[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 30 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                 H. R. 30

To provide for universal access to basic group health benefits coverage 
  and to remove barriers and provide incentives in order to make such 
   coverage more affordable, to improve and make more efficient the 
 provision of medical and health insurance information, and to improve 
   enforcement of requirements relating to multiple employer welfare 
                             arrangements.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 5, 1993

 Mr. Grandy (for himself, Mr. Goodling, Mr. Henry, and Mr. Cunningham) 
   introduced the following bill; which was referred jointly to the 
 Committees on Education and Labor, Energy and Commerce, and Ways and 
                                 Means

_______________________________________________________________________

                                 A BILL


 
To provide for universal access to basic group health benefits coverage 
  and to remove barriers and provide incentives in order to make such 
   coverage more affordable, to improve and make more efficient the 
 provision of medical and health insurance information, and to improve 
   enforcement of requirements relating to multiple employer welfare 
                             arrangements.

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

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Universal Health 
Benefits Empowerment and Partnership Act of 1993''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title and table of contents.
Sec. 2. Findings and declaration of policy.
              TITLE I--UNIVERSAL ACCESS TO HEALTH COVERAGE

Sec. 101. Universal access to coverage under group health plans and 
                            accessible health benefits systems.
  ``Part 6--Universal Access to Coverage under Group Health Plans and 
                   Accessible Health Benefits Systems

                    ``Subpart A--General Provisions

        ``Sec. 601. Definitions and special rules.
``Subpart B--Required Coverage Options; Group Health Payroll Deduction 
                                 Plans

        ``Sec. 611. Coverage for eligible individuals under basic group 
                            health plans or group health payroll 
                            deduction plans.
        ``Sec. 612. Group health payroll deduction plans.
        ``Sec. 613. Availability of coverage under accessible health 
                            benefits systems.
            ``Subpart C--Accessible Health Benefits Systems

        ``Sec. 621. General requirements.
        ``Sec. 622. Reporting requirements.
        ``Sec. 623. Participation requirements.
        ``Sec. 624. Benefits requirements.
        ``Sec. 625. Contribution requirements.
        ``Sec. 626. Reciprocity and reliance by accessible health 
                            benefits systems on other such systems.
        ``Sec. 627. Regulatory authority of Secretary of Health and 
                            Human Services.
 ``Subpart D--Coverage for Uninsurable Risks and Material Pre-Existing 
                               Conditions

        ``Sec. 631. Coverage for uninsurable risks and pre-existing 
                            conditions.
        ``Sec. 632. Participation requirements for uninsurable risks 
                            and material pre-existing conditions.
        ``Sec. 633. Benefits requirements for uninsurable risks and 
                            material pre-existing conditions.
        ``Sec. 634. Regulatory authority of Secretary of Health and 
                            Human Services.''.
Sec. 102. Establishment of State-based system in absence of State-wide 
                            access to coverage; substitute systems.
Sec. 103. Continuation coverage and accessible health benefits systems 
                            or substitute systems.
Sec. 104. Preemption of State law to provide for more affordable health 
                            care coverage.
Sec. 105. Encouragement of multiple employer arrangements providing 
                            basic health benefits.
Sec. 106. Treatment practice guidelines and outcomes research for all 
                            Americans.
               ``Part A--Establishment and General Duties

        ``Sec. 901. Establishment.
        ``Sec. 902. General authorities and duties.
      ``Part B--Forum for Quality and Effectiveness in Health Care

        ``Sec. 911. Establishment of office.
        ``Sec. 912. Duties.
Sec. 107. Federal Advisory Council on Health Care Coverage and Costs.
Sec. 108. Increase in deduction for health insurance costs of self-
                            employed individuals from 25 percent to 100 
                            percent.
Sec. 109. Effective dates.
       TITLE II--MEDICAL AND HEALTH INSURANCE INFORMATION REFORM

Sec. 201. Short title.
Sec. 202. Medical and health insurance information reform.
     ``TITLE XXII--MEDICAL AND HEALTH INSURANCE INFORMATION REFORM

                ``Part A--Comparative Value Information

        ``Sec. 2200. Comparative value information programs for health 
                            care purchasing.
        ``Sec. 2201. Grants for the development of State programs.
  ``Part B--Storage and Transmission of Medical and Health Insurance 
                  Information and Priority of Payment

        ``Sec. 2210. Preemption of State quill pen laws.
        ``Sec. 2211. Promulgation of requirements by Secretary.
        ``Sec. 2212. State programs.
        ``Sec. 2213. Application of Federal requirements.
        ``Sec. 2214. Health insurance information privacy and 
                            confidentiality protection.
        ``Sec. 2215. Identification numbers.
        ``Sec. 2216. Standards and requirements for the receipt and 
                            transmission of health insurance 
                            information.
        ``Sec. 2217. Health insurance claim forms.
        ``Sec. 2218. Priority among insurers.
        ``Sec. 2219. Furnishing of information among insurers.
        ``Sec. 2220. Noncompliance with Federal requirements.
        ``Sec. 2221. No effect on scope of benefits covered.
                  ``Part C--Medical Data Requirements

        ``Sec. 2230. Promulgation of requirements by Secretary.
        ``Sec. 2231. Medicare requirements for hospitals.
        ``Sec. 2232. Electronic transmission to Federal agencies.
                      ``Part D--General Provisions

        ``Sec. 2240. Definitions.''.
 
Sec. 203. Conforming amendment.
Sec. 204. Failure to satisfy certain health insurance requirements.
                TITLE III--MEWA ENFORCEMENT IMPROVEMENTS

Sec. 301. Short title.
Sec. 302. Amendment to definition of employee welfare benefit plan.
Sec. 303. Amendment to definition of multiple employer welfare 
                            arrangement.
Sec. 304. Coverage.
Sec. 305. Registration requirement.
Sec. 306. Enforcement and civil penalties.
Sec. 307. Exemption procedure.
Sec. 308. Clarification of States' ability to obtain information.
Sec. 309. Effective date.

SEC. 2. FINDINGS AND DECLARATION OF POLICY.

    (a) Findings.--The Congress finds that--
            (1) the health care delivery system of the United States 
        provides most Americans with a level of access and quality of 
        care that is unsurpassed;
            (2) for a significant minority of Americans, the system 
        works less well because they cannot obtain or otherwise do not 
        have basic health care coverage under either public or private 
        programs;
            (3) these individuals represent a diversity of situations 
        for which there is no single solution;
            (4) assuring access to basic health care coverage and 
        quality care for these individuals is a compelling national 
        priority that will require commitments from both the private 
        and public sectors;
            (5) the most practical and effective solutions for these 
        access problems are ones that--
                    (A) preserve the pluralistic base of the health 
                care delivery system of the United States;
                    (B) emphasize incentives, innovation, and the 
                removal of current barriers to access; and
                    (C) recognize that both the complexity of the 
                problem and the existence of fiscal constraints means 
                that responsibility must be shared among employers, 
                employees, insurers, providers, and patients, as well 
                as Federal, State, and local governments;
            (6) Federal efforts need to be closely coordinated with 
        others who share in the responsibility for improving access to 
        basic health care services;
            (7) Federal efforts need to reflect not only the diversity 
        of interested parties but also the diversity of areas where 
        action is appropriate, including public health, basic group 
        health coverage, State initiatives, medical malpractice laws, 
        Medicaid, and tax incentives; and
            (8) improving access requires dealing with many of the most 
        difficult problems in the health system, including--
                    (A) the escalating costs, State mandated health 
                benefits, and other factors that have made health care 
                coverage less affordable for many employers and 
                individuals, especially the near poor who need more 
                creative workplace and public options to be able to 
                obtain basic health care coverage; and
                    (B) the inability of many individuals to protect 
                themselves against catastrophic health care expenses 
                because preexisting conditions make them 
                ``uninsurable''.
    (b) Purposes.--Therefore the Congress declares the purposes of this 
Act to be to provide a sound, flexible, and workable Federal framework 
to simultaneously address the issues of access to basic health care 
coverage and the affordability of such coverage, with an emphasis on 
improving health care quality by--
            (1) empowering employers, employees, and other individuals 
        to obtain more affordable basic health care coverage, and
            (2) providing incentives for private and public-private 
        partnership arrangements to be established for such purposes.
    (c) Declaration of Policy.--In carrying out such purposes, it is 
the policy of this Act to--
            (1) provide universal access to basic group health coverage 
        for all Americans under plans offered by employers or, in the 
        case in which such coverage is unavailable to employees and 
        other individuals from private sources or existing public 
        programs, under accessible health benefits systems;
            (2) make such basic health coverage more affordable--
                    (A) by removing barriers and encouraging ``group'' 
                plans and arrangements to spread risk and lower 
                expenses;
                    (B) by preempting State health benefit mandates, 
                thereby encouraging group health coverage providers to 
                offer lower cost basic coverage to the uninsured;
                    (C) by preempting State barriers to the providing 
                of managed care, thereby encouraging competition, 
                innovation of cost-control approaches, and quality 
                review;
                    (D) by encouraging the development of treatment 
                practice guidelines and outcomes research to aid in 
                reducing unnecessary services, increasing quality care, 
                and reducing malpractice costs;
                    (E) by eliminating tax inequities and barriers--
                            (i) to the full deductibility of 
                        contributions to health plans covering the 
                        self-employed, and
                            (ii) to the establishment of soundly 
                        financed multiple employer basic group health 
                        plans;
            (3) improve and make more efficient the provision of 
        medical and health insurance information; and
            (4) improve enforcement of requirements relating to 
        multiple employer welfare arrangements.

              TITLE I--UNIVERSAL ACCESS TO HEALTH COVERAGE

SEC. 101. UNIVERSAL ACCESS TO COVERAGE UNDER GROUP HEALTH PLANS AND 
              ACCESSIBLE HEALTH BENEFITS SYSTEMS.

    (a) In General.--Subtitle B of title I of the Employee Retirement 
Income Security Act of 1974 is amended--
            (1) by striking the heading for part 6 and inserting the 
        following:

           ``Subpart E--Continuation Coverage Requirements'';

            (2) by redesignating sections 601 through 608 as sections 
        641 through 648, respectively; and
            (3) by inserting after part 5 the following:

  ``Part 6--Universal Access to Coverage under Group Health Plans and 
                   Accessible Health Benefits Systems

                    ``Subpart A--General Provisions

``SEC. 601. DEFINITIONS AND SPECIAL RULES.

    ``(a) In General.--For purposes of this part--
            ``(1) Group health plan.--The term `group health plan' 
        means an employee welfare benefit plan providing medical care 
        (as defined in section 213(d) of the Internal Revenue Code of 
        1986) to participants or beneficiaries directly or through 
        insurance, reimbursement, or otherwise.
            ``(2) Basic group health plan.--
                    ``(A) In general.--The term `basic group health 
                plan' means a group health plan, or any combination of 
                two or more group health plans, which includes at least 
                a basic health benefits provision.
                    ``(B) Treatment of uninsurable risks.--A plan which 
                excludes from coverage under a basic health benefits 
                provision any individual (who would otherwise be 
                eligible for coverage) solely because the individual is 
                an uninsurable risk shall not be treated as a basic 
                group health plan, unless the requirements of 
                subparagraph (D) are met for purposes of this 
                subparagraph with respect to such individual.
                    ``(C) Treatment of material pre-existing 
                conditions.--A plan which provides coverage to any 
                individual under a basic health benefits provision 
                subject to a substantial restriction based on a 
                material pre-existing condition shall not be treated as 
                a basic group health plan, unless the requirements of 
                subparagraph (D) are met for purposes of this 
                subparagraph with respect to such individual.
                    ``(D) Exemption where adequate accessible health 
                benefits system or substitute system is available.--The 
                requirements of this subparagraph are met with respect 
                to any individual--
                            ``(i) for purposes of subparagraph (B), if 
                        such individual is eligible for coverage under 
                        an accessible health benefits system 
                        established and maintained in accordance with 
                        subpart C (and subpart D as applicable) (or 
                        under any substitute basic health benefits 
                        system with respect to which the Secretary of 
                        Health and Human Services has made a 
                        determination pursuant to section 102(b) of the 
                        Universal Health Benefits Empowerment and 
                        Partnership Act of 1993 relating to the element 
                        of coverage described in section 
                        102(b)(2)(B)(i) of such Act (relating to 
                        treatment of individuals as uninsurable 
                        risks)), or
                            ``(ii) for purposes of subparagraph (C), if 
                        such individual is eligible for coverage for 
                        the material pre-existing condition referred to 
                        in subparagraph (C) under an accessible health 
                        benefits system established and maintained in 
                        accordance with subpart C (and subpart D as 
                        applicable) (or under any substitute basic 
                        health benefits system with respect to which 
                        the Secretary of Health and Human Services has 
                        made a determination pursuant to section 102(b) 
                        of the Universal Health Benefits Empowerment 
                        and Partnership Act of 1993 relating to the 
                        element of coverage described in section 
                        102(b)(2)(B)(ii) of such Act (relating to 
                        treatment of material preexisting conditions)).
            ``(3) Basic health benefits provision.--The term `basic 
        health benefits provision' means, with respect to any plan, 
        combination of plans, or health benefit system, an arrangement 
        which--
                    ``(A) provides to individuals provided coverage 
                under such plan, combination of plans, or system, 
                directly or through insurance, reimbursement, or 
                otherwise, medical care (as defined in section 213(d) 
                of the Internal Revenue Code of 1986)--
                            ``(i) which consists of services determined 
                        by the Secretary of Health and Human Services, 
                        under regulations prescribed by such Secretary, 
                        to consist of basic health care services 
                        (including physician's, inpatient hospital, and 
                        outpatient hospital services which are 
                        prevalent under group health plans and other 
                        services which may be necessary for basic 
                        health care), and
                            ``(ii) which consists of coverage at a 
                        percentage of cost determined by such Secretary 
                        under such regulations (by means of 
                        deductibles, coinsurance, and other limits on 
                        covered services) to be not less than a 
                        percentage which is, taking into account the 
                        population covered and the extent of cost 
                        currently covered under group health plans, 
                        adequate to meet basic health care needs, and
                    ``(B) in the case of any individual described in 
                paragraph (2)(B) or (C) in relation to a basic group 
                health plan maintained by the employer of such 
                individual (or of the person of whom such individual is 
                a dependent), requires contributions by the employer of 
                not less than the amount provided under the plan with 
                respect to individuals covered under such plan who are 
                similarly situated, disregarding any condition under 
                the plan relating to uninsurable risks (in the case of 
                an individual described in paragraph (2)(B)) or to 
                material pre-existing conditions (in the case of an 
                individual described in paragraph (2)(C)).
        In issuing regulations referred to in this paragraph (including 
        any revisions thereof), the Secretary of Health and Human 
        Services shall take into account recommendations submitted to 
        such Secretary by the Federal Advisory Council on Health Care 
        Coverage and Costs pursuant to section 107(d)(2) of the 
        Universal Health Benefits Empowerment and Partnership Act of 
        1993.
            ``(4) Dependent.--The term `dependent' means, with respect 
        to any individual, any person who--
                    ``(A) is the spouse or surviving spouse of the 
                individual, or
                    ``(B) is, under regulations of the Secretary, a 
                child of such individual who--
                            ``(i) is under 18 years of age,
                            ``(ii) is under 23 years of age and a full-
                        time student, or
                            ``(iii) is otherwise dependent on such 
                        individual.
            ``(5) Employer.--The term `employer' shall have the meaning 
        applicable under section 3(5), except that such term shall 
        include any State (or political subdivision thereof), or any 
        agency or instrumentality of one or more of the foregoing.
            ``(6) Eligible individual.--The term `eligible individual' 
        means any employee or dependent thereof, unless such employee 
        or dependent--
                    ``(A) was eligible for coverage under a basic group 
                health plan which is maintained by the employer and to 
                which the employer makes contributions but such 
                coverage was declined under such plan, or
                    ``(B) is excluded from coverage under such a plan 
                as an uninsurable risk but is eligible for uninsurable 
                risk coverage under an accessible health benefits 
                system in accordance with subpart C (and subpart D as 
                applicable) (or any substitute basic health benefits 
                system with respect to which the Secretary of Health 
                and Human Services has made a determination pursuant to 
                section 102 of the Universal Health Benefits 
                Empowerment and Partnership Act of 1993 relating to the 
                element of coverage described in section 
                102(b)(2)(B)(i) of such Act (relating to treatment of 
                individuals as uninsurable risks)).
            ``(7) Uninsurable risk.--An individual shall be deemed to 
        have been excluded from coverage under a basic health benefits 
        provision as an `uninsurable risk' if such denial of coverage 
        is provided--
                    ``(A) in such terms, or
                    ``(B) in such other terms or under such 
                circumstances as are, subject to such regulations as 
                the Secretary of Health and Human Services may 
                prescribe, reasonably equivalent to such a denial.
            ``(8) Material pre-existing condition.--An individual shall 
        be deemed to have been provided coverage by a basic health 
        benefits provision subject to a restriction based on a 
        `material pre-existing condition' if, subject to such 
        regulations as the Secretary of Health and Human Services may 
        prescribe, under such provision--
                    ``(A) benefits (which would otherwise be payable) 
                are not paid solely on the basis of a material pre-
                existing condition, or
                    ``(B) the costs for coverage of the individual with 
                a material pre-existing condition, to either an 
                employer or to the individual, are at a rate materially 
                greater than costs for coverage of similarly situated 
                individuals without such a material pre-existing 
                condition, to the extent such costs are payable to a 
                third party.
    ``(b) Cross-References.--
            ``(1) General rule.--Except as otherwise provided in this 
        part, for definitions of terms used in this part, see section 
        3.
            ``(2) Secretary.--Except with respect to references 
        specifically to the Secretary of Health and Human Services, for 
        the definition of `Secretary', see section 3(13).
            ``(3) Regulations.--Except with respect to provisions for 
        which regulatory authority is specifically provided to the 
        Secretary of Health and Human Services, for provisions 
        governing regulatory authority under this part, see section 
        505.

``Subpart B--Required Coverage Options; Group Health Payroll Deduction 
                                 Plans

``SEC. 611. COVERAGE FOR ELIGIBLE INDIVIDUALS UNDER BASIC GROUP HEALTH 
              PLANS OR GROUP HEALTH PAYROLL DEDUCTION PLANS.

    ``(a) Requirement That Employers Offer Coverage for Eligible 
Individuals Under Basic Group Health Plans or Group Health Payroll 
Deduction Plans.--Each employer shall maintain with respect to each 
eligible individual--
            ``(1) a basic group health plan under which coverage of 
        such individual may be elected, or
            ``(2) a group health payroll deduction plan (as defined in 
        section 612).
    ``(b) Special Rules.--
            ``(1) Exclusion of certain employers.--
                    ``(A) In general.--This section shall not apply to 
                any employer for any plan year if, as of the beginning 
                of such plan year--
                            ``(i) such employer (including any 
                        predecessor thereof) has been an employer for 
                        less than 2 years,
                            ``(ii) such employer has no more than 2 
                        individuals in such employer's employ, or
                            ``(iii) no more than 2 individuals in such 
                        employer's employ are not covered under any 
                        basic group health plan.
                    ``(B) Exclusion of family members.--Under such 
                procedures as the Secretary may prescribe, any relative 
                of an employer may be, at the election of the employer, 
                excluded from consideration as an employee for purposes 
                of this paragraph. In the case of an employer that is 
                not an individual, an employee who is a relative of a 
                key employee (as defined in section 416(i)(1) of the 
                Internal Revenue Code of 1986) of the employer may, at 
                the election of the key employee, be considered a 
                relative excludible under this subparagraph.
            ``(2) Exclusion of certain temporary employees.--A plan 
        shall not be treated as failing to meet the requirements of 
        this section solely because a period of service by an employee 
        of not more than 60 days is required under the plan for 
        coverage of such employee or any dependent thereof under the 
        plan.

``SEC. 612. GROUP HEALTH PAYROLL DEDUCTION PLANS.

    ``(a) General Rule.--For purposes of this subpart, the term `group 
health payroll deduction plan' means a basic group health plan under 
which amounts are deducted by the employer from the employee's wages 
pursuant to an election by the employee and paid as a contribution to 
such plan in accordance with such regulations as the Secretary may 
prescribe relating to withholding procedures and timely payment of 
premiums.
    ``(b) Elections.--
            ``(1) In general.--Any election by an employee under a 
        group health payroll deduction plan shall specify the amount 
        which is to be deducted in relation to the benefits provided 
        under the plan. Any such election may be revoked or changed by 
        the employee under the terms of the plan.
            ``(2) Manner for making or revoking elections.--Any 
        election under a group health payroll deduction plan (and any 
        revocation or change of such an election) shall be made in such 
        form and in such manner as the Secretary may by regulations 
        prescribe.

``SEC. 613. AVAILABILITY OF COVERAGE UNDER ACCESSIBLE HEALTH BENEFITS 
              SYSTEMS.

    ``In any case in which there is in effect, as of the beginning of a 
plan year of any group health payroll deduction plan, an entity 
determined by the Secretary of Health and Human Services to be an 
accessible health benefits system established and maintained in 
accordance with subpart C (and subpart D as applicable) with respect to 
the employee, such plan shall not be treated as failing to meet the 
requirements of section 612(a) for such plan solely because the amounts 
deducted are, under such plan, paid for such plan year or the 
succeeding plan year as a contribution to such a system accepting 
coverage of such employee rather than to such plan, if a provider of 
group health plan coverage with respect to the plan rejects an 
individual otherwise eligible for coverage under such plan because of a 
requirement that a certain number or percentage of individuals 
otherwise eligible for coverage under the plan are not covered.

            ``Subpart C--Accessible Health Benefits Systems

``SEC. 621. GENERAL REQUIREMENTS.

    ``For purposes of this part, an accessible health benefits system 
established and maintained in accordance with this subpart is any 
system which, with respect to any group of individuals residing in a 
defined geographic area--
            ``(1) meets the reporting requirements of section 622,
            ``(2) meets the participation requirements of section 623 
        with respect to residents of the State,
            ``(3) meets the benefit requirements of section 624,
            ``(4) meets the contribution requirements of section 625, 
        and
            ``(5) provides coverage in accordance with subpart D 
        (relating to uninsurable risks and material pre-existing 
        conditions) as applicable.

``SEC. 622. REPORTING REQUIREMENTS.

    ``(a) In General.--A health benefits system meets the reporting 
requirements of this section if the system maintains a program under 
which the system provides, upon the request of group health payroll 
deduction plans under which amounts are paid from such plans to the 
system, such information held by the system as the plans require to 
meet the requirements of part 1 of subtitle B of title I.
    ``(b) Form of Requests.--Each system shall be required to process 
requests made under this section only if such requests are made in such 
form and manner as may be prescribed in regulations of the Secretary.

``SEC. 623. PARTICIPATION REQUIREMENTS.

    ``A health benefits system meets the participation requirements of 
this section if the system provides that an individual within the group 
referred to in section 621 is provided coverage under the system if 
such individual--
            ``(1) is an eligible individual (as defined in section 
        601(a)(6)),
            ``(2) is an individual required to be provided coverage 
        under subpart E of this part or under title XXII of the Public 
        Health Service Act,
            ``(3) is an individual described in section 632, or
            ``(4) is an individual (other than an individual described 
        in paragraph (1), (2), or (3)) who is not covered under any 
        arrangement providing basic health care services described in 
        section 601(a)(3)(A),
and is not otherwise eligible for coverage under a basic group health 
plan or under a plan for medical assistance under title XIX of the 
Social Security Act.

``SEC. 624. BENEFITS REQUIREMENTS.

    ``(a) In General.--Except as otherwise provided in this section, a 
health benefits system meets the benefits requirements of this section 
if the system provides medical care (as defined in section 213(d) of 
the Internal Revenue Code of 1986), directly or through insurance, 
reimbursement, or otherwise, in the form of at least the following 
options, available at the election of the individual provided coverage:
            ``(1) Basic and catastrophic benefits.--Coverage under a 
        basic health benefits provision.
            ``(2) Catastrophic only coverage.--Catastrophic coverage 
        with respect to basic health care services.
            ``(3) Supplemental benefits.--Coverage consisting of 
        coverage described in paragraph (1) and such supplemental 
        coverage as the Secretary of Health and Human Services may by 
        regulation prescribe.
    ``(b) Cost Containment and Quality of Care.--A health benefits 
system does not meet the requirements of this section unless such 
system, to the maximum extent determined practicable under regulations 
of the Secretary of Health and Human Services, taking into account 
quality of care, provides for a hospital precertification utilization 
review program, constraint of costs to the extent practicable through 
the use of appropriately managed care, and such other cost containment 
procedures as may from time to time be proven effective.
    ``(c) Treatment of Uninsurable Risks and Material Pre-Existing 
Conditions.--In any case in which the requirements of section 633 are 
met with respect to any individual with respect to whom the system 
meets the requirements of section 631, the requirements of subsection 
(a) shall be treated as satisfied with respect to such individual.
    ``(d) Duration of Coverage.--A health benefits system does not meet 
the requirements of this section if coverage under such system 
terminates solely by reason of the termination of a period of coverage 
required under subpart E of this part or title XXII of the Public 
Health Service Act.
    ``(e) Coverage Under Accessible Health Benefits System Secondary to 
Coverage Under Employee Benefit Plans.--A health benefits system does 
not meet the requirements of this section unless, under the terms of 
such system, coverage under such system with respect to any claim is 
secondary to coverage provided under any employee benefit plan with 
respect to such claim.

``SEC. 625. CONTRIBUTION REQUIREMENTS.

    ``(a) In General.--Except as otherwise provided in this section, a 
health benefits system meets the contribution requirements of this 
section if the system does not require, for coverage of individuals 
described in paragraphs (1) and (2) of section 623(a), contributions in 
excess of levels determined--
            ``(1) on the basis of its own experience with respect to 
        covered individuals described in such paragraphs (1) and (2), 
        and
            ``(2) without regard to any coverage provided under the 
        system to individuals who are not described in such paragraphs 
        (1) and (2).
    ``(b) Variances in Rate Level.--
            ``(1) Separate schedule required for children-only 
        coverage.--A health benefits system does not meet the 
        contribution requirements of this section unless the system 
        provides for a separate schedule of contributions with respect 
        to children-only coverage.
            ``(2) Other variances permitted.--A health benefits system 
        shall not be treated as failing to meet the requirements of 
        this section solely because the system otherwise provides for 
        differing rates of contributions to reflect the age, family 
        composition, or income of the covered individual and the 
        location at which the covered individual is expected to 
        normally receive medical care.
    ``(c) Certain State and Other Contributions Permitted.--A health 
benefits system shall not be treated as failing to meet the 
requirements of this section solely because the system provides for--
            ``(1) payment by any State or any other entity of part or 
        all of the contribution with respect to any covered individual,
            ``(2) varying the amount of such payment based on the 
        individual's income or any other basis, or
            ``(3) payment by any State or any other entity of all or 
        part of monthly premiums for purposes of enrollment under 
        section 1818 or 1818A of the Social Security Act, or of 
        premiums under section 1916(c) of such Act.
    ``(d) Maximized Participation.--A health benefits system does not 
meet the requirements of this section if the Secretary of Health and 
Human Services determines, under regulations prescribed by such 
Secretary and on the basis of past experience, that, under such system, 
contributions are not established and maintained in such form and 
manner as to be promotive of participation in the system.

``SEC. 626. RECIPROCITY AND RELIANCE BY ACCESSIBLE HEALTH BENEFITS 
              SYSTEMS ON OTHER SUCH SYSTEMS.

    ``The requirements of the preceding provisions of this subpart may 
be met with respect to any health benefits system by means of 
reciprocity agreements between such system and any other such system 
with respect to which such requirements are met.

``SEC. 627. REGULATORY AUTHORITY OF SECRETARY OF HEALTH AND HUMAN 
              SERVICES.

    ``The Secretary of Health and Human Services shall prescribe such 
regulations as such Secretary considers necessary to carry out the 
provisions of this subpart (other than section 622).

 ``Subpart D--Coverage for Uninsurable Risks and Material Pre-Existing 
                               Conditions

``SEC. 631. COVERAGE FOR UNINSURABLE RISKS AND PRE-EXISTING CONDITIONS.

    ``A health benefits system provides coverage in accordance with 
this subpart if such system, such system in combination with one or 
more other health benefits systems, or such system under voluntary 
participation in a program established by or under State law--
            ``(1) meets the participation requirements of section 632,
            ``(2) meets the benefits requirements of section 633, and
            ``(3) to the extent practicable and actuarially sound, 
        provides for separate accounting for such coverage so as to 
        separately account at least for individuals described in 
        section 632(1)(A) and for individuals described in section 
        632(2)(A).

``SEC. 632. PARTICIPATION REQUIREMENTS FOR UNINSURABLE RISKS AND 
              MATERIAL PRE-EXISTING CONDITIONS.

    ``A health benefits system meets the participation requirements of 
this section if the system meets the following requirements:
            ``(1) Coverage for uninsurable risks.--The system provides 
        that an individual is provided coverage under the system if--
                    ``(A) such individual is an employee (or a 
                dependent thereof) who has been excluded as an 
                uninsurable risk from coverage under a basic health 
                benefits provision included in the system or in a basic 
                group health plan maintained by the employer, or
                    ``(B) such individual is not an employee (or 
                dependent) described in subparagraph (A), and--
                            ``(i) would, in accordance with section 623 
                        (except section 623(a)(3)), be subject to 
                        exclusion from coverage under a basic health 
                        benefits provision included in the system, or
                            ``(ii) in the case of an individual not 
                        otherwise eligible for coverage under a basic 
                        health benefits provision included in the 
                        system or in a basic group health plan or 
                        coverage under title XIX of the Social Security 
                        Act, is rejected for coverage under any policy 
                        of insurance which provides at least basic 
                        health care services described in section 
                        601(a)(3)(A),
                but would be eligible for such coverage but for the 
                exclusion of such individual from coverage as an 
                uninsurable risk.
            ``(2) Coverage for material pre-existing conditions.--The 
        system provides that an individual is provided coverage under 
        the system for any material pre-existing condition if--
                    ``(A) such individual is an employee (or a 
                dependent thereof) who is provided coverage under a 
                basic health benefits provision included in the system 
                or in a basic group health plan, subject to a 
                substantial restriction based on such material pre-
                existing condition, or
                    ``(B) such individual is not an employee (or 
                dependent) described in subparagraph (A), and--
                            ``(i) is provided coverage under a basic 
                        health benefits provision included in the 
                        system under subpart C, or
                            ``(ii) in the case of an individual not 
                        otherwise eligible for coverage under a basic 
                        health benefits provision included in the 
                        system or in a basic group health plan or 
                        coverage under title XIX of the Social Security 
                        Act, is provided coverage under a policy of 
                        insurance which provides at least basic health 
                        care services,
                but such coverage is provided subject to such a 
                substantial restriction.

``SEC. 633. BENEFITS REQUIREMENTS FOR UNINSURABLE RISKS AND MATERIAL 
              PRE-EXISTING CONDITIONS.

    ``A health benefits system meets the benefits requirements of this 
section if the system provides, directly or through insurance, 
reinsurance, or otherwise--
            ``(1) in the case of individuals described in section 
        632(1), benefits described in section 624(a), and
            ``(2) in the case of individuals described in section 
        632(2), coverage of the material pre-existing condition which 
        is not otherwise covered to the extent necessary to constitute 
        basic health care services described in section 601(a)(3)(A) 
        with respect to such condition, in accordance with such 
        regulations as the Secretary of Health and Human Services may 
        prescribe.

``SEC. 634. REGULATORY AUTHORITY OF SECRETARY OF HEALTH AND HUMAN 
              SERVICES.

    ``The Secretary of Health and Human Services shall prescribe such 
regulations as such Secretary considers necessary to carry out the 
provisions of this subpart.''.
    (b) Regulations for Defining Basic Health Care Provisions.--
            (1)  Initial  regulations.--Not  later  than July 1, 1994, 
        the Secretary of Health and Human Services shall publish in the 
        Federal Register proposed regulations referred to in section 
        601(a)(3) of the Employee Retirement Income Security Act of 
        1974 (as amended by subsection (a)). In prescribing such 
        proposed regulations, the Secretary shall take into account 
        recommendations submitted to the Secretary by the Federal 
        Advisory Council on Health Care Coverage and Costs pursuant to 
        section 107(d)(1) of this Act.
            (2) Interim review period before issuance of final 
        regulations.--The Secretary of Health and Human Services shall 
        not issue the regulations referred to in section 601(a)(3) of 
        the Employee Retirement Income Security Act of 1974 in final 
        form before July 1, 1995.
    (c) Enforcement of Certain Provisions by Secretary of Health and 
Human Services.--Section 502(a) of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1132(a)) is amended by adding at the 
end, after and below paragraph (6), the following new flush sentence:
``With respect to provisions of subparts C and D of part 6 (other than 
section 622), the references to `Secretary' in paragraph (5), and in 
other provisions of this part relating to actions brought under such 
paragraph, shall be deemed a reference to the Secretary of Health and 
Human Services.''.
    (d) Clerical Amendment.--The table of contents in section 1 of such 
Act is amended by striking the items relating to part 6 of subtitle B 
of title I and inserting the following new items:

  ``Part 6--Universal Access to Coverage Under Group Health Plans and 
                     State Health Benefits Systems

                    ``Subpart A--General Provisions

``Sec. 601. Definitions and special rules.
``Subpart B--Required Coverage Options; Group Health Payroll Deduction 
                                 Plans

``Sec. 611. Coverage for eligible individuals under basic group health 
                            plans or group health payroll deduction 
                            plans.
``Sec. 612. Group health payroll deduction plans.
``Sec. 613. Availability of coverage under accessible health benefits 
                            systems.
            ``Subpart C--Accessible Health Benefits Systems

``Sec. 621. General requirements.
``Sec. 622. Reporting requirements.
``Sec. 623. Participation requirements.
``Sec. 624. Benefits requirements.
``Sec. 625. Contribution requirements.
``Sec. 626. Reciprocity and reliance by accessible health benefits 
                            systems on other such systems.
``Sec. 627. Regulatory Authority of Secretary of Health and Human 
                            Services.
 ``Subpart D--Coverage for Uninsurable Risks and Material Pre-Existing 
                               Conditions

``Sec. 631. Coverage for uninsurable risks and material pre-existing 
                            conditions.
``Sec. 632. Participation requirements for uninsurable risks and 
                            material pre-existing conditions.
``Sec. 633. Benefit requirements for uninsurable risks and material 
                            pre-existing conditions.
``Sec. 634. Regulatory authority of Secretary of Health and Human 
                            Services.
            ``Subpart E--Continuation Coverage Requirements

``Sec. 641. Plans must provide continuation coverage to certain 
                            individuals.
``Sec. 642. Continuation coverage.
``Sec. 643. Qualifying event.
``Sec. 644. Applicable premium.
``Sec. 645. Election.
``Sec. 646. Notice requirements.
``Sec. 647. Definitions.
``Sec. 648. Regulations.''.

SEC. 102. ESTABLISHMENT OF STATE-BASED SYSTEM IN ABSENCE OF STATE-WIDE 
              ACCESS TO COVERAGE; SUBSTITUTE SYSTEMS.

    (a) State-Based Systems.--
            (1) In general.--If, as of January 1, 1996, one or more 
        residents of any State (as defined in section 3(10) of the 
        Employee Retirement Income Security Act of 1974 (29 U.S.C. 
        1002(10))) are--
                    (A) individuals described in section 623(a) of such 
                Act (as amended by this Act), and
                    (B) are eligible for coverage under none of the 
                following:
                            (i) a basic group health plan (as defined 
                        in section 601(a)(2) of such Act (as amended by 
                        this Act)),
                            (ii) an accessible health benefits system 
                        meeting the requirements of subpart C (and 
                        subpart D as applicable) of part 6 of subtitle 
                        B of title I of such Act, and
                            (iii) a substitute health benefits system 
                        (as defined in subsection (b)(2)(A)),
        then such State may establish and maintain a health benefits 
        system covering such residents to the extent that such system 
        is an accessible health benefits system established and 
        maintained in accordance with this subsection and such subpart 
        C (and such subpart D as applicable).
            (2) Governance of system.--The system shall not be treated 
        as meeting the requirements of this subsection unless such 
        system--
                    (A) is administered by a nonprofit corporation 
                which is established by and regulated under the laws of 
                such State,
                    (B) such corporation is governed by a Board of 
                Directors whose membership includes representatives of 
                at least employers, employee organizations, and 
                providers of group health plan coverage, and
                    (C) such corporation is subject under State law to 
                the supervision of an agency of the State which is 
                responsible for the regulation of providers of group 
                health plan coverage.
            (3) Exclusions.--The system shall not be treated as meeting 
        the requirements of this subsection unless the system excludes 
        from coverage--
                    (A) except to the extent permitted under section 
                625(c)(3) of the Employee Retirement Income Security 
                Act of 1974 (as amended by this Act), individuals 
                entitled to benefits under title XVIII or XIX of the 
                Social Security Act, or
                    (B) inmates of public institutions.
    (b) Substitute Basic Health Benefits Systems.--
            (1) In general.--If, at any time before the effective date 
        for the amendments made by section 101, the Secretary of Health 
        and Human Services determines, under regulations prescribed by 
        the Secretary--
                    (A) that there is in effect, with respect to any 
                group of individuals, an arrangement which is a 
                substitute basic health benefits system, and
                    (B) that, with respect to such group of 
                individuals, such system meets requirements (provided 
                in such regulations) for a specified element of 
                coverage which are substantially equivalent to the 
                requirements of the specified ERISA provision which is 
                applicable to such specified element of coverage,
        then the requirements of such specified ERISA provision shall 
        be treated as met with respect to such individuals until such 
        Secretary nullifies such determination under such regulations.
            (2) Definitions and special rules.--For purposes of this 
        subsection--
                    (A) Substitute basic health benefits system.--The 
                term ``substitute basic health benefits system'' means, 
                with respect to any group of individuals, any 
                arrangement (other than an accessible health benefits 
                system established and maintained in accordance with 
                subpart C (and subpart D as applicable) of part 6 of 
                subtitle B of title I of ERISA) which--
                            (i) includes at least a basic health 
                        benefits provision (as defined in section 
                        601(a)(3) of ERISA), and
                            (ii) meets, with respect to such 
                        individuals, the reporting requirements of 
                        section 622 of ERISA, the participation 
                        requirements of section 623 of ERISA, the 
                        benefits requirements of section 624 of ERISA, 
                        and the contribution requirements of section 
                        625 of ERISA.
                    (B) Specified element of coverage.--The term 
                ``specified element of coverage'' means any of the 
                following:
                            (i) Treatment of uninsurable risks.--
                        Exclusion from coverage of an individual as an 
                        uninsurable risk under a basic health benefits 
                        provision included in a plan, within the 
                        meaning of section 601(a)(7) of ERISA.
                            (ii) Treatment of material pre-existing 
                        conditions.--Coverage of an individual under a 
                        basic health benefits provision included in a 
                        plan subject to a restriction based on a 
                        material pre-existing condition, within the 
                        meaning of section 601(a)(8) of ERISA.
                            (iii) Provision of continuation coverage.--
                        Provision of coverage by a plan to qualified 
                        beneficiaries required under subpart E of part 
                        6 of subtitle B of title I of ERISA or under 
                        title XXII of the Public Health Service Act.
                    (C) Specified erisa provisions.--
                            (i) Treatment of uninsurable risks.--The 
                        ``specified ERISA provision'' applicable to the 
                        specified element of coverage described in 
                        subparagraph (B)(i) is section 601(a)(2)(D)(i) 
                        of ERISA.
                            (ii) Treatment of material pre-existing 
                        conditions.--The ``specified ERISA provision'' 
                        applicable to the specified element of coverage 
                        described in subparagraph (B)(ii) is section 
                        601(a)(2)(D)(ii) of ERISA.
                            (iii) Provision of continuation coverage.--
                        The ``specified ERISA provisions'' applicable 
                        to the specified element of coverage described 
                        in subparagraph (B)(iii) are section 641(b) of 
                        ERISA, section 4980B(f)(8) of the Internal 
                        Revenue Code of 1986, and section 2201(b) of 
                        the Public Health Service Act.
                    (D) State.--The term ``State'' has the meaning 
                provided in section 3(10) of ERISA.
                    (E) ERISA.--The term ``ERISA'' means the Employee 
                Retirement Income Security Act of 1974, as amended by 
                this Act.
    (c) Federal Assistance in Establishment of Universal Access to 
Coverage.--
            (1) Grant program.--The Secretary of Health and Human 
        Services shall establish by regulation a program of monetary 
        assistance in the form of grants to accessible health benefits 
        systems established and maintained in accordance with subpart C 
        (and subpart D as applicable) of part 6 of subtitle B of title 
        I of the Employee Retirement Income Security Act of 1974 
        pursuant to the amendments made by this Act. Grants to any 
        system shall be in such amount as such Secretary considers 
        appropriate to facilitate the effectuation of the policies of 
        this Act.
            (2) Authorization of appropriations.--There is authorized 
        to be appropriated for the Department of Health and Human 
        Services, for the purpose of carrying out the provisions of 
        paragraph (1), $200,000,000 for each of the fiscal years 1994, 
        1995, and 1996.

SEC. 103. CONTINUATION COVERAGE AND ACCESSIBLE HEALTH BENEFITS SYSTEMS 
              OR SUBSTITUTE SYSTEMS.

    (a) Amendment to ERISA.--Section 641(b) of the Employee Retirement 
Income Security Act of 1974 (as redesignated by section 102) is amended 
to read as follows:
    ``(b) Substitution of Accessible Health Benefits System or 
Substitute System.--The requirements of this subpart may be met by 
providing, as an option to qualified beneficiaries or otherwise, for 
coverage of them under an accessible health benefits system established 
and maintained in accordance with subpart C (and subpart D as 
applicable), or under a substitute health benefits system providing 
continuation coverage in accordance with section 102 of the Universal 
Health Benefits Empowerment and Partnership Act of 1993, in lieu of 
coverage as otherwise required under this subpart.''.
    (b) Conforming Amendment to Internal Revenue Code.--Section 4980B 
of the Internal Revenue Code of 1986 (relating to excise tax for 
failure to satisfy continuation coverage requirements of group health 
plans) is amended--
            (1) in subsection (d), by striking paragraph (1) and 
        redesignating paragraphs (2) and (3) as paragraphs (1) and (2), 
        respectively; and
            (2) by adding at the end of subsection (f) the following 
        new paragraph:
            ``(8) Substitution of accessible health benefits system or 
        substitute system.--The requirements of this subsection may be 
        met by providing, as an option to qualified beneficiaries or 
        otherwise, for coverage of them under an accessible health 
        benefits system established and maintained in accordance with 
        subpart C (and subpart D as applicable) of part 6 of subtitle B 
        of title I of the Employee Retirement Income Security Act of 
        1974, or under a substitute health benefits system providing 
        continuation coverage in accordance with section 102 of the 
        Universal Health Benefits Empowerment and Partnership Act of 
        1993, in lieu of coverage as otherwise required under this 
        subsection.''.
    (c) Conforming Amendment to Public Health Service Act.--Section 
2201 of the Public Health Service Act is amended by striking subsection 
(b) and inserting the following new subsection:
    ``(b) Substitution of Accessible Health Benefits System or 
Substitute System.--The requirements of this title may be met by 
providing, as an option to qualified beneficiaries or otherwise, for 
coverage of them under an accessible health benefits system established 
and maintained in accordance with subpart C (and subpart D as 
applicable) of part 6 of subtitle B of title I of the Employee 
Retirement Income Security Act of 1974, or under a substitute health 
benefits system providing continuation coverage in accordance with 
section 102 of the Universal Health Benefits Empowerment and 
Partnership Act of 1993, in lieu of coverage as otherwise required 
under this title.''.

SEC. 104. PREEMPTION OF STATE LAW TO PROVIDE FOR MORE AFFORDABLE HEALTH 
              CARE COVERAGE.

    (a) In General.--Section 514(b)(2)(B) of the Employee Retirement 
Income Security Act of 1974 (29 U.S.C. 1144(b)(2)(B)) is amended--
            (1) by inserting ``(i)'' after ``(B)''; and
            (2) by adding at the end the following new clause:
    ``(ii) A provision of State law which provides that one or more 
specific benefits must be provided or made available by a contract or 
policy of health insurance issued to an employee benefit plan, or which 
provides that services rendered by one or more particular classes of 
health care providers must be covered under such a contract or policy, 
is a law which relates to an employee benefit plan within the meaning 
of subsection (a) and is not a law which regulates insurance within the 
meaning of subparagraph (A).''.
    (b) Preemption of Certain State Laws Restricting Managed Care Under 
Employee Welfare Benefit Plans.--Section 514(b) of such Act is amended 
by adding at the end the following new paragraph:
    ``(9) For purposes of this section, a provision of State law which 
in any manner restricts managed care under an employee welfare benefit 
plan providing medical care (as defined in section 213(d) of the 
Internal Revenue Code of 1986) to participants or beneficiaries 
directly or through insurance, reimbursement, or otherwise, by 
restricting the ability to negotiate provider reimbursement rates or to 
set such rates for any provider, limiting the number or type of 
providers, or restricting utilization or quality review in connection 
with such plan shall be deemed a law which relates to an employee 
benefit plan within the meaning of subsection (a) and not a law which 
regulates insurance within the meaning of paragraph (2)(A).''.

SEC. 105. ENCOURAGEMENT OF MULTIPLE EMPLOYER ARRANGEMENTS PROVIDING 
              BASIC HEALTH BENEFITS.

    Paragraph (9) of section 501(c) of the Internal Revenue Code of 
1986 (relating to exempt organizations) is amended--
            (1) by inserting ``(A)'' after ``(9)''; and
            (2) by adding at the end the following:
            ``(B) Any determination of whether a multiple employer 
        welfare arrangement (as defined in section 3(25) of the 
        Employee Retirement Income Security Act of 1974) is a voluntary 
        employees' beneficiary association meeting the requirements of 
        this paragraph shall be made without regard to any 
        determination of commonality of interest or geographic location 
        if--
                    ``(i) such arrangement provides at least basic 
                health care services described in section 601(a)(3)(A) 
                of the Employee Retirement Income Security Act of 1974, 
                and
                            ``(I) such arrangement is fully insured, or
                            ``(II) meets the requirements enforcible 
                        under section 514(b)(6)(B)(i) of such Act, and
                    ``(ii) meets reporting requirements which shall be 
                prescribed by the Secretary and are similar to the 
                requirements of section 622 of such Act.''.

SEC. 106. TREATMENT PRACTICE GUIDELINES AND OUTCOMES RESEARCH FOR ALL 
              AMERICANS.

    (a) Agency for Health Care Policy and Research.--So much of part A 
of title IX of the Public Health Service Act as precedes section 902(c) 
is amended to read as follows:

               ``Part A--Establishment and General Duties

``SEC. 901. ESTABLISHMENT.

    ``(a) In General.--There is established within the Service an 
agency to be known as the Agency for Health Care Policy and Research.
    ``(b) Purpose.--The purpose of the Agency is to enhance the 
quality, appropriateness, and effectiveness of health care services for 
all Americans, and access to such services, through the establishment 
of a broad base of scientific research and through the promotion of 
improvements in clinical practice and in the organization, financing, 
and delivery of health care services.
    ``(c) Appointment of Administrator.--There shall be at the head of 
the Agency an official to be known as the Administrator for Health Care 
Policy and Research. The Administrator shall be appointed by the 
Secretary. The Secretary, acting through the Administrator, shall carry 
out the authorities and duties established in this title.

``SEC. 902. GENERAL AUTHORITIES AND DUTIES.

    ``(a) In General.--In carrying out section 901(b), the 
Administrator shall conduct and support research, demonstration 
projects, evaluations, training, guideline development, and the 
dissemination of information, on health care services and on systems 
for the delivery of such services to all Americans, including 
activities with respect to--
            ``(1) the effectiveness, efficiency, and quality of health 
        care services;
            ``(2) subject to subsection (d), the outcomes of health 
        care services and procedures;
            ``(3) clinical practice, including primary care and 
        practice-oriented research;
            ``(4) health care technologies, facilities, and equipment;
            ``(5) health care costs, productivity, and market forces;
            ``(6) health promotion and disease prevention;
            ``(7) health statistics and epidemiology; and
            ``(8) medical liability.
    ``(b) Requirements With Respect to Rural Areas and Underserved 
Populations.--In carrying out subsection (a), the Administrator shall 
undertake and support research, demonstration projects, and evaluations 
with respect to--
            ``(1) the delivery of health care services in rural areas 
        (including frontier areas) to Americans of all ages; and
            ``(2) the health of low-income groups, minority groups, and 
        the elderly.''.
    (b) Forum for Quality and Effectiveness in Health Care.--So much of 
part B of title IX of the Public Health Service Act as precedes section 
912(c) is amended to read as follows:

      ``Part B--Forum for Quality and Effectiveness in Health Care

``SEC. 911. ESTABLISHMENT OF OFFICE.

    ``There is established within the Agency an office to be known as 
the Office of the Forum for Quality and Effectiveness in Health Care. 
The office shall be headed by a director, who shall be appointed by the 
Administrator.

``SEC. 912. DUTIES.

    ``(a) Establishment of Forum Program.--The Administrator, acting 
through the Director, shall establish a program to be known as the 
Forum for Quality and Effectiveness in Health Care. For the purpose of 
promoting the quality, appropriateness, and effectiveness of health 
care, the Director, using the process set forth in section 913, shall 
arrange for the development and periodic review and updating of--
            ``(1) clinically relevant guidelines that may be used by 
        physicians, educators, and health care practitioners to assist 
        in determining how diseases, disorders, and other health 
        conditions can most effectively and appropriately be prevented, 
        diagnosed, treated, and managed clinically; and
            ``(2) standards of quality, performance measures, and 
        medical review criteria through which health care providers and 
        other appropriate entities may assess or review the provision 
        of health care and assure the quality of such care.
    ``(b) Certain Requirements.--Guidelines, standards, performance 
measures, and review criteria under subsection (a) shall--
            ``(1) be based on the best available research and 
        professional judgment regarding the effectiveness and 
        appropriateness of health care services and procedures;
            ``(2) be presented--
                    ``(A) in formats appropriate for use by physicians, 
                health care practitioners, providers, medical 
                educators, and medical review organizations,
                    ``(B) in formats appropriate for use by group 
                health plans (as defined in section 601(a)(1) of the 
                Employee Retirement Income Security Act of 1974), 
                health benefits systems established and maintained by 
                States in accordance with subpart C of part 6 of 
                subtitle B of title I of the Employee Retirement Income 
                Security Act of 1974, and substitute basic health 
                benefits systems with respect to which the Secretary 
                has made a determination pursuant to section 4 of the 
                Universal Health Benefits Empowerment and Partnership 
                Act of 1990 relating to an element of coverage 
                described in section 4(a)(2)(B) of such Act, and
                    ``(C) in formats appropriate for use by consumers 
                of health care; and
            ``(3) include treatment-specific or condition-specific 
        practice guidelines for clinical treatments and conditions in 
        forms appropriate for use in clinical practice, for use in 
        educational programs, and for use in reviewing quality and 
        appropriateness of medical care.''.
    (c) Dissemination of Standards, Criteria, Etc.--Section 914(c) of 
the Public Health Service Act is amended to read as follows:
    ``(c) Dissemination.--
            ``(1) In general.--The Director shall promote and support 
        the dissemination of the guidelines, standards, performance 
        measures, and review criteria described in section 912(a).
            ``(2) Organizations utilized.--Such dissemination shall be 
        carried out through--
                    ``(1) organizations representing health care 
                providers;
                    ``(2) group health plans (as defined in section 
                601(a)(1) of the Employee Retirement Income Security 
                Act of 1974);
                    ``(3) accessible health benefits systems 
                established and maintained in accordance with subpart C 
                (and subpart D as applicable) of part 6 of subtitle B 
                of title I of the Employee Retirement Income Security 
                Act of 1974;
                    ``(4) organizations representing health care 
                consumers;
                    ``(5) peer review organizations;
                    ``(6) accrediting bodies; and
                    ``(7) other appropriate entities.''.
    (d) Study of Role of Practice Guidelines In Reducing Malpractice 
Costs.--As soon as practicable after the date of the enactment of this 
Act, the Federal Advisory Council on Health Care Coverage and Costs 
shall undertake a study of the manner in which practice guidelines may 
be used in reducing medical malpractice costs. The Council shall submit 
the results of such study together with any recommendations to the 
Secretary of Health and Human Services.
    (e) Authorization of Additional Appropriations.--Section 926(a) of 
the Public Health Service Act is amended by adding at the end the 
following: ``In addition to amounts otherwise authorized by this 
subsection, for the purpose of carrying out the amendments made by 
section 8 of the Universal Health Benefits Empowerment and Partnership 
Act of 1993, there are authorized to be appropriated $10,000,000 for 
fiscal year 1994, $15,000,000 for fiscal year 1995, and $20,000,000 for 
fiscal year 1996.''.

SEC. 107. FEDERAL ADVISORY COUNCIL ON HEALTH CARE COVERAGE AND COSTS.

    (a) In General.--There is hereby established a Federal Advisory 
Council on Health Care Coverage and Costs for the purpose of reviewing, 
overseeing, and making recommendations relating to the implementation 
of the provisions of this Act and studying the causes of changes in the 
costs of health care coverage and delivery.
    (b) Membership.--The Council shall consist of a Chairman and 12 
other persons, appointed by the Secretary of Health and Human Services 
with the concurrence of the Secretary of Labor and without regard to 
the provisions of title 5, United States Code, governing appointments 
in the competitive service. The appointed members shall, to the extent 
possible, represent organizations of small and large employers, 
employee organizations, health care providers, providers of group 
health plan coverage, State and local governments, the field of 
actuarial counseling, and the general public.
    (c) Expenses.--
            (1) Services and assistance.--The Council is authorized to 
        engage such technical assistance, including actuarial services, 
        as may be required to carry out its functions, and the 
        Secretary of Health and Human Services and the Secretary of 
        Labor shall, in addition, make available to the Council such 
        secretarial, clerical, and other assistance as it may require 
        to carry out such functions. The Secretary of Health and Human 
        Services and the Secretary of Labor shall, in addition, make 
        available to the Council such actuarial and other pertinent 
        data prepared by the Department of Health and Human Services, 
        the Department of Labor, or other agencies of the Government as 
        it may require to carry out such functions.
            (2) Travel and per diem.--Appointed members of the Council, 
        while serving on the business of the Council (inclusive of 
        travel time), while so serving away from their homes or regular 
        places of business, may be allowed travel expenses, including 
        per diem in lieu of subsistence, as authorized by section 5703 
        of title 5, United States Code, for persons in the Government 
        employed intermittently.
    (d) Functions.--The Council shall--
            (1) make timely recommendations to the Secretary of Health 
        and Human Services for purposes of the issuance of initial 
        regulations under section 101(b)(1),
            (2) make recommendations to the Secretary of Health and 
        Human Services relating to appropriate mechanisms for and the 
        frequency of revisions of regulations under section 601(a)(3) 
        of the Employee Retirement Income Security Act of 1974 (as 
        amended by this Act),
            (3) otherwise advise the Secretary of Health and Human 
        Services and the Secretary of Labor with respect to the 
        implementation of the amendments made by this Act,
            (4) offer States and other entities advice regarding health 
        benefits systems and implementation of the amendments made by 
        this Act,
            (5) serve as a forum for exchange of advice, 
        recommendations, and information regarding the amendments made 
        by this Act, their implementation, and health benefits systems 
        established and maintained by States, and otherwise foster 
        cooperation between States and other entities in implementing 
        such amendments,
            (6) make from time to time such recommendations as it 
        considers appropriate relating to possible improvements 
        relating to the financing and affordability of health care 
        coverage for individuals eligible for coverage under health 
        benefits systems established and maintained by States and other 
        entities, and
            (7) make from time to time such recommendations to the 
        Secretary of Health and Human Services and to the Congress as 
        it considers appropriate relating to changes in the costs of 
        health care coverage and delivery.
    (e) Reports.--The Council shall, at least annually, submit a report 
to the Secretary of Health and Human Services and the Secretary of 
Labor of any findings or recommendations relating to matters considered 
by the Council, and such reports shall thereupon be transmitted to the 
Congress.
    (f) Final Report and Termination.--Upon the request of the 
Secretary of Health and Human Services, the Council shall submit a 
final report to such Secretary and the Secretary of Labor. The Council 
shall terminate upon the submission of such final report.

SEC. 108. INCREASE IN DEDUCTION FOR HEALTH INSURANCE COSTS OF SELF-
              EMPLOYED INDIVIDUALS FROM 25 PERCENT TO 100 PERCENT.

    (a) In General.--Paragraph (1) of section 162(l) of the Internal 
Revenue Code of 1986 (relating to special rules for health insurance 
costs of self-employed individuals) is amended by striking ``25 
percent'' and inserting ``the applicable percentage''.
    (b) Applicable Percentage.--Paragraph (6) of section 162(l) of such 
Code is amended to read as follows:
            ``(6) Applicable percentage.--For purposes of paragraph 
        (1)--

        In the case of taxable
                                                                       
          years beginning in
                                                         The applicable
          calendar year:
                                                         percentage is:
                1992, 1993, 1994, or 1995............        25 percent
                1996 or 1997.........................        50 percent
                1998 or thereafter...................    100 percent.''

SEC. 109. EFFECTIVE DATES.

    (a) Sections 101 and 103.--The amendments made by section 101 shall 
take effect January 1, 1996, and the amendments made by section 103 
shall apply with respect to plan years beginning on or after such date.
    (b) Section 102.--The provisions of section 102 shall take effect 
on the date of the enactment of this Act.
    (c) Section 104.--The amendments made by section 104(b) shall take 
effect January 1, 1994. The amendments made by section 104(a) shall 
take effect January 1, 1994, except that with respect to plans in 
effect on the date of the enactment of this Act, such amendments shall 
take effect on the effective date of section 101.
    (d) Section 105.--The amendments made by section 105 shall apply 
with respect to determinations made on or after January 1, 1994.
    (e) Section 106.--The amendments made by section 106 shall take 
effect January 1, 1994.
    (f) Section 107.--The provisions of section 107 shall take effect 
on the date of the enactment of this Act.
    (g) Section 108.--The amendments made by section 108 shall apply 
with respect to taxable years beginning on or after January 1, 1992.

       TITLE II--MEDICAL AND HEALTH INSURANCE INFORMATION REFORM

SEC. 201. SHORT TITLE.

    This title may be cited as the ``Medical and Health Insurance 
Information Reform Act of 1993''.

SEC. 202. MEDICAL AND HEALTH INSURANCE INFORMATION REFORM.

    The Social Security Act, as amended by section 202, is further 
amended by adding at the end the following new title:

     ``TITLE XXII--MEDICAL AND HEALTH INSURANCE INFORMATION REFORM

                ``Part A--Comparative Value Information

  ``comparative value information programs for health care purchasing

    ``Sec. 2200. (a) Purpose.--In order to assure the availability of 
comparative value information to purchasers of health care in each 
State, the Secretary shall determine whether each State is developing 
and implementing a health care value information program that meets the 
criteria and the schedule see out in subsection (b).
    ``(b) Criteria for State Programs.--A State's health care value 
information program shall be determined by the Secretary to meet the 
criteria and the schedule of this subsection if--
            ``(1) the State begins promptly after enactment of this 
        section to develop (directly or through contractual or other 
        arrangements with coalitions of health care purchasers, one or 
        more States, other entities, or any combination of such 
        arrangements) information systems regarding comparative health 
        care values;
            ``(2) the information contained in such systems covers at 
        least the average prices of common health care services (as 
        defined in subsection (c)) and information related to the value 
        of each health insurance plan available in the State, including 
        premium costs and the value of benefits, and, where available, 
        measures of the variability of those prices within the State or 
        other market areas;
            ``(3) the information described in paragraph (2) is made 
        available within the State beginning not later than one year 
        after enactment of this section, and is revised as frequently 
        as reasonably necessary, but at intervals of no greater than 
        one year; and
            ``(4) not later than four years following the enactment of 
        this section, the State has developed information systems that 
        provide comparative quality and outcomes data with respect to 
        health insurance plans and hospitals and made the information 
        broadly available within the relevant market areas.
    ``(c) Definition.--For purposes of this section, `common health 
care services' includes such procedures as the Secretary may specify 
and any additional health care services which a State may wish to 
include in its comparative value information program.
    ``(d) Federal Implementation.--If the Secretary finds, at any time, 
that a State has not developed a health care value information program, 
or has failed to implement it (on a continuing basis) in accordance 
with the criteria and schedule set out in subsection (b), he shall take 
the actions necessary, directly or through grant or contract, to 
implement a comparable program in such State. Fees may be charged by 
the Secretary for the informational materials provided pursuant to such 
program. Any amounts so collected shall be deposited in the 
appropriation account from which the Secretary's costs of developing 
and providing such materials were met, and shall remain available for 
such purposes until expended.
    ``(e) Comparative Value Information Concerning Federal Programs.--
The head of each Federal agency with responsibility for the provision 
of health insurance, or of health care services, to individuals shall 
promptly develop health care value information relating to each program 
that he administers, and covering types of data comparative to the 
types of data that a State program meeting the criteria of this part 
would provide. Such information shall be made generally available to 
States and to providers and consumers of health care services.
    ``(f) Information for Research From Insurers.--
            ``(1) The Secretary, after consulting with insurers, 
        providers, and others, shall promulgate (and may modify from 
        time to time) requirements for the periodic submission by 
        insurers to the Secretary on a sample basis of health care data 
        relevant to research concerning health care services, and shall 
        promulgate an effective date for those requirements, to be at 
        least one year after their promulgation.
            ``(2) Each insurer shall comply with the requirements 
        specified by the Secretary under paragraph (1) by the effective 
        date specified by the Secretary.
            ``(3) For provisions imposing an excise tax with respect to 
        noncompliance with Federal requirements under this subsection, 
        see section 5000A of the Internal Revenue Code of 1986.
    ``(g) Release of Medicare Information.--
            ``(1) The Department of Health and Human Services shall 
        make available, under section 552 of title 5, United States 
        Code, all records of claims filed under the programs 
        established by title XVIII of the Social Security Act, without 
        regard to the consent of the physician or other individual who 
        furnished the item or service in question.
            ``(2)(A) Paragraph (1) shall not affect any prohibition 
        against disclosure under section 552a of title 5, United States 
        Code, with respect to any individual to whom an item or service 
        was furnished.
            ``(B) The requirement of paragraph (1) does not apply to 
        information received by the Department of Health and Human 
        Services, or by any of its contractors, before the date of 
        enactment of the Medical and Health Insurance Information 
        Reform Act of 1994.
    ``(h) Development of Model Systems.--
            ``(1) The Secretary shall, directly or through grant or 
        contract, develop model systems to facilitate gathering of 
        health care cost, quality, and outcomes data and analyzing such 
        data in a manner that will permit the valid comparison of such 
        data cost, quality, and outcomes among providers and among 
        health plans. The Secretary shall support experimentation with 
        different approaches to achieve the objectives of the preceding 
        sentence in the most cost effective manner (relative to the 
        accuracy and timeliness of the data secured) and shall evaluate 
        the various methods to determine their relative success. When 
        he considers it appropriate, the Secretary may establish 
        standards for the collection and reporting of health care cost, 
        quality, and outcomes data in order to facilitate analysis and 
        comparisons among States and nationally.
            ``(2) There are authorized to be appropriated such sums as 
        are necessary for each fiscal year beginning with fiscal year 
        1994, to enable the Secretary to conduct the activities 
        required by paragraph (1), including evaluation of the 
        different approaches tested under such paragraph and their 
        relative cost effectiveness.

             ``grants for the development of state programs

    ``Sec. 2201. (a) Grant Authority.--The Secretary may make grants to 
each State to enable such State to plan the development of its health 
care value information program described in section 2200, and if 
necessary, to initiate the implementation of such program. Each State 
seeking such a grant shall submit an application therefor, containing 
such information as the Secretary finds necessary to assure that the 
State is likely to develop and implement a program in accordance with 
the criteria and schedule of section 2200(b).
    ``(b) Offset Authority.--If, at any time within the three year 
period following the receipt by a State of a grant pursuant to 
subsection (a), the Secretary is required by section 2200(d) to 
implement a health care information program in such State, he may 
recover the amount of the grant under subsection (a) by offset against 
any other amount payable to such State under this Act. The amount of 
the offset shall be made available (from the appropriation account with 
respect to which the offset was taken) to the Secretary to carry out 
section 2200(d) in such State.
    ``(c) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as are necessary to carry out this section, to 
remain available until expended.

  ``Part B--Storage and Transmission of Medical and Health Insurance 
                  Information and Priority of Payment

                  ``preemption of state quill pen laws

    ``Sec. 2210. After 1994, no effect shall be given to any provision 
of State law that requires medical or health insurance records 
(including billing information) to be maintained in written, rather 
than electronic, form.

              ``promulgation of requirements by secretary

    ``Sec. 2211. (a) Health Insurance Information Privacy and 
Confidentiality Protection.--
            ``(1) The Secretary, after taking into consideration the 
        Insurance Information and Privacy Protection Model Act of the 
        NAIC, shall promulgate by January 1, 1994, (and may modify from 
        time to time) requirements concerning health insurance 
        information privacy and confidentiality protection for 
        individuals. There shall be included a requirement that 
        information that identifies individuals shall not be 
        redisclosed (with such limited exceptions as the Secretary may 
        provide) except to the extent necessary to carry out the 
        purpose for which the information was collected.
            ``(2) The Secretary, in promulgating requirements under 
        paragraph (1), shall take into consideration the following 
        principles concerning information that identifies individuals:
                    ``(A) Such information should be collected only to 
                the extent necessary to carry out the purpose for which 
                the information is collected.
                    ``(B) Such information collected for one purpose 
                should not be used for another purpose without the 
                individual's informed consent.
                    ``(C) Such information should be disposed of when 
                no longer necessary to carry out the purpose for which 
                it was collected.
                    ``(D) Methods to ensure the accuracy, reliability, 
                relevance, completeness, and timeliness of such 
                information should be instituted.
                    ``(E) Individuals should be notified (in advance of 
                the collection of such information) as to whether the 
                furnishing of such information is mandatory or 
                voluntary, as to what the record keeping practices are 
                concerning such information, and as to what uses will 
                be made of such information.
                    ``(F) Individuals should be permitted to inspect 
                and correct such information concerning themselves.
    ``(b) Standards and Requirements for the Electronic Receipt and 
Transmission of Health Insurance Information.--
            ``(1) By January 1, 1995, the Secretary shall determine 
        whether problems relating to standards for the electronic 
        receipt and transmission of health insurance information cause 
        significant administrative costs. If the Secretary determines 
        that such problems do cause significant administrative costs, 
        the Secretary, after consulting with the Accredited Standards 
        Committee X-12 of the American National Standards Institute, 
        insurers, providers, and others, shall promulgate (and may 
        modify from time to time) standards concerning the electronic 
        receipt and transmission of claims, payment, eligibility, and 
        enrollment information (including requirements, consistent with 
        those promulgated under subsection (a), to protect privacy and 
        confidentiality), and shall promulgate an effective date for 
        those standards, to be at least one year after the promulgation 
        of the standards.
            ``(2) By January 1, 1995, the Secretary shall determine 
        whether problems relating to the receipt and transmission of 
        health insurance eligibility verification cause significant 
        administrative costs. If the Secretary determines that such 
        problems do cause significant administrative costs, the 
        Secretary, after consulting with the Accredited Standards 
        Committee X-12 of the American National Standards Institute, 
        insurers, providers, and others, shall promulgate (and may 
        modify from time to time) requirements concerning the receipt 
        and transmission of health insurance eligibility verification, 
        and shall promulgate an effective date for those requirements, 
        to be at least one year after the promulgation of the 
        requirement.
            ``(3) By January 1, 1995, the Secretary shall determine 
        whether the proportion of health insurance claims and payment 
        information received and transmitted by paper will continue to 
        cause significant administrative costs. If the Secretary 
        determines that the proportion will continue to cause 
        significant administrative costs, the Secretary, after 
        consulting with the Accredited Standards Committee X-12 of the 
        American National Standards Institute, insurers, providers, and 
        others, shall promulgate (and may modify from time to time) a 
        requirement that insurers receive and transmit a specified 
        proportion of (or all) health insurance claims and payment 
        information electronically (with such exceptions as the 
        Secretary may specify from time to time), and shall promulgate 
        an effective date for that requirement, to be at least one year 
        after the promulgation of the requirement.
    ``(c) Health Insurance Claim Forms.--
            ``(1) By January 1, 1995, the Secretary, after consulting 
        with insurers, providers, and others, shall promulgate (and may 
        modify from time to time) requirements for the format and 
        content of basic claim forms under health insurance plans.
            ``(2) The Secretary shall determine whether the variety of 
        information requested by insurers (in addition to the 
        information requested in basic claim forms) causes 
        administrative costs that are disproportionate to the benefits 
        derived from that information. If the Secretary determines that 
        the variety of information requested does cause such costs, the 
        Secretary, after consulting with insurers, providers, and 
        others, shall publish (and may modify from time to time) 
        recommendations concerning what additional information should 
        be allowed to be requested and in what format.
    ``(d) Priority Among Insurers.--By January 1, 1995, but after June 
30, 1994, the Secretary, after consulting with the NAIC, shall 
promulgate (and may modify from time to time) rules for determining the 
liability of insurers when benefits are payable under two or more 
health insurance plans.
    ``(e) Furnishing of Information Among Insurers.--By January 1, 
1996, but after June 30, 1995, the Secretary shall determine whether 
problems relating to the availability of information among insurers 
when benefits are payable under two or more health insurance plans 
cause significant mistaken benefit payments or administrative costs. If 
the Secretary determines that such problems do cause significant 
mistaken benefit payments or administrative costs, the Secretary shall 
promulgate (and may modify from time to time) requirements concerning 
the transfer among insurers (and annual updating) of appropriate 
information (which may include requirements for the use of unique 
identifiers, and for the listing of all individuals covered under a 
health insurance plan), and shall promulgate an effective date for 
those requirements (to be not earlier than one year after the 
promulgation of the requirements).

                            ``state programs

    ``Sec. 2212. The Secretary shall determine from time to time, for 
each State, whether--
            ``(1) the State has in effect standards, requirements, and 
        rules (for insurers other than administrators of self-insured 
        employee plans) substantially the same (or, for section 2214, 
        at least as protective of privacy and confidentiality) as those 
        described in sections 2214 through 2219, and
            ``(2) the State maintains an effective enforcement 
        mechanism for those State requirements.

                 ``application of federal requirements

    ``Sec. 2213. (a) Administrators of Self-Insured Employee Plans.--
The provisions in each of sections 2214 through 2219 apply to 
administrators of self-insured employee plans.
    (b) Other Insurers.--The provisions in each of sections 2214 
through 2219 apply to activities (of insurers other than administrators 
of self-insured employee plans) in a State only if--
            ``(1) with respect to a section, the Secretary determines 
        that the State does not meet the requirements of section 2212, 
        or
            ``(2) with respect to a section, the State fails to provide 
        such information from time to time as requested by the 
        Secretary to enable the Secretary to make a determination under 
        section 2212.

 ``health insurance information privacy and confidentiality protection

    ``Sec. 2214. As of January 1, 1995, each insurer shall comply with 
the requirements promulgated by the Secretary under section 2211(a).

                        ``identification numbers

    ``Sec. 2215. As of January 1, 1995, each insurer shall--
            ``(1) for each of its beneficiaries that has a social 
        security number, use that number, and
            ``(2) for each provider that has a unique identifier for 
        purposes of title XVIII and that furnishes health care items or 
        services to a beneficiary under a health insurance plan of that 
        insurer, use that identifier.

``standards and requirements for the receipt and transmission of health 
                         insurance information

    ``Sec. 2216. If the Secretary promulgates standards or requirements 
under section 2211(b), each insurer, by the effective date specified by 
the Secretary for those standards or requirements, shall comply with 
them.

                     ``health insurance claim forms

    ``Sec. 2217. As of January 1, 1996, each insurer shall comply with 
the requirements promulgated by the Secretary under section 2211(c)(1).

                       ``priority among insurers

    ``Sec. 2218. As of January 1, 1996, each insurer shall comply with 
the rules promulgated by the Secretary under section 2211(d).

               ``furnishing of information among insurers

    ``Sec. 2219. If the Secretary promulgates requirements under 
section 2211(e), each insurer, by the effective date specified by the 
Secretary for those requirements, shall comply with them.

               ``noncompliance with federal requirements

    ``Sec. 2220. For provisions imposing an excise tax with respect to 
noncompliance with Federal requirements under this part, see section 
5000A of the Internal Revenue Code of 1986.

                ``no effect on scope of benefits covered

    ``Sec. 2221. Nothing in this part shall be construed to specify 
what items and services are covered under a health insurance plan.

                  ``Part C--Medical Data Requirements

              ``promulgation of requirements by secretary

    ``Sec. 2230. (a) Promulgation of Requirements for Hospitals.--
            ``(1) By January 1, 1996, but after June 30, 1995, the 
        Secretary shall promulgate requirements for hospitals 
        concerning electronic medical data. In developing the 
        requirements, the Secretary shall consult with the American 
        National Standards Institute, insurers, hospitals, and other 
        interested parties (and shall take into consideration, in 
        developing requirements under paragraph (2)(A), the data set 
        used by the utilization and quality control peer review program 
        under part B of title XI).
            ``(2) The requirements promulgated under paragraph (1) 
        shall include--
                    ``(A) the definition of a standard set of data 
                elements for use by utilization and quality control 
                peer review organizations,
                    ``(B) the definition of a set of data elements for 
                use by intermediaries and carriers under the programs 
                established by title XVIII (that shall include the 
                standard set of data elements defined under 
                subparagraph (A)),
                    ``(C) standards for an electronic patient care 
                information system with data obtained at the point of 
                care (including requirements, consistent with those 
                promulgated under section 2211(a), to protect privacy 
                and confidentiality),
                    ``(D) the specification of, and manner of 
                presentation of, the individual data elements of the 
                sets and system under the preceding subparagraph, and
                    ``(E) standards concerning the transmission of 
                electronic medical data.
            ``(3) The Secretary may from time to time (after consulting 
        with the American National Standards Institute, insurers, 
        hospitals, and other interested parties) modify the 
        requirements promulgated under the preceding paragraphs.
    ``(b) Promulgation of Requirements for Other Health Care 
Providers.--
            ``(1) The Secretary may promulgate requirements concerning 
        electronic medical data for providers that are not hospitals. 
        In developing the requirements, the Secretary shall consult 
        with the American National Standards Institute, insurers, 
        providers other than hospitals, and other interested parties.
            ``(2) The requirements promulgated under paragraph (1) may 
        include--
                    ``(A) the definition of a set of data elements for 
                use by intermediaries and carriers under the programs 
                established by title XVIII,
                    ``(B) the specification of, and manner of 
                presentation of, the individual data elements of the 
                set under subparagraph (A), and
                    ``(C) standards concerning the transmission of 
                electronic medical data.
            ``(3) The Secretary may from time to time modify the 
        requirements promulgated under paragraph (1).

                 ``medicare requirements for hospitals

    ``Sec. 2231. (a) General Rule.--As of January 1, 1997, each 
hospital that has entered into an agreement under section 1866 shall 
(except as otherwise provided by subsection (b))--
            ``(1) maintain an electronic patient care information 
        system that meets the requirements of subparagraphs (C) and (D) 
        of section 2230(a)(2);
            ``(2) upon request of the Secretary or of a utilization and 
        quality control peer review organization (with which the 
        Secretary has entered into a contract under part B of title 
        XI), transmit electronically the data set specified under 
        subparagraphs (A) and (D) of section 2230(a)(2) with respect to 
        a specified discharge;
            ``(3) upon request of the Secretary, or of a fiscal 
        intermediary or carrier (as defined in both cases in title 
        XVIII), transmit electronically any data (with respect to a 
        claim) from the data set specified under subparagraphs (B) and 
        (D) of section 2230(a)(2); and
            ``(4) transmit the data specified under paragraphs (2) and 
        (3) in accordance with the requirements of section 
        2230(a)(2)(E).
    ``(b) Waivers.--
            ``(1) The Secretary may waive the requirements of 
        subsection (a) until January 1, 1999, for a hospital that--
                    ``(A) is in the process of developing a system 
                specified under section 2230(a)(2)(C) and that executes 
                agreements with its fiscal intermediary and its 
                utilization and quality control peer review 
                organization that the hospital will meet the 
                requirements of subsection (a) by a specified date (not 
                later than January 1, 1999), or
                    ``(B) is a small rural hospital (as defined by the 
                Secretary).
            ``(2) The Secretary may waive the requirements of 
        subsection (a)(1) for a hospital that--
                    ``(A) agrees to obtain from its records the data 
                elements that are needed to meet the requirements of 
                paragraphs (2) and (3) of subsection (a), and
                    ``(B) agrees to subject its data transfer process 
                to a quality assurance program specified by the 
                Secretary.

             ``electronic transmission to federal agencies

    ``Sec. 2232. As of January 1, 1999, the head of any Federal agency 
may require any provider that is required to transmit a data element 
(utilized by that agency in carrying out health care or research 
programs) specified under section 2230(a)(2)(D) or 2230(b)(2)(B)--
            ``(1) to transmit the data element electronically in 
        accordance with the requirements of section 2230(a)(2)(E) or 
        2230(b)(2)(C), as applicable, and
            ``(2) to present the data element in the manner prescribed 
        under section 2230(a)(2)(D) or 2230(b)(2)(B), as applicable.

                      ``Part D--General Provisions

                             ``definitions

    ``Sec. 2240. For purposes of this title--
            ``(1) The term `administrator' has the meaning given that 
        term in section 3(16)(A) of the Employee Retirement Income 
        Security Act of 1974.
            ``(2) The term `employee welfare benefit plan' has the 
        meaning given that term in section 3(1) of the Employee 
        Retirement Income Security Act of 1974.
            ``(3) The term `health insurance plan' means any contract 
        or arrangement under which an entity bears all or part of the 
        cost of providing health care items and services, including a 
        hospital or medical expense incurred policy or certificate, 
        hospital or medical service plan contract, or health 
        maintenance subscriber contract (including any self-insured 
        health insurance plan), but does not include (except for 
        purposes of sections 2211(d), 2211(e), 2218, and 2219)--
                    ``(A) coverage only for accident, dental, vision, 
                disability, or long-term care, medicare supplemental 
                health insurance, or any combination thereof,
                    ``(B) coverage issued as a supplement to liability 
                insurance,
                    ``(C) workers' compensation or similar insurance, 
                or
                    ``(D) automobile medical-payment insurance.
            ``(4) The term `insurer' means any entity that offers a 
        health insurance plan under which that entity is at risk for 
        all or part of the cost of benefits under the plan, and 
        includes any agent of that entity.
            ``(5) The term `NAIC' means the National Association of 
        Insurance Commissioners.
            ``(6) The term `provider' means a physician, hospital, 
        pharmacy, laboratory, or other person licensed or otherwise 
        authorized under applicable State laws to furnish health care 
        items or services.
            ``(7) The term `administrator of a self-insured employee 
        plan' means an insurer that is an administrator of an employee 
        welfare benefit plan.
            ``(8) The term `utilization review' means review of the 
        medical necessity, appropriateness, and quality of health care 
        items and services.''.

SEC. 203. CONFORMING AMENDMENT.

    The first sentence of section 1866(a)(1) of the Social Security Act 
is amended--
            (1) by striking ``and'' at the end of subparagraph (P),
            (2) by striking the period at the end of subparagraph (Q) 
        and inserting a comma and ``and'', and
            (3) by adding at the end the following:
            ``(R) in the case of hospitals, to comply with the 
        requirements of section 2231.''.

SEC. 204. FAILURE TO SATISFY CERTAIN HEALTH INSURANCE REQUIREMENTS.

    (a) In general.--Chapter 47 of the Internal Revenue Code of 1986 
(relating to taxes on group health plans) is amended by adding at the 
end the following new section:

``SEC. 5000B. FAILURE TO SATISFY CERTAIN HEALTH INSURANCE REQUIREMENTS.

    ``(a) General Rule.--
            ``(1) Administrators of self-insured employee plans.--There 
        is hereby imposed, on any administrator of a self-insured 
        employee plan, a tax on any failure to comply with a 
        requirement under section 2214, 2215, 2216, 2217, 2218, or 2219 
        of that Act. The Secretary of Health and Human Services, in 
        consultation with the Secretary of Labor, shall determine 
        whether any administrator of a self-insured employee plan meets 
        the requirements of those sections.
            ``(2) Other insurers.--There is hereby imposed, on any 
        insurer other than an administrator of a self-insured employee 
        plan, a tax on any failure to comply with a requirement under 
        section 2214, 2215, 2216, 2217, 2218, or 2219 of that Act with 
        respect to an activity in a State that is subject to Federal 
        regulation pursuant to section 2213(b) of the Social Security 
        Act. The Secretary of Health and Human Services shall determine 
        whether any insurer meets the requirements of those sections.
            ``(3) Research data requirements.--There is hereby imposed 
        on any insurer a tax on any failure to comply with a 
        requirement under paragraph (2) of section 2200(f) of the 
        Social Security Act. The Secretary of Health and Human Services 
        shall determine whether any insurer meets the requirements of 
        that paragraph.
    ``(b) Amount of Tax.--The amount of tax imposed by subsection (a) 
for a taxable year in which an insurer fails to comply with a 
requirement described in that subsection shall be equal to $100 for 
each such failure.
    ``(c) Controlled Groups.--
            ``(1) Employers.--In the case of an insurer that is an 
        employer, for purposes of this section all persons that are 
        treated as part of the same employer (within the meaning of 
        section 414) as the insurer shall be treated as the same 
        person.
            ``(2) Other insurers.--In the case of an insurer that is 
        not an employer, for purposes of this section--
                    ``(A) Controlled group of corporations.--All 
                corporations which are members of the same controlled 
                group of corporations shall be treated as one person. 
                For purposes of the preceding sentence, the term 
                `controlled group of corporations' has the meaning 
                given to such term by section 1563(a), except that--
                            ``(i) `more than 50 percent' shall be 
                        substituted for `at least 80 percent' each 
                        place it appears in section 1563(a)(1), and
                            ``(ii) the determination shall be made 
                        without regard to subsections (a)(4) and 
                        (e)(3)(C) of section 1563.
                    ``(B) Partnerships, proprietorships, etc., which 
                are under common control.--Under regulations prescribed 
                by the Secretary, all trades or businesses (whether or 
                not incorporated) which are under common control shall 
                be treated as one person. The regulations prescribed 
                under this subparagraph shall be based on principles 
                similar to the principles which apply in the case of 
                subparagraph (A).
    ``(d) Limitations on Tax.--
            ``(1) Tax not to apply where failure not discovered 
        exercising reasonable diligence.--No tax shall be imposed by 
        subsection (a) with respect to any failure for which it is 
        established to the satisfaction of the Secretary that the 
        person liable for tax did not know, and by exercising 
        reasonable diligence would not have known, that the failure 
        existed.
            ``(2) Tax not to apply to failures corrected within thirty 
        days.--No tax shall be imposed by subsection (a) on any failure 
        if--
                    ``(A) the failure was due to reasonable cause and 
                not to willful neglect, and
                    ``(B) the failure is corrected during the thirty-
                day period beginning on the 1st date the person liable 
                for the tax knew, or by exercising reasonable diligence 
                would have known, that the failure existed.
            ``(3) Waiver by secretary.--In the case of a failure which 
        is due to reasonable cause and not to willful neglect, the 
        Secretary may waive part or all of the tax imposed by 
        subsection (a) to the extent that the payment of that tax would 
        be excessive relative to the failure involved.
    ``(e) Definitions.--For purposes of this section--
            ``(1) the terms `insurer' and `administrator of a self-
        insured employee plan' have the meanings given to those terms 
        by section 2230 of the Social Security Act, and
            ``(2) the term `State' has the meaning given to that term 
        by section 1101(1) of the Social Security Act.''.
    (b) Nondeductibility of Tax.--Paragraph (6) of section 275(a) of 
that Code (relating to nondeductibility of certain taxes) is amended by 
inserting ``47,'' after ``46,''.
    (c) Clerical Amendments.--The table of sections for chapter 47 of 
that Code is amended by adding at the end the following new item:

                              ``Sec. 5000B. Failure to satisfy certain 
                                        health insurance 
                                        requirements.''
    Effective Date.--The amendments made by this section shall take 
effect on January 1, 1995.

                TITLE III--MEWA ENFORCEMENT IMPROVEMENTS

SEC. 301. SHORT TITLE.

    This title may be cited as the ``Multiple Employer Welfare 
Arrangements Enforcement Improvements Act of 1993''.

SEC. 302. AMENDMENT TO DEFINITION OF EMPLOYEE WELFARE BENEFIT PLAN.

    Section 3(1) of the Employee Retirement Income Security Act of 1974 
(29 U.S.C. 1002(1)) is amended--
            (1) by redesignating clauses (A) and (B) as clauses (i) and 
        (ii), respectively;
            (2) by inserting ``(A)'' after ``(1)''; and
            (3) by adding at the end the following new subparagraphs:
    ``(B) Notwithstanding subparagraph (A), a plan, fund, or program 
shall not fail to be an `employee welfare benefit plan' solely because 
the plan, fund, or program covers individuals who are not employees or 
former employees of the employer (or members or former members of the 
employee organization) which established or maintains the plan, or 
their beneficiaries, if at no time during the plan year the number of 
such individuals exceeds five percent of the aggregate number of 
individuals covered under the plan.
    ``(C) A plan, fund, or program shall not fail to be an `employee 
welfare benefit plan' solely because the plan, fund, or program is 
established or maintained by a franchise network (as defined in 
paragraph (40)(B)(vi)).
    ``(D) A plan, fund, or program shall not fail to be an `employee 
welfare benefit plan' solely because the plan, fund, or program is 
established or maintained by two or more trades or businesses, whether 
or not incorporated, that are within the same control group or were 
within the same control group at any time during the period commencing 
with the preceding one-year period. For purposes of this subparagraph, 
the term `control group' shall have the meaning provided in clauses 
(ii) and (iii) of paragraph (40)(B).''.

SEC. 303. AMENDMENT TO DEFINITION OF MULTIPLE EMPLOYER WELFARE 
              ARRANGEMENT.

    Section 3(40) of the Employee Retirement Income Security Act of 
1974 (29 U.S.C. 1002(40)) is amended--
            (1) in subparagraph (A), by striking clause (i) and 
        inserting the following:
            ``(i) pursuant to one or more collective bargaining 
        agreements, if, under such arrangements, coverage under such 
        arrangements is limited to--
                    ``(I) employees covered by a collective bargaining 
                agreement,
                    ``(II) employees of the plan,
                    ``(III) employees of an employee organization which 
                is a party to such collective bargaining agreement, and
                    ``(IV) beneficiaries of participants described in 
                subclauses (I), (II), and (III), or'';
            (2) in subparagraph (A), by striking ``or'' at the end of 
        clause (ii), by striking the period at the end of clause (iii) 
        and inserting a comma, and by adding after clause (iii) the 
        following new clauses:
            ``(iv) by a franchise network, or
            ``(v) by an insurer (as defined in section 401(b)(2)(A)) or 
        by a health maintenance organization, if such insurer or 
        organization is licensed to do business in a State.'';
            (3) in subparagraph (B)(i), by striking ``if such trades or 
        businesses are within the same control group'' and inserting 
        ``for any plan year of any such plan, or any fiscal year of any 
        other arrangement, if such trades or businesses are within the 
        same control group during such year or at any time during the 
        preceding one-year period.''; and
            (4) in subparagraph (B), by redesignating clauses (iv) and 
        (v) as clauses (viii) and (ix), respectively, and by inserting 
        after clause (iii) the following new clauses:
            ``(iv) the term `employee' includes any former employee who 
        is receiving benefits under the plan or under part 6 of 
        subtitle B,
            ``(v) the term `collective bargaining agreement' means a 
        written agreement between an employer or a group of employers 
        and one or more employee organizations which has been 
        negotiated through a process of arm's length, good faith 
        bargaining, pursuant to the National Labor Relations Act or 
        other applicable law, where a broad range of matters pertaining 
        to the employment relationship such as wages, rates of pay, 
        hours of employment, grievances, and conditions of employment, 
        in addition to employee benefits, have been negotiated,
            ``(vi) the term `franchise network' means a group or 
        association of franchisees (which may include the franchisor), 
        if each of such franchisees is a party to a franchise with the 
        same franchisor, except that, for purposes of this clause--
                    ``(I) the terms `franchise', `franchisor', and 
                `franchisee' shall have the meanings provided such 
                terms in the regulations of the Federal Trade 
                Commission, as in effect on January 1, 1991, under 
                paragraphs (1) and (2) of section 436.2(a) of title 16 
                of the Code of Federal Regulations, without regard to 
                paragraph (5) of such section 436.2(a), if the 
                franchise has as its primary economic basis a business 
                activity in fact apart from the provision of health 
                care benefits to employees of the franchisees,
                    ``(II) a franchise that is exempted from the 
                provisions of part 436 of title 16 of the Code of 
                Federal Regulations pursuant to section 436.2(a)(3) of 
                such title 16, or is an arrangement that is excluded 
                under section 436.2(a)(4) of such title 16, is not a 
                franchise for purposes of this part, and
                    ``(III) the Secretary may by regulation amend the 
                definition of `franchise network' for purposes of 
                maintaining consistency with any changes in the 
                definition of `franchise' adopted by the Federal Trade 
                Commission under the Federal Trade Commission Act,
            ``(vii) an employee welfare benefit plan which is 
        maintained by a single employer shall not be deemed to be a 
        multiple employer welfare arrangement for any plan year solely 
        because the plan covers individuals who are not employees or 
        former employees of the employer, or their beneficiaries, if, 
        at no time during the plan year, the number of such individuals 
        exceeds five percent of the aggregate number of individuals 
        covered under the plan,''.

SEC. 304. COVERAGE.

    Section 4 of the Employee Retirement Income Security Act of 1974 
(29 U.S.C. 1003) is amended by adding at the end the following new 
subsection:
    ``(c) Except as provided in subsection (b), this title shall apply 
to any multiple employer welfare arrangement engaged in commerce or in 
any industry or activity affecting commerce.''.

SEC. 305. REGISTRATION REQUIREMENT.

    Section 101 of the Employee Retirement Income Security Act of 1974 
(29 U.S.C. 1021) is amended--
            (1) by redesignating subsection (f) as subsection (g); and
            (2) by inserting after subsection (e) the following new 
        subsections:
    ``(f) Registration of Multiple Employer Welfare Arrangements.--
            ``(1) Existing arrangements.--The person or persons 
        responsible under paragraph (4), with respect to each multiple 
        employer welfare arrangement which provides benefits of medical 
        care (within the meaning of section 213(d) of the Internal 
        Revenue Code of 1986) and which have commenced operations as of 
        180 days after the date of the enactment of the Multiple 
        Employer Welfare Arrangements Enforcement Improvements Act of 
        1993, shall file with the Secretary--
                    ``(A) a registration statement described in 
                paragraph (3) covering the current fiscal year or any 
                part thereof, within 30 days after the 180-day period 
                following the date of enactment of such Act, and
                    ``(B) a registration statement described in 
                paragraph (3) for each fiscal year thereafter, within 
                30 days after the end of each fiscal year.
            ``(2) New arrangements.--The person or persons responsible 
        under paragraph (4), with respect to each multiple employer 
        welfare arrangement which provides benefits of medical care 
        (within the meaning of section 213(d) of the Internal Revenue 
        Code of 1986) and which have not commenced operations as of 180 
        days after the date of the enactment of the Multiple Employer 
        Welfare Arrangements Enforcement Improvements Act of 1993, 
        shall file with the Secretary a registration statement 
        described in paragraph (3)--
                    ``(A) at least 60 days before the date on which the 
                multiple employer welfare arrangement commences 
                operations, and
                    ``(B) within 30 days after the end of each fiscal 
                year.
            ``(3) Registration statements.--A registration statement 
        filed under this subsection shall--
                    ``(A) be filed in such form, and contain such 
                information concerning the multiple employer welfare 
                arrangement, as shall be provided in regulations 
                promulgated by the Secretary, including information 
                disclosing the names and addresses of any person 
                involved in its operation, the address of the 
                arrangement, the fiscal year of the arrangement, and a 
                list of States in which the arrangement conducts 
                business or intends to conduct business within the 
                following 12-month period,
                    ``(B) contain a certification that copies of such 
                registration statement have been filed with the 
                Insurance Commissioner (or other similar official) of 
                each State in which the multiple employer welfare 
                arrangement currently offers or provides benefits, or 
                intends to offer or provide benefits during the 
                following 12-month period, and
                    ``(C) indicate whether the multiple employer 
                welfare arrangement has obtained, applied for, or 
                intends to apply for an exemption from State regulation 
                under section 514(b)(6)(B).
            ``(4) Persons responsible for filing.--The person or 
        persons responsible for filing the annual registration 
        statement with respect to a multiple employer welfare 
        arrangement are--
                    ``(A) the trustee or trustees so designated by the 
                terms of the instrument under which the multiple 
                employer welfare arrangement is established or 
                maintained, or
                    ``(B) in the case of a multiple employer welfare 
                arrangement for which the trustee or trustees cannot be 
                identified, the person or persons actually responsible 
                for the acquisition, disposition, control, or 
                management of the cash or property of the multiple 
                employer welfare arrangement, irrespective of whether 
                such acquisition, disposition, control, or management 
                is exercised directly by such person or persons or 
                through an agent designated by such person or 
                persons.''.

SEC. 306. ENFORCEMENT AND CIVIL PENALTIES.

    (a) In General.--Section 502 of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1132) is amended--
            (1) in subsection (a)(6), by inserting ``or (c)(4)'' after 
        ``(c)(2)''; and
            (2) in subsection (c), by adding at the end the following 
        new paragraph:
    ``(4) The Secretary may assess, against the person or persons 
responsible for filing with the Secretary an annual registration 
statement with respect to a multiple employer welfare arrangement as 
required under section 101(f), a civil penalty of up to $1,000 a day 
from the date of such person's or persons' failure or refusal to timely 
file such statement. For purposes of this paragraph, an annual 
registration statement which the Secretary determines to be materially 
incomplete, and which is not refiled in a manner satisfactory to the 
Secretary within 45 days after the Secretary makes such determination, 
shall not be treated as having been filed with the Secretary.''.
    (b) Court Orders.--Section 502 of such Act is further amended by 
adding at the end the following new subsection:
    ``(m)(1) Upon application by the Secretary showing the operation, 
promotion, or marketing of a multiple employer welfare arrangement 
that--
            ``(A) offers or provides benefits to participants covered 
        by an employee welfare benefit plan, and
            ``(B) is neither--
                    ``(i) licensed, registered, or otherwise approved 
                under the insurance laws of all States in which the 
                arrangement offers or provides benefits, nor
                    ``(ii) operating in accordance with the terms of an 
                exemption granted by the Secretary pursuant to section 
                514(b)(6)(B),
a district court of the United States shall enter an order requiring 
that the arrangement cease activities.
    ``(2) Paragraph (1) shall not apply if it is shown that the 
arrangement--
            ``(A) is fully insured, within the meaning of section 
        514(b)(6)(D),
            ``(B) meets the requirements of paragraph (2)(A), except to 
        the extent that all or some of the States in which the 
        arrangement offers or provides benefits do not require 
        licensing, registration, or approval of fully-insured multiple 
        employer welfare arrangements, and
            ``(C) with respect to such States, is operating in 
        accordance with applicable State insurance laws that are not 
        superseded pursuant to section 514.
The court may grant such additional equitable or remedial relief, 
including any relief available under this title, as it deems necessary 
to protect the interests of the public and of persons having claims for 
benefits against the arrangement.''.

SEC. 307. EXEMPTION PROCEDURE.

    (a) In General.--Section 514(b)(6) of the Employee Retirement 
Income Security Act of 1974 (29 U.S.C. 1144(b)(6)) is amended--
            (1) in subparagraph (A)(i), by striking ``(or which is a 
        multiple employer welfare arrangement subject to an exemption 
        under subparagraph (B))'';
            (2) by subparagraph (A)(ii), by striking ``the preceding 
        sections of'';
            (3) in subparagraph (B), by striking ``(B) The Secretary'' 
        and all that follows through the end of the first sentence and 
        inserting the following: ``(B)(i) The Secretary may exempt from 
        subparagraph (A), for a period not to exceed three years, 
        individually or by class, multiple employer welfare 
        arrangements which are not fully insured and which provide 
        benefits of medical care (within the meaning of section 213(d) 
        of the Internal Revenue Code of 1986). This exemption may be 
        renewed by the Secretary upon application.''; and
            (4) by adding at the end of subparagraph (B) the following 
        new clauses:
    ``(ii) The Secretary may not grant an exemption under this 
subparagraph unless the Secretary finds that such exemption is--
            ``(I) administratively feasible,
            ``(II) not adverse to the interests of the participants and 
        beneficiaries of the employee welfare benefit plan which is a 
        multiple employer welfare arrangement, and
            ``(III) protective of the rights and benefits of such 
        participants and beneficiaries.
    ``(iii) Before granting an exemption under this subparagraph, the 
Secretary shall--
            ``(I) publish notice in the Federal Register of the 
        pendency of the exemption,
            ``(II) require that adequate notice be given to interested 
        persons, including the insurance commissioner (or similar 
        official having jurisdiction over the offering or sale of 
        insurance) of each State in which the multiple employer welfare 
        arrangement offers or provides, or intends to offer or provide, 
        benefits, and
            ``(III) afford interested persons opportunity to present 
        views.
The Secretary may not grant an exemption under this subparagraph unless 
the Secretary affords an opportunity for a hearing and makes a 
determination on the record with respect to the findings required by 
clauses (I), (II), and (III) of clause (ii).
    ``(iv) Any determination made by the Secretary under this 
subparagraph shall be in the Secretary's sole discretion.''.
    (b) Transitional Rule.--During the 540-day period commencing with 
the date of the enactment of this Act, section 514(b)(6)(A) of the 
Employee Retirement Income Security Act of 1974 (29 U.S.C. 
1144(b)(6)(A)) shall not apply to any multiple employer welfare 
arrangement which, as of such date, is an employee welfare benefit plan 
which provides benefits for medical care (within the meaning of section 
213(d) of the Internal Revenue Code of 1986) to participants and 
beneficiaries, if--
            (1) an application for an exemption with respect to such 
        arrangement is filed pursuant to section 514(b)(6)(B)(i) of the 
        Employee Retirement Income Security Act of 1974 (as amended by 
        this Act) during the 180-day period following the date of the 
        enactment of this Act, and
            (2) as of 90 days after receipt of the exemption 
        application, the Secretary of Labor has not found such 
        application to be materially deficient.
If the Secretary determines, at any time after the date of the 
enactment of this Act, that such exemption from such section 
514(b)(6)(A) would be detrimental to the interests of participants or 
beneficiaries of a multiple employer welfare arrangement, such 
exclusion shall cease as of the date of the determination. Any 
determination made by the Secretary under this subsection shall be in 
the Secretary's sole discretion.

SEC. 308. CLARIFICATION OF STATES' ABILITY TO OBTAIN INFORMATION.

    Section 514(b) of the Employee Retirement Income Security Act of 
1974 (29 U.S.C. 1144(b)) is amended by adding at the end the following 
new paragraph:
    ``(9) Notwithstanding any other provision of this section, in the 
case of an employee welfare benefit plan, any law of any State which 
regulates insurance may apply to such plan to the extent that such law, 
in connection with an investigation to determine whether or not a 
person has violated or is about to violate a provision of such law, 
gives the State the ability to require disclosure of information 
necessary to determine whether such plan--
            ``(A) is a multiple employer welfare arrangement,
            ``(B) is in compliance with an exemption granted by the 
        Secretary under paragraph (6)(B)(i), or
            ``(C) is in compliance with paragraph (6)(B)(ii).''.

SEC. 309. EFFECTIVE DATE.

    The amendments made by this title shall take effect upon the date 
of enactment of this Act.

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