State health reform projects

(a)

Purpose; Establishment of State Health Care Expansion and Improvement Program

The purposes of the programs approved under this section shall include, but not be limited to— (1)achieving the goals of increased health coverage and access; (2)ensuring that patients receive high-quality, appropriate health care; (3)improving the efficiency of health care spending; and (4)testing alternative reforms, such as building on the public or private health systems, or creating new systems, to achieve the objectives of this Act. (b)

Applications by States, Local Governments, and Tribes

(1)

Entities that may apply

(A)

In general

A State, in consultation with local governments, Indian tribes, and Indian organizations involved in the provision of health care, may apply for a State health care expansion and improvement program for the entire State (or for regions of the State) under paragraph (2). (B)

Regional groups

A regional entity consisting of more than one State may apply for a multi-State health care expansion and improvement program for the entire region involved under paragraph (2). (C)

Definition

In this Act, the term State means the 50 States, the District of Columbia, and the Commonwealth of Puerto Rico. Such term shall include a regional entity described in subparagraph (B). (2)

Submission of application

In accordance with this section, each State desiring to implement a State health care expansion and improvement program may submit an application to the State Health Innovation Commission under subsection (c) (referred to in this section as the Commission) for approval. (3)

Local government applications

(A)

In general

Where a State declines to submit an application under this section, a unit of local government of such State, or a consortium of such units of local governments, may submit an application directly to the Commission for programs or projects under this subsection. Such an application shall be subject to the requirements of this section. (B)

Other applications

Subject to such additional guidelines as the Secretary may prescribe, a unit of local government, Indian tribe, or Indian health organization may submit an application under this section, whether or not the State submits such an application, if such unit of local government can demonstrate unique demographic needs or a significant population size that warrants a substate program under this subsection. (c)

State Health Innovation Commission

(1)

In general

Within 90 days after the date of the enactment of this Act, the Secretary shall establish a State Health Innovation Commission that shall— (A)be comprised of— (i)the Secretary; (ii)four State governors to be appointed by the National Governors Association on a bipartisan basis; (iii)two members of a State legislature to be appointed by the National Conference of State Legislators on a bipartisan basis; (iv)two county officials to be appointed by the National Association of Counties on a bipartisan basis; (v)two mayors to be appointed by the United States Conference of Mayors and the National League of Cities on a joint and bipartisan basis; (vi)two individuals to be appointed by the Speaker of the House of Representatives; (vii)two individuals to be appointed by the minority leader of the House of Representatives; (viii)two individuals to be appointed by the majority leader of the Senate; (ix)two individuals to be appointed by the minority leader of the Senate; and (x)two individuals who are members of federally-recognized Indian tribes to be appointed on a bipartisan basis by the National Congress of American Indians; (B)upon approval of 2/3 of the members of the Commission, provide the States with a variety of reform options for their applications, such as tax credit approaches, expansions of public programs such as medicaid and the State Children’s Health Insurance Program, the creation of purchasing pooling arrangements similar to the Federal Employees Health Benefits Program, individual market purchasing options, single risk pool or single payer systems, health savings accounts, a combination of the options described in this clause, or other alternatives determined appropriate by the Commission, including options suggested by States, Indian tribes, or the public; (C)establish, in collaboration with a qualified and independent organization such as the Institute of Medicine, minimum performance measures and goals with respect to coverage, quality, and cost of State programs, as described under subsection (d)(1); (D)conduct a thorough review of the grant application from a State and carry on a dialogue with all State applicants concerning possible modifications and adjustments; (E)submit the recommendations and legislative proposal described in subsection (d)(4)(B); (F)be responsible for monitoring the status and progress achieved under program or projects granted under this section; (G)report to the public concerning progress made by States with respect to the performance measures and goals established under this Act, the periodic progress of the State relative to its State performance measures and goals, and the State program application procedures, by region and State jurisdiction; (H)promote information exchange between States and the Federal Government; and (I)be responsible for making recommendations to the Secretary and the Congress, using equivalency or minimum standards, for minimizing the negative effect of State program on national employer groups, provider organizations, and insurers because of differing State requirements under the programs. (2)

Period of appointment; representation requirements; vacancies

Members shall be appointed for a term of 5 years. In appointing such members under paragraph (1)(A), the designated appointing individuals shall ensure the representation of urban and rural areas and an appropriate geographic distribution of such members. Any vacancy in the Commission shall not affect its powers, but shall be filled in the same manner as the original appointment. (3)

Chairperson, meetings

(A)

Chairperson

The Commission shall select a Chairperson from among its members. (B)

Quorum

A majority of the members of the Commission shall constitute a quorum, but a lesser number of members may hold hearings. (C)

Meetings

Not later than 30 days after the date on which all members of the Commission have been appointed, the Commission shall hold its first meeting. The Commission shall meet at the call of the Chairperson. (4)

Powers of the commission

(A)

Negotiations with states

The Commission may conduct detailed discussions and negotiations with States submitting applications under this section, either individually or in groups, to facilitate a final set of recommendations for purposes of subsection (d)(4)(B). Such negotiations shall include consultations with Indian tribes, and be conducted in a public forum. (B)

Hearings

The Commission may hold such hearings, sit and act at such times and places, take such testimony, and receive such evidence as the Commission considers advisable to carry out the purposes of this subsection. (C)

Meetings

In addition to other meetings the Commission may hold, the Commission shall hold an annual meeting with the participating States under this section for the purpose of having States report progress toward the purposes in subsection (a)(1) and for an exchange of information. (D)

Information

The Commission may secure directly from any Federal department or agency such information as the Commission considers necessary to carry out the provisions of this subsection. Upon request of the Chairperson of the Commission, the head of such department or agency shall furnish such information to the Commission if the head of the department or agency involved determines it appropriate. (E)

Postal services

The Commission may use the United States mails in the same manner and under the same conditions as other departments and agencies of the Federal Government. (5)

Personnel matters

(A)

Compensation

Each member of the Commission who is not an officer or employee of the Federal Government or of a State or local government shall be compensated at a rate equal to the daily equivalent of the annual rate of basic pay prescribed for level IV of the Executive Schedule under section 5315 of title 5, United States Code, for each day (including travel time) during which such member is engaged in the performance of the duties of the Commission. All members of the Commission who are officers or employees of the United States shall serve without compensation in addition to that received for their services as officers or employees of the United States. (B)

Travel expenses

The members of the Commission shall be allowed travel expenses, including per diem in lieu of subsistence, at rates authorized for employees of agencies under subchapter I of chapter 57 of title 5, United States Code, while away from their homes or regular places of business in the performance of services for the Commission. (C)

Staff

The Chairperson of the Commission may, without regard to the civil service laws and regulations, appoint and terminate an executive director and such other additional personnel as may be necessary to enable the Commission to perform its duties. The employment of an executive director shall be subject to confirmation by the Commission. (D)

Detail of government employees

Any Federal Government employee may be detailed to the Commission without reimbursement, and such detail shall be without interruption or loss of civil service status or privilege. (E)

Temporary and intermittent services

The Chairperson of the Commission may procure temporary and intermittent services under section 3109(b) of title 5, United States Code, at rates for individuals which do not exceed the daily equivalent of the annual rate of basic pay prescribed for level V of the Executive Schedule under section 5316 of such title. (6)

Funding

For the purpose of carrying out this subsection, there are authorized to be appropriated $3,000,000 for fiscal year 2007 and each fiscal year thereafter. (d)

Requirements for Programs

(1)

State plan

A State that seeks to receive a grant under subsection (f) to operate a program under this section shall prepare and submit to the Commission, as part of the application under subsection (b), a State health care plan that shall have as its goal improvements in coverage, quality and costs. To achieve such goal, the State plan shall comply with the following: (A)

Coverage

With respect to coverage, the State plan shall— (i)provide and describe the manner in which the State will ensure that an increased number of individuals residing within the State will have expanded access to health care coverage with a specific 5-year target for reduction in the number of uninsured individuals through either private or public program expansion, or both, in accordance with the options established by the Commission; (ii)describe the number and percentage of current uninsured individuals who will achieve coverage under the State health program; (iii)describe the minimum benefits package that will be provided to all classes of beneficiaries under the State health program; (iv)identify Federal, State, or local and private programs that currently provide health care services in the State and describe how such programs could be coordinated with the State health program, to the extent practicable; and (v)provide for improvements in the availability of appropriate health care services that will increase access to care in urban, rural, and frontier areas of the State with medically underserved populations or where there is an inadequate supply of health care providers. (B)

Quality

With respect to quality, the State plan shall— (i)provide a plan to improve health care quality in the State, including increasing effectiveness, efficiency, timeliness, patient focused, equity while reducing health disparities, and medical errors; and (ii)contain appropriate results-based quality indicators established by the Commission that will be addressed by the State as well as State-specific quality indicators. (C)

Costs

With respect to costs, the State plan shall— (i)provide that the State will develop and implement systems to improve the efficiency of health care, including a specific 5-year target for reducing administrative costs (including paperwork burdens); (ii)describe the public and private sector financing to be provided for the State health program; (iii)estimate the amount of Federal, State, and local expenditures, as well as, the costs to business and individuals under the State health program; (iv)describe how the State plan will ensure the financial solvency of the State health program; and (v)provide that the State will prepare and submit to the Secretary and the Commission such reports as the Secretary or Commission may require to carry out program evaluations. (D)

Health information technology

With respect to health information technology, the State plan shall provide methodology for the appropriate use of health information technology to improve infrastructure, such as improving the availability of evidence-based medical and outcomes data to providers and patients, as well as other health information (such as electronic health records, electronic billing, and electronic prescribing). (2)

Technical assistance

The Secretary shall, if requested, provide technical assistance to States to assist such States in developing applications and plans under this section, including technical assistance by private sector entities if determined appropriate by the Commission. (3)

Initial review

With respect to a State application for a grant under subsection (b), the Secretary and the Commission shall complete an initial review of such State application within 60 days of the receipt of such application, analyze the scope of the proposal, and determine whether additional information is needed from the State. The Commission shall advise the State within such period of the need to submit additional information. (4)

Final determination

(A)

In general

Not later than 90 days after completion of the initial review under paragraph (3), the Commission shall determine whether to submit a State proposal to Congress for approval. (B)

Voting

(i)

In general

The determination to submit a State proposal to Congress under subparagraph (A) shall be approved by 2/3 of the members of the Commission who are eligible to participate in such determination subject to clause (ii). (ii)

Eligibility

A member of the Commission shall not participate in a determination under subparagraph (A) if— (I)in the case of a member who is a Governor, such determination relates to the State of which the member is the Governor; or (II)in the case of member not described in subclause (I), such determination relates to the geographic area of a State of which such member serves as a State or local official. (C)

Submission

Not later than 90 days prior to October 1 of each fiscal year, the Commission shall submit to Congress a list, in the form of a legislative proposal, of the State applications that the Commission recommends for approval under this section. (D)

Approval

With respect to a fiscal year, a State proposal that has been recommended under subparagraph (B) shall be deemed to be approved, and subject to the availability of appropriations, Federal funds shall be provided to such program, unless a joint resolution has been enacted disapproving such proposal as provided for in subsection (e). Nothing in the preceding sentence shall be construed to include the approval of State proposals that involve waivers or modifications in applicable Federal law. (5)

Program or project period

A State program or project may be approved for a period of 5 years and may be extended for subsequent 5-year periods upon approval by the Commission and the Secretary, based upon achievement of targets, except that a shorter period may be requested by a State and granted by the Secretary. (e)

Expedited Congressional Consideration

(1)

Introduction and Committee Consideration

(A)

Introduction

The legislative proposal submitted pursuant to subsection (d)(4)(B) shall be in the form of a joint resolution (in this subsection referred to as the resolution). Such resolution shall be introduced in the House of Representatives by the Speaker, and in the Senate, by the majority leader, immediately upon receipt of the language and shall be referred to the appropriate committee of Congress. If the resolution is not introduced in accordance with the preceding sentence, the resolution may be introduced in either House of Congress by any member thereof. (B)

Committee consideration

A resolution introduced in the House of Representatives shall be referred to the Committee on Ways and Means of the House of Representatives. A resolution introduced in the Senate shall be referred to the Committee on Finance of the Senate. Not later than 15 calendar days after the introduction of the resolution, the committee of Congress to which the resolution was referred shall report the resolution or a committee amendment thereto. If the committee has not reported such resolution (or an identical resolution) at the end of 15 calendar days after its introduction or at the end of the first day after there has been reported to the House involved a resolution, whichever is earlier, such committee shall be deemed to be discharged from further consideration of such reform bill and such reform bill shall be placed on the appropriate calendar of the House involved. (2)

Expedited Procedure

(A)

Consideration

Not later than 5 days after the date on which a committee has been discharged from consideration of a resolution, the Speaker of the House of Representatives, or the Speaker’s designee, or the majority leader of the Senate, or the leader’s designee, shall move to proceed to the consideration of the committee amendment to the resolution, and if there is no such amendment, to the resolution. It shall also be in order for any member of the House of Representatives or the Senate, respectively, to move to proceed to the consideration of the resolution at any time after the conclusion of such 5-day period. All points of order against the resolution (and against consideration of the resolution) are waived. A motion to proceed to the consideration of the resolution is highly privileged in the House of Representatives and is privileged in the Senate and is not debatable. The motion is not subject to amendment, to a motion to postpone consideration of the resolution, or to a motion to proceed to the consideration of other business. A motion to reconsider the vote by which the motion to proceed is agreed to or not agreed to shall not be in order. If the motion to proceed is agreed to, the House of Representatives or the Senate, as the case may be, shall immediately proceed to consideration of the resolution without intervening motion, order, or other business, and the resolution shall remain the unfinished business of the House of Representatives or the Senate, as the case may be, until disposed of. (B)

Consideration by other house

If, before the passage by one House of the resolution that was introduced in such House, such House receives from the other House a resolution as passed by such other House— (i)the resolution of the other House shall not be referred to a committee and may only be considered for final passage in the House that receives it under clause (iii); (ii)the procedure in the House in receipt of the resolution of the other House, with respect to the resolution that was introduced in the House in receipt of the resolution of the other House, shall be the same as if no resolution had been received from the other House; and (iii)notwithstanding clause (ii), the vote on final passage shall be on the reform bill of the other House.

Upon disposition of a resolution that is received by one House from the other House, it shall no longer be in order to consider the resolution bill that was introduced in the receiving House.

(C)

Consideration in conference

Immediately upon a final passage of the resolution that results in a disagreement between the two Houses of Congress with respect to the resolution, conferees shall be appointed and a conference convened. Not later than 10 days after the date on which conferees are appointed, the conferees shall file a report with the House of Representatives and the Senate resolving the differences between the Houses on the resolution. Notwithstanding any other rule of the House of Representatives or the Senate, it shall be in order to immediately consider a report of a committee of conference on the resolution filed in accordance with this subclause. Debate in the House of Representatives and the Senate on the conference report shall be limited to 10 hours, equally divided and controlled by the Speaker of the House of Representatives and the minority leader of the House of Representatives or their designees and the majority and minority leaders of the Senate or their designees. A vote on final passage of the conference report shall occur immediately at the conclusion or yielding back of all time for debate on the conference report. (3)

Rules of the senate and house of representatives

This subsection is enacted by Congress— (A)as an exercise of the rulemaking power of the Senate and House of Representatives, respectively, and is deemed to be part of the rules of each House, respectively, but applicable only with respect to the procedure to be followed in that House in the case of a resolution, and it supersedes other rules only to the extent that it is inconsistent with such rules; and (B)with full recognition of the constitutional right of either House to change the rules (so far as they relate to the procedure of that House) at any time, in the same manner, and to the same extent as in the case of any other rule of that House. (4)

Limitation

The amount of Federal funds provided with respect to any State proposal that is deemed approved under subsection (d)(3) shall not exceed the cost provided for such proposals within the concurrent resolution on the budget as enacted by Congress for the fiscal year involved. (f)

Funding

(1)

In general

The Secretary shall provide a grant to a State that has an application approved under subsection (b) to enable such State to carry out an innovative State health program in the State. (2)

Amount of grant

The amount of a grant provided to a State under paragraph (1) shall be determined based upon the recommendations of the Commission, subject to the amount appropriated under subsection (k). (3)

Performance-based funding allocation and prioritization

In awarding grants under paragraph (1), the Secretary shall— (A)fund a diversity of approaches as provided for by the Commission in subsection (c)(1)(B); (B)give priority to those State programs that the Commission determines have the greatest opportunity to succeed in providing expanded health insurance coverage and in providing children, youth, and other vulnerable populations with improved access to health care items and services; and (C)link allocations to the State to the meeting of the goals and performance measures relating to health care coverage, quality, and health care costs established under this Act through the State project application process. (4)

Maintenance of effort

A State, in utilizing the proceeds of a grant received under paragraph (1), shall maintain the expenditures of the State for health care coverage purposes for the support of direct health care delivery at a level equal to not less than the level of such expenditures maintained by the State for the fiscal year preceding the fiscal year for which the grant is received. (5)

Report

At the end of the 5-year period beginning on the date on which the Secretary awards the first grant under paragraph (1), the State Health Innovation Advisory Commission established under subsection (c) shall prepare and submit to the appropriate committees of Congress, a report on the progress made by States receiving grants under paragraph (1) in meeting the goals of expanded coverage, improved quality, and cost containment through performance measures established during the 5-year period of the grant. Such report shall contain the recommendation of the Commission concerning any future action that Congress should take concerning health care reform, including whether or not to extend the program established under this subsection. (g)

Monitoring and Evaluation

(1)

Annual reports and participation by states

Each State that has received a program approval shall— (A)submit to the Commission an annual report based on the period representing the respective State’s fiscal year, detailing compliance with the requirements established by the Commission and the Secretary in the approval and in this section; and (B)participate in the annual meeting under subsection (c)(4)(B). (2)

Evaluations by commission

The Commission, in consultation with a qualified and independent organization such as the Institute of Medicine, shall prepare and submit to the Committee on Finance and the Committee on Health, Education, Labor, and Pensions of the Senate and the Committee on Energy and Commerce, the Committee on Education and Labor, and the Committee on Ways and Means of the House of Representatives annual reports that shall contain— (A)a description of the effects of the reforms undertaken in States receiving approvals under this section; (B)a description of the recommendations of the Commission and actions taken based on these recommendations; (C)an evaluation of the effectiveness of such reforms in— (i)expanding health care coverage for State residents; (ii)improving the quality of health care provided in the States; and (iii)reducing or containing health care costs in the States; (D)recommendations regarding the advisability of increasing Federal financial assistance for State ongoing or future health program initiatives, including the amount and source of such assistance; and (E)as required by the Commission or the Secretary under subsection (f)(5), a periodic, independent evaluation of the program. (h)

Noncompliance

(1)

Corrective action plans

If a State is not in compliance with a requirement of this section, the Secretary shall develop a corrective action plan for such State. (2)

Termination

For good cause and in consultation with the Commission, the Secretary may revoke any program granted under this section. Such decisions shall be subject to a petition for reconsideration and appeal pursuant to regulations established by the Secretary. (i)

Relationship to Federal Programs

(1)

In general

Nothing in this Act, or in section 1115 of the Social Security Act (42 U.S.C. 1315) shall be construed as authorizing the Secretary, the Commission, a State, or any other person or entity to alter or affect in any way the provisions of title XIX of such Act (42 U.S.C. 1396 et seq.) or the regulations implementing such title. (2)

Maintenance of effort

No payment may be made under this section if the State adopts criteria for benefits, income, and resource standards and methodologies for purposes of determining an individual’s eligibility for medical assistance under the State plan under title XIX that are more restrictive than those applied as of the date of enactment of this Act. (j)

Miscellaneous Provisions

(1)

Application of certain requirements

(A)

Restriction on application of preexisting condition exclusions

(i)

In general

Subject to subparagraph (B), a State shall not permit the imposition of any preexisting condition exclusion for covered benefits under a program or project under this section. (ii)

Group health plans and group health insurance coverage

If the State program or project provides for benefits through payment for, or a contract with, a group health plan or group health insurance coverage, the program or project may permit the imposition of a preexisting condition exclusion but only insofar and to the extent that such exclusion is permitted under the applicable provisions of part 7 of subtitle B of title I of the Employee Retirement Income Security Act of 1974 and title XXVII of the Public Health Service Act. (B)

Compliance with other requirements

Coverage offered under the program or project shall comply with the requirements of subpart 2 of part A of title XXVII of the Public Health Service Act insofar as such requirements apply with respect to a health insurance issuer that offers group health insurance coverage. (2)

Prevention of duplicative payments

(A)

Other health plans

No payment shall be made to a State under this section for expenditures for health assistance provided for an individual to the extent that a private insurer (as defined by the Secretary by regulation and including a group health plan (as defined in section 607(1) of the Employee Retirement Income Security Act of 1974), a service benefit plan, and a health maintenance organization) would have been obligated to provide such assistance but for a provision of its insurance contract which has the effect of limiting or excluding such obligation because the individual is eligible for or is provided health assistance under the plan. (B)

Other federal governmental programs

Except as provided in any other provision of law, no payment shall be made to a State under this section for expenditures for health assistance provided for an individual to the extent that payment has been made or can reasonably be expected to be made promptly (as determined in accordance with regulations) under any other federally operated or financed health care insurance program, other than an insurance program operated or financed by the Indian Health Service, as identified by the Secretary. For purposes of this paragraph, rules similar to the rules for overpayments under section 1903(d)(2) of the Social Security Act shall apply. (3)

Application of certain general provisions

The following sections of the Social Security Act shall apply to States under this section in the same manner as they apply to a State under such title XIX: (A)

Title XIX provisions

(i)Section 1902(a)(4)(C) (relating to conflict of interest standards). (ii)Paragraphs (2), (16), and (17) of section 1903(i) (relating to limitations on payment). (iii)Section 1903(w) (relating to limitations on provider taxes and donations). (iv)Section 1920A (relating to presumptive eligibility for children). (B)

Title XI provisions

(i)Section 1116 (relating to administrative and judicial review), but only insofar as consistent with this title. (ii)Section 1124 (relating to disclosure of ownership and related information). (iii)Section 1126 (relating to disclosure of information about certain convicted individuals). (iv)Section 1128A (relating to civil monetary penalties). (v)Section 1128B(d) (relating to criminal penalties for certain additional charges). (vi)Section 1132 (relating to periods within which claims must be filed). (4)

Relation to other laws

(A)

HIPAA

Health benefits coverage provided under a State program or project under this section shall be treated as creditable coverage for purposes of part 7 of subtitle B of title I of the Employee Retirement Income Security Act of 1974, title XXVII of the Public Health Service Act, and subtitle K of the Internal Revenue Code of 1986. (B)

ERISA

Nothing in this section shall be construed as affecting or modifying section 514 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1144) with respect to a group health plan (as defined in section 2791(a)(1) of the Public Health Service Act (42 U.S.C. 300gg–91(a)(1))). (k)

Authorization of Appropriations

There is authorized to be appropriated to carry out this section, such sums as may be necessary in each fiscal year. Amounts appropriated for a fiscal year under this subsection and not expended may be used in subsequent fiscal years to carry out this section.