[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 346 Introduced in Senate (IS)]







105th CONGRESS
  1st Session
                                 S. 346

 To assure fairness and choice to patients and health care providers, 
                        and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           February 24, 1997

 Mr. Wellstone introduced the following bill; which was read twice and 
         referred to the Committee on Labor and Human Resources

_______________________________________________________________________

                                 A BILL


 
 To assure fairness and choice to patients and health care providers, 
                        and for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Patient Protection 
Act of 1997''.
    (b) Table of Contents.--The table of contents for this Act are as 
follows:

Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
  TITLE I--OFFICE FOR CONSUMER INFORMATION, COUNSELING AND ASSISTANCE 
                            WITH HEALTH CARE

Sec. 101. Establishment.
                    TITLE II--UTILIZATION MANAGEMENT

Sec. 201. Definitions.
Sec. 202. Requirement for utilization review program.
Sec. 203. Standards for utilization review.
                    TITLE III--HEALTH PLAN STANDARDS

Sec. 301. Health plan standards.
Sec. 302. Minimum solvency requirements.
Sec. 303. Information on terms of plan.
Sec. 304. Access.
Sec. 305. Credentialing for health providers.
Sec. 306. Grievance procedures.
Sec. 307. Confidentiality standards.
Sec. 308. Discrimination.
Sec. 309. Prohibition on selective marketing.
                   TITLE IV--MISCELLANEOUS PROVISIONS

Sec. 401. Enforcement.
Sec. 402. Effective date.
Sec. 403. Preemption.

SEC. 2. DEFINITIONS.

    Unless specifically provided otherwise, as used in this Act:
            (1) Carrier.--The term ``carrier'' means a licensed 
        insurance company, a hospital or medical service corporation 
        (including an existing Blue Cross or Blue Shield organization, 
        within the meaning of section 833(c)(2) of Internal Revenue 
        Code of 1986 as in effect before the date of the enactment of 
        this Act), a health maintenance organization, or other entity 
        licensed or certified by the State to provide health insurance 
        or health benefits.
            (2) Covered individual.--The term ``covered individual'' 
        means a member, enrollee, subscriber, covered life, patient or 
        other individual eligible to receive benefits under a health 
        plan.
            (3) Emergency services.--The term ``emergency services'' 
        means those health care services that are provided to a patient 
        after the sudden onset of a health condition that manifests 
        itself by symptoms of sufficient severity, including severe 
        pain, and the absence of such immediate health care attention 
        could reasonably be expected, to result in--
                    (A) placing the patient's health in serious 
                jeopardy;
                    (B) serious impairment to bodily function; or
                    (C) serious dysfunction of any bodily organ or 
                part.
            (4) Health plan.--The term ``health plan'' includes any 
        organization that seeks to arrange for, or provide for the 
        financing and coordinated delivery of, health care services 
        directly or through a contracted health provider panel, and 
        shall include health maintenance organizations, preferred 
        provider organizations, single service health maintenance 
        organizations, single service preferred provider organizations, 
        other entities such as provider-hospital or hospital-provider 
        organizations, employee welfare benefit plans (as defined in 
section 3(1) of the Employee Retirement Income Security Act of 1974 (29 
U.S.C. 1002(1)), and multiple employer welfare plans or other 
association plans, as well as carriers.
            (5) Health provider.--The term ``health provider'' means an 
        individual who is licensed or certified under State law to 
        provide health care services and who is operating within the 
        scope of such licensure or certification.
            (6) Managed care plan.--
                    (A) In general.--The term ``managed care plan'' 
                means a plan operated by a managed care entity (as 
                defined in subparagraph (B)), that provides for the 
                financing and delivery of health care services to 
                persons enrolled in such plan through--
                            (i) arrangements with selected providers to 
                        furnish health care services;
                            (ii) explicit standards for the selection 
                        of participating providers;
                            (iii) organizational arrangements for 
                        ongoing quality assurance, utilization review 
                        programs, and dispute resolution; and
                            (iv) financial incentives for persons 
                        enrolled in the plan to use the participating 
                        providers and procedures provided for by the 
                        plan.
                    (B) Managed care entity.--The term ``managed care 
                entity'' includes a licensed insurance company, 
                hospital or medical service plan (including provider 
                and provider-hospital networks), health maintenance 
                organization, an employer or employee organization, or 
                a managed care contractor (as defined in subparagraph 
                (C)), that operates a managed care plan.
                    (C) Managed care contractor.--The term ``managed 
                care contractor'' means a person that--
                            (i) establishes, operates, or maintains a 
                        network of participating providers;
                            (ii) conducts or arranges for utilization 
                        review activities; and
                            (iii) contracts with an insurance company, 
                        a hospital or health service plan, an employer, 
                        an employee organization, or any other entity 
                        providing coverage for health care services to 
                        operate a managed care plan.
            (7) Provider network.--The term ``provider network'' means, 
        with respect to a health plan that restricts access, those 
        providers who have entered into a contract or agreement with 
        the plan under which such providers are obligated to provide 
        items and services under the plan to eligible individuals 
        enrolled in the plan, or have an agreement to provide services 
        on a fee-for-service basis.
            (8) Secretary.--The term ``Secretary'' means the Secretary 
        of Health and Human Services unless specifically provided 
        otherwise.
            (9) Specialized treatment expertise.--The term 
        ``specialized treatment expertise'' means expertise in 
        diagnosing and treating unusual diseases and conditions, 
        diagnosing and treating diseases and conditions that are 
        usually difficult to diagnose or treat, and providing other 
        specialized health care.
            (10) Sponsor.--The term ``sponsor'' means a carrier or 
        employer that provides a health plan.
            (11) Utilization review.--The term ``utilization review'' 
        means a set of formal techniques designed to monitor and 
        evaluate the clinical necessity, appropriateness and efficiency 
        of health care services, procedures, providers and facilities. 
        Techniques may include ambulatory review, prospective review, 
        second opinion, certification, concurrent review, 
case management, discharge planning and retrospective review.

  TITLE I--OFFICE FOR CONSUMER INFORMATION, COUNSELING AND ASSISTANCE 
                            WITH HEALTH CARE

SEC. 101. ESTABLISHMENT.

    (a) In General.--The Secretary shall award a grant to each State 
and each State shall use amounts received under the grant to establish 
an Office for Consumer Information, Counseling and Assistance with 
Health Care (referred to in this section as the ``Office''). Each such 
Office shall perform public outreach and provide education and 
assistance concerning consumer rights with respect to health insurance 
and benefits as provided for in subsection (d).
    (b) Use of Grant.--
            (1) In general.--A State shall use a grant under this 
        section--
                    (A) to administer the Office and carry out the 
                duties described in subsection (d);
                    (B) to solicit and award contracts to private, 
                nonprofit organizations applying to the State to 
                administer the Office and carry out the duties 
                described in subsection (d); or
                    (C) in the case of a State operating a consumer 
                information counseling and assistance program on the 
                date of enactment of this Act, to expand and improve 
                such program.
            (2) Contracts.--With respect to the contract described in 
        paragraph (1)(B), the contract period shall be not less than 2 
        years and not more than 4 years.
    (c) Staff.--A State shall ensure that the Office has sufficient 
staff (including volunteers) and local offices throughout the State to 
carry out its duties under this section and a demonstrated ability to 
represent and work with a broad spectrum of consumers, including 
vulnerable and underserved populations.
    (d) Duties.--An Office established under this section shall--
            (1) establish a State-wide toll-free hotline to enable 
        consumers to contact the Office;
            (2) have the ability to provide culturally appropriate 
        assistance that as far as practicable takes into consideration 
        under this subsection language needs;
            (3) develop outreach programs to provide health insurance 
        and health benefits information, counseling, and assistance;
            (4) provide outreach and education relating to consumer 
        rights and responsibilities under this Act, including the 
        rights and services available through the Office;
            (5) provide individuals with assistance in enrolling in 
        health plans (including providing plan comparisons), or in 
        obtaining services or reimbursements from health plans;
            (6) provide individuals with assistance in filing 
        applications for appropriate State health plan premium 
        assistance programs;
            (7) provide individuals with information and advocacy 
        concerning existing grievance procedures and institute systems 
        of referral to appropriate Federal or State departments or 
        agencies for assistance with problems related to insurance 
        coverage (including legal problems);
            (8) ensure that regular and timely access is provided to 
        the services available through the Office;
            (9) implement training programs for staff members 
        (including volunteer staff members) and collect and disseminate 
        timely and accurate health care information to staff members;
            (10) not less than once each year, conduct public hearings 
        to identify and address community health care needs;
            (11) coordinate its activities with the staff of the 
        appropriate departments and agencies of the State government 
        and other appropriate entities within the State; and
            (12) carry out any other activities determined appropriate 
        by the Secretary.
    (e) State Duties.--
            (1) Access to information.--The State shall ensure that, 
        for purposes of carrying out the duties of the Office, the 
        Office has appropriate access to relevant information, subject 
        to the application of procedures to ensure confidentiality of 
        enrollee and proprietary health plan information.
            (2) Reporting and evaluation requirements.--
                    (A) Report.--The Office shall annually prepare and 
                submit to the State a report on the nature and patterns 
                of consumer complaints received by the Office during 
                the year for which the report is prepared. Such report 
                shall contain any policy, regulatory, and legislative 
                recommendations for improvements in the activities of 
                the Office together with a record of the activities of 
                the Office.
                    (B) Evaluation.--The State shall annually evaluate 
                the quality and effectiveness of the Office in carrying 
                out the activities described in subsection (d).
            (3) Conflicts of interest.--The State shall ensure that no 
        individual involved in selecting the entity with which to enter 
        into a contract under subsection (b)(1)(B), or involved in the 
        operation of the Office, or any delegate of the Office, is 
        subject to a conflict of interest.
    (f) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as may be necessary to carry out this section.

                    TITLE II--UTILIZATION MANAGEMENT

SEC. 201. DEFINITIONS.

    As used in this title:
            (1) Adverse determination.--The term ``adverse 
        determination'' means a determination that an admission to or 
        continued stay at a hospital or that another health care 
        service that is required has been reviewed and, based upon the 
        information provided, does not meet the requirements for 
        clinical necessity, appropriateness, level of care, or 
        effectiveness.
            (2) Ambulatory review.--The term ``ambulatory review'' 
        means utilization review of health care services performed or 
        provided in an outpatient setting.
            (3) Appeals procedure.--The term ``appeals procedure'' 
        means a formal process under which a covered individual (or an 
        individual acting on behalf of a covered individual), attending 
        provider or facility may appeal an adverse utilization review 
        decision rendered by the health plan or its designee 
        utilization review organization.
            (4) Care coordinator.--The term ``care coordinator'' means 
        a health provider who performs case management functions in 
        consultation with the interdisciplinary health care team, the 
        patient, family, and community.
            (5) Case management.--The term ``case management'' means a 
        coordinated set of activities conducted for the individual 
        patient management of serious, complicated, protracted or 
        chronic health conditions that provides cost-effective and 
        benefit-maximizing treatments for extremely resource-intensive 
        conditions.
            (6) Clinical review criteria.--The term ``clinical review 
        criteria'' means the recorded (written or otherwise) screening 
        procedures, decision abstracts, clinical protocols and practice 
        guidelines used by the health plan to determine necessity and 
        appropriateness of health care services.
            (7) Comparable.--The term ``comparable'' means a health 
        provider who is licensed or certified in a manner that permits 
        the provider to authorize the equipment, services, or 
        procedures that are the subject of a review.
            (8) Concurrent review.--The term ``concurrent review'' 
        means utilization review conducted during a patient's hospital 
        stay or course of treatment.
            (9) Discharge planning.--The term ``discharge planning'' 
        means the formal process for determining, coordinating and 
        managing the care a patient receives following the discharge of 
        the patient from a facility.
            (10) Facility.--The term ``facility'' means an institution 
        or health care setting providing the prescribed health care 
        services under review. Such term includes hospitals and other 
        licensed inpatient facilities, ambulatory surgical or treatment 
        centers, skilled nursing facilities, residential treatment 
        centers, diagnostic, laboratory and imaging centers and 
        rehabilitation and other therapeutic health care settings.
            (11) Prospective review.--The term ``prospective review'' 
        means utilization review conducted prior to an admission or a 
        course of treatment.
            (12) Retrospective review.--The term ``retrospective 
        review'' means utilization review conducted after health care 
        services have been provided to a patient. Such term does not 
        include the retrospective review of a claim that is limited to 
        an evaluation of reimbursement levels, veracity of 
        documentation, accuracy of coding and adjudication for payment.
            (13) Second opinion.--The term ``second opinion'' means an 
        opportunity or requirement to obtain a clinical evaluation by a 
        provider other than the provider originally making a 
        recommendation for a proposed health service to assess the 
        clinical necessity and appropriateness of the initial proposed 
        health service.
            (14) Utilization review organization.--The term 
        ``utilization review organization'' means an entity that 
        conducts utilization review.

SEC. 202. REQUIREMENT FOR UTILIZATION REVIEW PROGRAM.

    A health plan shall have in place a utilization review program that 
meets the requirements of this title and that is certified by the 
State.

SEC. 203. STANDARDS FOR UTILIZATION REVIEW.

    (a) Establishment.--The Secretary of Health and Human Services, in 
consultation with the Secretary of Labor (referred to in this title as 
the ``Secretaries''), shall establish standards for the establishment, 
operation, and certification and periodic recertification of health 
plan utilization review programs.
    (b) Alternative Standards.--
            (1) In general.--A State may certify a health plan as 
        meeting the standards established under subsection (a) if the 
        State determines that the health plan has met the utilization 
        standards required for accreditation as applied by a nationally 
        recognized, independent, nonprofit accreditation entity.
            (2) Review by state.--A State that makes a determination 
        under paragraph (1) shall periodically review the standards 
        used by the private accreditation entity to ensure that such 
        standards meet or exceed the standards established by the 
        Secretaries under this title.
    (c) Utilization Review Program Requirements.--The standards 
developed by the Secretaries under subsection (a) shall require that 
utilization review programs comply with the following:
            (1) Documentation.--A health plan shall provide a written 
        description of the utilization review program of the plan, 
        including a description of--
                    (A) any activities assigned from the health plan to 
                other entities;
                    (B) the policies and procedures used under the 
                program to evaluate clinical necessity; and
                    (C) the clinical review criteria, information 
                sources, and the process used to review and approve the 
                provision of health care services under the program.
            (2) Prohibition.--With respect to the administration of the 
        utilization review program, a health plan may not employ 
        utilization reviewers or contract with a utilization management 
        organization if the conditions of employment or the contract 
        terms include financial incentives to reduce or limit the 
        provision of clinically necessary or appropriate services to 
        covered individuals.
            (3) Review and modification.--A health plan shall develop 
        procedures for periodically reviewing and modifying the 
        utilization review of the plan. Such procedures shall provide 
        for the participation of providers and consumers in the health 
        plan in the development and review of utilization review 
        policies and procedures.
            (4) Decision protocols.--
                    (A) In general.--A utilization review program shall 
                develop and apply recorded (written or otherwise) 
                utilization review decision protocols. Such protocols 
                shall be based on sound health care evidence.
                    (B) Protocol criteria.--The clinical review 
                criteria used under the utilization review decision 
                protocols to assess the appropriateness of health care 
                services shall be clearly documented and available to 
                participating health providers upon request. Such 
                protocols shall include a mechanism for assessing the 
                consistency of the application of the criteria used 
                under the protocols across reviewers, and a mechanism 
                for periodically updating such criteria.
            (5) Review and decisions.--
                    (A) Review.--The procedures applied under a 
                utilization review program with respect to the 
                preauthorization and concurrent review of the necessity 
and appropriateness of health care devices, services or procedures, 
shall require that qualified, comparable health care providers 
supervise review decisions. With respect to a decision to deny the 
provision of health care devices, services or procedures, a comparable 
provider shall conduct a subsequent review to determine the clinical 
appropriateness of such a denial. Comparable health providers from the 
appropriate specialty area shall be utilized in the review process.
                    (B) Decisions.--All utilization review decisions 
                shall be made in a timely manner, as determined 
                appropriate when considering the urgency of the 
                situation.
                    (C) Adverse determinations.--With respect to 
                utilization review, an adverse determination or 
                noncertification of an admission, continued stay, or 
                service shall be clearly documented, including the 
                specific clinical or other reason for the adverse 
                determination or noncertification, and be available to 
                the covered individual and the affected provider or 
                facility. A health plan may not deny or limit coverage 
                with respect to a service that the enrollee has already 
                received solely on the basis of lack of prior 
                authorization or second opinion, to the extent that the 
                service would have otherwise been covered by the plan 
                had such prior authorization or a second opinion been 
                obtained.
                    (D) Notification of denial.--A health plan shall 
                provide a covered individual with timely notice of an 
                adverse determination or noncertification of an 
                admission, continued stay, or service. Such a 
                notification shall include information concerning the 
                utilization review program appeals procedure as well as 
                the telephone number for the Office.
            (6) Requests for authorization.--A health plan utilization 
        review program shall ensure that requests by covered 
        individuals or providers for prior authorization of a 
        nonemergency service shall be answered in a timely manner after 
        such request is received. If utilization review personnel are 
        not available in a timely fashion, any health care services 
        provided shall be considered approved.
            (7) New technologies.--A utilization review program shall 
        implement policies and procedures to evaluate the appropriate 
        use of new health care technologies or new applications of 
        established technologies, including health care procedures, 
        drugs, and devices. The program shall ensure that appropriate 
        providers participate in the development of technology 
        evaluation criteria.
            (8) Special rule.--Where prior authorization for a service 
        or other covered item is obtained under a program under this 
        section, the service shall be considered to be covered unless 
        there was intentional fraud or intentionally incorrect 
        information provided at the time such prior authorization was 
        obtained. If a provider intentionally supplied the incorrect 
        information that led to the authorization of clinically 
        unnecessary care, the provider shall be prohibited from 
        collecting payment directly from the enrollee, and shall 
        reimburse the plan and subscriber for any payments or 
        copayments the provider may have received.
    (d) Health Plan Requirements.--
            (1) Disclosure of information.--
                    (A) Prospective covered individuals.--A health plan 
                shall, with respect to any materials distributed to 
                prospective covered individuals, include a summary of 
                the utilization review procedures of the plan.
                    (B) Covered individuals.--A health plan shall, with 
                respect to any materials distributed to newly covered 
                individuals, include a clear and comprehensive 
                description of utilization review procedures of the 
                plan and a statement of patient rights and 
                responsibilities with respect to such procedures.
                    (C) State officials.--
                            (i) In general.--A health plan shall 
                        disclose to the State insurance commissioner, 
                        or other designated State official, the health 
                        plan utilization review program policies, 
                        procedures, and reports required by the State 
                        for certification.
                            (ii) Streamlining of procedures.--To the 
                        extent practicable, a State shall implement 
                        procedures to streamline the process by which a 
                        health plan documents compliance with the 
                        requirements of this Act, including procedures 
                        to condense the number of documents filed with 
                        the State concerning such compliance.
            (2) Toll-free number.--A health plan shall have a 
        membership card which shall have printed on the card the toll-
        free telephone number that a covered individual should call to 
        receive precertification utilization review decisions.
            (3) Evaluation.--A health plan shall establish mechanisms 
        to evaluate the effects of the utilization review program of 
        the plan through the use of member satisfaction data or through 
        other appropriate means.
    (e) Emergency Care.--
            (1) Emergency medical condition.--For purposes of this 
        section 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 
        (including the parent of a minor child or the guardian of a 
        disabled individual), who possesses an average knowledge of 
        health and medicine, could reasonably expect the absence of 
        immediate medical attention to result in--
                    (A) placing the health of the individual (or, with 
                respect to a pregnant woman, the health of the woman or 
                her unborn child) in serious jeopardy,
                    (B) serious impairment to bodily functions, or
                    (C) serious dysfunction of any bodily organ or 
                part.
            (2) Preauthorization.--With respect to emergency services 
        furnished in a hospital emergency department, a health plan 
        shall not require prior authorization for the provision of such 
        services if the enrollee arrived at the emergency department 
        with symptoms that reasonably suggested an emergency medical 
        condition based on the judgment of a prudent layperson, 
        regardless of whether the hospital was affiliated with the 
        health plan. All procedures performed during the evaluation and 
        treatment of an emergency medical condition shall be covered 
        under the health plan.

                    TITLE III--HEALTH PLAN STANDARDS

SEC. 301. HEALTH PLAN STANDARDS.

    (a) Establishment.--The Secretary of Health and Human Services, in 
conjunction with the Secretary of Labor (referred to in this title as 
the ``Secretaries''), shall establish standards for the certification 
and periodic recertification of health plans, including standards which 
require plans to meet the requirements of this title.
    (b) State Certification.--
            (1) In general.--A State shall provide for the 
        certification of health plans if the certifying authority 
        designated by the State determines that the plan meets the 
        applicable requirements of this Act.
            (2) Requirement.--Effective on January 1, 1999, a health 
        plan sponsor may only offer a health plan in a State if such 
        plan is certified by the State under paragraph (1).
    (c) Construction.--Whenever in this title a requirement or standard 
is imposed on a health plan, the requirement or standard is deemed to 
have been imposed on the sponsor of the plan in relation to that plan.

SEC. 302. MINIMUM SOLVENCY REQUIREMENTS.

    (a) In General.--Except as provided in subsection (b), each State 
shall apply minimum solvency requirements to all health plans offered 
or operating within the State to ensure the fiscal integrity of such 
plans. A health plan shall meet the financial reserve requirements that 
are established by the State to assure proper payment for health care 
services provided under the plan. Such requirements may include plan 
participation in a mechanism to provide for indemnification of plan 
failures even if a plan has met the reserve requirements.
    (b) Federal Standards.--The Secretaries shall establish minimum 
solvency standards that shall apply to all self-insured health plans. 
Such standards shall at least meet the solvency requirements 
established by the National Association of Insurance Commissioners.

SEC. 303. INFORMATION ON TERMS OF PLAN.

    (a) In General.--A health plan shall provide prospective covered 
individuals with written information concerning the terms and 
conditions of the health plan to enable such individuals to make 
informed decisions with respect to a certain system of health care 
delivery. Such information shall be standardized so that prospective 
covered individuals may compare the attributes of all such plans 
offered within the coverage area.
    (b) Understandability.--Information provided under this section, 
whether written or oral shall be easily understandable, truthful, 
linguistically appropriate and objective with respect to the terms 
used. Descriptions provided in such information shall be consistent 
with standards developed for supplemental insurance coverage under 
title XVIII of the Social Security Act (42 U.S.C. 1395 et seq.).
    (c) Required Information.--Information required under this section 
shall include information concerning--
            (1) coverage provisions, benefits, and any exclusions by 
        category of service or product;
            (2) plan loss ratios with an explanation that such ratios 
        reflect the percentage of the premiums expended for health 
        services;
            (3) prior authorization or other review requirements 
        including preauthorization review, concurrent review, post-
        service review, post-payment review and procedures that may 
        lead the patient to be denied coverage for, or not be provided, 
        a particular service or product;
            (4) an explanation of how plan design impacts enrollees, 
        including information on the financial responsibility of 
        covered individuals for payment for coinsurance or other out-
        of-plan services;
            (5) covered individual satisfaction statistics, including 
        disenrollment statistics and satisfaction statistics from those 
        who disenroll;
            (6) advance directives and organ donation;
            (7) the characteristics and availability of health care 
        providers and institutions participating in the plan, including 
        descriptions of the financial arrangements or contractual 
        provisions with hospitals, utilization review organizations, 
        physicians, or any other provider of health care services that 
        would affect the services offered, referral or treatment 
        options, or provider's fiduciary responsibility to patients, 
        including financial incentives regarding the provision of 
        services; and
            (8) quality indicators for the plan and for participating 
        health providers under the plan, including population-based 
        statistics such as immunization rates and performance measures 
        such as survival after surgery, adjusted for case mix.

SEC. 304. ACCESS.

    (a) In General.--A health plan shall demonstrate that the plan has 
a sufficient number, distribution, and variety of qualified health care 
providers to ensure that all covered health care services will be 
available and accessible in a timely manner to adults, infants, 
children, and individuals with disabilities enrolled in the plan. Plans 
shall make reasonable efforts to address issues of cultural competence 
and appropriateness with respect to providers.
    (b) Availability of Services.--A health plan shall ensure that 
services covered under the plan are available in a timely manner that 
ensures a continuity of care, are accessible within a reasonable 
proximity to the residences of the enrollees, are available within 
reasonable hours of operation, and include emergency and urgent care 
services when clinically necessary and available which shall be 
accessible within the service area 24-hours a day, seven days a week.
    (c) Specialized Treatment.--A health plan shall demonstrate that 
plan enrollees have meaningful access, when clinically indicated in the 
judgment of the treating health provider, to specialized treatment 
expertise.
    (d) Chronic Conditions.--
            (1) In general.--Any process established by a health plan 
        to coordinate care and control costs may not impose an undue 
        burden on enrollees with chronic health conditions. The plan 
        shall ensure a continuity of care and shall, when clinically 
        indicated in the judgment of the treating health provider, 
        ensure ongoing direct access to relevant specialists for 
        continued care.
            (2) Care coordinator.--In the case of an enrollee who has a 
        severe, complex, or chronic condition, the health plan shall 
        determine, based on the judgment of the treating health 
        provider, whether it is clinically necessary or appropriate to 
        use a care coordinator from an interdisciplinary team.
    (e) Requirement.--
            (1) In general.--The requirements of this section may not 
        be waived and shall be met in all areas where the health plan 
        has enrollees, including rural areas. With respect to children, 
        such services shall include pediatric and pediatric specialty 
services.
            (2) Out-of-network services.--If a health plan fails to 
        meet the requirements of this section, the plan shall arrange 
        for the provision of out-of-network services to enrollees in a 
        manner that provides enrollees with access to services in 
        accordance with the principles and parameters set forth in this 
        section.

SEC. 305. CREDENTIALING FOR HEALTH PROVIDERS.

    (a) In General.--A health plan shall credential health providers 
furnishing health care services under the plan.
    (b) Credentialing Process.--
            (1) In general.--A health plan shall establish a 
        credentialing process. Such process shall ensure that a health 
        provider is credentialed prior to that provider being listed as 
        a health provider in the health plan's marketing materials, in 
        accordance with recorded (written or otherwise) policies and 
        procedures.
            (2) Responsibility chief health care officer.--The chief 
        health care officer of the health plan, or another designated 
        health provider, shall have responsibility for the 
        credentialing of health providers under the plan.
            (3) Uniform applications.--A State shall develop a basic 
        uniform application that shall be used by all health plans in 
        the State for credentialing purposes.
            (4) Standards.--
                    (A) In general.--Credentialing decisions under a 
                health plan shall be based on objective standards with 
                input from health providers credentialed under the 
                plan. Information concerning all application and 
                credentialing policies and procedures shall be made 
                available for review by the health providers involved 
                upon written request.
                    (B) Right to review information.--A health provider 
                who undergoes the credentialing process shall have the 
                right to review the basis information, including the 
                sources of that information, that was used to meet the 
                designated credentialing criteria.

SEC. 306. GRIEVANCE PROCEDURES.

    (a) In General.--A health plan shall adopt a timely and organized 
system for resolving complaints and formal grievances filed by covered 
individuals. Such system shall include--
            (1) recorded (written or otherwise) procedures for 
        registering and responding to complaints and grievances in a 
        timely manner;
            (2) documentation concerning the substance of complaints, 
        grievances, and actions taken concerning such complaints and 
        grievances, which shall be in writing, and be available upon 
        request to the Office for Consumer Information, Counseling and 
        Assistance with Health Care;
            (3) procedures to ensure a resolution of a complaint or 
        grievance;
            (4) the compilation and analysis of complaint and grievance 
        data;
            (5) procedures to expedite the complaint process if the 
        complaint involves a dispute about the coverage of an 
        immediately and urgently needed service; and
            (6) procedures to ensure that if an enrollee orally 
        notifies a health plan about a complaint, the plan (if 
        requested) must send the enrollee a complaint form that 
        includes the telephone numbers and addresses of member 
        services, a description of the plan's grievance procedure, and 
        the telephone number of the Officer for Consumer Information, 
        Counseling and Assistance with Health Care where enrollees may 
        register complaints.
    (b) Appeal Process.--A health plan shall adopt an appeals process 
to enable covered individuals and providers to appeal decisions that 
are adverse to the covered individuals. Such a process shall include--
            (1) the right to a review by a grievance panel;
            (2) the right to a second review with a different panel, 
        independent from the health plan; and
            (3) an expedited process for review in emergency cases.
The Secretaries shall develop guidelines for the structure and 
requirements applicable to the independent review panel.
    (c) Notification.--With respect to the complaint, grievance, and 
appeals processes required under this section, a health plan shall, 
upon the request of a covered individual, provide the individual a 
written decision concerning a complaint, grievance, or appeal in a 
timely fashion.
    (d) Non-Impediment to Benefits.--The complaint, grievance, and 
appeals processes established in accordance with this section may not 
be used in any fashion to discourage, prevent, or deny a covered 
individual from receiving clinically necessary care in a timely manner.
    (e) Due Process With Respect to Credentialing.--
            (1) Receipt of information.--A health provider who is 
        subject to credentialing under section 305 shall, upon written 
        request, receive from the health plan any information obtained 
        by the plan during the credentialing process that, as 
        determined by the credentialing committee, does not meet the 
        credentialing standards of the plan, or that varies 
        substantially from the information provided to the health plan 
        by the health provider.
            (2) Submission of corrections.--A health plan shall have a 
        formal, recorded (written or otherwise) process by which a 
        health provider may submit supplemental information to the 
        credentialing committee if the health provider determines that 
        erroneous or misleading information has been previously 
        submitted. The health provider may request that such 
        information be reconsidered in the evaluation for credentialing 
        purposes.
            (3) No entitlement.--
                    (A) In general.--A health provider is not entitled 
                to be selected or retained by a health plan as a 
participating or contracting provider whether or not such provider 
meets the credentialing standards established under section 305.
                    (B) Economic considerations.--If economic 
                considerations, including the health care provider's 
                patterns of expenditure per patient, are part of a 
                selection decision, objective criteria shall be used in 
                examining such considerations and a written description 
                of such criteria shall be provided to applicants, 
                participating health providers, and enrollees. Any 
                economic profiling of health providers must be adjusted 
                to recognize case mix, severity of illness, and the age 
                and gender of patients of a health provider's practice 
                that may account for higher or lower than expected 
                costs, to the extent appropriate data in this regard is 
                available to the health plan.
            (4) Termination, reduction, or withdrawal.--
                    (A) Procedures.--A health plan shall develop and 
                implement procedures for the reporting, to appropriate 
                authorities, of serious quality deficiencies that 
                result in the suspension or termination of a contract 
                with a health provider.
                    (B) Review.--A health plan shall develop and 
                implement policies and procedures under which the plan 
                reviews the contract privileges of health providers 
                who--
                            (i) have seriously violated policies and 
                        procedures of the health plan;
                            (ii) have lost their privilege to practice 
                        with a contracting institutional provider; or
                            (iii) otherwise pose a threat to the 
                        quality of service and care provided to the 
                        enrollees of the health plan.
                At a minimum, the policies and procedures implemented 
                under this subparagraph shall meet the requirements of 
                the Health Care Quality Improvement Act of 1986.
                    (C) Communication.--Health plans shall not restrict 
                nor inhibit communication between providers and 
                patients or penalize a provider making public the 
                failure of the health plan to comply with the 
                provisions of this Act.
                    (D) Liability.--A health plan shall not require a 
                provider to sign any type of hold-harmless agreement as 
                a requirement for participation in the health plan.
                    (E) Due process.--The policies and procedures 
                implemented under subparagraph (B) shall include 
                requirements for the timely notification of the 
                affected health provider of the reasons for the 
                reduction, withdrawal, or termination of privileges, 
                and shall provide the health provider with the right to 
                appeal initially to the health plan and subsequently, 
                upon failure to resolve a dispute, to an independent 
                entity, the determination of reduction, withdrawal, or 
                termination. No reduction, withdrawal, or termination 
                of privileges shall be made without cause.
                    (F) Availability.--A written copy of the policies 
                and procedures implemented under this paragraph shall 
                be made available to a health provider on request prior 
                to the time at which the health provider contracts to 
                provide services under the plan.

SEC. 307. CONFIDENTIALITY STANDARDS.

    (a) In General.--A health plan shall ensure that the 
confidentiality of specified enrollee patient information and records 
is protected.
    (b) Policies and Procedures.--A health plan shall have written 
confidentiality policies and procedures. Such policies and procedures 
shall, at a minimum--
            (1) protect the confidentiality of enrollee patient 
        information within the administrative structure of the health 
        plan with special attention to sensitive health conditions and 
        history;
            (2) protect health care record information;
            (3) protect claim information;
            (4) establish requirements for the release of information; 
        and
            (5) inform health plan employees of the confidentiality 
        policies and procedures and enforce compliance with such 
        policies and procedures.
    (c) Patient Care Providers and Facilities.--A health plan shall 
ensure that providers, offices, and facilities responsible for 
providing covered items or services to plan enrollees have implemented 
policies and procedures to prevent the unauthorized or inadvertent 
disclosure of confidential patient information to individuals who 
should not have access to such information.
    (d) Release of Information.--An enrollee in a health plan shall 
have the opportunity to approve or disapprove the release of 
identifiable personal patient information by the health plan, except 
where such release is required under applicable law.

SEC. 308. DISCRIMINATION.

    (a) Enrollees.--A health plan (network or non-network) may not 
discriminate or engage (directly or through contractual arrangements) 
in any activity, including the selection of service area, that has the 
effect of discriminating against an individual on the basis of race, 
culture, national origin, gender, language, socio-economic status, age, 
disability, health status including genetic information, or anticipated 
utilization of health services.
    (b) Providers.--A health plan may not discriminate in the selection 
of members of the health provider or provider network (and in 
establishing the terms and conditions for membership in the network) of 
the plan based on--
            (1) the race, national origin, culture, age, or disability 
        of the health provider; or
            (2) the socio-economic status, disability, health status, 
        or anticipated utilization of health services of the patients 
        of the health provider.

SEC. 309. PROHIBITION ON SELECTIVE MARKETING.

    A health plan may not engage in marketing or other practices 
intended to discourage or limit the issuance of health plans to 
individuals on the basis of health condition, geographic area, 
industry, or other risk factors.

                   TITLE IV--MISCELLANEOUS PROVISIONS

SEC. 401. ENFORCEMENT.

    (a) In General.--A State shall prohibit the offering or issuance of 
any health plan in such State if such plan does not--
            (1) have in place a utilization review program that is 
        certified by the State as meeting the requirements of title II;
            (2) comply with the standards developed under title III;
            (3) have in place a credentialing program that meets the 
        requirements of section 305;
            (4) comply with the requirements of title IV; and
            (5) meet any other requirements determined appropriate by 
        the Secretary.
    (b) Self-Insured Plans.--The Secretary of Labor may take corrective 
action to terminate or disqualify a self-insured plan that does not 
meet the standards developed under this subsection.

SEC. 402. EFFECTIVE DATE.

    (a) In General.--Except as otherwise provided in this section, this 
Act shall take effect on the date of enactment of this Act.
    (b) Standards.--The standards and programs required under this Act 
shall apply to health plans beginning on January 1, 1999.
    (c) Office for Consumer Information, Counseling, and Assistance 
With Health Care.--A State shall have in place the Office required 
under section 101 on January 1, 1999. The Secretary may award grants 
for the establishment of such Offices beginning on the date of 
enactment of this Act.
    (d) Other Requirements.--The requirements of title IV shall apply 
to health plans beginning on January 1, 1999.
    (e) Regulations.--The Secretaries described in section 301(a) may 
promulgate regulations to carry out this Act.

SEC. 403. PREEMPTION.

    Nothing in this Act shall be construed to preempt any State law, or 
the implementation of such a State law, that provides protections for 
individuals that are equivalent to or stricter than the provisions of 
this Act.
                                 <all>