[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2925 Reported in House (RH)]





                                                 Union Calendar No. 325

104th CONGRESS

  2d Session

                               H. R. 2925

                          [Report No. 104-646]

_______________________________________________________________________

                                 A BILL

To modify the application of the antitrust laws to health care provider 
  networks that provide health care services; and for other purposes.

_______________________________________________________________________

                             June 27, 1996

Committed to the Committee of the Whole House on the State of the Union 
                       and ordered to be printed





                                                 Union Calendar No. 325
104th CONGRESS
  2d Session
                                H. R. 2925

                          [Report No. 104-646]

To modify the application of the antitrust laws to health care provider 
  networks that provide health care services; and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            February 1, 1996

Mr. Hyde (for himself, Mr. Archer, Mr. Weldon of Florida, Mr. McCollum, 
Mr. Gekas, Mr. Coble, Mr. Smith of Texas, Mr. Hastert, Mr. Schiff, Mr. 
   Thomas, Mr. Canady of Florida, Mr. Inglis of South Carolina, Mr. 
     Goodlatte, Mr. Boucher, Mr. Crane, Mr. Shaw, Mrs. Johnson of 
 Connecticut, Mr. McCrery, Mr. Camp, Mr. Campbell, Mr. Sam Johnson of 
  Texas, Mr. Christensen, Mr. Ganske, Mr. Lipinski, and Mr. Hancock) 
 introduced the following bill; which was referred to the Committee on 
                             the Judiciary

                             June 27, 1996

Additional sponsors: Mr. Davis, Mr. Norwood, Mr. Ensign, Ms. Greene of 
 Utah, Mr. Hoekstra, Mr. Moran, Mr. Petri, Mr. Talent, Mr. Linder, Mr. 
  Hutchinson, Mr. Moorhead, Mrs. Smith of Washington, Mr. Ehlers, Mr. 
  Cooley of Oregon, Mr. Scarborough, Mr. Knollenberg, Mr. Barcia, Mr. 
     Stump, Mr. Taylor of North Carolina, Mr. Zimmer, Ms. Dunn of 
 Washington, Mr. Hostettler, Mr. Saxton, Mr. Fox of Pennsylvania, Mr. 
 Barr of Georgia, Mr. Hayes, Mr. Portman, Mr. Mica, Mr. McIntosh, Mr. 
 Salmon, Mr. Combest, Mr. Cramer, Mr. Pickett, Ms. Pryce, Mr. Latham, 
  Mr. Shadegg, Mr. Nussle, Mr. Thornberry, Mr. Dickey, Mr. Crapo, Mr. 
Bunning of Kentucky, Mr. Gordon, Mr. Duncan, Mr. Sanford, Mr. Bartlett 
of Maryland, Mr. Ballenger, Mr. Cunningham, Mr. Upton, Mr. Parker, Mr. 
 Zeliff, Mr. Hobson, Mr. Walsh, Mr. Rogers, Mr. Souder, Mr. Taylor of 
 Mississippi, Mr. Condit, Mr. Frelinghuysen, Mr. Gillmor, Mr. DeFazio, 
  Mr. Livingston, Mr. Kildee, Mrs. Fowler, Mr. Manzullo, Mr. Young of 
 Alaska, Mr. Torkildsen, Mr. Greenwood, Mr. Nethercutt, Mr. Whitfield, 
 Mrs. Vucanovich, Mr. Wicker, Mr. Shays, Mr. Foley, Mr. Gutknecht, Mr. 
Minge, Mr. Weller, Mr. Stockman, Mr. Wilson, Mr. Ehrlich, Mr. Stearns, 
   Mrs. Myrick, Mr. Ney, Mr. Stenholm, Mr. Volkmer, Mr. Bonilla, Mr. 
 Forbes, Mr. Chrysler, Mr. Wamp, Mr. Castle, Mr. Callahan, Mr. Tejeda, 
 Mr. McKeon, Mr. Lazio of New York, Mr. Montgomery, Mr. Lightfoot, Mr. 
Peterson of Minnesota, Mr. Payne of Virginia, Mr. Heineman, Mr. English 
of Pennsylvania, Mr. Gilman, Mr. Jones, Mr. Burr, Mr. Holden, Mr. Tate, 
    Mr. Baldacci, Mrs. Kelly, Mr. Hayworth, Mr. Oxley, Mr. Lewis of 
  Kentucky, Mr. Porter, Mr. Brownback, Mr. Funderburk, Mr. Johnson of 
   South Dakota, Mr. Frost, Mrs. Cubin, Mr. Collins of Georgia, Mrs. 
Chenoweth, Mr. Barrett of Wisconsin, Mr. Longley, Mr. Deal of Georgia, 
 Ms. Harman, Mr. Kingston, Mr. Hilliard, Mr. Hilleary, Ms. Kaptur, Mr. 
Frisa, Mr. Watts of Oklahoma, Mr. Bilbray, Mr. Coburn, and Mrs. Lincoln

                             June 27, 1996

Committed to the Committee of the Whole House on the State of the Union 
                       and ordered to be printed

_______________________________________________________________________

                                 A BILL


 
To modify the application of the antitrust laws to health care provider 
  networks that provide health care services; and for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Antitrust Health Care Advancement 
Act of 1996''.

SEC. 2. APPLICATION OF ANTITRUST RULE OF REASON TO HEALTH CARE PROVIDER 
              NETWORKS.

    (a) Rule of Reason Standard.--In any action under the antitrust 
laws, or under any State law similar to the antitrust laws--
            (1) the conduct of a health care provider in exchanging 
        with 1 or more other health care providers information relating 
        to costs, sales, profitability, marketing, prices, or fees of 
        any health care service if--
                    (A) the exchange of such information is solely for 
                the purpose of establishing a health care provider 
                network and is reasonably required for such purpose, 
                and
                    (B) such information is not used for any other 
                purpose,
            (2) the conduct of a health care provider network 
        (including any health care provider who is a member of such 
        network and who is acting on behalf of such network) in 
        negotiating, making, or performing a contract (including the 
        establishment and modification of a fee schedule and the 
        development of a panel of physicians), to the extent such 
        contract is for the purpose of providing health care services 
        to individuals under the terms of a health benefit plan, and
            (3) the conduct of any member of such network for the 
        purpose of providing such health care services under such 
        contract to such extent,
shall not be deemed illegal per se. Such conduct shall be judged on the 
basis of its reasonableness, taking into account all relevant factors 
affecting competition, including the effects on competition in properly 
defined markets.
    (b) Definitions.--For purposes of subsection (a):
            (1) Antitrust laws.--The term ``antitrust laws'' has the 
        meaning given it in subsection (a) of the first section of the 
        Clayton Act (15 U.S.C. 12), except that such term includes 
        section 5 of the Federal Trade Commission Act (15 U.S.C. 45) to 
        the extent that such section 5 applies to unfair methods of 
        competition.
            (2) Health benefit plan.--The term ``health benefit plan'' 
        means--
                    (A) a hospital or medical expense-incurred policy 
                or certificate,
                    (B) a hospital or medical service plan contract,
                    (C) a health maintenance subscriber contract, or
                    (D) a multiple employer welfare arrangement or 
                employee benefit plan (as defined under the Employee 
                Retirement Income Security Act of 1974).
        Such term includes a contract to provide health care services 
        under section 1876 or 1903(m) of the Social Security Act.
            (3) Health care provider.--The term ``health care 
        provider'' means any individual or entity that is engaged in 
        the delivery of health care services in a State and that is 
        required by State law or regulation to be licensed or certified 
        by the State to engage in the delivery of such services in the 
        State.
            (4) Health care service.--The term ``health care service'' 
        means any health care service for which payment may be made 
        under a health benefit plan, including services related to the 
        delivery or administration of such service.
            (5) Health care provider network.--The term ``health care 
        provider network'' means an organization that--
                    (A) is organized by, operated by, and composed of 
                members who are health care providers and for purposes 
                that include providing health care services,
                    (B) is funded in part by capital contributions made 
                by the members of such organization,
                    (C) with respect to each contract made by such 
                organization for the purpose of providing a type of 
                health care service to individuals under the terms of a 
                health benefit plan--
                            (i) requires all members of such 
                        organization who engage in providing such type 
                        of health care service to agree to provide 
                        health care services of such type under such 
                        contract,
                            (ii) receives the compensation paid for the 
                        health care services of such type provided 
                        under such contract by such members, and
                            (iii) provides for the distribution of such 
                        compensation,
                    (D) has established a program to review, pursuant 
                to written guidelines, the quality, efficiency, and 
                appropriateness of treatment methods and setting of 
                services for all health care providers and all patients 
                participating in such health benefit plan, along with 
                internal procedures to correct identified deficiencies 
                relating to such methods and such services,
                    (E) has established a program to monitor and 
                control utilization of health care services provided 
                under such health benefit plan, for the purpose of 
                improving efficient, appropriate care and eliminating 
                the provision of unnecessary health care services,
                    (F) has established a management program to 
                coordinate the delivery of health care services for all 
                health care providers and all patients participating in 
                such health benefit plan, for the purpose of achieving 
                efficiencies and enhancing the quality of health care 
                services provided, and
                    (G) has established a grievance and appeal process 
                for such organization designed to review and promptly 
                resolve beneficiary or patient grievances and 
                complaints.
            (6) State.--The term ``State'' has the meaning given it in 
        section 4G(2) of the Clayton Act (15 U.S.C. 15g(2)).

SEC. 3. ISSUANCE OF GUIDELINES.

    Not later than 180 days after the date of the enactment of this 
Act, the Attorney General and the Federal Trade Commission jointly 
shall issue guidelines specifying the enforcement policies and 
analytical principles that will be applied by the Department of Justice 
and the Commission with respect to the operation of section 2.