[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 2416 Introduced in Senate (IS)]







105th CONGRESS
  2d Session
                                S. 2416

To amend the Public Health Service Act, the Employee Retirement Income 
Security Act of 1974, and the Internal Revenue Code of 1986 to protect 
       consumers in managed care plans and other health coverage.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 31, 1998

 Mr. Chafee (for himself, Mr. Graham, Mr. Lieberman, Mr. Specter, and 
  Mr. Baucus) introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
To amend the Public Health Service Act, the Employee Retirement Income 
Security Act of 1974, and the Internal Revenue Code of 1986 to protect 
       consumers in managed care plans and other health coverage.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Promoting 
Responsible Managed Care Act of 1998''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Preemption; State flexibility; construction.
Sec. 4. Regulations.
              TITLE I--PROMOTING RESPONSIBLE MANAGED CARE

                   Subtitle A--Grievance and Appeals

Sec. 101. Definitions and general provisions relating to grievance and 
                            appeals.
Sec. 102. Utilization review activities.
Sec. 103. Establishment of process for grievances.
Sec. 104. Coverage determinations.
Sec. 105. Internal appeals (reconsiderations).
Sec. 106. External appeals (reviews).
                    Subtitle B--Consumer Information

Sec. 111. Health plan information.
Sec. 112. Health care quality information.
Sec. 113. Confidentiality and accuracy of enrollee records.
Sec. 114. Quality assurance.
                Subtitle C--Patient Protection Standards

Sec. 121. Emergency services.
Sec. 122. Enrollee choice of health professionals and providers.
Sec. 123. Access to approved services.
Sec. 124. Nondiscrimination in delivery of services.
Sec. 125. Prohibition of interference with certain medical 
                            communications.
Sec. 126. Provider incentive plans.
Sec. 127. Provider participation.
Sec. 128. Required coverage for appropriate hospital stay for 
                            mastectomies and lymph node dissections for 
                            the treatment of breast cancer; required 
                            coverage for reconstructive surgery 
                            following mastectomies.
               Subtitle D--Enhanced Enforcement Authority

Sec. 141. Investigations and reporting authority, injunctive relief 
                            authority, and increased civil money 
                            penalty authority for Secretary of Health 
                            and Human Services for violations of 
                            patient protection standards.
Sec. 142. Authority for Secretary of Labor to impose civil penalties 
                            for violations of patient protection 
                            standards.
TITLE II--PATIENT PROTECTION STANDARDS UNDER THE PUBLIC HEALTH SERVICE 
                                  ACT

Sec. 201. Application to group health plans and group health insurance 
                            coverage.
Sec. 202. Application to individual health insurance coverage.
 TITLE III--PATIENT PROTECTION STANDARDS UNDER THE EMPLOYEE RETIREMENT 
                      INCOME SECURITY ACT OF 1974

Sec. 301. Application of patient protection standards to group health 
                            plans and group health insurance coverage 
                            under the Employee Retirement Income 
                            Security Act of 1974.
Sec. 302. Enforcement for economic loss caused by coverage 
                            determinations.
TITLE IV--PATIENT PROTECTION STANDARDS UNDER THE INTERNAL REVENUE CODE 
                                OF 1986

Sec. 401. Amendments to the Internal Revenue Code of 1986.
        TITLE V--EFFECTIVE DATES; COORDINATION IN IMPLEMENTATION

Sec. 501. Effective dates.
Sec. 502. Coordination in implementation.

SEC. 2. DEFINITIONS.

    (a) Incorporation of General Definitions.--The provisions of 
section 2971 of the Public Health Service Act shall apply for purposes 
of this section, section 3, and title I in the same manner as they 
apply for purposes of title XXVII of such Act.
    (b) Secretary.--Except as otherwise provided, for purposes of this 
section and title I, the term ``Secretary'' means the Secretary of 
Health and Human Services, in consultation with the Secretary of Labor 
and the Secretary of the Treasury, and the term ``appropriate 
Secretary'' means the Secretary of Health and Human Services in 
relation to carrying out title I under sections 2706 and 2751 of the 
Public Health Service Act, the Secretary of Labor in relation to 
carrying out title I under section 713 of the Employee Retirement 
Income Security Act of 1974, and the Secretary of the Treasury in 
relation to carrying out title I under chapter 100 and section 4980D of 
the Internal Revenue Code of 1986.
    (c) Additional Definitions.--For purposes of this section and title 
I:
            (1) Applicable authority.--The term ``applicable 
        authority'' means--
                    (A) in the case of a group health plan, the 
                Secretary of Health and Human Services and the 
                Secretary of Labor; and
                    (B) in the case of a health insurance issuer with 
                respect to a specific provision of title I, the 
                applicable State authority (as defined in section 
                2791(d) of the Public Health Service Act), or the 
                Secretary of Health and Human Services, if such 
                Secretary is enforcing such specific provision under 
                section 2722(a)(2) or 2761(a)(2) of the Public Health 
                Service Act.
            (2) Clinical peer.--The term ``clinical peer'' means, with 
        respect to a review or appeal, a physician (allopathic or 
        osteopathic) or other health care professional who holds a non-
        restricted license in a State and who is appropriately 
        credentialed, licensed, certified, or accredited in the same or 
similar specialty as manages (or typically manages) the medical 
condition, procedure, or treatment under review or appeal and includes 
a pediatric specialist where appropriate; except that only a physician 
may be a clinical peer with respect to the review or appeal of 
treatment rendered by a physician.
            (3) Health care provider.--The term ``health care 
        provider'' includes a physician or other health care 
        professional, as well as an institutional provider of health 
        care services.
            (4) Nonparticipating.--The term ``nonparticipating'' means, 
        with respect to a health care provider that provides health 
        care items and services to a participant, beneficiary, or 
        enrollee under a group health plan or health insurance 
        coverage, a health care provider that is not a participating 
        health care provider with respect to such items and services.
            (5) Participating.--The term ``participating'' mean, with 
        respect to a health care provider that provides health care 
        items and services to a participant, beneficiary, or enrollee 
        under a group health plan or health insurance coverage offered 
        by a health insurance issuer, a health care provider that 
        furnishes such items and services under a contract or other 
        arrangement with the plan or issuer.

SEC. 3. PREEMPTION; STATE FLEXIBILITY; CONSTRUCTION.

    (a) Continued Applicability of State Law With Respect to Health 
Insurance Issuers.--
            (1) In general.--Subject to paragraphs (2) and (3), title I 
        shall not be construed to supersede any provision of State law 
        which establishes, implements, or continues in effect any 
        standard or requirement solely relating to health insurance 
        issuers in connection with group health insurance coverage 
        except to the extent that such standard or requirement prevents 
        the application of a requirement of such title.
            (2) Continued preemption with respect to group health 
        plans.--Nothing in title I shall be construed to affect or 
        modify the provisions of section 514 of the Employee Retirement 
        Income Security Act of 1974 with respect to group health plans.
            (3) Construction with respect to time periods.--Subject to 
        paragraph (2), nothing in title I shall be construed to 
        prohibit a State from establishing, implementing, or continuing 
        in effect any requirement or standard that uses a shorter 
        period of time, than that provided under such title, for any 
        internal or external appeals process to be used by health 
        insurance issuers.
    (b) Rules of Construction.--Nothing in title I (other than section 
128) shall be construed as requiring a group health plan or health 
insurance coverage to provide specific benefits under the terms of such 
plan or coverage.
    (c) Definitions.--For purposes of this section:
            (1) State law.--The term ``State law'' includes all laws, 
        decisions, rules, regulations, or other State action having the 
        effect of law, of any State. A law of the United States 
        applicable only to the District of Columbia shall be treated as 
        a State law rather than a law of the United States.
            (2) Inclusion of political subdivisions of a state.--The 
        term ``State'' also includes any political subdivisions of a 
        State or any agency or instrumentality thereof.
    (d) Treatment of Religious Nonmedical Providers.--
            (1) In general.--Nothing in this Act (or the amendments 
        made thereby) shall be construed to--
                    (A) restrict or limit the right of group health 
                plans, and of health insurance issuers offering health 
                insurance coverage in connection with group health 
                plans, to include as providers religious nonmedical 
                providers;
                    (B) require such plans or issuers to--
                            (i) utilize medically based eligibility 
                        standards or criteria in deciding provider 
                        status of religious nonmedical providers;
                            (ii) use medical professionals or criteria 
                        to decide patient access to religious 
                        nonmedical providers;
                            (iii) utilize medical professionals or 
                        criteria in making decisions in internal or 
                        external appeals from decisions denying or 
                        limiting coverage for care by religious 
                        nonmedical providers; or
                            (iv) compel a participant or beneficiary to 
                        undergo a medical examination or test as a 
                        condition of receiving health insurance 
                        coverage for treatment by a religious 
                        nonmedical provider; or
                    (C) require such plans or issuers to exclude 
                religious nonmedical providers because they do not 
                provide medical or other data otherwise required, if 
                such data is inconsistent with the religious nonmedical 
                treatment or nursing care provided by the provider.
            (2) Religious nonmedical provider.--For purposes of this 
        subsection, the term ``religious nonmedical provider'' means a 
        provider who provides no medical care but who provides only 
        religious nonmedical treatment or religious nonmedical nursing 
        care.

SEC. 4. REGULATIONS.

    The Secretaries of Health and Human Services, Labor, and the 
Treasury shall issue such regulations as may be necessary or 
appropriate to carry out this Act. Such regulations shall be issued 
consistent with section 104 of Health Insurance Portability and 
Accountability Act of 1996. Such Secretaries may promulgate any interim 
final rules as the Secretaries determine are appropriate to carry out 
this Act.

              TITLE I--PROMOTING RESPONSIBLE MANAGED CARE

                   Subtitle A--Grievance and Appeals

SEC. 101. DEFINITIONS AND GENERAL PROVISIONS RELATING TO GRIEVANCE AND 
              APPEALS.

    (a) Definitions.--In this subtitle:
            (1) Authorized representative.--The term ``authorized 
        representative'' means, with respect to a covered individual, 
        an individual who--
                    (A) is--
                            (i) any treating health care professional 
                        of the covered individual (acting within the 
                        scope of the professional's license or 
                        certification under applicable State law), or
                            (ii) any legal representative of the 
                        covered individual (or, in the case of a 
                        deceased individual, the legal representative 
                        of the estate of the individual),
                regardless of whether such professional or 
                representative is affiliated with the plan or issuer 
                involved; and
                    (B) is acting on behalf of the covered individual 
                with the individual's consent.
            (2) Coverage determination.--The term ``coverage 
        determination'' means a determination by a group health plan or 
        a health insurance issuer with respect to any of the following:
                    (A) A decision whether to pay for emergency 
                services (as defined in section 121(a)(2)(B)).
                    (B) A decision whether to pay for health care 
                services not described in subparagraph (A) that are 
                furnished by a provider that is a participating health 
                care provider with the plan or issuer.
                    (C) A decision whether to provide benefits or 
                payment for such benefits.
                    (D) A decision whether to discontinue a benefit.
                    (E) A decision resulting from the application of 
                utilization review (as defined in section 
                102(a)(1)(C)).
Such term includes, pursuant to section 104(d)(2), the failure to 
provide timely notice under section 104(d).
            (3) Covered individual.--The term ``covered individual'' 
        means an individual who is a participant or beneficiary in a 
        group health plan or an enrollee in health insurance coverage 
        offered by a health insurance issuer.
            (4) Grievance.--The term ``grievance'' means any complaint 
        or dispute other than one involving a coverage determination.
            (5) Reconsideration.--The term ``reconsideration'' is 
        defined in section 105(a)(7).
            (6) Utilization review.--The term ``utilization review'' is 
        defined in section 102(a)(1)(C).
    (b) Summary of Rights of Individuals.--In accordance with the 
provisions of this subtitle, a covered individual has the following 
rights with respect to a group health plan and with respect to a health 
insurance issuer in connection with the provision of health insurance 
coverage:
            (1) The right to have grievances between the covered 
        individual and the plan or issuer heard and resolved as 
        provided in section 103.
            (2) The right to a timely coverage determination as 
        provided in section 104.
            (3) The right to request expedited treatment of a coverage 
        determination as provided in section 104(c).
            (4) If dissatisfied with any part of a coverage 
        determination, the following appeal rights:
                    (A) The right to a timely reconsideration of an 
                adverse coverage determination as provided in section 
                105.
                    (B) The right to request expedited treatment of 
                such a reconsideration as provided in section 105(c).
                    (C) If, as a result of a reconsideration of the 
                adverse coverage determination, the plan or issuer 
                affirms, in whole or in part, its adverse coverage 
                determination, the right to request and receive a 
                review of, and decision on, such determination by a 
                qualified external appeal entity as provided in section 
                106.
    (c) Requirements.--
            (1) Procedures.--A group health plan, and a health 
        insurance issuer in connection with the provision of health 
        insurance coverage shall, with respect to the provision of 
        benefits under such plan or coverage--
                    (A) establish and maintain--
                            (i) grievance procedures in accordance with 
                        section 103;
                            (ii) procedures for coverage determinations 
                        consistent with section 104; and
                            (iii) appeals procedures for adverse 
                        coverage determinations in accordance with 
                        sections 105 and 106; and
                    (B) provide for utilization review consistent with 
                section 102.
            (2) Delegation.--A group health plan or a health insurance 
        issuer in connection with the provision of health insurance 
        coverage that delegates any of its responsibilities under this 
        subtitle to another entity or individual through which the plan 
        or issuer provides health care services shall ultimately be 
        responsible for ensuring that such entity or individual 
        satisfies the relevant requirements of this subtitle.

SEC. 102. UTILIZATION REVIEW ACTIVITIES.

    (a) In General.--
            (1) Compliance with requirements.--
                    (A) In general.--A group health plan, and a health 
                insurance issuer in connection with the provision of 
                health insurance coverage, shall conduct utilization 
                review activities in connection with the provision of 
                benefits under such plan or coverage only in accordance 
                with a utilization review program that meets the 
                requirements of this section.
                    (B) Use of outside agents.--Nothing in this section 
                shall be construed as preventing a group health plan or 
                health insurance issuer from arranging through a 
                contract or otherwise for persons or entities to 
                conduct utilization review activities on behalf of the 
                plan or issuer, so long as such activities are 
                conducted in accordance with a utilization review 
                program that meets the requirements of this section.
                    (C) Utilization review defined.--For purposes of 
                this section, the terms ``utilization review'' and 
                ``utilization review activities'' mean procedures used 
                to monitor or evaluate the clinical necessity, 
                appropriateness, efficacy, or efficiency of health care 
                services, procedures or settings, and includes 
                prospective review, concurrent review, second opinions, 
                case management, discharge planning, or retrospective 
                review.
            (2) Written policies and criteria.--
                    (A) Written policies.--A utilization review program 
                shall be conducted consistent with written policies and 
                procedures that govern all aspects of the program.
                    (B) Use of written criteria.--
                            (i) In general.--Such a program shall 
                        utilize written clinical review criteria 
                        developed pursuant to the program with the 
                        input of appropriate physicians. Such criteria 
                        shall include written clinical review criteria 
                        described in section 114(b)(4)(B).
                            (ii) Continuing use of standards in 
                        retrospective review.--If a health care service 
                        has been specifically pre-authorized or 
                        approved for a covered individual under such a 
                        program, the program shall not, pursuant to 
                        retrospective review, revise or modify the 
                        specific standards, criteria, or procedures 
                        used for the utilization review for procedures, 
                        treatment, and services delivered to the 
                        individual during the same course of treatment.
            (3) Conduct of program activities.--
                    (A) Administration by health care professionals.--
                            (i) In general.--A utilization review 
                        program shall be administered by qualified 
                        health care professionals who shall oversee 
                        review decisions.
                            (ii) Health care professional defined.--In 
                        this subsection, the term ``health care 
                        professional'' means a physician or other 
                        health care practitioner licensed, accredited, 
                        or certified to perform specified health 
                        services consistent with State law.
                    (B) Use of qualified, independent personnel.--
                            (i) In general.--A utilization review 
                        program shall provide for the conduct of 
                        utilization review activities only through 
                        personnel who are qualified and, to the extent 
                        required, who have received appropriate 
                        training in the conduct of such activities 
                        under the program.
                            (ii) Peer review of sample of adverse 
                        clinical determinations.--Such a program shall 
                        provide that clinical peers (as defined in 
                        section 2(c)(2)) shall evaluate the clinical 
                        appropriateness of at least a sample of adverse 
                        clinical determinations.
                            (iii) Prohibition of contingent 
                        compensation arrangements.--Such a program 
                        shall not, with respect to utilization review 
                        activities, permit or provide compensation or 
                        anything of value to its employees, agents, or 
                        contractors in a manner that--
                                    (I) provides direct or indirect 
                                incentives for such persons to make 
                                inappropriate review decisions; or
                                    (II) is based, directly or 
                                indirectly, on the quantity or type of 
                                adverse determinations rendered.
                            (iv) Prohibition of conflicts.--Such a 
                        program shall not permit a health care 
                        professional who provides health care services 
                        to a covered individual to perform utilization 
                        review activities in connection with the health 
                        care services being provided to the individual. 
                        A group health plan, or a health insurance 
                        issuer in connection with the provision of 
                        health insurance coverage, may not retaliate 
                        against a covered individual or health care 
                        provider based on such individual's or 
                        provider's use of, or participation in, the 
                        utilization review program under this section.
                    (C) Accessibility of review.--Such a program shall 
                provide that appropriate personnel performing 
                utilization review activities under the program are 
                reasonably accessible by toll-free telephone during 
                normal business hours to discuss patient care and allow 
                response to telephone requests, and that appropriate 
                provision is made to receive and respond promptly to 
                calls received during other hours.
                    (D) Limits on frequency.--Such a program shall not 
                provide for the performance of utilization review 
                activities with respect to a class of services 
                furnished to a covered individual more frequently than 
                is reasonably required to assess whether the services 
                under review are medically necessary or appropriate.
                    (E) Limitation on information requests.--Such a 
                program shall provide that information shall be 
                required to be provided by health care providers only 
                to the extent it is necessary to perform the 
                utilization review activity involved.
                    (F) Review of preliminary utilization review 
                decision.--Such a program shall provide that a covered 
                individual who is dissatisfied with a preliminary 
                utilization review decision has the opportunity to 
                discuss the decision with, and have such decision 
                reviewed by, the medical director of the plan or issuer 
                involved (or the director's designee) who has the 
authority to reverse the decision.
    (b) Standards Relating to Medical Decision Making.--
            (1) In general.--In providing for a coverage determination 
        in the process of carrying out utilization review, a group 
        health plan, and a health insurance issuer in connection with 
        the provision of health insurance coverage, may not arbitrarily 
        interfere with or alter the decision of the treating physician 
        if the services are medically necessary or appropriate for 
        treatment or diagnosis to the extent that such treatment or 
        diagnosis is otherwise a covered benefit.
            (2) Construction.--Paragraph (1) shall not be construed as 
        prohibiting a plan or issuer from limiting the delivery of 
        services to one or more health care providers within a network 
        of such providers.
            (3) No change in coverage.--Paragraph (1) shall not be 
        construed as requiring coverage of particular services the 
        coverage of which is otherwise not covered under the terms of 
        the plan or coverage or from conducting utilization review 
        activities consistent with this section.
            (4) Medical necessity or appropriateness defined.--In 
        paragraph (1), the term ``medically necessary or appropriate'' 
        means, with respect to a service or benefit, a service or 
        benefit which is consistent with generally accepted principles 
        of professional medical practice.

SEC. 103. ESTABLISHMENT OF PROCESS FOR GRIEVANCES.

    (a) Establishment.--A group health plan, and a health insurance 
issuer in connection with the provision of health insurance coverage, 
shall provide meaningful procedures for timely hearing and resolution 
of grievances brought by covered individuals regarding any aspect of 
the plan's or issuer's services, including a decision not to expedite a 
coverage determination or reconsideration under section 
104(c)(4)(B)(ii)(II) or 105(c)(4)(B)(ii)(II).
    (b) Guidelines.--The grievance procedures required under subsection 
(a) shall meet all guidelines established by the appropriate Secretary.
    (c)  Distinguished From Coverage Determinations and Appeals.--The 
grievance procedures required under subsection (a) shall be separate 
and distinct from procedures regarding coverage determinations under 
section 104 and reconsiderations under section 105 and external reviews 
by a qualified external appeal entity under section 106 (which address 
appeals of coverage determinations).

SEC. 104. COVERAGE DETERMINATIONS.

    (a) Requirement.--
            (1) Responsibilities.--A group health plan, and a health 
        insurance issuer in connection with the provision of health 
        insurance coverage, shall establish and maintain procedures for 
        making timely coverage determinations (in accordance with the 
        requirements of this section) regarding the benefits a covered 
        individual is entitled to receive from the plan or issuer, 
        including the amount of any copayments, deductibles, or other 
        cost sharing applicable to such benefits. Under this section, 
        the plan or issuer shall have a standard procedure for making 
        such determinations, and procedures for expediting such 
        determinations in cases in which application of the standard 
        deadlines could seriously jeopardize the covered individual's 
        life, health, or ability to regain or maintain maximum function 
        or (in the case of a child under the age of 6) development.
            (2) Parties who may request coverage determinations.--Any 
        of the following may request a coverage determination relating 
        to a covered individual and are parties to such determination:
                    (A) The covered individual and an authorized 
                representative of the individual.
                    (B) A health care provider who has furnished an 
                item or service to the individual and formally agrees 
                to waive any right to payment directly from the 
                individual for that item or service.
                    (C) Any other provider or entity (other than the 
                group health plan or health insurance issuer) 
                determined by the appropriate Secretary to have an 
                appealable interest in the determination.
            (3) Effect of coverage determination.--A coverage 
        determination is binding on all parties unless it is 
        reconsidered pursuant to section 105 or reviewed pursuant to 
        section 106.
    (b) Determination by Deadline.--
            (1) In general.--In the case of a request for a coverage 
        determination, the group health plan or health insurance issuer 
        shall provide notice pursuant to subsection (d) to the person 
        submitting the request of its determination as expeditiously as 
        the health condition of the covered individual involved 
        requires, but in no case later than deadline established under 
        paragraph (2) or, if a request for expedited treatment of a 
        coverage determination is granted under subsection (c), the 
        deadline established under paragraph (3).
            (2) Standard deadline.--
                    (A) In general.--The deadline established under 
                this paragraph is, subject to subparagraph (B), 14 
                calendar days after the date the plan or issuer 
                receives the request for the coverage determination.
                    (B) Extension.--The plan or issuer may extend the 
                deadline under subparagraph (A) by up to 14 calendar 
                days if--
                            (i) the covered individual (or an 
                        authorized representative of the individual) 
                        requests the extension; or
                            (ii) the plan or issuer justifies to the 
                        applicable authority a need for additional 
                        information to make the coverage determination 
                        and how the delay is in the interest of the 
                        covered individual.
            (3) Expedited treatment deadline.--
                    (A) In general.--The deadline established under 
                this paragraph is, subject to subparagraphs (B) 
and (C), 72 hours after the date the plan or issuer receives the 
request for the expedited treatment under subsection (c).
                    (B) Extension.--The plan or issuer may extend the 
                deadline under subparagraph (A) by up to 5 calendar 
                days if--
                            (i) the covered individual (or an 
                        authorized representative of the individual) 
                        requests the extension; or
                            (ii) the plan or issuer justifies to the 
                        applicable authority a need for additional 
                        information to make the coverage determination 
                        and how the delay is in the interest of the 
                        covered individual.
                    (C)  How information from nonparticipating 
                providers affects deadlines for expedited coverage 
                determinations.--In the case of a group health plan or 
                health insurance issuer that requires medical 
                information from nonparticipating providers in order to 
                make a coverage determination, the deadline specified 
                under subparagraph (A) shall begin when the plan or 
                issuer receives such information. Nonparticipating 
                providers shall make reasonable and diligent efforts to 
                expeditiously gather and forward all necessary 
                information to the plan or issuer in order to receive 
                timely payment.
    (c) Expedited Treatment.--
            (1) Request for expedited treatment.--A covered individual 
        (or an authorized representative of the individual) may request 
        that the plan or issuer expedite a coverage determination 
        involving the issues described in subparagraphs (C), (D), or 
        (E) of section 101(a)(2).
            (2) Who may request.--To request expedited treatment of a 
        coverage determination, a covered individual (or authorized 
        representative of the individual) shall submit an oral or 
        written request directly to the plan or issuer (or, if 
        applicable, to the entity that the plan or issuer has 
        designated as responsible for making the determination).
            (3) Provider support.--
                    (A) In general.--A physician or other health care 
                provider may provide oral or written support for a 
                request for expedited treatment under this subsection.
                    (B)  Prohibition of punitive action.--A group 
                health plan and a health insurance issuer in connection 
                with the provision of health insurance coverage shall 
                not take or threaten to take any punitive action 
                against a physician or other health care provider 
                acting on behalf or in support of a covered individual 
                seeking expedited treatment under this subsection.
            (4) Processing of requests.--A group health plan and a 
        health insurance issuer in connection with the provision of 
        health insurance coverage shall establish and maintain the 
        following procedures for processing requests for expedited 
        treatment of coverage determinations:
                    (A) An efficient and convenient means for the 
                submission of oral and written requests for expedited 
                treatment. The plan or issuer shall document all oral 
                requests in writing and maintain the documentation in 
                the case file of the covered individual involved.
                    (B) A means for deciding promptly whether to 
                expedite a determination, based on the following 
                requirements:
                            (i) For a request made or supported by a 
                        physician, the plan or issuer shall expedite 
                        the coverage determination if the physician 
                        indicates that applying the standard deadline 
                        under subsection (b)(2) for making the 
                        determination could seriously jeopardize the 
                        covered individual's life, health, or ability 
                        to regain or maintain maximum function or (in 
                        the case of a child under the age of 6) 
                        development.
                            (ii) For another request, the plan or 
                        issuer shall expedite the coverage 
                        determination if the plan or issuer determines 
                        that applying such standard deadline for making 
                        the determination could seriously jeopardize 
                        the covered individual's life, health, or 
                        ability to regain or maintain maximum function 
                        or (in the case of a child under the age of 6) 
                        development.
            (5) Actions following denial of request for expedited 
        treatment.--If a group health plan or a health insurance issuer 
        in connection with the provision of health insurance coverage 
        denies a request for expedited treatment of a coverage 
        determination under this subsection, the plan or issuer shall--
                    (A) make the coverage determination within the 
                standard deadline otherwise applicable; and
                    (B) provide the individual submitting the request 
                with--
                            (i) prompt oral notice of the denial of the 
                        request, and
                            (ii) within 2 business days a written 
                        notice that--
                                    (I) explains that the plan or 
                                issuer will process the coverage 
                                determination request within the 
                                standard deadlines;
                                    (II) informs the requester of the 
                                right to file a grievance if the 
                                requester disagrees with the plan's or 
                                issuer's decision not to expedite the 
                                determination; and
                                    (III) provides instructions about 
                                the grievance process and its 
                                timeframes.
            (6) Action on accepted request for expedited treatment.--If 
        a group health plan or health insurance issuer grants a request 
        for expedited treatment of a coverage determination, the plan 
        or issuer shall make the determination and provide the notice 
        under subsection (d) within the deadlines specified under 
        subsection (b)(3).
    (d) Notice of Coverage Determinations.--
            (1) Requirement.--
                    (A) In general.--A group health plan or health 
                insurance issuer that makes a coverage determination 
                that--
                            (i) is completely favorable to the covered 
                        individual shall provide the party submitting 
                        the request for the coverage determination with 
                        notice of such determination; or
                            (ii) is adverse, in whole or in part, to 
                        the covered individual shall provide such party 
                        with written notice of the determination, 
                        including the information described in 
                        subparagraph (B).
                    (B)  Content of written notice.--A written notice 
                under subparagraph (A)(ii) shall--
                            (i) provide the specific reasons for the 
                        determination (including, in the case of a 
                        determination relating to utilization review, 
                        the clinical rationale for the determination) 
                        in clear and understandable language;
                            (ii) include notice of the availability of 
                        the clinical review criteria relied upon in 
                        making the coverage determination;
                            (iii) describe the reconsideration and 
                        review processes established to carry out 
                        sections 105 and 106, including the right to, 
                        and conditions for, obtaining expedited 
                        consideration of requests for reconsideration 
                        or review; and
                            (iv) comply with any other requirements 
                        specified by the appropriate Secretary.
            (2) Failure to provide timely notice.--Any failure of a 
        group health plan or health insurance issuer to provide a 
        covered individual with timely notice of a coverage 
        determination as specified in this section shall constitute an 
        adverse coverage determination and a timely request for a 
        reconsideration with respect to such determination shall be 
        deemed to have been made pursuant to the section 105(a)(2).
            (3) Provision of oral notice with written confirmation in 
        case of expedited treatment.--If a group health plan or health 
        insurance issuer grants a request for expedited treatment under 
        subsection (c), the plan or issuer may first provide notice of 
        the coverage determination orally within the deadlines 
        established under subsection (b)(3) and then shall mail written 
        confirmation of the determination within 2 business days of the 
        date of oral notification.

SEC. 105. INTERNAL APPEALS (RECONSIDERATIONS).

    (a) Requirement.--
            (1) Responsibilities.--A group health plan, and a health 
        insurance issuer in connection with the provision of health 
        insurance coverage, shall establish and maintain procedures for 
        making timely reconsiderations of coverage determinations in 
        accordance with this section. Under this section, the plan or 
        issuer shall have a standard procedure for making such 
        determinations, and procedures for expediting such 
        determinations in cases in which application of the standard 
        deadlines could seriously jeopardize the covered individual's 
        life, health, or ability to regain or maintain maximum function 
        or (in the case of a child under the age of 6) development.
            (2) Parties who may request reconsideration.--Any party to 
        a coverage determination may request a reconsideration of the 
        determination under this section. Such party shall submit an 
        oral or written request directly with the group health plan or 
        health insurance issuer that made the determination. The party 
        who files a request for reconsideration may withdraw it by 
        filing a written request for withdrawal with the group health 
        plan or health insurance issuer involved.
            (3) Deadline for filing request.--
                    (A) In general.--Except as provided in subparagraph 
                (B), a party to a coverage determination shall submit 
                the request for a reconsideration within 60 calendar 
                days from the date of the written notice of the 
                coverage determination.
                    (B) Extending time for filing request.--Such a 
                party may submit a written request to the plan or 
                issuer to extend the deadline specified in subparagraph 
                (A). If such a party demonstrates in the request for 
                the extension good cause for such extension, the plan 
                or issuer may extend the deadline.
            (4) Parties to the reconsideration.--
                    (A) In general.--The parties to the reconsideration 
                are the parties to the coverage determination, as 
                described in section 104(a)(2), and any other provider 
                or entity (other than the plan or issuer) whose rights 
                with respect to the coverage determination may be 
                affected by the reconsideration (as determined by the 
                entity that conducts the reconsideration).
                    (B) Opportunity to submit evidence.--A group health 
                plan and a health insurance issuer shall provide the 
                parties to the reconsideration with a reasonable 
                opportunity to present evidence and allegations of fact 
                or law, related to the issue in dispute, in person as 
                well as in writing. The plan or issuer shall inform the 
                parties of the conditions for submitting the evidence, 
                especially any time limitations.
            (5) Effect of reconsideration.--A decision of a plan or 
        issuer after reconsideration is binding on all parties unless 
        it is reviewed pursuant to section 106.
            (6) Limitation on conducting reconsideration.--In 
        conducting the reconsideration under this subsection, the 
        following rules shall apply:
                    (A) The person or persons conducting the 
                reconsideration shall not have been involved in making 
                the underlying coverage determination that is the basis 
                for such reconsideration.
                    (B) If the issuer involved in the reconsideration 
                is the plan's or issuer's denial of coverage based on a 
                lack of medical necessity, a clinical peer (as defined 
                in section 2(c)(2)) shall make the reconsidered 
determination.
            (7) Reconsideration defined.--In this subtitle, the term 
        ``reconsideration'' means a review under this section of a 
        coverage determination that is adverse to the covered 
        individual involved, including a review of the evidence and 
        findings upon which it was based and any other evidence the 
        parties submit or the group health plan or health insurance 
        issuer obtains.
    (b) Determination by Deadline.--
            (1) In general.--In the case of a request for a 
        reconsideration, the group health plan or health insurance 
        issuer shall provide notice pursuant to subsection (d) to the 
        person submitting the request of its determination as 
        expeditiously as the health condition of the covered individual 
        involved requires, but in no case later than the deadline 
        established under paragraph (2) or, if a request for expedited 
        treatment of a reconsideration is granted under subsection (c), 
        the deadline established under paragraph (3).
            (2) Standard deadline.--
                    (A) In general.--The deadline established under 
                this paragraph is, subject to subparagraph (B)--
                            (i) in the case of a reconsideration 
                        regarding the coverage of benefits, 30 calendar 
                        days after the date the plan or issuer receives 
                        the request for the reconsideration, or
                            (ii) in other cases, 60 days after such 
                        date.
                    (B) Extension.--The plan or issuer may extend the 
                deadline under subparagraph (A) by up to 14 calendar 
                days if--
                            (i) the covered individual (or an 
                        authorized representative of the individual) 
                        requests the extension; or
                            (ii) the plan or issuer justifies to the 
                        applicable authority a need for additional 
                        information to make the reconsideration and how 
                        the delay is in the interest of the covered 
                        individual.
            (3) Expedited treatment deadline.--
                    (A) In general.--The deadline established under 
                this paragraph is, subject to subparagraphs (B) and 
                (C), 72 hours after the date the plan or issuer 
                receives the request for the expedited treatment under 
                subsection (d).
                    (B) Extension.--The plan or issuer may extend the 
                deadline under subparagraph (A) by up to 5 calendar 
                days if--
                            (i) the covered individual (or an 
                        authorized representative of the individual) 
                        requests the extension; or
                            (ii) the plan or issuer justifies to the 
                        applicable authority a need for additional 
                        information to make the reconsideration and how 
                        the delay is in the interest of the covered 
                        individual.
                    (C)  How information from nonparticipating 
                providers affects deadlines for expedited 
                reconsiderations.--In the case of a group health plan 
                or health insurance issuer that requires medical 
                information from nonparticipating providers in order to 
                make a reconsideration, the deadline specified under 
                subparagraph (A) shall begin when the plan or issuer 
                receives such information. Nonparticipating providers 
                shall make reasonable and diligent efforts to 
                expeditiously gather and forward all necessary 
                information to the plan or issuer in order to receive 
                timely payment.
    (c) Expedited Treatment.--
            (1) Request for expedited treatment.--A covered individual 
        (or an authorized representative of the individual) may request 
        that the plan or issuer expedite a reconsideration involving 
        the issues described in subparagraphs (C), (D), or (E) of 
        section 101(a)(2).
            (2) Who may request.--To request expedited treatment of a 
        reconsideration, a covered individual (or an authorized 
        representative of the individual) shall submit an oral or 
        written request directly to the plan or issuer (or, if 
        applicable, to the entity that the plan or issuer has 
        designated as responsible for making the decision relating to 
        the reconsideration).
            (3) Provider support.--
                    (A) In general.--A physician or other health care 
                provider may provide oral or written support for a 
                request for expedited treatment under this subsection.
                    (B)  Prohibition of punitive action.--A group 
                health plan and a health insurance issuer in connection 
                with the provision of health insurance coverage shall 
                not take or threaten to take any punitive action 
                against a physician or other health care provider 
                acting on behalf or in support of a covered individual 
                seeking expedited treatment under this subsection.
            (4) Processing of requests.--A group health plan and a 
        health insurance issuer in connection with the provision of 
        health insurance coverage shall establish and maintain the 
        following procedures for processing requests for expedited 
        treatment of reconsiderations:
                    (A) An efficient and convenient means for the 
                submission of oral and written requests for expedited 
                treatment. The plan or issuer shall document all oral 
                requests in writing and maintain the documentation in 
                the case file of the covered individual involved.
                    (B) A means for deciding promptly whether to 
                expedite a reconsideration, based on the following 
                requirements:
                            (i) For a request made or supported by a 
                        physician, the plan or issuer shall expedite 
                        the reconsideration if the physician indicates 
                        that applying the standard deadline under 
                        subsection (b)(2) for making the 
                        reconsideration determination could seriously 
                        jeopardize the covered individual's life, 
                        health, or ability to regain or maintain 
                        maximum function or (in the case of a child 
                        under the age of 6) development.
                            (ii) For another request, the plan or 
                        issuer shall expedite the reconsideration if 
                        the plan or issuer determines that applying 
                        such standard deadline for making the 
                        reconsideration determination could seriously 
                        jeopardize the covered individual's life, 
                        health, or ability to regain or maintain 
                        maximum function or (in the case of a child 
                        under the age of 6) development.
            (5) Actions following denial of request for expedited 
        treatment.--If a group health plan or a health insurance issuer 
        in connection with the provision of health insurance coverage 
        denies a request for expedited treatment of a reconsideration 
        under this subsection, the plan or issuer shall--
                    (A) make the reconsideration determination within 
                the standard deadline otherwise applicable; and
                    (B) provide the individual submitting the request 
                with--
                            (i) prompt oral notice of the denial of the 
                        request, and
                            (ii) within 2 business days a written 
                        notice that--
                                    (I) explains that the plan or 
                                issuer will process the reconsideration 
                                request within the standard deadlines;
                                    (II) informs the requester of the 
                                right to file a grievance if the 
                                requester disagrees with the plan's or 
                                issuer's decision not to expedite the 
                                reconsideration; and
                                    (III) provides instructions about 
                                the grievance process and its 
                                timeframes.
            (6) Action on accepted request for expedited treatment.--If 
        a group health plan or health insurance issuer grants a request 
        for expedited treatment of a reconsideration, the plan or 
        issuer shall make the reconsideration determination and provide 
        the notice under subsection (d) within the deadlines specified 
        under subsection (b)(3).
    (d) Notice of Decision in Reconsiderations.--
            (1) Requirement.--
                    (A) In general.--A group health plan or health 
                insurance issuer that makes a decision in the 
                reconsideration that--
                            (i) is completely favorable to the covered 
                        individual shall provide the party submitting 
                        the request for the reconsideration with notice 
                        of such decision; or
                            (ii) is adverse, in whole or in part, to 
                        the covered individual shall--
                                    (I) provide such party with written 
                                notice of the decision, including the 
                                information described in subparagraph 
                                (B), and
                                    (II) prepare the case file 
                                (including such notice) for the covered 
                                individual involved, to be available 
                                for submission (if requested) under 
                                section 106(a).
                    (B)  Content of written notice.--The written notice 
                under subparagraph (A)(ii)(I) shall--
                            (i) provide the specific reasons for the 
                        decision in the reconsideration (including, in 
                        the case of a decision relating to utilization 
                        review, the clinical rationale for the 
                        decision) in clear and understandable language;
                            (ii) include notice of the availability of 
                        the clinical review criteria relied upon in 
                        making the decision;
                            (iii) describe the review processes 
                        established to carry out sections 106, 
                        including the right to, and conditions for, 
                        obtaining expedited consideration of requests 
                        for review under such section; and
                            (iv) comply with any other requirements 
                        specified by the appropriate Secretary.
            (2) Failure to provide timely notice.--Any failure of a 
        group health plan or health insurance issuer to provide a 
        covered individual with timely notice of a decision in a 
        reconsideration as specified in this section shall constitute 
        an affirmation of the adverse coverage determination and the 
        plan or issuer shall submit the case file to the qualified 
        external appeal entity under section 106 within 24 hours of 
        expiration of the deadline otherwise applicable.
            (3) Provision of oral notice with written confirmation in 
        case of expedited treatment.--If a group health plan or health 
        insurance issuer grants a request for expedited treatment under 
        subsection (c), the plan or issuer may first provide notice of 
        the decision in the reconsideration orally within the deadlines 
        established under subsection (b)(3) and then shall mail written 
        confirmation of the decision within 2 business days of the date 
        of oral notification.
            (4) Affirmation of an adverse coverage determination under 
        expedited treatment.--If, as a result of its reconsideration, 
        the plan or issuer affirms, in whole or in part, a coverage 
        determination that is adverse to the covered individual and the 
        reconsideration received expedited treatment under subsection 
        (c), the plan or issuer shall submit the case file (including 
        the written notice of the decision in the reconsideration) to 
        the qualified external appeal entity as expeditiously as the 
        covered individual's health condition requires, but in no case 
        later than within 24 hours of its affirmation. The plan or 
        issuer shall make reasonable and diligent efforts to assist in 
        gathering and forwarding information to the qualified external 
        appeal entity.
            (5) Notification of individual.--If the plan or issuer 
        refers the matter to an qualified external appeal entity under 
        paragraph (2) or (4), it shall concurrently notify the 
        individual (or an authorized representative of the individual) 
        of that action.

SEC. 106. EXTERNAL APPEALS (REVIEWS).

    (a) Review by Qualified External Appeal Entity.--
            (1) In general.--If a qualified external appeal entity 
        obtains a case file under section 105(d) or under paragraph (2) 
        and determines that--
                    (A) the individual's appeal is supported by the 
                opinion of the individual's treating physician; or
                    (B) such appeal is not so supported but--
                            (i) there is a significant financial amount 
                        in controversy (as defined by the Secretary); 
                        or
                            (ii) the appeal involves services for the 
                        diagnosis, treatment, or management of an 
                        illness, disability, or condition which the 
                        entity finds, in accordance with standards 
                        established by the entity and approved by the 
                        Secretary, constitutes a condition that could 
                        seriously jeopardize the covered individual's 
                        life, health, or ability to regain or maintain 
                        maximum function or (in the case of a child 
                        under the age of 6) development;
        the entity shall review and resolve under this section any 
        remaining issues in dispute.
            (2) Request for review.--
                    (A) In general.--A party to a reconsidered 
                determination under section 105 that receives notice of 
                an unfavorable determination under section 105(d) may 
                request a review of such determination by a qualified 
                external appeal entity under this section.
                    (B) Time for request.--To request such a review, 
                such party shall submit an oral or written request 
                directly to the plan or issuer (or, if applicable, to 
                the entity that the plan or issuer has designated as 
                responsible for making the determination).
                    (C) If review is requested.--If a party provides 
                the plan or issuer (or such an entity) with notice of a 
                request for such review, the plan or issuer (or such 
                entity) shall submit the case file to the qualified 
                external appeal entity as expeditiously as the covered 
                individual's health condition requires, but in no case 
                later than 2 business days from the date the plan or 
                issuer (or entity) receives such request. The plan or 
                issuer (or entity) shall make reasonable and diligent 
                efforts to assist in gathering and forwarding 
                information to the qualified external appeal entity.
            (3) Notice and timing for review.--The qualified external 
        appeal entity shall establish and apply rules for the timing 
        and content of notices for reviews under this section 
        (including appropriate expedited treatment of reviews under 
        this section) that are similar to the applicable requirements 
        for timing and content of notices in the case of 
        reconsiderations under subsections (b), (c), and (d) of section 
        105.
            (4) Parties.--The parties to the review by a qualified 
        external appeal entity under this section shall be the same 
        parties listed in section 105(a)(4) who qualified during the 
        plan's or issuer's reconsideration, with the addition of the 
        plan or issuer.
    (b) General Elements of External Appeals.--
            (1) Contract with qualified external appeal entity.--
                    (A) Contract requirement.--Subject to subparagraph 
                (B), the external appeal review under this section of a 
                determination of a plan or issuer shall be conducted 
                under a contract between the plan or issuer and 1 or 
                more qualified external appeal entities.
                    (B) Eligibility for designation as external review 
                entity.--Entities eligible to conduct reviews brought 
                under this subsection shall include--
                            (i) any State licensed or credentialed 
                        external review entity;
                            (ii) a State agency established for the 
                        purpose of conducting independent external 
                        reviews; and
                            (iii) an independent, external entity that 
                        contracts with the appropriate Secretary.
                    (C) Licensing and credentialing.--
                            (i) In general.--In licensing or 
                        credentialing entities described in 
                        subparagraph (B)(i), the State agent shall use 
                        licensing and certification procedures 
                        developed by the State in consultation with the 
                        National Association of Insurance 
                        Commissioners.
                            (ii) Special rule.--In the case of a State 
                        that--
                                    (I) has not established such 
                                licensing or credentialing procedures 
                                within 24 months of the date of 
                                enactment of this Act, the State shall 
                                license or credential such entities in 
                                accordance with procedures developed by 
                                the Secretary; or
                                    (II) refuses to designate such 
                                entities, the Secretary shall license 
                                or credential such entities.
                    (D) Qualifications.--An entity (which may be a 
                governmental entity) shall meet the following 
                requirements in order to be a qualified external appeal 
                entity:
                            (i) There is no real or apparent conflict 
                        of interest that would impede the entity from 
                        conducting external appeal activities 
                        independent of the plan or issuer.
                            (ii) The entity conducts external appeal 
                        activities through clinical peers (as defined 
                        in section 2(c)(2)).
                            (iii) The entity has sufficient medical, 
                        legal, and other expertise and sufficient 
                        staffing to conduct external appeal activities 
                        for the plan or issuer on a timely basis 
                        consistent with subsection (a)(3).
                            (iv) The entity meets such other 
                        requirements as the appropriate Secretary may 
                        impose.
                    (E) Limitation on plan or issuer selection.--If an 
                applicable authority permits more than 1 entity to 
                qualify as a qualified external appeal entity with 
                respect to a group health plan or health insurance 
                issuer and the plan or issuer may select among such 
                qualified entities, the applicable authority--
                            (i) shall assure that the selection process 
                        will not create any incentives for qualified 
                        external appeal entities to make a decision in 
                        a biased manner; and
                            (ii) shall implement procedures for 
                        auditing a sample of decisions by such entities 
                        to assure that no such decisions are made in a 
                        biased manner.
                    (F) Other terms and conditions.--The terms and 
                conditions of a contract under this paragraph shall be 
                consistent with the standards the appropriate Secretary 
                shall establish to assure that there is no real or 
                apparent conflict of interest in the conduct of 
                external appeal activities. Such contract shall provide 
                that the direct costs of the process (not including 
                costs of representation of a covered individual or 
                other party) shall be paid by the plan or issuer, and 
                not by the covered individual.
            (2) Elements of process.--An external appeal process under 
        this section shall be conducted consistent with standards 
        established by the appropriate Secretary that include at least 
        the following:
                    (A) Fair process; de novo determination.--The 
                process shall provide for a fair, de novo 
                determination.
                    (B) Opportunity to submit evidence, have 
                representation, and make oral presentation.--Any party 
                to a review under this section--
                            (i) may submit and review evidence related 
                        to the issues in dispute,
                            (ii) may use the assistance or 
                        representation of 1 or more individuals (any of 
                        whom may be an attorney), and
                            (iii) may make an oral presentation.
                    (C) Provision of information.--The plan or issuer 
                involved shall provide timely access to all its records 
                relating to the matter being reviewed under this 
                section and to all provisions of the plan or health 
                insurance coverage (including any coverage manual) 
                relating to the matter.
            (3) Admissible evidence.--In addition to personal health 
        and medical information supplied with respect to an individual 
        whose claim for benefits has been appealed and the opinion of 
        the individual's treating physician or health care 
        professional, an external appeals entity shall take into 
        consideration the following evidence:
                    (A) The results of studies that meet professionally 
                recognized standards of validity and replicability or 
                that have been published in peer-reviewed journals.
                    (B) The results of professional consensus 
                conferences conducted or financed in whole or in part 
                by one or more government agencies.
                    (C) Practice and treatment guidelines prepared or 
                financed in whole or in part by government agencies.
                    (D) Government-issued coverage and treatment 
                policies.
                    (E) To the extent that the entity determines it to 
                be free of any conflict of interest--
                            (i) the opinions of individuals who are 
                        qualified as experts in one or more fields of 
                        health care which are directly related to the 
                        matters under appeal, and
                            (ii) the results of peer reviews conducted 
                        by the plan or issuer involved.
    (c) Notice of Determination by External Appeal Entity.--
            (1) Responsibility for the notice.--After the qualified 
        external appeal entity has reviewed and resolved the 
        determination that has been appealed, such entity shall mail a 
        notice of its final decision to the parties.
            (2) Content of the notice.--The notice described in 
        paragraph (1) shall--
                    (A) describe the specific reasons for the entity's 
                decisions; and
                    (B) comply with any other requirements specified by 
                the appropriate Secretary.
    (d) Effect of Determination.--A final decision by the qualified 
external appeal entity after a review of the determination that has 
been appealed is final and binding on the group health plan or the 
health insurance issuer.

                    Subtitle B--Consumer Information

SEC. 111. HEALTH PLAN INFORMATION.

    (a) Disclosure Requirement.--
            (1) Group health plans.--A group health plan shall--
                    (A) provide to participants and beneficiaries at 
                the time of initial coverage under the plan (or the 
                effective date of this section, in the case of 
                individuals who are participants or beneficiaries as of 
                such date), at least annually thereafter, and at the 
                beginning of any open enrollment period provided under 
                the plan, the information described in subsection (b) 
                in printed form;
                    (B) provide to participants and beneficiaries 
                information in printed form on material changes in the 
                information described in paragraphs (1), (2)(A), 
                (2)(B), (3)(A), (6), and (7) of subsection (b), or a 
                change in the health insurance issuer through which 
                coverage is provided, within a reasonable period of (as 
                specified by the Secretary, but not later than 30 days 
                after) the effective date of the changes; and
                    (C) upon request, make available to participants 
                and beneficiaries, the applicable authority, and 
                prospective participants and beneficiaries, the 
                information described in subsections (b) and (c) in 
                printed form.
            (2) Health insurance issuers.--A health insurance issuer in 
        connection with the provision of health insurance coverage 
        shall--
                    (A) provide to individuals enrolled under such 
                coverage at the time of enrollment, and at least 
                annually thereafter, (and to plan administrators of 
                group health plans in connection with which such 
coverage is offered) the information described in subsection (b) in 
printed form;
                    (B) provide to enrollees and such plan 
                administrators information in printed form on material 
                changes in the information described in paragraphs (1), 
                (2)(A), (2)(B), (3)(A), (6), and (7) of subsection (b), 
                or a change in the health insurance issuer through 
                which coverage is provided, within a reasonable period 
                of (as specified by the Secretary, but later than 30 
                days after) the effective date of the changes; and
                    (C) upon request, make available to the applicable 
                authority, to individuals who are prospective 
                enrollees, to plan administrators of group health plans 
                that may obtain such coverage, and to the public the 
                information described in subsections (b) and (c) in 
                printed form.
            (3) Exemption authority.--Upon application of one or more 
        group health plans or health insurance issuers, the appropriate 
        Secretary, under procedures established by such Secretary, may 
        grant an exemption to one or more plans or issuers from 
        compliance with one or more of the requirements of paragraph 
        (1) or (2). Such an exemption may be granted for plans and 
        issuers as a class with similar characteristics, such as 
        private fee-for-service plans described in section 1859(b)(2) 
        of the Social Security Act.
            (4) Establishment of internet site.--The appropriate 
        Secretaries shall provide for the establishment of 1 or more 
        sites on the Internet to provide technical support and 
        information concerning the rights of participants, 
        beneficiaries, and enrollees under this title.
    (b) Information Provided.--The information described in this 
subsection with respect to a group health plan or health insurance 
coverage offered by a health insurance issuer includes the following:
            (1) Service area.--The service area of the plan or issuer.
            (2) Benefits.--Benefits offered under the plan or coverage, 
        including--
                    (A) covered benefits, including benefits for 
                preventive services, benefit limits, and coverage 
                exclusions, any optional supplemental benefits under 
                the plan or coverage and the terms and conditions 
                (including premiums or cost-sharing) for such 
                supplemental benefits, and any out-of-area coverage;
                    (B) cost sharing, such as premiums, deductibles, 
                coinsurance, and copayment amounts, including any 
                liability for balance billing, any maximum limitations 
                on out of pocket expenses, and the maximum out of 
                pocket costs for services that are provided by 
                nonparticipating providers or that are furnished 
                without meeting the applicable utilization review 
                requirements;
                    (C) the extent to which benefits may be obtained 
                from nonparticipating providers, and any supplemental 
                premium or cost-sharing in so obtaining such benefits;
                    (D) the extent to which a participant, beneficiary, 
                or enrollee may select from among participating 
                providers and the types of providers participating in 
                the plan or issuer network;
                    (E) process for determining experimental coverage 
                or coverage in cases of investigational treatments and 
                clinical trials; and
                    (F) use of a prescription drug formulary.
            (3) Access.--A description of the following:
                    (A) The number, mix, and distribution of health 
                care providers under the plan or coverage.
                    (B) The procedures for participants, beneficiaries, 
                and enrollees to select, access, and change 
                participating primary and specialty providers.
                    (C) The rights and procedures for obtaining 
                referrals (including standing referrals) to 
                participating and nonparticipating providers.
                    (D) Any limitations imposed on the selection of 
                qualifying participating health care providers, 
                including any limitations imposed under section 
                122(a)(2)(B).
                    (E) How the plan or issuer addresses the needs of 
                participants, beneficiaries, and enrollees and others 
                who do not speak English or who have other special 
                communications needs in accessing providers under the 
                plan or coverage, including the provision of 
                information described in this subsection and subsection 
                (c) to such individuals, including the provision of 
                information in a language other than English if 5 
                percent of the number of participants, beneficiaries, 
                and enrollees communicate in that language instead of 
                English, and including the availability of 
                interpreters, audio tapes, and information in braille 
                to meet the needs of people with special communications 
                needs.
            (4) Out-of-area coverage.--Out-of-area coverage provided by 
        the plan or issuer.
            (5) Emergency coverage.--Coverage of emergency services, 
        including--
                    (A) the appropriate use of emergency services, 
                including use of the 911 telephone system or its local 
                equivalent in emergency situations and an explanation 
                of what constitutes an emergency situation;
                    (B) the process and procedures of the plan or 
                issuer for obtaining emergency services; and
                    (C) the locations of (i) emergency departments, and 
                (ii) other settings, in which plan physicians and 
                hospitals provide emergency services and post-
                stabilization care.
            (6) Prior authorization rules.--Rules regarding prior 
        authorization or other review requirements that could result in 
        noncoverage or nonpayment.
            (7) Grievance and appeals procedures.--All appeal or 
        grievance rights and procedures under the plan or coverage, 
        including the method for filing grievances and the time frames 
        and circumstances for acting on grievances and appeals, the 
name, address, and telephone number of the applicable authority with 
respect to the plan or issuer, and the availability of assistance 
through an ombudsman to individuals in relation to group health plans 
and health insurance coverage.
            (8) Quality assurance.--A summary description of the data 
        on quality indicators and measures submitted under section 
        112(a) for the plan or issuer, including a summary description 
        of the data on process and outcome satisfaction of 
        participants, beneficiaries, and enrollees (including data on 
        individual voluntary disenrollment and grievances and appeals) 
        described in section 112(b)(3)(D), and notice that information 
        comparing such indicators and measures for different plans and 
        issuers is available through the Agency for Health Care Policy 
        and Research.
            (9) Summary of provider financial incentives.--A summary 
        description of the information on the types of financial 
        payment incentives (described in section 1852(j)(4) of the 
        Social Security Act) provided by the plan or issuer under the 
        coverage.
            (10) Information on issuer.--Notice of appropriate mailing 
        addresses and telephone numbers to be used by participants, 
        beneficiaries, and enrollees in seeking information or 
        authorization for treatment.
            (11) Information on licensure.--Information on the 
        licensure, certification, or accreditation status of the plan 
        or issuer.
            (12) Availability of technical support and information.--
        Notice that technical support and information concerning the 
        rights of participants, beneficiaries, and enrollees under this 
        title are available from the Secretary of Labor (in the case of 
        group health plans) or the Secretary of Health and Human 
        Services (in the case of health insurance issuers), including 
        the telephone numbers and mailing address of the regional 
        offices of the appropriate Secretary and the Internet address 
        to obtain such information and support.
            (13) Advance directives and organ donation decisions.--
        Information regarding the use of advance directives and organ 
        donation decisions under the plan or coverage.
            (14) Participating provider list.--A list of current 
        participating health care providers for the relevant geographic 
        area, including the name, address and telephone number of each 
        provider.
            (15) Availability of information on request.--Notice that 
        the information described in subsection (c) is available upon 
        request and how and where (such as the telephone number and 
        Internet website) such information may be obtained.
    (c) Information Made Available Upon Request.--The information 
described in this subsection is the following:
            (1) Utilization review activities.--A description of 
        procedures used and requirements (including circumstances, time 
        frames, and appeal rights) under any utilization review program 
        under section 102(a), including under any drug formulary 
        program under section 123(b).
            (2) Grievance and appeals information.--Information on the 
        number of grievances and internal and external appeals and on 
        the disposition in the aggregate of such matters, including 
        information on the reasons for the disposition of external 
        appeal cases.
            (3) Method of compensation.--A summary description as to 
        the method of compensation of participating health care 
        professionals and health care facilities, including information 
        on the types of financial payment incentives (described in 
        section 1852(j)(4) of the Social Security Act) provided by the 
        plan or issuer under the coverage and on the proportion of 
        participating health care professionals who are compensated 
        under each type of incentive under the plan or coverage.
            (4) Confidentiality policies and procedures.--A description 
        of the policies and procedures established to carry out section 
        112.
            (5) Formulary restrictions.--A description of the nature of 
        any drug formula restrictions, including the specific 
        prescription medications included in any formulary and any 
        provisions for obtaining off-formulary medications.
            (6) Additional information on participating providers.--For 
        each current participating health care provider described in 
        subsection (b)(14)--
                    (A) the licensure or accreditation status of the 
                provider;
                    (B) to the extent possible, an indication of 
                whether the provider is available to accept new 
                patients;
                    (C) in the case of medical personnel, the 
                education, training, speciality qualifications or 
                certification, speciality focus, affiliation 
                arrangements, and specialty board certification (if 
                any) of the provider; and
                    (D) any measures of consumer satisfaction and 
                quality indicators for the provider.
            (7) Percentage of premiums used for benefits (loss-
        ratios).--In the case of health insurance coverage only (and 
        not with respect to group health plans that do not provide 
        coverage through health insurance coverage), a description of 
        the overall loss-ratio for the coverage (as defined in 
        accordance with rules established or recognized by the 
        Secretary of Health and Human Services).
            (8) Quality information developed.--Quality information on 
        processes and outcomes developed as part of an accreditation or 
        licensure process for the plan or issuer to the extent the 
        information is publicly available.
    (d) Form of Disclosure.--
            (1) Uniformity.--Information required to be disclosed under 
        this section shall be provided in accordance with uniform, 
        national reporting standards specified by the Secretary, after 
        consultation with applicable State authorities, so that 
        prospective enrollees may compare the attributes of different 
        issuers and coverage offered within an area within a type of 
        coverage. Such information shall be provided in an accessible 
format that is understandable to the average participant, beneficiary, 
or enrollee involved.
            (2) Information into handbook.--Nothing in this section 
        shall be construed as preventing a group health plan or health 
        insurance issuer from making the information under subsections 
        (b) and (c) available to participants, beneficiaries, and 
        enrollees through an enrollee handbook or similar publication.
            (3) Updating participating provider information.--The 
        information on participating health care providers described in 
        subsections (b)(14) and (c)(6) shall be updated within such 
        reasonable period as determined appropriate by the Secretary. A 
        group health plan or health insurance issuer shall be 
        considered to have complied with the provisions of such 
        subsection if the plan or issuer provides the directory or 
        listing of participating providers to participants and 
        beneficiaries or enrollees once a year and such directory or 
        listing is updated within such a reasonable period to reflect 
        any material changes in participating providers. Nothing in 
        this section shall prevent a plan or issuer from changing or 
        updating other information made available under this section.
            (4) Rule of mailing to last address.--For purposes of this 
        section, a plan or issuer, in reliance on records maintained by 
        the plan or issuer, shall be deemed to have met the 
        requirements of this section with respect to the disclosure of 
        information to a participant, beneficiary, or enrollee if the 
        plan or issuer transmits the information requested to the 
        participant, beneficiary, or enrollee at the address contained 
        in such records with respect to such participant, beneficiary, 
        or enrollee.
    (e) Enrollee Assistance.--
            (1) In general.--Each State that obtains a grant under 
        paragraph (3) shall provide for creation and operation of a 
        Health Insurance Ombudsman through a contract with a not-for-
        profit organization that operates independent of group health 
        plans and health insurance issuers. Such Ombudsman shall be 
        responsible for at least the following:
                    (A) To provide consumers in the State with 
                information about health insurance coverage options or 
                coverage options offered within group health plan.
                    (B) To provide counseling and assistance to 
                enrollees dissatisfied with their treatment by health 
                insurance issuers and group health plans in regard to 
                such coverage or plans and with respect to grievances 
                and appeals regarding determinations under such 
                coverage or plans.
            (2) Federal role.--In the case of any State that does not 
        provide for such an Ombudsman under paragraph (1), the 
        Secretary may provide for the creation and operation of a 
        Health Insurance Ombudsman through a contract with a not-for-
        profit organization that operates independent of group health 
        plans and health insurance issuers and that is to provide 
        consumers in the State with information about health insurance 
        coverage options or coverage options offered within group 
        health plans.
            (3) Eligibility.--To be eligible to serve as a Health 
        Insurance Ombudsman under this section, a not-for-profit 
        organization shall provide assurances that--
                    (A) the organization has no real or perceived 
                conflict of interest in providing advice and assistance 
                to consumers regarding health insurance coverage, and
                    (B) the organization is independent of health 
                insurance issuers, health care providers, health care 
                payors, and regulators of health care or health 
                insurance.
            (4) Authorization of appropriations.--There are authorized 
        to be appropriated to the Secretary of Health and Human 
        Services such amounts as may be necessary to provide for grants 
        to States for contracts for Health Insurance Ombudsmen under 
        paragraph (1) or contracts for such Ombudsmen under paragraph 
        (2).
            (5) Construction.--Nothing in this section shall be 
        construed to prevent the use of other forms of enrollee 
        assistance.
    (f) Construction.--Nothing in this section shall be construed as 
requiring public disclosure of individual contracts or financial 
arrangements between a group health plan or health insurance issuer and 
any provider.

SEC. 112. HEALTH CARE QUALITY INFORMATION.

    (a) Collection and Submission of Information on Quality Indicators 
and Measures.--
            (1) In general.--A group health plan and a health insurance 
        issuer that offers health insurance coverage shall collect and 
        submit to the Director for the Agency for Health Care Policy 
        and Research (in this section referred to as the ``Director'') 
        aggregate data on quality indicators and measures (as defined 
        in subsection (g)) that includes the minimum uniform data set 
        specified under subsection (b). Such data shall not include 
        patient identifiers.
            (2) Data sampling methods.--The Director shall develop data 
        sampling methods for the collection of data under this 
        subsection.
            (3) Exemption authority.--The provisions of section 
        111(a)(3) shall apply to the requirements of paragraph (1) in 
        the same manner as they apply to the requirements referred to 
        in such section.
    (b) Minimum Uniform Data Set.--
            (1) In general.--The Secretary shall specify (and may from 
        time to time update) by rule the data required to be included 
        in the minimum uniform data set under subsection (a) and the 
        standard format for such data.
            (2) Design.--Such specification shall--
                    (A) take into consideration the different 
                populations served (such as children and individuals 
                with disabilities);
                    (B) be consistent where appropriate with 
                requirements applicable to Medicare+Choice health plans 
                under 1851(d)(4)(D) of the Social Security Act;
                    (C) take into consideration such differences in the 
                delivery system among group health plans and health 
                insurance issuers as the Secretary deems appropriate;
                    (D) be consistent with standards adopted to carry 
                out part C of title XI of the Social Security Act; and
                    (E) be consistent where feasible with existing 
                health plan quality indicators and measures used by 
                employers and purchasers.
            (3) Minimum data.--The data in such set shall include, to 
        the extent determined feasible by the appropriate Secretary, at 
        least--
                    (A) data on process measures of clinical 
                performance for health care services provided by health 
                care professionals and facilities;
                    (B) data on outcomes measures of morbidity and 
                mortality including to the extent feasible and 
                appropriate data for pediatric and gender-specific 
                measures; and
                    (C) data on data on satisfaction of such 
                individuals, including data on voluntary disenrollment 
                and grievances.
        The minimum data set under this paragraph shall be established 
        by the appropriate Secretaries using a negotiated rulemaking 
        process under subchapter III of chapter 5 of title 5, United 
        States Code.
    (c) Dissemination of Information.--
            (1) In general.--The Director shall publicly disseminate 
        (through printed media and the Internet) information on the 
        aggregate data submitted under this section.
            (2) Formats.--The information shall be disseminated in a 
        manner that provides for a comparison of health care quality 
        among different group health plans and health insurance 
        issuers, with appropriate differentiation by delivery system. 
        In disseminating the information, the Director may reference an 
        appropriate benchmark (or benchmarks) for performance with 
        respect to specific quality indicators and measures (or groups 
        of such measures).
    (d) Health Care Quality Research and Information.--The Secretary of 
Health and Human Services, acting through the Director, shall conduct 
and support research demonstration projects, evaluations, and the 
dissemination of information with respect to measurement, status, 
improvement, and presentation of quality indicators and measures and 
other health care quality information.
    (e) National Reports on Health Care Quality.--
            (1) Report on national goals.--Not later than 18 months 
        after the date of enactment of this Act, and every 2 years 
        thereafter, the Secretary of Health and Human Services shall 
        prepare and submit to the appropriate committees of Congress 
        and the President a report that--
                    (A) establishes national goals for the improvement 
                of the quality of health care; and
                    (B) contains recommendations for achieving the 
                national goals established under paragraph (1).
            (2) Report on health related topics.--Not later than 30 
        months after the date of enactment of this Act and every 2 
        years thereafter, such Secretary shall prepare and submit to 
        Congress and the President a report that addresses at least 1 
        of the following (or a related matter):
                    (A) The availability, applicability, and 
                appropriateness of information to consumers regarding 
                the quality of their health care.
                    (B) The state of information systems and data 
                collecting capabilities for measuring and reporting on 
                quality indicators.
                    (C) The impact of quality measurement on access to 
                and the cost of medical care.
                    (D) Barriers to continuous quality improvement in 
                medical care.
                    (E) The state of health care quality measurement 
                research and development.
    (f) Authorization of Appropriations.--There are authorized to be 
appropriated $25,000,000 for each fiscal year (beginning with fiscal 
year 1999) to carry out this section. Any such amounts appropriated for 
a fiscal year shall remain available, without fiscal year limitation, 
until expended.
    (g) Quality Indicators and Measures Defined.--For purposes of this 
section, the term ``quality indicators and measures'' means structural 
characteristics, patient-encounter data, and the subsequent health 
status change of a patient as a result of health care services provided 
by health care professionals and facilities.

SEC. 113. CONFIDENTIALITY AND ACCURACY OF ENROLLEE RECORDS.

    A group health plan or a health insurance issuer shall establish 
procedures with respect to medical records or other health information 
maintained regarding participants, beneficiaries, and enrollees to 
safeguard the privacy of any individually identifiable information 
about them.

SEC. 114. QUALITY ASSURANCE.

    (a) Requirement.--A group health plan, and a health insurance 
issuer that offers health insurance coverage, shall establish and 
maintain an ongoing, internal quality assurance and continuous quality 
improvement program that meets the requirements of subsection (b).
    (b) Program Requirements.--The requirements of this subsection for 
a quality improvement program of a plan or issuer are as follows:
            (1) Administration.--The plan or issuer has an identifiable 
        unit with responsibility for administration of the program.
            (2) Written plan.--The plan or issuer has a written plan 
        for the program that is updated annually and that specifies at 
        least the following:
                    (A) The activities to be conducted.
                    (B) The organizational structure.
                    (C) The duties of the medical director.
                    (D) Criteria and procedures for the assessment of 
                quality.
            (3) Systematic review.--The program provides for systematic 
        review of the type of health services provided, consistency of 
services provided with good medical practice, and patient outcomes.
            (4) Quality criteria.--The program--
                    (A) uses criteria that are based on performance and 
                patient outcomes where feasible and appropriate;
                    (B) includes criteria that are directed 
                specifically at meeting the needs of at-risk 
                populations and covered individuals with chronic 
                conditions or severe illnesses, including gender-
                specific criteria and pediatric-specific criteria where 
                available and appropriate;
                    (C) includes methods for informing covered 
                individuals of the benefit of preventive care and what 
                specific benefits with respect to preventive care are 
                covered under the plan or coverage; and
                    (D) makes available to the public a description of 
                the criteria used under subparagraph (A).
            (5) System for identifying.--The program has procedures for 
        identifying possible quality concerns by providers and 
        enrollees and for remedial actions to correct quality problems, 
        including written procedures for responding to concerns and 
        taking appropriate corrective action.
            (6) Data analysis.--The program provides, using data that 
        include the data collected under section 112, for an analysis 
        of the plan's or issuer's performance on quality measures.
            (7) Drug utilization review.--The program provides for a 
        drug utilization review program which--
                    (A) encourages appropriate use of prescription 
                drugs by participants, beneficiaries, and enrollees and 
                providers, and
                    (B) takes appropriate action to reduce the 
                incidence of improper drug use and adverse drug 
                reactions and interactions.
    (c) Deeming.--For purposes of subsection (a), the requirements of--
            (1) subsection (b) (other than paragraph (5)) are deemed to 
        be met with respect to a health insurance issuer that is a 
        qualified health maintenance organization (as defined in 
        section 1310(c) of the Public Health Service Act); or
            (2) subsection (b) are deemed to be met with respect to a 
        health insurance issuer that is accredited by a national 
        accreditation organization that the Secretary certifies as 
        applying, as a condition of certification, standards at least a 
        stringent as those required for a quality improvement program 
        under subsection (b).
    (d) Variation Permitted.--The Secretary may provide for variations 
in the application of the requirements of this section to group health 
plans and health insurance issuers based upon differences in the 
delivery system among such plans and issuers as the Secretary deems 
appropriate.
    (e) Consultation in Medical Policies.--A group health plan, and 
health insurance issuer that offers health insurance coverage, shall 
consult with participating physicians (if any) regarding the plan's or 
issuer's medical policy, quality, and medical management procedures.

                Subtitle C--Patient Protection Standards

SEC. 121. EMERGENCY SERVICES.

    (a) Coverage of Emergency Services.--
            (1) In general.--If a group health plan, or health 
        insurance coverage offered by a health insurance issuer, 
        provides any benefits with respect to emergency services (as 
        defined in paragraph (2)(B)), the plan or issuer shall cover 
        emergency services furnished under the plan or coverage--
                    (A) without the need for any prior authorization 
                determination;
                    (B) whether or not the health care provider 
                furnishing such services is a participating provider 
                with respect to such services;
                    (C) in a manner so that, if such services are 
                provided to a participant, beneficiary, or enrollee by 
                a nonparticipating health care provider--
                            (i) the participant, beneficiary, or 
                        enrollee is not liable for amounts that exceed 
                        the amounts of liability that would be incurred 
                        if the services were provided by a 
                        participating health care provider, and
                            (ii) the plan or issuer pays an amount that 
                        is not less than the amount paid to a 
                        participating health care provider for the same 
                        services; and
                    (D) without regard to any other term or condition 
                of such plan or coverage (other than exclusion or 
                coordination of benefits, or an affiliation or waiting 
                period, permitted under section 2701 of the Public 
                Health Service Act, section 701 of the Employee 
                Retirement Income Security Act of 1974, or section 9801 
                of the Internal Revenue Code of 1986, and other than 
                applicable cost-sharing).
            (2) Definitions.--In this section:
                    (A) Emergency medical condition based on prudent 
                layperson standard.--The term ``emergency medical 
                condition'' means a medical condition manifesting 
                itself by acute symptoms of sufficient severity 
                (including severe pain) such that a prudent layperson, 
                who possesses an average knowledge of health and 
                medicine, could reasonably expect the absence of 
                immediate medical attention to result in a condition 
                described in clause (i), (ii), or (iii) of section 
                1867(e)(1)(A) of the Social Security Act.
                    (B) Emergency services.--The term ``emergency 
                services'' means--
                            (i) a medical screening examination (as 
                        required under section 1867 of the Social 
                        Security Act) that is within the capability of 
                        the emergency department of a hospital, 
                        including ancillary services routinely 
                        available to the emergency department to 
                        evaluate an emergency medical condition (as 
                        defined in subparagraph (A)), and
                            (ii) within the capabilities of the staff 
                        and facilities available at the hospital, such 
                        further medical examination and treatment as 
                        are required under section 1867 of such Act to 
                        stabilize the patient.
    (b) Reimbursement for Maintenance Care and Post-Stabilization 
Care.--In the case of services (other than emergency services) for 
which benefits are available under a group health plan, or under health 
insurance coverage offered by a health insurance issuer, the plan or 
issuer shall provide for reimbursement with respect to such services 
provided to a participant, beneficiary, or enrollee other than through 
a participating health care provider in a manner consistent with 
subsection (a)(1)(C) if the services are maintenance care or post-
stabilization care covered under the guidelines established under 
section 1852(d)(2) of the Social Security Act (relating to promoting 
efficient and timely coordination of appropriate maintenance and post-
stabilization care of an enrollee after an enrollee has been determined 
to be stable), in accordance with regulations established to carry out 
such section.

SEC. 122. ENROLLEE CHOICE OF HEALTH PROFESSIONALS AND PROVIDERS.

    (a) Choice of Personal Health Professional.--
            (1) Primary care.--A group health plan, and a health 
        insurance issuer that offers health insurance coverage, shall 
        permit each participant, beneficiary, and enrollee--
                    (A) to receive primary care from any participating 
                primary care provider who is available to accept such 
                individual, and
                    (B) in the case of a participant, beneficiary, or 
                enrollee who has a child who is also covered under the 
                plan or coverage, to designate a participating 
                physician who specializes in pediatrics as the child's 
                primary care provider.
            (2) Specialists.--
                    (A) In general.--Subject to subparagraph (B), a 
                group health plan and a health insurance issuer that 
                offers health insurance coverage shall permit each 
                participant, beneficiary, or enrollee to receive 
                medically necessary or appropriate specialty care, 
                pursuant to appropriate referral procedures, from any 
                qualified participating health care provider who is 
                available to accept such individual for such care.
                    (B) Limitation.--Subparagraph (A) shall not apply 
                to specialty care if the plan or issuer clearly informs 
                participants, beneficiaries, and enrollees of the 
                limitations on choice of participating providers with 
                respect to such care.
    (b) Specialized Services.--
            (1) Obstetrical and gynecological care.--
                    (A) In general.--If a group health plan, or a 
                health insurance issuer in connection with the 
                provision of health insurance coverage, requires or 
                provides for a participant, beneficiary, or enrollee to 
                designate a participating primary care provider, and an 
                individual who is female has not designated a 
                participating physician specializing in obstetrics and 
                gynecology as a primary care provider, the plan or 
                issuer--
                            (i) may not require authorization or a 
                        referral by the individual's primary care 
                        provider or otherwise for coverage of routine 
                        gynecological care (such as preventive women's 
                        health examinations) and pregnancy-related 
                        services provided by a participating health 
                        care professional who specializes in obstetrics 
                        and gynecology to the extent such care is 
                        otherwise covered, and
                            (ii) may treat the ordering of other 
                        gynecological care by such a participating 
                        physician as the authorization of the primary 
                        care provider with respect to such care under 
                        the plan or coverage.
                    (B) Construction.--Nothing in subparagraph (A)(ii) 
                shall waive any requirements of coverage relating to 
                medical necessity or appropriateness with respect to 
                coverage of gynecological care so ordered.
            (2) Specialty care.--
                    (A) Specialty care for covered services.--
                            (i) In general.--If--
                                    (I) an individual is a participant 
                                or beneficiary under a group health 
                                plan or an enrollee who is covered 
                                under health insurance coverage offered 
                                by a health insurance issuer,
                                    (II) the individual has a condition 
                                or disease of sufficient seriousness 
                                and complexity to require treatment by 
                                a specialist, and
                                    (III) benefits for such treatment 
                                are provided under the plan or 
                                coverage,
                        the plan or issuer shall make or provide for a 
                        referral to a specialist who is available and 
                        accessible to provide the treatment for such 
                        condition or disease.
                            (ii) Specialist defined.--For purposes of 
                        this paragraph, the term ``specialist'' means, 
                        with respect to a condition, a health care 
                        practitioner, facility, or center (such as a 
                        center of excellence) that has adequate 
                        expertise through appropriate training and 
                        experience (including, in the case of a child, 
                        appropriate pediatric expertise) to provide 
                        high quality care in treating the condition.
                            (iii) Care under referral.--A group health 
                        plan or health insurance issuer may require 
                        that the care provided to an individual 
                        pursuant to such referral under clause (i) be--
                                    (I) pursuant to a treatment plan, 
                                only if the treatment plan is developed 
                                by the specialist and approved by the 
                                plan or issuer, in consultation with 
                                the designated primary care provider or 
                                specialist and the individual (or the 
                                individual's designee), and
                                    (II) in accordance with applicable 
                                quality assurance and utilization 
                                review standards of the plan or issuer.
                        Nothing in this paragraph shall be construed as 
                        preventing such a treatment plan for an 
                        individual from requiring a specialist to 
                        provide the primary care provider with regular 
                        updates on the specialty care provided, as well 
                        as all necessary medical information.
                            (iv) Referrals to participating 
                        providers.--A group health plan or health 
                        insurance issuer is not required under clause 
                        (i) to provide for a referral to a specialist 
                        that is not a participating provider, unless 
                        the plan or issuer does not have an appropriate 
                        specialist that is available and accessible to 
                        treat the individual's condition and that is a 
                        participating provider with respect to such 
                        treatment.
                            (v) Treatment of nonparticipating 
                        providers.--If a plan or issuer refers an 
                        individual to a nonparticipating specialist 
                        pursuant to clause (i), services provided 
                        pursuant to the approved treatment plan (if 
                        any) shall be provided at no additional cost to 
                        the individual beyond what the individual would 
                        otherwise pay for services received by such a 
                        specialist that is a participating provider.
                    (B) Specialists as primary care providers.--
                            (i) In general.--A group health plan, or a 
                        health insurance issuer, in connection with the 
                        provision of health insurance coverage, shall 
                        have a procedure by which an individual who is 
                        a participant, beneficiary, or enrollee and who 
                        has an ongoing special condition (as defined in 
                        clause (iii)) may receive a referral to a 
                        specialist for such condition who shall be 
                        responsible for and capable of providing and 
                        coordinating the individual's primary and 
                        specialty care. If such an individual's care 
                        would most appropriately be coordinated by such 
                        a specialist, such plan or issuer shall refer 
                        the individual to such specialist.
                            (ii) Treatment as primary care provider.--
                        Such specialist shall be permitted to treat the 
                        individual without a referral from the 
                        individual's primary care provider and may 
                        authorize such referrals, procedures, tests, 
                        and other medical services as the individual's 
                        primary care provider would otherwise be 
                        permitted to provide or authorize, subject to 
                        the terms of the treatment plan (referred to in 
                        subparagraph (A)(iii)(I)).
                            (iii) Ongoing special condition defined.--
                        In this subparagraph, the term ``special 
                        condition'' means a condition or disease that--
                                    (I) is life-threatening, 
                                degenerative, or disabling, and
                                    (II) requires specialized medical 
                                care over a prolonged period of time.
                            (iv) Terms of referral.--The provisions of 
                        clauses (iii) through (v) of subparagraph (A) 
                        apply with respect to referrals under clause 
                        (i) of this subparagraph in the same manner as 
                        they apply to referrals under subparagraph 
                        (A)(i).
                    (C) Standing referrals.--
                            (i) In general.--A group health plan, and a 
                        health insurance issuer in connection with the 
                        provision of health insurance coverage, shall 
                        have a procedure by which an individual who is 
                        a participant, beneficiary, or enrollee and who 
                        has a condition that requires ongoing care from 
                        a specialist may receive a standing referral to 
                        such specialist for treatment of such 
                        condition. If the plan or issuer, or if the 
                        primary care provider in consultation with the 
                        medical director of the plan or issuer and the 
                        specialist (if any), determines that such a 
                        standing referral is appropriate, the plan or 
                        issuer shall make such a referral to such a 
                        specialist.
                            (ii) Terms of referral.--The provisions of 
                        clauses (iii) through (v) of subparagraph (A) 
                        apply with respect to referrals under clause 
                        (i) of this subparagraph in the same manner as 
                        they apply to referrals under subparagraph 
                        (A)(i).
    (c) Continuity of Care.--
            (1) In general.--
                    (A) Termination of provider.--If a contract between 
                a group health plan, or a health insurance issuer in 
                connection with the provision of health insurance 
                coverage, and a health care provider is terminated (as 
                defined in subparagraph (C)), or benefits or coverage 
                provided by a health care provider are terminated 
                because of a change in the terms of provider 
                participation in a group health plan, and an individual 
                who is a participant, beneficiary, or enrollee in the 
                plan or coverage is undergoing a course of treatment 
                from the provider at the time of such termination, the 
                plan or issuer shall--
                            (i) notify the individual on a timely basis 
                        of such termination, and
                            (ii) subject to paragraph (3), permit the 
                        individual to continue or be covered with 
                        respect to the course of treatment with the 
                        provider during a transitional period (provided 
                        under paragraph (2)) if the plan or issuer is 
                        notified orally or in writing of the facts and 
                        circumstances concerning the course of 
                        treatment.
                    (B) Treatment of termination of contract with 
                health insurance issuer.--If a contract for the 
                provision of health insurance coverage between a group 
                health plan and a health insurance issuer is terminated 
                and, as a result of such termination, coverage of 
                services of a health care provider is terminated with 
                respect to an individual, the provisions of 
                subparagraph (A) (and the succeeding provisions of this 
section) shall apply under the group health plan in the same manner as 
if there had been a direct contract between the group health plan and 
the provider that had been terminated, but only with respect to 
benefits that are covered under the group health plan after the 
contract termination.
                    (C) Termination.--In this section, the term 
                ``terminated'' includes, with respect to a contract, 
                the expiration or nonrenewal of the contract, but does 
                not include a termination of the contract by the plan 
                or issuer for failure to meet applicable quality 
                standards or for fraud.
            (2) Transitional period.--
                    (A) In general.--Except as provided in 
                subparagraphs (B) through (D), the transitional period 
                under this subsection shall extend for at least 90 days 
                from the date of the notice described in paragraph 
                (1)(A)(i) of the provider's termination.
                    (B) Institutional care.--The transitional period 
                under this subsection for institutional or inpatient 
                care from a provider shall extend until the discharge 
                or termination of the period of institutionalization 
                and also shall include institutional care provided 
                within a reasonable time of the date of termination of 
                the provider status.
                    (C) Pregnancy.--If--
                            (i) a participant, beneficiary, or enrollee 
                        has entered the second trimester of pregnancy 
                        at the time of a provider's termination of 
                        participation, and
                            (ii) the provider was treating the 
                        pregnancy before date of the termination,
                the transitional period under this subsection with 
                respect to provider's treatment of the pregnancy shall 
                extend through the provision of post-partum care 
                directly related to the delivery.
                    (D) Terminal illness.--If--
                            (i) a participant, beneficiary, or enrollee 
                        was determined to be terminally ill (as 
                        determined under section 1861(dd)(3)(A) of the 
                        Social Security Act) at the time of a 
                        provider's termination of participation, and
                            (ii) the provider was treating the terminal 
                        illness before the date of termination,
                the transitional period under this subsection shall 
                extend for the remainder of the individual's life for 
                care directly related to the treatment of the terminal 
                illness, but in no case is the transitional period 
                required to extend for longer than 180 days.
            (3) Permissible terms and conditions.--A group health plan 
        or health insurance issuer may condition coverage of continued 
        treatment by a provider under paragraph (1)(A)(ii) upon the 
        provider agreeing to the following terms and conditions:
                    (A) The provider agrees to accept reimbursement 
                from the plan or issuer and individual involved (with 
                respect to cost-sharing) at the rates applicable prior 
                to the start of the transitional period as payment in 
                full (or, in the case described in paragraph (1)(B), at 
                the rates applicable under the replacement plan or 
                issuer after the date of the termination of the 
                contract with the health insurance issuer) and not to 
                impose cost-sharing with respect to the individual in 
                an amount that would exceed the cost-sharing that could 
                have been imposed if the contract referred to in 
                paragraph (1)(A) had not been terminated.
                    (B) The provider agrees to adhere to the quality 
                assurance standards of the plan or issuer responsible 
                for payment under subparagraph (A) and to provide to 
                such plan or issuer necessary medical information 
                related to the care provided.
                    (C) The provider agrees otherwise to adhere to such 
                plan's or issuer's policies and procedures, including 
                procedures regarding utilization review and referrals, 
                and obtaining prior authorization and providing 
                services pursuant to a treatment plan (if any) approved 
                by the plan or issuer.
            (4) Construction.--Nothing in this subsection shall be 
        construed to require the coverage of benefits which would not 
        have been covered if the provider involved remained a 
        participating provider.
    (d) Protection Against Involuntary Disenrollment Based on Certain 
Conditions.--
            (1) In general.--Subject to paragraph (2), a group health 
        plan and a health insurance issuer in connection with the 
        provision of health insurance coverage may not disenroll an 
        individual under the plan or coverage because the individual's 
        behavior is considered disruptive, unruly, abusive, or 
        uncooperative to the extent that the individual's continued 
        enrollment under the coverage seriously impairs the plan's or 
        issuer's ability to furnish covered services if the 
        circumstances for the individual's behavior is directly related 
        to diminished mental capacity, severe and persistent mental 
        illness, or a serious childhood mental and emotional disorder.
            (2) Exception.--Paragraph (1) shall not apply if the 
        behavior engaged in directly threatens bodily injury to any 
        person.
    (e) General Access.--
            (1) In general.--Each group health plan, and each health 
        insurance issuer offering health insurance coverage, that 
        provides benefits, in whole or in part, through participating 
        health care providers shall have (in relation to the coverage) 
        a sufficient number, distribution, and variety of qualified 
        participating health care providers to ensure that all covered 
        health care services, including specialty services, will be 
        available and accessible in a timely manner to all 
        participants, beneficiaries, and enrollees under the plan or 
        coverage.
            (2) Treatment of certain providers.--The qualified health 
        care providers under paragraph (1) may include Federally 
        qualified health centers, rural health clinics, migrant health 
        centers, high-volume, disproportionate share hospitals, and 
        other essential community providers located in the service area 
        of the plan or issuer and shall include such providers if 
        necessary to meet the standards established to carry out such 
        subsection.

SEC. 123. ACCESS TO APPROVED SERVICES.

    (a) Coverage for Individuals Participating in Approved Clinical 
Trials.--
            (1) Coverage.--
                    (A) In general.--If a group health plan, or health 
                insurance issuer that is providing health insurance 
                coverage, provides coverage to a qualified individual 
                (as defined in paragraph (2)), the plan or issuer--
                            (i) may not deny the individual 
                        participation in the clinical trial referred to 
                        in paragraph (2)(B);
                            (ii) subject to paragraph (3), may not deny 
                        (or limit or impose additional conditions on) 
                        the coverage of routine patient costs for items 
                        and services furnished in connection with 
                        participation in the trial; and
                            (iii) may not discriminate against the 
                        individual on the basis of the enrollee's 
                        participation in such trial.
                    (B) Exclusion of certain costs.--For purposes of 
                subparagraph (A)(ii), routine patient costs do not 
                include the cost of the tests or measurements conducted 
                primarily for the purpose of the clinical trial 
                involved.
                    (C) Use of in-network providers.--If one or more 
                participating providers is participating in a clinical 
                trial, nothing in subparagraph (A) shall be construed 
                as preventing a plan or issuer from requiring that a 
                qualified individual participate in the trial through 
                such a participating provider if the provider will 
                accept the individual as a participant in the trial.
            (2) Qualified individual defined.--For purposes of 
        paragraph (1), the term ``qualified individual'' means an 
        individual who is a participant or beneficiary in a group 
        health plan, or who is an enrollee under health insurance 
        coverage, and who meets the following conditions:
                    (A)(i) The individual has a life-threatening or 
                serious illness for which no standard treatment is 
                effective.
                    (ii) The individual is eligible to participate in 
                an approved clinical trial according to the trial 
                protocol with respect to treatment of such illness.
                    (iii) The individual's participation in the trial 
                offers meaningful potential for significant clinical 
                benefit for the individual.
                    (B) Either--
                            (i) the referring physician is a 
                        participating health care professional and has 
                        concluded that the individual's participation 
                        in such trial would be appropriate based upon 
                        the individual meeting the conditions described 
                        in subparagraph (A); or
                            (ii) the participant, beneficiary, or 
                        enrollee provides medical and scientific 
                        information establishing that the individual's 
                        participation in such trial would be 
                        appropriate based upon the individual meeting 
                        the conditions described in subparagraph (A).
            (3) Payment.--
                    (A) In general.--Under this subsection a group 
                health plan or health insurance issuer shall provide 
                for payment for routine patient costs described in 
                paragraph (1)(A) but is not required to pay for costs 
                of items and services that are reasonably expected (as 
                determined by the Secretary) to be paid for by the 
                sponsors of an approved clinical trial.
                    (B) Payment rate.--In the case of covered items and 
                services provided by--
                            (i) a participating provider, the payment 
                        rate shall be at the agreed upon rate, or
                            (ii) a nonparticipating provider, the 
                        payment rate shall be at the rate the plan or 
                        issuer would normally pay for comparable 
                        services under subparagraph (A).
            (4) Approved clinical trial defined.--
                    (A) In general.--In this subsection, the term 
                ``approved clinical trial'' means a clinical research 
                study or clinical investigation approved and funded 
                (which may include funding through in-kind 
                contributions) by one or more of the following:
                            (i) The National Institutes of Health.
                            (ii) A cooperative group or center of the 
                        National Institutes of Health.
                            (iii) Either of the following if the 
                        conditions described in subparagraph (B) are 
                        met:
                                    (I) The Department of Veterans 
                                Affairs.
                                    (II) The Department of Defense.
                    (B) Conditions for departments.--The conditions 
                described in this subparagraph, for a study or 
                investigation conducted by a Department, are that the 
                study or investigation has been reviewed and approved 
                through a system of peer review that the Secretary 
                determines--
                            (i) to be comparable to the system of peer 
                        review of studies and investigations used by 
                        the National Institutes of Health, and
                            (ii) assures unbiased review of the highest 
                        scientific standards by qualified individuals 
                        who have no interest in the outcome of the 
                        review.
            (5) Construction.--Nothing in this subsection shall be 
        construed to limit a plan's or issuer's coverage with respect 
        to clinical trials.
    (b) Access to Prescription Drugs.--
            (1) In general.--If a group health plan, or health 
        insurance issuer that offers health insurance 
coverage, provides benefits with respect to prescription drugs but the 
coverage limits such benefits to drugs included in a formulary, the 
plan or issuer shall--
                    (A) ensure participation of participating 
                physicians and pharmacists in the development of the 
                formulary; and
                    (B) disclose to providers and, disclose upon 
                request under section 111(c)(5) to participants, 
                beneficiaries, and enrollees, the nature of the 
                formulary restrictions; and
                    (C) consistent with the standards for a utilization 
                review program under section 102(a), provide for 
                exceptions from the formulary limitation when a non-
                formulary alternative is medically indicated.
            (2) Construction.--Nothing in this subsection shall be 
        construed as requiring a group health plan (or health insurance 
        issuer in connection with health insurance coverage) to provide 
        any coverage of prescription drugs or as preventing such a plan 
        or issuer from negotiating higher cost-sharing in the case a 
        non-formulary alternative is provided under paragraph (1)(C).

SEC. 124. NONDISCRIMINATION IN DELIVERY OF SERVICES.

    (a) Application to Delivery of Services.--Subject to subsection 
(b), a group health plan, and health insurance issuer in relation to 
health insurance coverage, may not discriminate against a participant, 
beneficiary, or enrollee in the delivery of health care services 
consistent with the benefits covered under the plan or coverage or as 
required by law based on race, color, ethnicity, national origin, 
religion, sex, age, mental or physical disability, sexual orientation, 
genetic information, or source of payment.
    (b) Construction.--Nothing in subsection (a) shall be construed as 
relating to the eligibility to be covered, or the offering (or 
guaranteeing the offer) of coverage, under a plan or health insurance 
coverage, the application of any pre-existing condition exclusion 
consistent with applicable law, or premiums charged under such plan or 
coverage. To the extent that health care providers are permitted under 
State and Federal law to prioritize the admission or treatment of 
patients based on such patients' individual religious affiliation, 
group health plans and health insurance issuers may reflect those 
priorities in referring patients to such providers.

SEC. 125. PROHIBITION OF INTERFERENCE WITH CERTAIN MEDICAL 
              COMMUNICATIONS.

    (a) In General.--An organization on behalf of a group health plan 
(as described in subsection (a)(2)) or a health insurance issuer shall 
not penalize (financially or otherwise) a health care professional for 
advocating on behalf of his or her patient or for providing information 
or referral for medical care (as defined in section 2791(a)(2) of the 
Public Health Service Act) consistent with the health care needs of the 
patient and with the code of ethical conduct, professional 
responsibility, conscience, medical knowledge, and license of the 
health care professional.
    (b) Construction.--Nothing in subsection (a) shall be construed as 
requiring a health insurance issuer or a group health plan to pay for 
medical care not otherwise paid for or covered by the plan provided by 
nonparticipating health care professionals, except in those instances 
and to the extent that the issuer or plan would normally pay for such 
medical care.
    (c) Assistance and Support.--A group health plan or a health 
insurance issuer shall not prohibit or otherwise restrict a health care 
professional from providing letters of support to, or in any way 
assisting, enrollees who are appealing a denial, termination, or 
reduction of service in accordance with the procedures under subtitle 
A.

SEC. 126. PROVIDER INCENTIVE PLANS.

    (a) Prohibition of Transfer of Indemnification.--
            (1) In general.--No contract or agreement between a group 
        health plan or health insurance issuer (or any agent acting on 
        behalf of such a plan or issuer) and a health care provider 
        shall contain any provision purporting to transfer to the 
        health care provider by indemnification or otherwise any 
        liability relating to activities, actions, or omissions of the 
        plan, issuer, or agent (as opposed to the provider).
            (2) Nullification.--Any contract or agreement provision 
        described in paragraph (1) shall be null and void.
    (b) Prohibition of Improper Physician Incentive Plans.--
            (1) In general.--A group health plan and a health insurance 
        issuer offering health insurance coverage may not operate any 
        physician incentive plan (as defined in subparagraph (B) of 
        section 1876(i)(8) of the Social Security Act) unless the 
        requirements described in subparagraph (A) of such section are 
        met with respect to such a plan.
            (2) Application.--For purposes of carrying out paragraph 
        (1), any reference in section 1876(i)(8) of the Social Security 
        Act to the Secretary, an eligible organization, or an 
        individual enrolled with the organization shall be treated as a 
        reference to the applicable authority, a group health plan or 
        health insurance issuer, respectively, and a participant, 
        beneficiary, or enrollee with the plan or organization, 
        respectively.

SEC. 127. PROVIDER PARTICIPATION.

    (a) In General.--A group health plan and a health insurance issuer 
that offers health insurance coverage shall, if it provides benefits 
through participating health care professionals, have a written process 
for the selection of participating health care professionals under the 
plan or coverage. Such process shall include--
            (1) minimum professional requirements;
            (2) providing notice of the rules regarding participation;
            (3) providing written notice of participation decisions 
        that are adverse to professionals; and
            (4) providing a process within the plan or issuer for 
        appealing such adverse decisions, including the presentation of 
        information and views of the professional regarding such 
        decision.
    (b) Verification of Background.--Such process shall include 
verification of a health care provider's license and a history of 
suspension or revocation.
    (c) Restriction.--Such process shall not use a high-risk patient 
base or location of a provider in an area with residents with poorer 
health status as a basis for excluding providers from participation.
    (d) General Nondiscrimination.--
            (1) In general.--Subject to paragraph (2), such process 
        shall not discriminate with respect to selection of a health 
        care professional to be a participating health care provider, 
        or with respect to the terms and conditions of such 
        participation, based on the professional's race, color, 
        religion, sex, national origin, age, sexual orientation, or 
        disability (consistent with the Americans with Disabilities Act 
        of 1990).
            (2) Rules.--The appropriate Secretary may establish such 
        definitions, rules, and exceptions as may be appropriate to 
        carry out paragraph (1), taking into account comparable 
        definitions, rules, and exceptions in effect under employment-
        based nondiscrimination laws and regulations that relate to 
        each of the particular bases for discrimination described in 
        such paragraph.

SEC. 128. REQUIRED COVERAGE FOR APPROPRIATE HOSPITAL STAY FOR 
              MASTECTOMIES AND LYMPH NODE DISSECTIONS FOR THE TREATMENT 
              OF BREAST CANCER; REQUIRED COVERAGE FOR RECONSTRUCTIVE 
              SURGERY FOLLOWING MASTECTOMIES.

    (a) Coverage of Inpatient Care for Surgical Treatment of Breast 
Cancer.--
            (1) In general.--A group health plan, and a health 
        insurance issuer providing health insurance coverage, that 
        provides medical and surgical benefits shall ensure that 
        inpatient coverage with respect to the surgical treatment of 
        breast cancer (including a mastectomy, lumpectomy, or lymph 
        node dissection for the treatment of breast cancer) is provided 
        for a period of time as is determined by the attending 
        physician, in his or her professional judgment consistent with 
        generally accepted principles of professional medical practice, 
        in consultation with the patient, to be medically necessary or 
        appropriate.
            (2) Exception.--Nothing in this section shall be construed 
        as requiring the provision of inpatient coverage if the 
        attending physician in consultation with the patient determine 
        that a shorter period of hospital stay is medically necessary 
        or appropriate.
    (b) Coverage of Reconstructive Surgery Following Mastectomies.--A 
group health plan, and a health insurance issuer providing health 
insurance coverage, that provides medical and surgical benefits with 
respect to a mastectomy shall ensure that, in a case in which a 
mastectomy patient elects breast reconstruction, coverage is provided 
for--
            (1) all stages of reconstruction of the breast on which the 
        mastectomy has been performed;
            (2) surgery and reconstruction of the other breast to 
        produce a symmetrical appearance; and
            (3) the costs of prostheses and complications of mastectomy 
        including lymphedemas;
in the manner determined by the attending physician and the patient to 
be appropriate. Such coverage may be subject to annual deductibles and 
coinsurance provisions as may be deemed appropriate and as are 
consistent with those established for other benefits under the plan or 
coverage. Written notice of the availability of such coverage shall be 
delivered to the participant or enrollee upon enrollment and annually 
thereafter.
    (c) No Authorization Required.--
            (1) In general.--An attending physician shall not be 
        required to obtain authorization from the plan or issuer for 
        prescribing any length of stay in connection with a mastectomy, 
        a lumpectomy, or a lymph node dissection for the treatment of 
        breast cancer.
            (2) Prenotification.--Nothing in this section shall be 
        construed as preventing a group health plan or health insurance 
        issuer from requiring prenotification of an inpatient stay 
        referred to in this section if such requirement is consistent 
        with terms and conditions applicable to other inpatient 
        benefits under the plan or health insurance coverage, except 
        that the provision of such inpatient stay benefits shall not be 
        contingent upon such notification.
    (d) Prohibitions.--A group health plan and a health insurance 
issuer offering health insurance coverage may not--
            (1) deny to a patient eligibility, or continued 
        eligibility, to enroll or to renew coverage under the terms of 
        the plan or coverage, solely for the purpose of avoiding the 
        requirements of this section;
            (2) provide monetary payments or rebates to individuals to 
        encourage such individuals to accept less than the minimum 
        protections available under this section;
            (3) penalize or otherwise reduce or limit the reimbursement 
        of an attending provider because such provider provided care to 
        an individual participant, beneficiary, or enrollee in 
        accordance with this section;
            (4) provide incentives (monetary or otherwise) to an 
        attending provider to induce such provider to provide care to 
        an individual participant, beneficiary, or enrollee in a manner 
        inconsistent with this section; and
            (5) subject to subsection (e)(2), restrict benefits for any 
        portion of a period within a hospital length of stay required 
        under subsection (a) in a manner which is less favorable than 
        the benefits provided for any preceding portion of such stay.
    (e) Rules of Construction.--
            (1) In general.--Nothing in this section shall be construed 
        to require a patient who is a participant, beneficiary, or 
        enrollee--
                    (A) to undergo a mastectomy or lymph node 
                dissection in a hospital; or
                    (B) to stay in the hospital for a fixed period of 
                time following a mastectomy or lymph node dissection.
            (2) Cost sharing.--Nothing in this section shall be 
        construed as preventing a group health plan or issuer 
from imposing deductibles, coinsurance, or other cost-sharing in 
relation to benefits for hospital lengths of stay in connection with a 
mastectomy or lymph node dissection for the treatment of breast cancer 
under the plan or health insurance coverage, except that such 
coinsurance or other cost-sharing for any portion of a period within a 
hospital length of stay required under subsection (a) may not be 
greater than such coinsurance or cost-sharing for any preceding portion 
of such stay.
            (3) Level and type of reimbursements.--Nothing in this 
        section shall be construed to prevent a group health plan or a 
        health insurance issuer from negotiating the level and type of 
        reimbursement with a provider for care provided in accordance 
        with this section.

               Subtitle D--Enhanced Enforcement Authority

SEC. 141. INVESTIGATIONS AND REPORTING AUTHORITY, INJUNCTIVE RELIEF 
              AUTHORITY, AND INCREASED CIVIL MONEY PENALTY AUTHORITY 
              FOR SECRETARY OF HEALTH AND HUMAN SERVICES FOR VIOLATIONS 
              OF PATIENT PROTECTION STANDARDS.

    (a) Investigations and Reporting Authority.--
            (1) In general.--For purposes of carrying out sections 
        2722(b) and 2761(b) of the Public Health Service Act with 
        respect to enforcement of the provisions of sections 2706 and 
        2752, respectively, of such Act (as added by title II of this 
        Act)--
                    (A) the Secretary of Health and Human Services 
                shall have the same authorities with respect to 
                compelling health insurance issuers to produce 
                information and to conducting investigations in cases 
                of violations of such provisions as the Secretary of 
                Labor has under section 504 of the Employee Retirement 
                Income Security Act of 1974 with respect to violations 
                of title I of such Act; and
                    (B) section 504(c) of the Employee Retirement 
                Income Security Act of 1974 shall apply to 
                investigations conducted under paragraph (1) in the 
                same manner as it applies to investigations conducted 
                under title I of such Act.
            (2) Reporting authority.--In exercising authority under 
        paragraph (1), the Secretary may require--
                    (A) States that have indicated an intention to 
                assume authority under section 2722(a)(1) or 2761(a) of 
                the Public Health Service Act to report to the 
                Secretary on enforcement efforts undertaken to assure 
                compliance with the requirements of sections 2706 and 
                2752, respectively, of such Act; and
                    (B) health insurance issuers to submit reports to 
                assure compliance with such requirements.
    (b) Authority for Injunctive Relief.--In addition to the authority 
referred to in subsection (a), the Secretary of Health and Human 
Services has the same authority with respect to enforcement of the 
provisions of this title as the Secretary of Labor has under subsection 
(a)(5) of section 502 of the Employee Retirement Income Security Act of 
1974 (as applied without regard to subsection (b) of that section) and 
the related provisions of part 5 of subtitle B of title I of such Act 
with respect to enforcement of such title I of such Act.
    (c) Increase in Civil Money Penalties.--
            (1) In general.--In the case of a civil money penalty that 
        may be imposed under section 2722(b)(2) or 2761(b) of the 
        Public Health Service Act with respect to a failure to meet the 
        provisions of sections 2706 and 2752, respectively, of such 
        Act, the maximum amount of penalty otherwise provided under 
        section 2722(b)(2)(C)(i) of such Act may, notwithstanding the 
        amounts specified in such section, and subject to paragraph 
        (2), be up to the greatest of the following:
                    (A) Failures involving unreasonable denial or delay 
                in benefits impacting on life or health.--In the case 
                of a failure that results in an unreasonable denial or 
                delay in benefits that has seriously jeopardized (or 
                has substantial likelihood of seriously jeopardizing) 
                the individual's life, health, or ability to regain or 
                maintain maximum function or (in the case of a child 
                under the age of 6) development, the greater of the 
                following:--
                            (i) Pattern or practice failure.--If the 
                        failure reflects a pattern or practice of 
                        wrongful conduct, $250,000, plus the amount (if 
                        any) determined under paragraph (2).
                            (ii) Other failures.--In the case of a 
                        failure that does not reflect a pattern or 
                        practice of wrongful conduct, $50,000 for each 
                        individual involved, plus the amount (if any) 
                        determined under paragraph (2).
                    (B) Other failures.--In the case of a failure not 
                described in subparagraph (A), the greater of the 
                following:
                            (i) Pattern and practice failures.--In the 
                        case of a failure that reflects a pattern or 
                        practice of wrongful conduct $50,000, plus the 
                        amount (if any) determined under paragraph (2).
                            (ii) Other failures.--In the case of a 
                        failure that does not reflect a pattern or 
                        practice of wrongful conduct, $10,000 for each 
                        individual involved, plus the amount (if any) 
                        determined under paragraph (2).
            (2) Continuing failure without correction.--In the case of 
        a failure which is not corrected within the first week 
        beginning with the date on which the failure is established, 
        the maximum amount of the penalty under paragraph (1) shall be 
        increased by $10,000 for each full succeeding week in which the 
        failure is not so corrected.
    (d) Authorization of Appropriations.--In addition to any other 
amounts authorized to be appropriated, there are authorized to be 
appropriated to the Secretary of Health and Human Services such sums as 
may be necessary to carry out this section.

SEC. 142. AUTHORITY FOR SECRETARY OF LABOR TO IMPOSE CIVIL PENALTIES 
              FOR VIOLATIONS OF PATIENT PROTECTION STANDARDS.

    (a) In General.--Section 502(c) of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1132(c)) is amended by redesignating 
paragraphs (6) and (7) as paragraphs (7) and (8), respectively, and by 
inserting after paragraph (5) the following new paragraph:
    ``(6)(A) The Secretary may assess a civil penalty against a person 
acting in the capacity of a fiduciary of a group health plan (as 
defined in 733(a)) so as to cause a violation of section 713.
    ``(B) Subject to subparagraph (C), the maximum amount which may be 
assessed under subparagraph (A) is the greatest of the following:
            ``(i) In the case of a failure that results in an 
        unreasonable denial or delay in benefits that seriously 
        jeopardized (or has substantial likelihood of seriously 
        jeopardizing) the individual's life, health, or ability to 
        regain or maintain maximum function or (in the case of a child 
        under the age of 6) development, the greater of the following:
                    ``(I) If the failure reflects a pattern or practice 
                of wrongful conduct, $250,000, plus the amount (if any) 
                determined under subparagraph (C).
                    ``(II) In the case of a failure that does not 
                reflect a pattern or practice of wrongful conduct, 
                $50,000 for each individual involved, plus the amount 
                (if any) determined under subparagraph (C).
            ``(ii) In the case of a failure not described in clause 
        (i), the greater of the following:
                    ``(I) In the case of a failure that reflects a 
                pattern or practice of wrongful conduct $50,000, plus 
                the amount (if any) determined under subparagraph (C).
                    ``(II) In the case of a failure that does not 
                reflect a pattern or practice of wrongful conduct, 
                $10,000 for each individual involved, plus the amount 
                (if any) determined under subparagraph (C).
    ``(C) In the case of a failure which is not corrected within the 
first week beginning with the date on which the failure is established, 
the maximum amount of the penalty under subparagraph (B) shall be 
increased by $10,000 for each full succeeding week in which the failure 
is not so corrected.''.
    (b) Conforming Amendment.--Section 502(a)(6) of such Act (29 U.S.C. 
1132(a)(6)) is amended by striking ``paragraph (2), (4), (5), or (6)'' 
and inserting ``paragraph (2), (4), (5), (6), or (7)''.
    (c) Authorization of Appropriations.--In addition to any other 
amounts authorized to be appropriated, there are authorized to be 
appropriated to the Secretary of Labor such sums as may be necessary to 
carry out the amendments made by this section.

 TITLE II--PATIENT PROTECTION STANDARDS UNDER PUBLIC HEALTH SERVICE ACT

SEC. 201. APPLICATION TO GROUP HEALTH PLANS AND GROUP HEALTH INSURANCE 
              COVERAGE.

    (a) In General.--Subpart 2 of part A of title XXVII of the Public 
Health Service Act is amended by adding at the end the following new 
section:

``SEC. 2706. PATIENT PROTECTION STANDARDS.

    ``(a) In General.--Each group health plan shall comply with patient 
protection requirements under title I of the Promoting Responsible 
Managed Care Act of 1998, and each health insurance issuer shall comply 
with patient protection requirements under such title with respect to 
group health insurance coverage it offers, and such requirements shall 
be deemed to be incorporated into this subsection.
    ``(b) Notice.--A group health plan shall comply with the notice 
requirement under section 711(d) of the Employee Retirement Income 
Security Act of 1974 with respect to the requirements referred to in 
subsection (a) and a health insurance issuer shall comply with such 
notice requirement as if such section applied to such issuer and such 
issuer were a group health plan.''.
    (b) Conforming Amendment.--Section 2721(b)(2)(A) of such Act (42 
U.S.C. 300gg-21(b)(2)(A)) is amended by inserting ``(other than section 
2706)'' after ``requirements of such subparts''.
    (c) Reference to Enhanced Enforcement Authority.--For provisions 
providing for enhanced authority to enforce the patient protection 
requirements of title I under the Public Health Service Act, see 
section 141.

SEC. 202. APPLICATION TO INDIVIDUAL HEALTH INSURANCE COVERAGE.

    Part B of title XXVII of the Public Health Service Act is amended 
by inserting after section 2751 the following new section:

``SEC. 2752. PATIENT PROTECTION STANDARDS.

    ``(a) In General.--Each health insurance issuer shall comply with 
patient protection requirements under title I of the Promoting 
Responsible Managed Care Act of 1998 with respect to individual health 
insurance coverage it offers, and such requirements shall be deemed to 
be incorporated into this subsection.
    ``(b) Notice.--A health insurance issuer under this part shall 
comply with the notice requirement under section 711(d) of the Employee 
Retirement Income Security Act of 1974 with respect to the requirements 
of such title as if such section applied to such issuer and such issuer 
were a group health plan.''.

 TITLE III--PATIENT PROTECTION STANDARDS UNDER THE EMPLOYEE RETIREMENT 
                      INCOME SECURITY ACT OF 1974

SEC. 301. APPLICATION OF PATIENT PROTECTION STANDARDS TO GROUP HEALTH 
              PLANS AND GROUP HEALTH INSURANCE COVERAGE UNDER THE 
              EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974.

    (a) In General.--Subpart B of part 7 of subtitle B of title I of 
the Employee Retirement Income Security Act of 1974 is amended by 
adding at the end the following new section:

``SEC. 713. PATIENT PROTECTION STANDARDS.

    ``(a) In General.--Subject to subsection (b), a group health plan 
(and a health insurance issuer offering group health insurance coverage 
in connection with such a plan) shall comply with the requirements of 
title I of the Promoting Responsible Managed Care Act of 1998 (as in 
effect as of the date of the enactment of such Act), and such 
requirements shall be deemed to be incorporated into this subsection.
    ``(b) Plan Satisfaction of Certain Requirements.--
            ``(1) Satisfaction of certain requirements through 
        insurance.--For purposes of subsection (a), insofar as a group 
        health plan provides benefits in the form of health insurance 
        coverage through a health insurance issuer, the plan shall be 
        treated as meeting the following requirements of title I of the 
        Promoting Responsible Managed Care Act of 1998 with respect to 
        such benefits and not be considered as failing to meet such 
        requirements because of a failure of the issuer to meet such 
        requirements so long as the plan sponsor or its representatives 
        did not cause such failure by the issuer:
                    ``(A) Section 121 (relating to access to emergency 
                care).
                    ``(B) Section 122 (relating to choice of 
                providers).
                    ``(C) Section 122(b) (relating to specialized 
                services).
                    ``(D) Section 122(c)(1)(A) (relating to continuity 
                in case of termination of provider contract) and 
                section 122(c)(1)(B) (relating to continuity in case of 
                termination of issuer contract), but only insofar as a 
                replacement issuer assumes the obligation for 
                continuity of care.
                    ``(E) Section 123(a) (relating to coverage for 
                individuals participating in approved clinical trials.)
                    ``(F) Section 123(b) (relating to access to needed 
                prescription drugs).
                    ``(G) Section 122(e) (relating to adequacy of 
                provider network).
                    ``(H) Subtitle B (relating to consumer 
                information).
            ``(2) Information.--With respect to information required to 
        be provided or made available under section 111 of such Act, in 
        the case of a group health plan that provides benefits in the 
        form of health insurance coverage through a health insurance 
        issuer, the Secretary shall determine the circumstances under 
        which the plan is not required to provide or make available the 
        information (and is not liable for the issuer's failure to 
        provide or make available the information), if the issuer is 
        obligated to provide and make available (or provides and makes 
        available) such information.
            ``(3) Grievance and internal appeals.--With respect to the 
        grievance system and internal appeals process required to be 
        established under sections 102 and 103 of such Act, in the case 
        of a group health plan that provides benefits in the form of 
        health insurance coverage through a health insurance issuer, 
        the Secretary shall determine the circumstances under which the 
        plan is not required to provide for such system and process 
        (and is not liable for the issuer's failure to provide for such 
        system and process), if the issuer is obligated to provide for 
        (and provides for) such system and process.
            ``(4) External appeals.--Pursuant to rules of the 
        Secretary, insofar as a group health plan enters into a 
        contract with a qualified external appeal entity for the 
        conduct of external appeal activities in accordance with 
        section 106 of such Act, the plan shall be treated as meeting 
        the requirement of such section and is not liable for the 
        entity's failure to meet any requirements under such section.
            ``(5) Application to prohibitions.--Pursuant to rules of 
        the Secretary, if a health insurance issuer offers health 
        insurance coverage in connection with a group health plan and 
        takes an action in violation of any of the following sections 
        of such Act, the group health plan shall not be liable for such 
        violation unless the plan caused such violation:
                    ``(A) Section 124 (relating to nondiscrimination in 
                delivery of services).
                    ``(B) Section 125 (relating to prohibition of 
                interference with certain medical communications).
                    ``(C) Section 126 (relating to provider incentive 
                plans).
                    ``(D) Section 102(b) (relating to providing 
                medically necessary care).
            ``(6) Construction.--Nothing in this subsection shall be 
        construed to affect or modify the responsibilities of the 
        fiduciaries of a group health plan under part 4 of subtitle B.
    (b) Satisfaction of ERISA Claims Procedure Requirement.--Section 
503 of such Act (29 U.S.C. 1133) is amended by inserting ``(a)'' after 
``Sec. 503.'' and by adding at the end the following new subsection:
    ``(b) In the case of a group health plan (as defined in section 
733) compliance with the requirements of subtitle D (and section 113) 
of title I of the Promoting Responsible Managed Care Act of 1998 in the 
case of a claims denial shall be deemed compliance with subsection (a) 
with respect to such claims denial.''.
    (c) Conforming Amendments.--(1) Section 732(a) of such Act (29 
U.S.C. 1185(a)) is amended by striking ``section 711'' and inserting 
``sections 711 and 713''.
    (2) The table of contents in section 1 of such Act is amended by 
inserting after the item relating to section 712 the following new 
item:

``Sec. 713. Patient protection standards.''.
    (3) Section 502(b)(3) of such Act (29 U.S.C. 1132(b)(3)) is amended 
by inserting ``(other than section 144(b))'' after ``part 7''.
    (d) Reference to Enhanced Enforcement Authority.--For provisions 
providing for enhanced authority to enforce the patient protection 
requirements of title I under the Employee Retirement Income Security 
Act of 1974, see section 142.

SEC. 302. ENFORCEMENT FOR ECONOMIC LOSS CAUSED BY COVERAGE 
              DETERMINATIONS.

    (a) In General.--Section 502(c) of the Employee Retirement Income 
Security Act of 1974 (29 U.S.C. 1132), as amended by section 142(a) of 
this Act, is amended by redesignating paragraphs (7) and (8) as 
paragraphs (8) and (9), respectively, and by inserting after paragraph 
(6) the following new paragraph:
    ``(7)(A) In any case in which--
            ``(i) a coverage determination (as defined in section 
        101(a)(2) of the Promoting Responsible Managed Care Act of 
        1998) under a group health plan (as defined in section 
        503(b)(8)) is not made on a timely basis or is made on such a 
        basis but is not made in accordance with the terms of the plan, 
        this title, or title I of such Act, and
            ``(ii) a participant or beneficiary suffers injury 
        (including loss of life, health, or the ability to regain or 
        maintain maximum function or (in the case of a child under the 
        age of 6) development) as a result of such coverage 
        determination,
any person or persons who are responsible under the terms of the plan 
for the making of such coverage determination are liable to the 
aggrieved participant or beneficiary for the amount of the economic 
loss suffered by the participant or beneficiary caused by such coverage 
determination. Any question of fact in any cause of action under this 
paragraph shall be based on the preponderance of the evidence after de 
novo review.
    ``(B) For purposes of subparagraph (A), the term `economic loss' 
means any pecuniary loss (including the loss of earnings or other 
benefits related to employment, medical expense loss, replacement 
services loss, loss due to death, burial costs, and loss of business or 
employment opportunities) caused by the coverage determination. Such 
term does not include punitive damages or damages for pain and 
suffering, inconvenience, emotional distress, mental anguish, loss of 
consortium, injury to reputation, humiliation, and other nonpecuniary 
losses.
    ``(C) Nothing in this paragraph shall be construed as requiring 
exhaustion of administrative process in the case of severe bodily 
injury or death.''.
    (b) Effective Date.--The amendments made by subsection (a) apply to 
coverage determinations made on or after the date of the enactment of 
this Act.

TITLE IV--PATIENT PROTECTION STANDARDS UNDER THE INTERNAL REVENUE CODE 
                                OF 1986

SEC. 401. AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1986

    Subchapter B of chapter 100 of the Internal Revenue Code of 1986 
(as amended by section 1531(a) of the Taxpayer Relief Act of 1997) is 
amended--
            (1) in the table of sections, by inserting after the item 
        relating to section 9812 the following new item:

                              ``Sec. 9813. Standard relating to patient 
                                        protection standards.''; and
            (2) by inserting after section 9812 the following:

``SEC. 9813. STANDARD RELATING TO PATIENT PROTECTION STANDARDS.

    ``A group health plan shall comply with the requirements of title I 
of the Promoting Responsible Managed Care Act of 1998 (as in effect as 
of the date of the enactment of such Act), and such requirements shall 
be deemed to be incorporated into this section.''.

        TITLE V--EFFECTIVE DATES; COORDINATION IN IMPLEMENTATION

SEC. 501. EFFECTIVE DATES.

    (a) Group Health Coverage.--
            (1) In general.--Subject to paragraph (2), the amendments 
        made by sections 201(a), 301, and 401 (and title I insofar as 
        it relates to such sections) shall apply with respect to group 
        health plans, and health insurance coverage offered in 
        connection with group health plans, for plan years beginning on 
        or after January 1, 1999 (in this section referred to as the 
        ``general effective date'') and also shall apply to portions of 
        plan years occurring on and after such date.
            (2) Treatment of collective bargaining agreements.--In the 
        case of a group health plan maintained pursuant to 1 or more 
        collective bargaining agreements between employee 
        representatives and 1 or more employers ratified before the 
        date of enactment of this Act, the amendments made by sections 
        201(a), 301, and 401 (and title I insofar as it relates to such 
        sections) shall not apply to plan years beginning before the 
        later of--
                    (A) the date on which the last collective 
                bargaining agreement relating to the plan terminates 
                (determined without regard to any extension thereof 
                agreed to after the date of enactment of this Act), or
                    (B) the general effective date.
        For purposes of subparagraph (A), any plan amendment made 
        pursuant to a collective bargaining agreement relating to the 
        plan which amends the plan solely to conform to any requirement 
        added by this Act shall not be treated as a termination of such 
        collective bargaining agreement.
    (b) Individual Health Insurance Coverage.--The amendments made by 
section 202 shall apply with respect to individual health insurance 
coverage offered, sold, issued, renewed, in effect, or operated in the 
individual market on or after the general effective date.

SEC. 502. COORDINATION IN IMPLEMENTATION.

    Section 104(1) of Health Insurance Portability and Accountability 
Act of 1996 is amended by striking ``this subtitle (and the amendments 
made by this subtitle and section 401)'' and inserting ``the provisions 
of part 7 of subtitle B of title I of the Employee Retirement Income 
Security Act of 1974, the provisions of parts A and C of title XXVII of 
the Public Health Service Act, chapter 100 of the Internal Revenue Code 
of 1986, and title I of the Promoting Responsible Managed Care Act of 
1998''.
                                 <all>