIFIED HEALTH INSURANCE COSTS OF
INDIVIDUALS.
(a) In General.--Part VII of subchapter B of chapter 1 of the
Internal Revenue Code of 1986 (relating to additional itemized
deductions for individuals) is amended by redesignating section 224 as
section 225 and by inserting after section 223 the following new
section:
``SEC. 224. COSTS OF QUALIFIED HEALTH INSURANCE.
``(a) In General.--In the case of an individual, there shall be
allowed as a deduction an amount equal to the amount paid during the
taxable year for coverage for the taxpayer, his spouse, and dependents
under qualified health insurance.
``(b) Qualified Health Insurance.--For purposes of this section,
the term `qualified health insurance' means insurance which constitutes
medical care, other than insurance substantially all of the coverage of
which is of excepted benefits described in section 9832(c).
``(c) Special Rules.--
``(1) Coordination with medical deduction, etc.--Any amount
paid by a taxpayer for insurance to which subsection (a)
applies shall not be taken into account in computing the amount
allowable to the taxpayer as a deduction under section 162(l)
or 213(a). Any amount taken into account in determining the
credit allowed under section 35 shall not be taken into account
for purposes of this section.
``(2) Deduction not allowed for self-employment tax
purposes.--The deduction allowable by reason of this section
shall not be taken into account in determining an individual's
net earnings from self-employment (within the meaning of
section 1402(a)) for purposes of chapter 2.''.
(b) Deduction Allowed in Computing Adjusted Gross Income.--
Subsection (a) of section 62 of such Code is amended by inserting
before the last sentence the following new paragraph:
``(22) Costs of qualified health insurance.--The deduction
allowed by section 224.''.
(c) Clerical Amendment.--The table of sections for part VII of
subchapter B of chapter 1 of such Code is amended by redesignating the
item relating to section 224 as an item relating to section 225 and
inserting before such item the following new item:
``Sec. 224. Costs of qualified health insurance.''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2010.
DIVISION C--ENACTING REAL MEDICAL LIABILITY REFORM
SEC. 301. CAP ON NON-ECONOMIC DAMAGES AGAINST HEALTH CARE
PRACTITIONERS.
When an individual is injured or dies as the result of health care,
a person entitled to non-economic damages may not recover, from the
class of liable health care practitioners (regardless of the theory of
liability), more than $250,000 such damages.
SEC. 302. CAP ON NON-ECONOMIC DAMAGES AGAINST HEALTH CARE INSTITUTIONS.
When an individual is injured or dies as the result of health care,
a person entitled to non-economic damages may not recover--
(1) from any single liable health care institution
(regardless of the theory of liability), more than $250,000
such damages; and
(2) from the class of liable health care institutions
(regardless of the theory of liability), more than $500,000
such damages.
SEC. 303. CAP, IN WRONGFUL DEATH CASES, ON TOTAL DAMAGES AGAINST ANY
SINGLE HEALTH CARE PRACTITIONER.
(a) In General.--When an individual dies as the result of health
care, a person entitled to damages may not recover, from any single
liable health care practitioner (regardless of the theory of
liability), more than $1,400,000 in total damages.
(b) Total Damages Defined.--In this section, the term ``total
damages'' includes compensatory damages, punitive damages, statutory
damages, and any other type of damages.
(c) Adjustment for Inflation.--For each calendar year after the
calendar year of the enactment of this Act, the dollar amount referred
to in subsection (a) shall be adjusted to reflect changes in the
Consumer Price Index of the Bureau of Labor Statistics of the
Department of Labor. The adjustment shall be based on the relationship
between--
(1) the Consumer Price Index data most recently published
as of January 1 of the calendar year of the enactment of this
Act; and
(2) the Consumer Price Index data most recently published
as of January 1 of the calendar year concerned.
(d) Applicability of Adjustment.--The dollar amount that applies to
a recovery is the dollar amount for the calendar year during which the
amount of the recovery is made final.
SEC. 304. LIMITATION OF INSURER LIABILITY WHEN INSURER REJECTS CERTAIN
SETTLEMENT OFFERS.
In a civil action, to the extent the civil action seeks damages for
the injury or death of an individual as the result of health care, when
the insurer of a health care practitioner or health care institution
rejects a reasonable settlement offer within policy limits, the insurer
is not, by reason of that rejection, liable for damages in an amount
that exceeds the liability of the insured.
SEC. 305. MANDATORY JURY INSTRUCTION ON CAP ON DAMAGES.
In a civil action tried to a jury, to the extent the civil action
seeks damages for the injury or death of an individual as the result of
health care, the court shall instruct the jury that the jury is not to
consider whether, or to what extent, a limitation on damages applies.
SEC. 306. DETERMINATION OF NEGLIGENCE; MANDATORY JURY INSTRUCTION.
(a) In General.--When an individual is injured or dies as the
result of health care, liability for negligence may not be based solely
on a bad result.
(b) Mandatory Jury Instruction.--In a civil action tried to a jury,
to the extent the civil action seeks damages for the injury or death of
an individual as the result of health care and alleges liability for
negligence, the court shall instruct the jury as provided in subsection
(a).
SEC. 307. EXPERT REPORTS REQUIRED TO BE SERVED IN CIVIL ACTIONS.
(a) Service Required.--To the extent a pleading filed in a civil
action seeks damages against a health care practitioner for the injury
or death of an individual as the result of health care, the party
filing the pleading shall, not later than 120 days after the date on
which the pleading was filed, serve on each party against whom such
damages are sought a qualified expert report.
(b) Qualified Expert Report.--As used in subsection (a), a
qualified expert report is a written report of a qualified health care
expert that--
(1) includes a curriculum vitae for that expert; and
(2) sets forth a summary of the expert opinion of that
expert as to--
(A) the standard of care applicable to that
practitioner;
(B) how that practitioner failed to meet that
standard of care; and
(C) the causal relationship between that failure
and the injury or death of the individual.
(c) Motion To Enforce.--A party not served as required by
subsection (a) may move the court to enforce that subsection. On such a
motion, the court--
(1) shall dismiss, with prejudice, the pleading as it
relates to that party; and
(2) shall award to that party the attorney fees reasonably
incurred by that party to respond to that pleading.
(d) Use of Expert Report.--
(1) In general.--Except as otherwise provided in this
section, a qualified expert report served under subsection (a)
may not, in that civil action--
(A) be offered by any party as evidence;
(B) be used by any party in discovery or any other
pretrial proceeding; or
(C) be referred to by any party at trial.
(2) Violations.--
(A) By other party.--If paragraph (1) is violated
by a party other than the party who served the report,
the court shall, on motion of any party or on its own
motion, take such measures as the court considers
appropriate, which may include the imposition of
sanctions.
(B) By serving party.--If paragraph (1) is violated
by the party who served the report, paragraph (1) shall
no longer apply to any party.
SEC. 308. EXPERT OPINIONS RELATING TO PHYSICIANS MAY BE PROVIDED ONLY
BY ACTIVELY PRACTICING PHYSICIANS.
(a) In General.--A physician-related opinion may be provided only
by an actively practicing physician who is determined by the court to
be qualified on the basis of training and experience to render that
opinion.
(b) Considerations Required.--In determining whether an actively
practicing physician is qualified under subsection (a), the court
shall, except on good cause shown, consider whether that physician is
board-certified, or has other substantial training, in an area of
medical practice relevant to the health care to which the opinion
relates.
(c) Definitions.--In this section:
(1) The term ``actively practicing physician'' means an
individual who--
(A) is licensed to practice medicine in the United
States or, if the individual is a defendant providing a
physician-related opinion with respect to the health
care provided by that defendant, is a graduate of a
medical school accredited by the Liaison Committee on
Medical Education or the American Osteopathic
Association;
(B) is practicing medicine when the opinion is
rendered, or was practicing medicine when the health
care was provided; and
(C) has knowledge of the accepted standards of care
for the health care to which the opinion relates.
(2) The term ``physician-related opinion'' means an expert
opinion as to any one or more of the following:
(A) The standard of care applicable to a physician.
(B) Whether a physician failed to meet such a
standard of care.
(C) Whether there was a causal relationship between
such a failure by a physician and the injury or death
of an individual.
(3) The term ``practicing medicine'' includes training
residents or students at an accredited school of medicine or
osteopathy, and serving as a consulting physician to other
physicians who provide direct patient care.
SEC. 309. PAYMENT OF FUTURE DAMAGES ON PERIODIC OR ACCRUAL BASIS.
(a) In General.--When future damages are awarded against a health
care practitioner to a person for the injury or death of an individual
as a result of health care, and the present value of those future
damages is $100,000 or more, that health care practitioner may move
that the court order payment on a periodic or accrual basis of those
damages. On such a motion, the court--
(1) shall order that payment be made on an accrual basis of
future damages described in subsection (b)(1); and
(2) may order that payment be made on a periodic or accrual
basis of any other future damages that the court considers
appropriate.
(b) Future Damages Defined.--In this section, the term ``future
damages'' means--
(1) the future costs of medical, health care, or custodial
services;
(2) noneconomic damages, such as pain and suffering or loss
of consortium;
(3) loss of future earnings; and
(4) any other damages incurred after the award is made.
SEC. 310. UNANIMOUS JURY REQUIRED FOR PUNITIVE OR EXEMPLARY DAMAGES.
When an individual is injured or dies as the result of health care,
a jury may not award punitive or exemplary damages against a health
care practitioner or health care institution unless the jury is
unanimous with regard to both the liability of that party for such
damages and the amount of the award of such damages.
SEC. 311. PROPORTIONATE LIABILITY.
When an individual is injured or dies as the result of health care
and a person is entitled to damages for that injury or death, each
person responsible is liable only for a proportionate share of the
total damages that directly corresponds to that person's proportionate
share of the total responsibility.
SEC. 312. DEFENSE-INITIATED SETTLEMENT PROCESS.
(a) In General.--In a civil action, to the extent the civil action
seeks damages for the injury or death of an individual as the result of
health care, a health care practitioner or health care institution
against which such damages are sought may serve one or more qualified
settlement offers under this section to a person seeking such damages.
If the person seeking such damages does not accept such an offer, that
person may thereafter serve one or more qualified settlement offers
under this section to the party whose offer was not accepted.
(b) Qualified Settlement Offer.--A qualified settlement offer under
this section is an offer, in writing, to settle the matter as between
the offeror and the offeree, which--
(1) specifies that it is made under this section;
(2) states the terms of settlement; and
(3) states the deadline within which the offer must be
accepted.
(c) Effect of Offer.--If the offeree of a qualified settlement
offer does not accept that offer, and thereafter receives a judgment at
trial that, as between the offeror and the offeree, is significantly
less favorable than the terms of settlement in that offer, that offeree
is responsible for those litigation costs reasonably incurred, after
the deadline stated in the offer, by the offeror to respond to the
claims of the offeree.
(d) Litigation Costs Defined.--In this section, the term
``litigation costs'' include court costs, filing fees, expert witness
fees, attorney fees, and any other costs directly related to carrying
out the litigation.
(e) Significantly Less Favorable Defined.--For purposes of this
section, a judgment is significantly less favorable than the terms of
settlement if--
(1) in the case of an offeree seeking damages, the
offeree's award at trial is less than 80 percent of the value
of the terms of settlement; and
(2) in the case of an offeree against whom damages are
sought, the offeror's award at trial is more than 120 percent
of the value of the terms of settlement.
SEC. 313. STATUTE OF LIMITATIONS; STATUTE OF REPOSE.
(a) Statute of Limitations.--When an individual is injured or dies
as the result of health care, the statute of limitations shall be as
follows:
(1) Individuals of age 12 and over.--If the individual has
attained the age of 12 years, the claim must be brought
either--
(A) within 2 years after the negligence occurred;
or
(B) within 2 years after the health care on which
the claim is based is completed.
(2) Individuals under age 12.--If the individual has not
attained the age of 12 years, the claim must be brought before
the individual attains the age of 14 years.
(b) Statute of Repose.--When an individual is injured or dies as
the result of health care, the statute of repose shall be as follows:
The claim must be brought within 10 years after the act or omission on
which the claim is based is completed.
(c) Tolling.--
(1) Statute of limitations.--The statute of limitations
required by subsection (a) may be tolled if applicable law so
provides, except that it may not be tolled on the basis of
minority.
(2) Statute of repose.--The statute of repose required by
subsection (b) may not be tolled for any reason.
SEC. 314. LIMITATION ON LIABILITY FOR GOOD SAMARITANS PROVIDING
EMERGENCY HEALTH CARE.
(a) Willful or Wanton Negligence Required.--A health care
practitioner or health care institution that provides emergency health
care on a Good Samaritan basis is not liable for damages caused by that
care except for willful or wanton negligence or more culpable
misconduct.
(b) Good Samaritan Basis.--For purposes of this section, care is
provided on a Good Samaritan basis if it is not provided for or in
expectation of remuneration. Being entitled to remuneration is relevant
to, but is not determinative of, whether it is provided for or in
expectation of remuneration.
SEC. 315. DEFINITIONS.
In this division:
(1) Health care institution.--The term ``health care
institution'' includes institutions such as--
(A) an ambulatory surgical center;
(B) an assisted living facility;
(C) an emergency medical services provider;
(D) a home health agency;
(E) a hospice;
(F) a hospital;
(G) a hospital system;
(H) an intermediate care facility for the mentally
retarded;
(I) a nursing home; and
(J) an end stage renal disease facility.
(2) Health care practitioner.--The term ``health care
practitioner'' includes a physician and a physician entity.
(3) Physician entity.--The term ``physician entity''
includes--
(A) a partnership or limited liability partnership
created by a group of physicians;
(B) a company created by physicians; and
(C) a nonprofit health corporation whose board is
composed of physicians.
DIVISION D--PROTECTING THE DOCTOR-PATIENT RELATIONSHIP
SEC. 401. RULE OF CONSTRUCTION.
Nothing in this Act shall be construed to interfere with the
doctor-patient relationship or the practice of medicine.
SEC. 402. REPEAL OF FEDERAL COORDINATING COUNCIL FOR COMPARATIVE
EFFECTIVENESS RESEARCH.
Effective on the date of the enactment of this Act, section 804 of
the American Recovery and Reinvestment Act of 2009 is repealed.
DIVISION E--INCENTIVIZING WELLNESS AND QUALITY IMPROVEMENTS
SEC. 501. INCENTIVES FOR PREVENTION AND WELLNESS PROGRAMS.
(a) Employee Retirement Income Security Act of 1974 Limitation on
Exception for Wellness Programs Under HIPAA Discrimination Rules.--
(1) In general.--Section 702(b)(2) of the Employee
Retirement Income Security Act of 1974 (29 U.S.C. 1182(b)(2)),
as restored by section 2, is amended by adding after and below
subparagraph (B) the following:
``In applying subparagraph (B), a group health plan (or a
health insurance issuer with respect to health insurance
coverage) may vary premiums and cost-sharing by up to 50
percent of the value of the benefits under the plan (or
coverage) based on participation in a standards-based wellness
program.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to plan years beginning more than 1 year after the
date of the enactment of this Act.
(b) Conforming Amendments to PHSA.--
(1) Group market rules.--
(A) In general.--Section 2702(b)(2) of the Public
Health Service Act (42 U.S.C. 300gg-1(b)(2)), as
restored by section 2, is amended by adding after and
below subparagraph (B) the following:
``In applying subparagraph (B), a group health plan (or a
health insurance issuer with respect to health insurance
coverage) may vary premiums and cost-sharing by up to 50
percent of the value of the benefits under the plan (or
coverage) based on participation in a standards-based wellness
program.''.
(B) Effective date.--The amendment made by
subparagraph (A) shall apply to plan years beginning
more than 1 year after the date of the enactment of
this Act.
(2) Individual market rules relating to guaranteed
availability.--
(A) In general.--Section 2741(f) of the Public
Health Service Act (42 U.S.C. 300gg-1(b)(2)), as
restored by section 2, is amended by adding after and
below paragraph (1) the following:
``In applying paragraph (2), a health insurance issuer may vary
premiums and cost-sharing under health insurance coverage by up to 50
percent of the value of the benefits under the coverage based on
participation in a standards-based wellness program.''.
(B) Effective date.--The amendment made by
paragraph (1) shall apply to health insurance coverage
offered or renewed on and after the date that is 1 year
after the date of the enactment of this Act.
(c) Conforming Amendments to IRC.--
(1) In general.--Section 9802(b)(2) of the Internal Revenue
Code of 1986,as restored by section 2, is amended by adding
after and below subparagraph (B) the following:
``In applying subparagraph (B), a group health plan (or a
health insurance issuer with respect to health insurance
coverage) may vary premiums and cost-sharing by up to 50
percent of the value of the benefits under the plan (or
coverage) based on participation in a standards-based wellness
program.''.
(2) Effective date.--The amendment made by paragraph (1)
shall apply to plan years beginning more than 1 year after the
date of the enactment of this Act.
DIVISION F--PROTECTING TAXPAYERS
SEC. 601. PERMANENTLY PROHIBITING TAXPAYER FUNDED ABORTIONS AND
ENSURING CONSCIENCE PROTECTIONS.
Title 1 of the United States Code is amended by adding at the end
the following new chapter:
``CHAPTER 4--PERMANENTLY PROHIBITING TAXPAYER FUNDED ABORTIONS AND
ENSURING CONSCIENCE PROTECTIONS
``SEC. 301. PROHIBITION ON FUNDING FOR ABORTIONS.
``No funds authorized or appropriated by Federal law, and none of
the funds in any trust fund to which funds are authorized or
appropriated by Federal law, shall be expended for any abortion.
``SEC. 302. PROHIBITION ON FUNDING FOR HEALTH BENEFITS PLANS THAT COVER
ABORTION.
``None of the funds authorized or appropriated by federal law, and
none of the funds in any trust fund to which funds are authorized or
appropriated by federal law, shall be expended for a health benefits
plan that includes coverage of abortion.
``SEC. 303. TREATMENT OF ABORTIONS RELATED TO RAPE, INCEST, OR
PRESERVING THE LIFE OF THE MOTHER.
``The limitations established in sections 301 and 302 shall not
apply to an abortion--
``(1) if the pregnancy is the result of an act of rape or
incest; or
``(2) in the case where a woman suffers from a physical
disorder, physical injury, or physical illness that would, as
certified by a physician, place the woman in danger of death
unless an abortion is performed, including a life-endangering
physical condition caused by or arising from the pregnancy
itself.
``SEC. 304. CONSTRUCTION RELATING TO SUPPLEMENTAL COVERAGE.
``Nothing in this chapter shall be construed as prohibiting any
individual, entity, or State or locality from purchasing separate
supplemental abortion plan or coverage that includes abortion so long
as such plan or coverage is paid for entirely using only funds not
authorized or appropriated by federal law and such plan or coverage
shall not be purchased using matching funds required for a federally
subsidized program, including a State's or locality's contribution of
Medicaid matching funds.
``SEC. 305. CONSTRUCTION RELATING TO THE USE OF NON-FEDERAL FUNDS FOR
HEALTH COVERAGE.
``Nothing in this chapter shall be construed as restricting the
ability of any managed care provider or other organization from
offering abortion coverage or the ability of a State to contract
separately with such a provider or organization for such coverage with
funds not authorized or appropriated by federal law and such plan or
coverage shall not be purchased using matching funds required for a
federally subsidized program, including a State's or locality's
contribution of Medicaid matching funds.
``SEC. 306. NO GOVERNMENT DISCRIMINATION AGAINST CERTAIN HEALTH CARE
ENTITIES.
``(a) In General.--No funds authorized or appropriated by federal
law may be made available to a Federal agency or program, or to a State
or local government, if such agency, program, or government subjects
any institutional or individual health care entity to discrimination on
the basis that the health care entity does not provide, pay for,
provide coverage of, or refer for abortions.
``(b) Health Care Entity Defined.--For purposes of 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.''.
SEC. 602. IMPROVED ENFORCEMENT OF THE MEDICARE AND MEDICAID SECONDARY
PAYER PROVISIONS.
(a) Medicare.--
(1) In general.--The Secretary of Health and Human
Services, in coordination with the Inspector General of the
Department of Health and Human Services, shall provide through
the Coordination of Benefits Contractor for the identification
of instances where the Medicare program should be, but is not,
acting as a secondary payer to an individual's private health
benefits coverage under section 1862(b) of the Social Security
Act (42 U.S.C. 1395y(b)).
(2) Updating procedures.--The Secretary shall update
procedures for identifying and resolving credit balance
situations which occur under the Medicare program when payment
under such title and from other health benefit plans exceed the
providers' charges or the allowed amount.
(3) Report on improved enforcement.--Not later than 1 year
after the date of the enactment of this Act, the Secretary
shall submit a report to Congress on progress made in improved
enforcement of the Medicare secondary payer provisions,
including recoupment of credit balances.
(b) Medicaid.--Section 1903 of the Social Security Act (42 U.S.C.
1396b) is amended by adding at the end the following new subsection:
``(aa) Enforcement of Payer of Last Resort Provisions.--
``(1) Submission of state plan amendment.--Each State shall
submit, not later than 1 year after the date of the enactment
of this subsection, a State plan amendment that details how the
State will become fully compliant with the requirements of
section 1902(a)(25).
``(2) Bonus for compliance.--If a State submits a timely
State plan amendment under paragraph (1) that the Secretary
determines provides for full compliance of the State with the
requirements of section 1902(a)(25), the Secretary shall
provide for an additional payment to the State of $1,000,000.
If a State certifies, to the Secretary's satisfaction, that it
is already fully compliant with such requirements, such amount
shall be increased to $2,000,000.
``(3) Reduction for noncompliance.--If a State does not
submit such an amendment, the Secretary shall reduce the
Federal medical assistance percentage otherwise applicable
under this title by 1 percentage point until the State submits
such an amendment.
``(4) Ongoing reduction.--If at any time the Secretary
determines that a State is not in compliance with section
1902(a)(25), regardless of the status of the State's submission
of a State plan amendment under this subsection or previous
determinations of compliance such requirements, the Secretary
shall reduce the Federal medical assistance percentage
otherwise applicable under this title for the State by 1
percentage point during the period of non-compliance as
determined by the Secretary.''.
SEC. 603. STRENGTHEN MEDICARE PROVIDER ENROLLMENT STANDARDS AND
SAFEGUARDS.
(a) Protecting Against the Fraudulent Use of Medicare Provider
Numbers.--Subject to subsection (c)(2)--
(1) Screening new providers.--As a condition of a provider
of services or a supplier, including durable medical equipment
suppliers and home health agencies, applying for the first time
for a provider number under the Medicare program under title
XVIII of the Social Security Act and before granting billing
privileges under such title, the Secretary of Health and Human
Services shall screen the provider or supplier for a criminal
background or other financial or operational irregularities
through fingerprinting, licensure checks, site-visits, other
database checks.
(2) Application fees.--The Secretary shall impose an
application charge on such a provider or supplier in order to
cover the Secretary's costs in performing the screening
required under paragraph (1) and that is revenue neutral to the
Federal government.
(3) Provisional approval.--During an initial, provisional
period (specified by the Secretary) in which such a provider or
supplier has been issued such a number, the Secretary shall
provide enhanced oversight of the activities of such provider
or supplier under the Medicare program, such as through
prepayment review and payment limitations.
(4) Penalties for false statements.--In the case of a
provider or supplier that makes a false statement in an
application for such a number, the Secretary may exclude the
provider or supplier from participation under the Medicare
program, or may impose a civil money penalty (in the amount
described in section 1128A(a)(4) of the Social Security Act),
in the same manner as the Secretary may impose such an
exclusion or penalty under sections 1128 and 1128A,
respectively, of such Act in the case of knowing presentation
of a false claim described in section 1128A(a)(1)(A) of such
Act.
(5) Disclosure requirements.--With respect to approval of
such an application, the Secretary--
(A) shall require applicants to disclose previous
affiliation with enrolled entities that have
uncollected debt related to the Medicare or Medicaid
programs;
(B) may deny approval if the Secretary determines
that these affiliations pose undue risk to the Medicare
or Medicaid program, subject to an appeals process for
the applicant as determined by the Secretary; and
(C) may implement enhanced safeguards (such as
surety bonds).
(b) Moratoria.--The Secretary of Health and Human Services may
impose moratoria on approval of provider and supplier numbers under the
Medicare program for new providers of services and suppliers as
determined necessary to prevent or combat fraud a period of delay for
any one applicant cannot exceed 30 days unless cause is shown by the
Secretary.
(c) Funding.--
(1) In general.--There are authorized to be appropriated to
carry out this section such sums as may be necessary.
(2) Condition.--The provisions of paragraphs (1) and (2) of
subsection (a) shall not apply unless and until funds are
appropriated to carry out such provisions.
SEC. 604. TRACKING BANNED PROVIDERS ACROSS STATE LINES.
(a) Greater Coordination.--The Secretary of Health and Human
Services shall provide for increased coordination between the
Administrator of the Centers for Medicare & Medicaid Services (in this
section referred to as ``CMS'') and its regional offices to ensure that
providers of services and suppliers that have operated in one State and
are excluded from participation in the Medicare program are unable to
begin operation and participation in the Medicare program in another
State.
(b) Improved Information Systems.--
(1) In general.--The Secretary shall improve information
systems to allow greater integration between databases under
the Medicare program so that--
(A) Medicare administrative contractors, fiscal
intermediaries, and carriers have immediate access to
information identifying providers and suppliers
excluded from participation in the Medicare and
Medicaid program and other Federal health care
programs; and
(B) such information can be shared across Federal
health care programs and agencies, including between
the Departments of Health and Human Services, the
Social Security Administration, the Department of
Veterans Affairs, the Department of Defense, the
Department of Justice, and the Office of Personnel
Management.
(c) Medicare/Medicaid ``One PI'' Database.--The Secretary shall
implement a database that includes claims and payment data for all
components of the Medicare program and the Medicaid program.
(d) Authorizing Expanded Data Matching.--Notwithstanding any
provision of the Computer Matching and Privacy Protection Act of 1988
to the contrary--
(1) the Secretary and the Inspector General in the
Department of Health and Human Services may perform data
matching of data from the Medicare program with data from the
Medicaid program; and
(2) the Commissioner of Social Security and the Secretary
may perform data matching of data of the Social Security
Administration with data from the Medicare and Medicaid
programs.
(e) Consolidation of Databases.--The Secretary shall consolidate
and expand into a centralized database for individuals and entities
that have been excluded from Federal health care programs the
Healthcare Integrity and Protection Data Bank, the National
Practitioner Data Bank, the List of Excluded Individuals/Entities, and
a national patient abuse/neglect registry.
(f) Comprehensive Provider Database.--
(1) Establishment.--The Secretary shall establish a
comprehensive database that includes information on providers
of services, suppliers, and related entities participating in
the Medicare program, the Medicaid program, or both. Such
database shall include, information on ownership and business
relationships, history of adverse actions, results of site
visits or other monitoring by any program.
(2) Use.--Prior to issuing a provider or supplier number
for an entity under the Medicare program, the Secretary shall
obtain information on the entity from such database to assure
the entity qualifies for the issuance of such a number.
(g) Comprehensive Sanctions Database.--The Secretary shall
establish a comprehensive sanctions database on sanctions imposed on
providers of services, suppliers, and related entities. Such database
shall be overseen by the Inspector General of the Department of Health
and Human Services and shall be linked to related databases maintained
by State licensure boards and by Federal or State law enforcement
agencies.
(h) Access to Claims and Payment Databases.--The Secretary shall
ensure that the Inspector General of the Department of Health and Human
Services and Federal law enforcement agencies have direct access to all
claims and payment databases of the Secretary under the Medicare or
Medicaid programs.
(i) Civil Money Penalties for Submission of Erroneous
Information.--In the case of a provider of services, supplier, or other
entity that submits erroneous information that serves as a basis for
payment of any entity under the Medicare or Medicaid program, the
Secretary may impose a civil money penalty of not to exceed $50,000 for
each such erroneous submission. A civil money penalty under this
subsection shall be imposed and collected in the same manner as a civil
money penalty under subsection (a) of section 1128A of the Social
Security Act is imposed and collected under that section.
<all>
Introduced in House
Introduced in House
Referred to the Committee on Energy and Commerce, and in addition to the Committees on Ways and Means, Education and the Workforce, Natural Resources, the Judiciary, House Administration, Rules, and Appropriations, 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 Committees on Ways and Means, Education and the Workforce, Natural Resources, the Judiciary, House Administration, Rules, and Appropriations, 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 Committees on Ways and Means, Education and the Workforce, Natural Resources, the Judiciary, House Administration, Rules, and Appropriations, 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 Committees on Ways and Means, Education and the Workforce, Natural Resources, the Judiciary, House Administration, Rules, and Appropriations, 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 Committees on Ways and Means, Education and the Workforce, Natural Resources, the Judiciary, House Administration, Rules, and Appropriations, 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.
Llama 3.2 · runs locally in your browser
Ask anything about this bill. The AI reads the full text to answer.
Enter to send · Shift+Enter for new line
Referred to the Committee on Energy and Commerce, and in addition to the Committees on Ways and Means, Education and the Workforce, Natural Resources, the Judiciary, House Administration, Rules, and Appropriations, 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 Committees on Ways and Means, Education and the Workforce, Natural Resources, the Judiciary, House Administration, Rules, and Appropriations, 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 Committees on Ways and Means, Education and the Workforce, Natural Resources, the Judiciary, House Administration, Rules, and Appropriations, 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 Indian and Alaska Native Affairs.
Referred to the Subcommittee on the Constitution and Civil Justice.