[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1836 Reported in House (RH)]





                                                 Union Calendar No. 219

105th CONGRESS

  1st Session

                               H. R. 1836

                          [Report No. 105-374]

_______________________________________________________________________

                                 A BILL

    To amend chapter 89 of title 5, United States Code, to improve 
 administration of sanctions against unfit health care providers under 
 the Federal Employees Health Benefits Program, and for other purposes.

_______________________________________________________________________

                            November 4, 1997

  Reported with an amendment, committed to the Committee of the Whole 
       House on the State of the Union, and ordered to be printed





                                                 Union Calendar No. 219
105th CONGRESS
  1st Session
                                H. R. 1836

                          [Report No. 105-374]

    To amend chapter 89 of title 5, United States Code, to improve 
 administration of sanctions against unfit health care providers under 
 the Federal Employees Health Benefits Program, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 10, 1997

    Mr. Burton of Indiana (for himself and Mr. Mica) introduced the 
   following bill; which was referred to the Committee on Government 
                          Reform and Oversight

                            November 4, 1997

Additional sponsors: Mr. Sununu, Mr. Sessions, Mr. Shays, Mr. Cummings, 
    Mr. Skeen, Mr. McIntosh, Mr. Cox of California, Mr. Barrett of 
 Wisconsin, Mr. Gilman, Mr. Souder, Mr. Horn, Mr. Barr of Georgia, Mr. 
 Roemer, Mr. Davis of Virginia, Mr. Bereuter, Mr. Hoyer, Mr. Moran of 
   Virginia, Mr. Fawell, Mr. Greenwood, Mr. Kanjorski, Mr. Wynn, Ms. 
       Norton, Mr. Ford, Mrs. Morella, Mr. Waxman, and Mr. Allen

                            November 4, 1997

  Reported with an amendment, committed to the Committee of the Whole 
       House on the State of the Union, and ordered to be printed
 [Strike out all after the enacting clause and insert the part printed 
                               in italic]
 [For text of introduced bill, see copy of bill as introduced on June 
                               10, 1997]

_______________________________________________________________________

                                 A BILL


 
    To amend chapter 89 of title 5, United States Code, to improve 
 administration of sanctions against unfit health care providers under 
 the Federal Employees Health Benefits Program, 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 ``Federal Employees Health Care 
Protection Act of 1997''.

SEC. 2. DEBARMENT AND OTHER SANCTIONS.

    (a) Amendments.--Section 8902a of title 5, United States Code, is 
amended--
            (1) in subsection (a)--
                    (A) in paragraph (1)--
                            (i) by striking ``and'' at the end of 
                        subparagraph (B);
                            (ii) by striking the period at the end of 
                        subparagraph (C) and inserting ``; and''; and
                            (iii) by adding at the end the following:
            ``(D) the term `should know' means that a person, with 
        respect to information, acts in deliberate ignorance of, or in 
        reckless disregard of, the truth or falsity of the information, 
        and no proof of specific intent to defraud is required;''; and
                    (B) in paragraph (2)(A), by striking ``subsection 
                (b) or (c)'' and inserting ``subsection (b), (c), or 
                (d)'';
            (2) in subsection (b)--
                    (A) by striking ``The Office of Personnel 
                Management may bar'' and inserting ``The Office of 
                Personnel Management shall bar''; and
                    (B) by amending paragraph (5) to read as follows:
            ``(5) Any provider that is currently debarred, suspended, 
        or otherwise excluded from any procurement or nonprocurement 
        activity (within the meaning of section 2455 of the Federal 
        Acquisition Streamlining Act of 1994).'';
            (3) by redesignating subsections (c) through (i) as 
        subsections (d) through (j), respectively, and by inserting 
        after subsection (b) the following:
    ``(c) The Office may bar the following providers of health care 
services from participating in the program under this chapter:
            ``(1) Any provider--
                    ``(A) whose license to provide health care services 
                or supplies has been revoked, suspended, restricted, or 
                not renewed, by a State licensing authority for reasons 
                relating to the provider's professional competence, 
                professional performance, or financial integrity; or
                    ``(B) that surrendered such a license while a 
                formal disciplinary proceeding was pending before such 
an authority, if the proceeding concerned the provider's professional 
competence, professional performance, or financial integrity.
            ``(2) Any provider that is an entity directly or indirectly 
        owned, or with a control interest of 5 percent or more held, by 
        an individual who has been convicted of any offense described 
        in subsection (b), against whom a civil monetary penalty has 
        been assessed under subsection (d), or who has been debarred 
        from participation under this chapter.
            ``(3) Any individual who directly or indirectly owns or has 
        a control interest in a sanctioned entity and who knows or 
        should know of the action constituting the basis for the 
        entity's conviction of any offense described in subsection (b), 
        assessment with a civil monetary penalty under subsection (d), 
        or debarment from participation under this chapter.
            ``(4) Any provider that the Office determines, in 
        connection with claims presented under this chapter, has 
        charged for health care services or supplies in an amount 
        substantially in excess of such provider's customary charge for 
        such services or supplies (unless the Office finds there is 
        good cause for such charge), or charged for health care 
        services or supplies which are substantially in excess of the 
        needs of the covered individual or which are of a quality that 
        fails to meet professionally recognized standards for such 
        services or supplies.
            ``(5) Any provider that the Office determines has committed 
        acts described in subsection (d).
Any determination under paragraph (4) relating to whether a charge for 
health care services or supplies is substantially in excess of the 
needs of the covered individual shall be made by trained reviewers 
based on written medical protocols developed by physicians. In the 
event such a determination cannot be made based on such protocols, a 
physician in an appropriate specialty shall be consulted.'';
            (4) in subsection (d) (as so redesignated by paragraph (3)) 
        by amending paragraph (1) to read as follows:
            ``(1) in connection with claims presented under this 
        chapter, that a provider has charged for a health care service 
        or supply which the provider knows or should have known 
        involves--
                    ``(A) an item or service not provided as claimed,
                    ``(B) charges in violation of applicable charge 
                limitations under section 8904(b), or
                    ``(C) an item or service furnished during a period 
                in which the provider was debarred from participation 
                under this chapter pursuant to a determination by the 
                Office under this section, other than as permitted 
                under subsection (g)(2)(B);'';
            (5) in subsection (f) (as so redesignated by paragraph (3)) 
        by inserting after ``under this section'' the first place it 
        appears the following: ``(where such debarment is not 
        mandatory)'';
            (6) in subsection (g) (as so redesignated by paragraph 
        (3))--
                    (A) by striking ``(g)(1)'' and all that follows 
                through the end of paragraph (1) and inserting the 
                following:
    ``(g)(1)(A) Except as provided in subparagraph (B), debarment of a 
provider under subsection (b) or (c) shall be effective at such time 
and upon such reasonable notice to such provider, and to carriers and 
covered individuals, as shall be specified in regulations prescribed by 
the Office. Any such provider that is debarred from participation may 
request a hearing in accordance with subsection (h)(1).
    ``(B) Unless the Office determines that the health or safety of 
individuals receiving health care services warrants an earlier 
effective date, the Office shall not make a determination adverse to a 
provider under subsection (c)(5) or (d) until such provider has been 
given reasonable notice and an opportunity for the determination to be 
made after a hearing as provided in accordance with subsection 
(h)(1).'';
                    (B) in paragraph (3)--
                            (i) by inserting ``of debarment'' after 
                        ``notice''; and
                            (ii) by adding at the end the following: 
                        ``In the case of a debarment under paragraph 
                        (1), (2), (3), or (4) of subsection (b), the 
                        minimum period of debarment shall not be less 
                        than 3 years, except as provided in paragraph 
                        (4)(B)(ii).'';
                    (C) in paragraph (4)(B)(i)(I) by striking 
                ``subsection (b) or (c)'' and inserting ``subsection 
                (b), (c), or (d)''; and
                    (D) by striking paragraph (6);
            (7) in subsection (h) (as so redesignated by paragraph (3)) 
        by striking ``(h)(1)'' and all that follows through the end of 
        paragraph (2) and inserting the following:
    ``(h)(1) Any provider of health care services or supplies that is 
the subject of an adverse determination by the Office under this 
section shall be entitled to reasonable notice and an opportunity to 
request a hearing of record, and to judicial review as provided in this 
subsection after the Office renders a final decision. The Office shall 
grant a request for a hearing upon a showing that due process rights 
have not previously been afforded with respect to any finding of fact 
which is relied upon as a cause for an adverse determination under this 
section. Such hearing shall be conducted without regard to subchapter 
II of chapter 5 and chapter 7 of this title by a hearing officer who 
shall be designated by the Director of the Office and who shall not 
otherwise have been involved in the adverse determination being 
appealed. A request for a hearing under this subsection shall be filed 
within such period and in accordance with such procedures as the Office 
shall prescribe by regulation.
    ``(2) Any provider adversely affected by a final decision under 
paragraph (1) made after a hearing to which such provider was a party 
may seek review of such decision in the United States District Court 
for the District of Columbia or for the district in which the plaintiff 
resides or has his or her principal place of business by filing a 
notice of appeal in such court within 60 days after the date the 
decision is issued, and by simultaneously sending copies of such notice 
by certified mail to the Director of the Office and to the Attorney 
General. In answer to the appeal, the Director of the Office shall 
promptly file in such court a certified copy of the transcript of the 
record, if the Office conducted a hearing, and other evidence upon 
which the findings and decision complained of are based. The court 
shall have power to enter, upon the pleadings and evidence of record, a 
judgment affirming, modifying, or setting aside, in whole or in part, 
the decision of the Office, with or without remanding the case for a 
rehearing. The district court shall not set aside or remand the 
decision of the Office unless there is not substantial evidence on the 
record, taken as whole, to support the findings by the Office of a 
cause for action under this section or unless action taken by the 
Office constitutes an abuse of discretion.''; and
            (8) in subsection (i) (as so redesignated by paragraph 
        (3))--
                    (A) by striking ``subsection (c)'' and inserting 
                ``subsection (d)''; and
                    (B) by adding at the end the following: ``The 
                amount of a penalty or assessment as finally determined 
                by the Office, or other amount the Office may agree to 
                in compromise, may be deducted from any sum then or 
                later owing by the United States to the party against 
                whom the penalty or assessment has been levied.''.
    (b) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall take effect on the date 
        of the enactment of this Act.
            (2) Exceptions.--(A) Paragraphs (2), (3), and (5) of 
        section 8902a(c) of title 5, United States Code, as amended by 
        subsection (a)(3), shall apply only to the extent that the 
        misconduct which is the basis for debarment under such 
        paragraph (2), (3), or (5), as applicable, occurs after the 
        date of the enactment of this Act.
            (B) Paragraph (1)(B) of section 8902a(d) of title 5, United 
        States Code, as amended by subsection (a)(4), shall apply only 
        with respect to charges which violate section 8904(b) of such 
        title for items or services furnished after the date of the 
        enactment of this Act.
            (C) Paragraph (3) of section 8902a(g) of title 5, United 
        States Code, as amended by subsection (a)(6)(B), shall apply 
        only with respect to debarments based on convictions occurring 
        after the date of the enactment of this Act.

SEC. 3. MISCELLANEOUS AMENDMENTS RELATING TO THE HEALTH BENEFITS 
              PROGRAM FOR FEDERAL EMPLOYEES.

    (a) Definition of a Carrier.--Paragraph (7) of section 8901 of 
title 5, United States Code, is amended by striking ``organization;'' 
and inserting ``organization and an association of organizations or 
other entities described in this paragraph sponsoring a health benefits 
plan;''.
    (b) Service Benefit Plan.--Paragraph (1) of section 8903 of title 
5, United States Code, is amended by striking ``plan,'' and inserting 
``plan, which may be underwritten by participating affiliates licensed 
in any number of States,''.
    (c) Preemption.--Section 8902(m) of title 5, United States Code, is 
amended by striking ``(m)(1)'' and all that follows through the end of 
paragraph (1) and inserting the following:
    ``(m)(1) The terms of any contract under this chapter which relate 
to the nature, provision, or extent of coverage or benefits (including 
payments with respect to benefits) shall supersede and preempt any 
State or local law, or any regulation issued thereunder, which relates 
to health insurance or plans.''.

SEC. 4. CONTINUED HEALTH INSURANCE COVERAGE FOR CERTAIN INDIVIDUALS.

    (a) Enrollment in Chapter 89 Plan.--For purposes of chapter 89 of 
title 5, United States Code, any period of enrollment--
            (1) in a health benefits plan administered by the Federal 
        Deposit Insurance Corporation before the termination of such 
        plan on January 3, 1998, or
            (2) subject to subsection (c), in a health benefits plan 
        (not under chapter 89 of such title) with respect to which the 
        eligibility of any employees or retired employees of the Board 
        of Governors of the Federal Reserve System terminates on 
        January 3, 1998,
shall be deemed to be a period of enrollment in a health benefits plan 
under chapter 89 of such title.
    (b) Continued Coverage.--(1) Subject to subsection (c), any 
individual who, on January 3, 1998, is enrolled in a health benefits 
plan described in subsection (a) (1) or (2) may enroll in an approved 
health benefits plan under chapter 89 of title 5, United States Code, 
either as an individual or for self and family, if, after taking into 
account the provisions of subsection (a), such individual--
            (A) meets the requirements of such chapter for eligibility 
        to become so enrolled as an employee, annuitant, or former 
        spouse (within the meaning of such chapter); or
            (B) would meet those requirements if, to the extent such 
        requirements involve either retirement system under such title 
        5, such individual satisfies similar requirements or provisions 
        of the Retirement Plan for Employees of the Federal Reserve 
        System.
Any determination under subparagraph (B) shall be made under guidelines 
which the Office of Personnel Management shall establish in 
consultation with the Board of Governors of the Federal Reserve System.
    (2) Subject to subsection (c), any individual who, on January 3, 
1998, is entitled to continued coverage under a health benefits plan 
described in subsection (a) (1) or (2) shall be deemed to be entitled 
to continued coverage under section 8905a of title 5, United States 
Code, but only for the same remaining period as would have been 
allowable under the health benefits plan in which such individual was 
enrolled on January 3, 1998, if--
            (A) such individual had remained enrolled in such plan; and
            (B) such plan did not terminate, or the eligibility of such 
        individual with respect to such plan did not terminate, as 
        described in subsection (a).
    (3) Subject to subsection (c), any individual (other than an 
individual under paragraph (2)) who, on January 3, 1998, is covered 
under a health benefits plan described in subsection (a) (1) or (2) as 
an unmarried dependent child, but who does not then qualify for 
coverage under chapter 89 of title 5, United States Code, as a family 
member (within the meaning of such chapter) shall be deemed to be 
entitled to continued coverage under section 8905a of such title, to 
the same extent and in the same manner as if such individual had, on 
January 3, 1998, ceased to meet the requirements for being considered 
an unmarried dependent child of an enrollee under such chapter.
    (4) Coverage under chapter 89 of title 5, United States Code, 
pursuant to an enrollment under this section shall become effective on 
January 4, 1998.
    (c) Eligibility for FEHBP Limited to Individuals Losing Eligibility 
Under Former Health Plan.--Nothing in subsection (a)(2) or any 
paragraph of subsection (b) (to the extent such paragraph relates to 
the plan described in subsection (a)(2)) shall be considered to apply 
with respect to any individual whose eligibility for coverage under 
such plan does not involuntarily terminate on January 3, 1998.
    (d) Transfers to the Employees Health Benefits Fund.--The Federal 
Deposit Insurance Corporation and the Board of Governors of the Federal 
Reserve System shall transfer to the Employees Health Benefits Fund 
under section 8909 of title 5, United States Code, amounts determined 
by the Director of the Office of Personnel Management, after 
consultation with the Federal Deposit Insurance Corporation and the 
Board of Governors of the Federal Reserve System, to be necessary to 
reimburse the Fund for the cost of providing benefits under this 
section not otherwise paid for by the individuals covered by this 
section. The amounts so transferred shall be held in the Fund and used 
by the Office in addition to amounts available under section 8906(g)(1) 
of such title.
    (e) Administration and Regulations.--The Office of Personnel 
Management--
            (1) shall administer the provisions of this section to 
        provide for--
                    (A) a period of notice and open enrollment for 
                individuals affected by this section; and
                    (B) no lapse of health coverage for individuals who 
                enroll in a health benefits plan under chapter 89 of 
                title 5, United States Code, in accordance with this 
                section; and
            (2) may prescribe regulations to implement this section.

SEC. 5. FULL DISCLOSURE IN HEALTH PLAN CONTRACTS.

    The Office of Personnel Management shall encourage carriers 
offering health benefits plans described by section 8903 or section 
8903a of title 5, United States Code, with respect to contractual 
arrangements made by such carriers with any person for purposes of 
obtaining discounts from providers for health care services or supplies 
furnished to individuals enrolled in such plan, to seek assurance that 
the conditions for such discounts are fully disclosed to the providers 
who grant them.

SEC. 6. PROVISIONS RELATING TO CERTAIN PLANS THAT HAVE DISCONTINUED 
              THEIR PARTICIPATION IN FEHBP.

    (a) Authority To Readmit.--
            (1) In general.--Chapter 89 of title 5, United States Code, 
        is amended by inserting after section 8903a the following:
``Sec. 8903b. Authority to readmit an employee organization plan
    ``(a) In the event that a plan described by section 8903(3) or 
8903a is discontinued under this chapter (other than in the 
circumstance described in section 8909(d)), that discontinuation shall 
be disregarded, for purposes of any determination as to that plan's 
eligibility to be considered an approved plan under this chapter, but 
only for purposes of any contract year later than the third contract 
year beginning after such plan is so discontinued.
    ``(b) A contract for a plan approved under this section shall 
require the carrier--
            ``(1) to demonstrate experience in service delivery within 
        a managed care system (including provider networks) throughout 
        the United States; and
            ``(2) if the carrier involved would not otherwise be 
        subject to the requirement set forth in section 8903a(c)(1), to 
        satisfy such requirement.''.
            (2) Conforming amendment.--The analysis for chapter 89 of 
        title 5, United States Code, is amended by inserting after the 
        item relating to section 8903a the following:

``8903b. Authority to readmit an employee organization plan.''.
            (3) Applicability.--
                    (A) In general.--The amendments made by this 
                subsection shall apply as of the date of enactment of 
                this Act, including with respect to any plan which has 
                been discontinued as of such date.
                    (B) Transition rule.--For purposes of applying 
                section 8903b(a) of title 5, United States Code (as 
                amended by this subsection) with respect to any plan 
                seeking to be readmitted for purposes of any contract 
                year beginning before January 1, 2000, such section 
                shall be applied by substituting ``second contract 
                year'' for ``third contract year''.
    (b) Treatment of the Contingency Reserve of a Discontinued Plan.--
            (1) In general.--Subsection (e) of section 8909 of title 5, 
        United States Code, is amended by striking ``(e)'' and 
        inserting ``(e)(1)'' and by adding at the end the following:
    ``(2) Any crediting required under paragraph (1) pursuant to the 
discontinuation of any plan under this chapter shall be completed by 
the end of the second contract year beginning after such plan is so 
discontinued.
    ``(3) The Office shall prescribe regulations in accordance with 
which this subsection shall be applied in the case of any plan which is 
discontinued before being credited with the full amount to which it 
would otherwise be entitled based on the discontinuation of any other 
plan.''.
            (2) Transition rule.--In the case of any amounts remaining 
        as of the date of enactment of this Act in the contingency 
        reserve of a discontinued plan, such amounts shall be disposed 
        of in accordance with section 8909(e) of title 5, United States 
        Code, as amended by this subsection, by--
                    (A) the deadline set forth in section 8909(e) of 
                such title (as so amended); or
                    (B) if later, the end of the 6-month period 
                beginning on such date of enactment.

SEC. 7. MAXIMUM PHYSICIANS COMPARABILITY ALLOWANCE PAYABLE.

    (a) In General.--Paragraph (2) of section 5948(a) of title 5, 
United States Code, is amended by striking ``$20,000'' and inserting 
``$30,000''.
    (b) Authority To Modify Existing Agreements.--
            (1) In general.--Any service agreement under section 5948 
        of title 5, United States Code, which is in effect on the date 
        of enactment of this Act may, with respect to any period of 
        service remaining in such agreement, be modified based on the 
        amendment made by subsection (a).
            (2) Limitation.--A modification taking effect under this 
        subsection in any year shall not cause an allowance to be 
        increased to a rate which, if applied throughout such year, 
        would cause the limitation under section 5948(a)(2) of such 
        title (as amended by this section), or any other applicable 
        limitation, to be exceeded.
    (c) Rule of Construction.--Nothing in this section shall be 
considered to authorize additional or supplemental appropriations for 
the fiscal year in which occurs the date of enactment of this Act.

SEC. 8. CLARIFICATION RELATING TO SECTION 8902(K).

    Section 8902(k) of title 5, United States Code, is amended--
            (1) by redesignating paragraph (2) as paragraph (3); and
            (2) by inserting after paragraph (1) the following:
    ``(2) Nothing in this subsection shall be considered to preclude a 
health benefits plan from providing direct access or direct payment or 
reimbursement to a provider in a health care practice or profession 
other than a practice or profession listed in paragraph (1), if such 
provider is licensed or certified as such under Federal or State 
law.''.